Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2017 | Jul. 25, 2017 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q2 | |
Trading Symbol | ATRC | |
Entity Registrant Name | AtriCure, Inc. | |
Entity Central Index Key | 1,323,885 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 34,334,163 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 21,013 | $ 24,208 |
Short-term investments | 13,965 | 19,801 |
Accounts receivable, less allowance for doubtful accounts of $107 and $246 | 23,110 | 21,094 |
Inventories | 19,943 | 17,660 |
Other current assets | 3,080 | 2,954 |
Total current assets | 81,111 | 85,717 |
Property and equipment, net | 29,959 | 29,995 |
Long-term investments | 3,000 | |
Intangible assets, net | 51,447 | 52,131 |
Goodwill | 105,257 | 105,257 |
Other noncurrent assets | 736 | 321 |
Total Assets | 268,510 | 276,421 |
Current liabilities: | ||
Accounts payable | 11,697 | 10,673 |
Accrued liabilities | 14,707 | 16,467 |
Other current liabilities and current maturities of capital leases and long-term debt | 5,291 | 1,688 |
Total current liabilities | 31,695 | 28,828 |
Capital leases | 13,048 | 13,319 |
Long-term debt | 20,421 | 23,886 |
Other noncurrent liabilities | 41,845 | 41,946 |
Total Liabilities | 107,009 | 107,979 |
Commitments and contingencies (Note 7) | ||
Stockholders' Equity: | ||
Common stock, $0.001 par value, 90,000 shares authorized and 34,326 and 33,342 issued and outstanding | 34 | 33 |
Additional paid-in capital | 377,554 | 367,851 |
Accumulated other comprehensive loss | (47) | (468) |
Accumulated deficit | (216,040) | (198,974) |
Total Stockholders' Equity | 161,501 | 168,442 |
Total Liabilities and Stockholders' Equity | $ 268,510 | $ 276,421 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Condensed Consolidated Balance Sheets [Abstract] | ||
Accounts receivable, allowance for doubtful accounts | $ 107 | $ 246 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 90,000,000 | 90,000,000 |
Common stock, shares issued | 34,326,000 | 33,342,000 |
Common stock, shares outstanding | 34,326,000 | 33,342,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Condensed Consolidated Statements of Operations and Comprehensive Loss [Abstract] | ||||
Revenue | $ 45,231 | $ 39,672 | $ 86,504 | $ 75,612 |
Cost of revenue | 12,677 | 10,854 | 23,942 | 20,880 |
Gross profit | 32,554 | 28,818 | 62,562 | 54,732 |
Operating expenses: | ||||
Research and development expenses | 8,907 | 9,124 | 18,457 | 17,687 |
Selling, general and administrative expenses | 30,002 | 27,432 | 60,102 | 54,202 |
Total operating expenses | 38,909 | 36,556 | 78,559 | 71,889 |
Loss from operations | (6,355) | (7,738) | (15,997) | (17,157) |
Other income (expense): | ||||
Interest expense | (564) | (477) | (1,118) | (736) |
Interest income | 48 | 60 | 102 | 99 |
Other | 5 | (34) | (13) | (114) |
Loss before income tax expense | (6,866) | (8,189) | (17,026) | (17,908) |
Income tax expense | 17 | 17 | 40 | 22 |
Net loss | $ (6,883) | $ (8,206) | $ (17,066) | $ (17,930) |
Basic and diluted net loss per share | $ (0.21) | $ (0.26) | $ (0.53) | $ (0.57) |
Weighted average shares outstanding — basic and diluted | 32,288 | 31,575 | 32,154 | 31,466 |
Comprehensive loss: | ||||
Unrealized gain on investments | $ 4 | $ 13 | $ 6 | $ 54 |
Foreign currency translation adjustment | 342 | (219) | 415 | 67 |
Other comprehensive income (loss) | 346 | (206) | 421 | 121 |
Net loss | (6,883) | (8,206) | (17,066) | (17,930) |
Comprehensive loss, net of tax | $ (6,537) | $ (8,412) | $ (16,645) | $ (17,809) |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Cash flows from operating activities: | ||
Net loss | $ (17,066) | $ (17,930) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Share-based compensation expense | 7,325 | 5,869 |
Depreciation | 3,906 | 3,678 |
Amortization of intangible assets | 684 | 822 |
Amortization of deferred financing costs | 132 | 86 |
Loss on disposal of property and equipment | 88 | 117 |
Realized gain from foreign exchange on intercompany transactions | (10) | (15) |
Amortization/accretion on investments | 59 | 74 |
Change in allowance for doubtful accounts | (134) | (49) |
Changes in operating assets and liabilities: | ||
Accounts receivable | (1,673) | (1,897) |
Inventories | (2,094) | (1,595) |
Other current assets | (26) | (236) |
Accounts payable | 565 | 131 |
Accrued liabilities | (1,891) | (5,673) |
Other noncurrent assets and liabilities | (468) | (338) |
Net cash used in operating activities | (10,603) | (16,956) |
Cash flows from investing activities: | ||
Purchases of available-for-sale securities | (7,567) | (21,940) |
Maturities of available-for-sale securities | 16,350 | 12,404 |
Purchases of property and equipment | (3,488) | (4,341) |
Net cash provided by (used in) investing activities | 5,295 | (13,877) |
Cash flows from financing activities: | ||
Proceeds from debt borrowings | 25,000 | |
Payments on capital leases | (241) | (218) |
Payment of debt fees | (50) | (120) |
Proceeds from stock option exercises | 3,074 | 2,301 |
Shares repurchased for payment of taxes on stock awards | (1,901) | (1,033) |
Proceeds from issuance of common stock under employee stock purchase plan | 1,205 | 987 |
Net cash provided by financing activities | 2,087 | 26,917 |
Effect of exchange rate changes on cash and cash equivalents | 26 | 69 |
Net decrease in cash and cash equivalents | (3,195) | (3,847) |
Cash and cash equivalents-beginning of period | 24,208 | 23,764 |
Cash and cash equivalents-end of period | 21,013 | 19,917 |
Supplemental cash flow information: | ||
Cash paid for interest | 985 | 577 |
Cash paid for income taxes | ||
Non-cash investing and financing activities: | ||
Accrued purchases of property and equipment | 703 | 306 |
Assets acquired through capital lease | 43 | |
Capital lease asset early termination | $ 9 |
Description of Business and Sum
Description of Business and Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2017 | |
Description of Business and Summary of Significant Accounting Policies [Abstract] | |
Description of Business and Summary of Significant Accounting Policies | 1. DESC RIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of the Business —The “Company” or “AtriCure” consists of AtriCure, Inc. and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The Company is a leading innovator in surgical treatments for atrial fibrillation (Afib) and left atrial appendage (LAA) management, and it sells its products to medical centers globally through its direct sales force and distributors. Basis of Presentation —The accompanying interim financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (SEC). The accompanying interim financial statements are unaudited, but in the opinion of the Company’s management, contain all of the normal, recurring adjustments considered necessary to present fairly the financial position, results of operations and cash flows for the periods presented in conformity with accounting principles generally accepted in the United States of America (GAAP) applicable to interim periods. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with GAAP have been omitted or condensed. The Company believes the disclosures herein are adequate to make the information presented not misleading. Results of operations are not necessarily indicative of the results expected for the full year or for any future period. The accompanying Condensed Consolidated Financial Statements should be read in conjunction with the audited financial statements of the Company included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016 filed with the SEC. Cash and Cash Equivalents —The Company considers highly liquid investments with maturities of three months or less at the date of acquisition as cash equivalents in the accompanying Condensed Consolidated Financial Statements. Investments —The Company places its investments primarily in U.S. Government agencies and securities, corporate bonds and commercial paper. The Company classifies all investments as available-for-sale. Investments with maturities of less than one year are classified as short-term investments. Investments are recorded at fair value, with unrealized gains and losses recorded as accumulated other comprehensive income (loss). The Company recognizes gains and losses when these securities are sold using the specific identification method and includes them in interest income or expense in the Condensed Consolidated Statements of Operations and Comprehensive Loss. Revenue Recognition —The Company accounts for revenue in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 605, “Revenue Recognition” (ASC 605). The Company recognizes revenue when all of the following criteria are met: (i) there is persuasive evidence that an arrangement exists; (ii) delivery of the products and/or services has occurred; (iii) the selling price is fixed or determinable; and (iv) collectability is reasonably assured. Pursuant to the Company’s standard terms of sale, revenue is recognized when title to the goods and risk of loss transfers to customers and there are no remaining obligations that will affect the customers’ final acceptance of the sale. Generally, the Company’s standard terms of sale define the transfer of title and risk of loss to occur upon shipment to the respective customer. The Company does not normally maintain any post-shipping obligations to the recipients of products. No installation, calibration or testing of products is performed by the Company subsequent to shipment to the customer in order to render it operational. Revenue includes shipping and handling revenue of $300 and $329 for the three months ended June 30, 2017 and 2016 and $640 and $625 for the six months ended June 30, 2017 and 2016. Cost of freight for shipments made to customers is included in cost of revenue. Sales and other value-added taxes collected from customers and remitted to governmental authorities are excluded from revenue. The Company sells its products primarily through its direct sales force, with certain international markets sold through distributors. Terms of sale are generally consistent for both end-users and distributors except that payment terms are generally net 30 days for end-users and net 60 days for distributors with limited exceptions. Sales Returns and Allowances —The Company maintains a provision for sales returns and allowances to account for potential returns of defective or damaged products, products shipped in error and invoice adjustments, as well as current deferrals of revenue. The Company estimates such provision on a quarterly basis based on a combination of specific identification and an estimated general reserve based on historical experience. Increases to the provision result in a reduction of revenue. The provision is included in accrued liabilities in the Condensed Consolidated Balance Sheets. Allowance for Doubtful Accounts Receivable —The Company evaluates the collectability of accounts receivable to determine the appropriate reserve for doubtful accounts. In determining the amount of the reserve, the Company considers aging of account balances, historical credit losses, customer-specific information and other relevant factors. An increase to the allowance for doubtful accounts results in a corresponding increase in selling, general and administrative expenses. The Company reviews accounts receivable and adjusts the allowance based on current circumstances and charges off uncollectible receivables against the allowance when all attempts to collect the receivable have failed. The Company’s history of write-offs against the allowance has not been significant. Inventories —Inventories are stated at the lower of cost or net realizable value based on the first-in, first-out cost method (FIFO). The Company’s industry is characterized by rapid product development and frequent new product introductions. Uncertain timing of product approvals, variability in product launch strategies and variation in product use all impact inventory reserves for excess and obsolete products. An inventory allowance is estimated and recorded quarterly for excess, slow moving and obsolete inventory and for specific inventory if carrying value exceeds net realizable value. An increase to the inventory reserve allowance results in a corresponding increase in cost of revenue. Write-offs are recorded when a product is disposed. Inventories consist of the following: June 30, December 31, 2017 2016 Raw materials $ 5,812 $ 5,719 Work in process 1,787 1,221 Finished goods 12,344 10,720 Inventories $ 19,943 $ 17,660 Property and Equipment —Property and equipment is stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. The estimated useful life by major asset category is the following: generators and other capital equipment - one to three years; machinery, equipment and vehicles - three to seven years; computer and other office equipment - three years; furniture and fixtures - three to seven years; and leasehold improvements, buildings and equipment under capital leases - the shorter of their useful life or remaining lease term. The Company reassesses the useful lives of property and equipment annually and retires assets no longer in service. Maintenance and repair costs are expensed as incurred. Generators and other capital equipment (such as the Company’s switchbox units and cryosurgical consoles) are placed with certain customers that use the Company’s disposable products. The estimated useful lives of this equipment are based on anticipated usage by customers and the timing and impact of expected new technology rollouts by the Company. To the extent the Company experiences changes in the usage of this equipment or introduces new technologies, the estimated useful lives of this equipment may change in a future period. Depreciation related to these generators was $909 and $879 for the three months ended June 30, 2017 and 2016, and $1,825 and $1,715 for the six months ended June 30, 2017 and 2016, and is recorded in cost of revenue in the Condensed Consolidated Statements of Operations and Comprehensive Loss. As of June 30, 2017 and December 31, 2016 , the net carrying amount of loaned equipment included in net property and equipment in the Condensed Consolidated Balance Sheets was $5,331 and $5,692 . The Company reviews property and equipment for impairment using its best estimates based on reasonable and supportable assumptions and projections of expected cash flows. Property and equipment impairments recorded by the Company have not been significant. Intangible Assets —Intangible assets with determinable useful lives are amortized on a straight-line basis over the estimated periods benefited. Included in intangible assets is In Process Research and Development (IPR&D). The Company defines IPR&D as the value of acquired technology which has not yet reached technological feasibility. The primary basis for determining the technological feasibility is obtaining specific regulatory approvals. IPR&D is accounted for as an indefinite-lived intangible asset until completion or abandonment of the IPR&D project. Upon completion of the development project, the IPR&D is amortized over its estimated useful life. If the IPR&D project is abandoned, the related IPR&D asset would be written off. The IPR&D asset represents an estimate of the fair value of the pre-market approval (PMA) that could result from the CONVERGE IDE clinical trial. The Company reviews intangible assets for impairment using its best estimates based on reasonable and supportable assumptions and projections. Goodwill— Goodwill represents the excess of purchase price over the fair value of the net assets acquired in business combinations. The Company tests goodwill for impairment annually on November 30, or more often if impairment indicators are present. The Company’s goodwill is accounted for in a single reporting unit representing the Company as a whole. Other Noncurrent Liabilities— Other noncurrent liabilities are primarily contingent consideration recorded in business combinations, long-term deferred revenues and other contractual obligations. Other Income (Expense) — Other income (expense) consists of foreign currency transaction gains and losses. The Company recorded net foreign currency transaction gains (losses) of $5 and $(34) for the three months ended June 30, 2017 and 2016 , and $(13) and $(114) for the six months ended June 30, 2017 and 2016 primarily in connection with settlements of its intercompany balances denominated in Euros and invoices transacted in British Pounds. Taxes —Deferred income tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities from a change in tax rates is recognized in the period that includes the enactment date. The Company’s estimate of the valuation allowance for deferred income tax assets requires it to make significant estimates and judgments about its future operating results. Deferred income tax assets are reduced by valuation allowances if, based on the consideration of all available evidence, it is more-likely-than-not that some portion of the deferred income tax asset will not be realized. Significant weight is given to evidence that can be objectively verified. The Company evaluates deferred tax income assets on an annual basis to determine if valuation allowances are required by considering all available evidence. Deferred income tax assets are realized by having sufficient future taxable income to allow the related tax benefits to reduce taxes otherwise payable. The sources of taxable income that may be available to realize the benefit of deferred income tax assets are future reversals of existing taxable temporary differences, future taxable income, exclusive of reversing temporary differences and carryforwards, taxable income in carry-back years and tax planning strategies that are both prudent and feasible. In evaluating whether to record a valuation allowance, the applicable accounting standards deem that the existence of cumulative losses in recent years is a significant piece of objectively verifiable negative evidence that must be overcome by objectively verifiable positive evidence to avoid the need to record a valuation allowance. The Company has recorded a full valuation allowance against its net deferred income tax assets as it is more-likely-than-not that the benefit of the deferred income tax assets will not be recognized in future periods. Net Loss Per Share —Basic and diluted net loss per share is computed in accordance with FASB ASC 260, “Earnings Per Share” (ASC 260) by dividing the net loss by the weighted average number of common shares outstanding during the period. Since the Company has experienced net losses for all periods presented, net loss per share excludes the effect of 4,349 and 4,471 stock options and restricted stock shares as of June 30, 2017 and 2016 because they are anti-dilutive. Therefore, the number of shares calculated for basic net loss per share is also used for the diluted net loss per share calculation. Comprehensive Loss and Accumulated Other Comprehensive Loss —In addition to net losses, the comprehensive loss includes foreign currency translation adjustments and unrealized gains on investments. Accumulated other comprehensive loss consisted of the following (net of tax): Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 Total accumulated other comprehensive loss at beginning of period $ (393) $ (284) $ (468) $ (611) Unrealized Gains on Investments Balance at beginning of period $ (19) $ 2 $ (21) $ (39) Other comprehensive income before reclassifications 4 13 6 54 Amounts reclassified from accumulated other comprehensive income to other income on the statement of operations and comprehensive loss — — — — Balance at end of period $ (15) $ 15 $ (15) $ 15 Foreign Currency Translation Adjustment Balance at beginning of period $ (374) $ (286) $ (447) $ (572) Other comprehensive income before reclassifications 373 (229) 425 52 Amounts reclassified from accumulated other comprehensive income to other income/expense on the statement of operations and comprehensive loss (31) 10 (10) 15 Balance at end of period $ (32) $ (505) $ (32) $ (505) Total accumulated other comprehensive loss at end of period $ (47) $ (490) $ (47) $ (490) Research and Development —Research and development costs are expensed as incurred. These costs include compensation and other internal and external costs associated with the development and research related to new and existing products or concepts, preclinical studies, clinical trials, healthcare compliance and regulatory affairs. Advertising Costs — The Company expenses advertising costs as incurred. Advertising costs were not significant during the three and six months ended June 30, 2017 and 2016 . Share-Based Compensation —The Company follows FASB ASC 718, “Compensation-Stock Compensation” (ASC 718) to record share-based compensation for all employee share-based payment awards, including stock options, restricted stock and stock purchases related to an employee stock purchase plan, based on estimated fair values. The Company’s share-based compensation expense recognized under ASC 718 for the three months ended June 30, 2017 and 2016 was $3,697 and $3,027, and $7,325 and $5,869 for the six months ended June 30, 2017 and 2016 . ASC 718 requires companies to estimate the fair value of share-based payment awards on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in the Company’s Condensed Consolidated Statement of Operations and Comprehensive Loss. The expense has been reduced for estimated forfeitures. The Company estimates forfeitures at the time of grant and revises them, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The Company estimates the fair value of time-based options on the date of grant using the Black-Scholes option-pricing model (Black-Scholes model). The Company’s determination of fair value of share-based payment awards on the date of grant using an option-pricing model is affected by the Company’s stock price, as well as assumptions regarding a number of subjective variables. These variables include but are not limited to the Company’s expected stock price volatility over the term of the awards and actual and projected employee stock option exercise behaviors. The fair value of market-based performance option grants is estimated at the date of grant using a Monte-Carlo simulation. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in the Condensed Consolidated Statement of Operations and Comprehensive Loss. The Company estimates the fair value of restricted stock based upon the grant date closing market price of the Company’s common stock. The Company’s determination of fair value is affected by the Company’s stock price as well as assumptions regarding the number of shares expected to be granted. The Company also has an employee stock purchase plan (ESPP) which is available to all eligible employees as defined by the plan document. Under the ESPP, shares of the Company’s common stock may be purchased at a discount. The Company estimates the number of shares to be purchased under the ESPP at the beginning of each purchase period and records estimated compensation expense during the period based upon the fair value of the stock at the beginning of the purchase period using the Black-Scholes model. Expense is adjusted at the time of stock purchase. Use of Estimates —The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting period. Actual results could differ from those estimates. Fair Value Disclosures —The Company classifies and records cash and investments in U.S. government agencies and securities as Level 1 within the fair value hierarchy. Accounts receivable, short-term other assets, accounts payable and accrued liabilities are also classified as Level 1. The carrying amounts of these assets and liabilities approximate their fair value due to their relatively short-term nature. Cash equivalents and investments in corporate bonds and commercial paper are classified as Level 2 within the fair value hierarchy (see Note 3 – Fair Value for further information). Fixed term debt fair value is determined by calculating the net present value of future debt payments at current market interest rates and is classified as Level 2. The recorded value of the Company’s fixed term debt approximates its fair value as of June 30, 2017. Significant unobservable inputs with respect to the Level 3 fair value measurement of the contingent consideration liability is developed using Company data. When an input is changed, the corresponding valuation models are updated and the results are analyzed for reasonableness. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 6 Months Ended |
Jun. 30, 2017 | |
Recent Accounting Pronouncements [Abstract] | |
Recent Accounting Pronouncements | 2. RECENT ACCOUNTING PRONOUNCEMENTS In May 2014 the FASB issued a final standard on revenue from contracts with customers. The standard, issued as FASB Accounting Standards Update (ASU) 2014-09, “ Revenue from Contracts with Customers” (ASU 2014-09), outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance. In July 2015 the FASB deferred the effective date of ASU 2014-09 for entities reporting under U.S. GAAP from interim and annual reporting periods beginning after December 15, 2016 to interim and annual reporting periods beginning after December 15, 2017 and allow early adoption as of the original effective date. A full retrospective or modified retrospective approach may be taken to adopt the guidance in the ASU. FASB ASU 2016-08, “Revenue from Contracts with Customers (Topic 606): Principal Versus Agent Considerations (Reporting Revenue Gross Versus Net)”, FASB ASU 2016-10, “Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing”, and FASB ASU 2016-12, “Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients”, have been issued in 2016 to further refine the guidance in ASU 2014-09. The Company is evaluating the impact of the provisions of the revenue-related ASUs on its consolidated financial position, results of operations and related disclosures. In February 2016 the FASB issued ASU 2016-02, “Leases” (ASU 2016-02) which requires lessees to record most leases onto their balance sheet but recognize expenses on their income statement in a manner similar to today’s accounting. The guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Entities are required to use a modified retrospective approach for leases that exist or are entered into after the beginning of the earliest comparative period in the financial statements. Full retrospective application is prohibited. The Company is evaluating the provisions of ASU 2016-02 to determine the impact on its consolidated financial position, results of operations and related disclosures. In May 2017 the FASB issued ASU 2017-09, “Compensation — Stock Compensation (Topic 718), Scope of Modification Accounting” (ASU 2017-09), which amends the scope of modification accounting for share-based payment arrangements. ASU 2017-09 provides guidance on the types of changes to the terms or conditions of share-based payment awards to which an entity would be required to apply modification accounting under ASC 718. Specifically, an entity would not apply modification accounting if the fair value, vesting conditions, and classification of the awards are the same immediately before and after the modification. The new guidance also clarifies that a modification to an award could be significant and therefore require disclosure, even if modification accounting is not required. ASU 2017-09 is effective for annual reporting periods, including interim periods within those annual reporting periods, beginning after December 15, 2017. Early adoption is permitted, including adoption in any interim period. The Company will consider the new guidance in its accounting and financial reporting for modifications if and when they occur. |
Fair Value
Fair Value | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value [Abstract] | |
Fair Value | 3. FAIR VALUE FASB ASC 820, “Fair Value Measurements and Disclosures” (ASC 820) defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The standard describes a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value which are the following: · Level 1—Quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. An active market for the asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. The valuation under this approach does not entail a significant degree of judgment. · Level 2—Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. The valuation technique for the Company’s Level 2 assets is based on quoted market prices for similar assets from observable pricing sources at the reporting date. · Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Unobservable inputs shall be used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at the measurement date. The following table represents the Company’s fair value hierarchy for its financial assets and liabilities measured at fair value on a recurring basis as of June 30, 2017 : Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Other Unobservable Inputs (Level 3) Total Assets: Money market funds $ — $ 12,074 $ — $ 12,074 U.S. government agencies and securities 6,992 — — 6,992 Corporate bonds — 1,500 — 1,500 Commercial paper — 5,473 — 5,473 Total assets $ 6,992 $ 19,047 $ — $ 26,039 Liabilities: Acquisition-related contingent consideration — — 41,176 41,176 Total liabilities $ — $ — $ 41,176 $ 41,176 There were no changes in the levels or methodology of measurement of financial assets and liabilities during the three and six months ended June 30, 2017 . The following table represents the Company’s fair value hierarchy for its financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2016 : Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Other Unobservable Inputs (Level 3) Total Assets: Money market funds $ — $ 17,085 $ — $ 17,085 Commercial paper — 5,996 — 5,996 U.S. government agencies and securities 7,000 1,529 — 8,529 Corporate bonds — 8,276 — 8,276 Total assets $ 7,000 $ 32,886 $ — $ 39,886 Liabilities: Acquisition-related contingent consideration — — 41,176 41,176 Total liabilities $ — $ — $ 41,176 $ 41,176 Acquisition-Related Contingent Consideration. Contingent consideration arrangements obligate the Company to pay former shareholders of an acquired entity if specified future events occur or conditions are met, such as the achievement of certain technological milestones or the achievement of targeted revenue milestones. As of December 31, 2016 and currently, such arrangements relate solely to the Company’s acquisition of nContact Surgical, Inc. The Company measures such liabilities using unobservable inputs, applying the income approach, such as the discounted cash flow technique or the probability-weighted scenario method. Various key assumptions, such as the probability of achievement of the agreed milestones, projected revenues from acquisitions and the discount rate, are used in the determination of fair value of contingent consideration arrangements and are not observable in the market, thus representing a Level 3 measurement within the fair value hierarchy. Subsequent revisions to key assumptions, which impact the estimated fair value of contingent consideration liabilities, are reflected in the Condensed Consolidated Statements of Operations and Comprehensive Loss. Acquisition-related contingent consideration is recorded in other noncurrent liabilities in the Condensed Consolidated Balance Sheets. There were no changes in the underlying estimates or discount rate used to calculate the fair value of contingent consideration for the three and six months ended June 30, 2017 . The following table represents the Company’s Level 3 fair value measurements using significant other unobservable inputs for acquisition-related contingent consideration as of June 30, 2017 : Beginning Balance – January 1, 2017 $ 41,176 Amounts acquired — Transfers in (out) of Level 3 — Changes in fair value included in earnings — Ending Balance – June 30, 2017 $ 41,176 The following table represents the Company’s Level 3 fair value measurements using significant other unobservable inputs for acquisition-related contingent consideration as of December 31, 2016 : Beginning Balance – January 1, 2016 $ 40,207 Amounts acquired — Transfers in (out) of Level 3 — Changes in fair value included in earnings 969 Ending Balance – December 31, 2016 $ 41,176 |
Intangible Assets
Intangible Assets | 6 Months Ended |
Jun. 30, 2017 | |
Intangible Assets [Abstract] | |
Intangible Assets | 4. INTANGIBLE ASSETS The following table provides a summary of the Company’s intangible assets: June 30, December 31, 2017 2016 Cost Accumulated Amortization Cost Accumulated Amortization Fusion technology $ 9,242 $ 3,235 $ 9,242 $ 2,773 Clamp & probe technology 829 829 829 829 SUBTLE access technology 2,179 760 2,179 538 IPR&D 44,021 — 44,021 — Total $ 56,271 $ 4,824 $ 56,271 $ 4,140 Amortization expense related to intangible assets with definite lives, which excludes the IPR&D asset, was $342 and $411 for the three months ended June 30, 2017 and 2016, and $684 and $822 for the six months ended June 30, 2017 and 2016 . Future amortization expense related to intangible assets with definite lives is projected as follows: 2017 $ 683 July 1, 2017 through December 31, 2017 2018 1,367 2019 1,367 2020 1,235 2021 924 2022 and thereafter 1,850 Total $ 7,426 |
Accrued Liabilities
Accrued Liabilities | 6 Months Ended |
Jun. 30, 2017 | |
Accrued Liabilities [Abstract] | |
Accrued Liabilities | 5. ACCRUED LIABILITIES Accrued liabilities consisted of the following: June 30, December 31, 2017 2016 Accrued commissions $ 4,113 $ 5,737 Accrued bonus 3,802 2,871 Accrued payroll and related benefits 3,578 4,326 Sales returns allowance 1,029 834 Other accrued liabilities 836 929 Accrued taxes and value-added taxes 776 1,289 Accrued royalties 573 481 Total $ 14,707 $ 16,467 |
Indebtedness
Indebtedness | 6 Months Ended |
Jun. 30, 2017 | |
Indebtedness [Abstract] | |
Indebtedness | 6. INDEBTEDNESS Credit Facility. The Company has a Loan and Security Agreement (Loan Agreement) with Silicon Valley Bank (SVB). The Loan Agreement, as amended, restated and modified, effective April 25, 2016, includes a $25,000 term loan and $15,000 revolving line of credit, both which mature in April 2021 . Borrowing availability under the revolving credit facility is based on the lesser of $15,000 or a borrowing base calculation as defined by the Loan Agreement. As of June 30, 2017 the Company had no borrowings under the revolving credit facility and had borrowing availability of $15,000 . The revolving line of credit is subject to an annual commitment fee of $50 , and any borrowings bear interest at the Prime Rate. Financing costs related to the revolving line of credit are included in other assets in the Condensed Consolidated Balance Sheets and amortized ratably over the term of the Loan Agreement. The term loan has a five -year term, with principal payments to be made ratably commencing eighteen months after the inception of the loan (November 2017) through to the loan’s maturity date. The term loan accrues interest at the Prime Rate and is subject to an additional 4.0% fee on the original $25,000 term loan principal amount at maturity or prepayment of the term loan. The Company is accruing the 4.0% fee over the term of the Loan Agreement. As of June 30, 2017 , the Company accrued $237 of this fee and included it in the outstanding loan balance in the Condensed Consolidated Balance Sheets. Financing costs related to the term loan are net against the outstanding loan balance in the Condensed Consolidated Balance Sheets and amortized ratably over the term of the Loan Agreement. The Loan Agreement also provides for certain prepayment and early termination fees, as well as establishes covenants related to liquidity, sales growth and a minimum cash balance, and includes other customary terms and conditions. Specified assets have been pledged as collateral. Capital Lease Obligations. As of June 30, 2017 the Company had capital leases for its corporate headquarters building and computer equipment that expire at various terms through 2030 . The capital lease assets are depreciated over their estimated useful lives. As of June 30, 2017 , the cost of the leased assets, both building and computer equipment, was $14,467 and accumulated amortization on the capital lease assets was $1,747 . Future maturities of long-term debt and capital lease obligations are projected as follows: 2017 $ 1,914 July 1, 2017 through December 31, 2017 2018 8,610 2019 8,629 2020 8,645 2021 4,071 2022 and thereafter 14,487 Total payments $ 46,356 Imputed interest (7,596) Net long-term debt and capital lease obligations, of which $5,291 is current and $33,469 is noncurrent $ 38,760 In connection with the terms of the Company’s corporate headquarters lease, a letter of credit in the amount of $1,250 was issued to the landlord of the building in October 2015. The letter of credit was renewed in June 2017 and remains outstanding as of June 30, 2017 . |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2017 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | 7. COMMITMENTS AND CONTINGENCIES Lease Commitments. The Company leases certain office, manufacturing and warehouse facilities and equipment under noncancelable operating leases that expire at various terms through 2022 . Royalty Agreements. The Company has certain royalty agreements in place with terms that include payment of royalties based on product revenue from sales of specified current products. The current royalty agreements have effective dates as early as 2003 and terms ranging from eighteen years to at least twenty years. The royalties range from 3% to 5% of specified product sales. Parties to the royalty agreements have the right at any time to terminate the agreement immediately for cause. Royalty expense of $602 and $445 was recorded as part of cost of rev enue for the three months ended June 30, 2017 and 2016 . Royalty expense of $1,136 and $886 was recorded as part of cost of revenue for the six months ended June 30, 2017 and 2016 . Purchase Agreements. The Company enters into standard purchase agreements with certain vendors in the ordinary course of business. Outstanding commitments at June 30, 2017 were not significant. Legal. The Company may, from time to time, become a party to legal proceedings. Such matters are subject to many uncertainties and to outcomes the financial impacts of which are not predictable with assurance and that may not be known for extended periods of time. When management has assessed that a loss is probable and an amount can be reasonably estimated, the Company records a liability in the Condensed Consolidated Financial Statements. Costs associated with legal proceedings that may be commenced could have a material adverse effect on the Company’s future consolidated results of operations, financial position, or cash flows. The Company has been named the defendant in a lawsuit filed by the Regents of the University of California claiming infringement of patents covering methods of treating atrial fibrillation. While the Company believes it has meritorious defenses against the suit and intends to vigorously defend against this claim, the ultimate resolution of the matter could result in a loss that may exceed the estimated liability recorded by the Company as of June 30, 2017. |
Income Tax Provision
Income Tax Provision | 6 Months Ended |
Jun. 30, 2017 | |
Income Tax Provision [Abstract] | |
Income Tax Provision | 8. INCOME TAX PROVISION The Company files federal, state, and foreign income tax returns in jurisdictions with varying statutes of limitations. Income taxes are computed using the asset and liability method in accordance with FASB ASC 740, “Income Taxes”. The Company’s provision for income taxes for continuing operations in interim periods is computed by applying its estimated annual effective rate against its loss before income tax expense for the period. In addition, non-recurring or discrete items are recorded during the period in which they occur. The effective tax rate for the three months ended June 30, 2017 and 2016 was (0.25%) and ( 0.20% ). The effective tax rate for the six months ended June 30, 2017 and 2016 was (0.23%) and ( 0.12% ) . The Company has not accrued any interest and penalties related to unrecognized income tax benefits as a result of offsetting net operating losses. However, if the situation occurs, the Company will recognize interest and penalties within the income tax expense line in the Condensed Consolidated Statements of Operations and Comprehensive Loss and within the related tax liability line in the Condensed Consolidated Balance Sheets. Federal, state and local tax returns of the Company are routinely subject to review by various taxing authorities. |
Equity Compensation Plans
Equity Compensation Plans | 6 Months Ended |
Jun. 30, 2017 | |
Equity Compensation Plans [Abstract] | |
Equity Compensation Plans | 9. EQUITY COMPENSATION PLANS The Company has two share-based incentive plans: the 2014 Stock Incentive Plan (2014 Plan) and the 2008 Employee Stock Purchase Plan (ESPP). Stock Incentive Plan Under the 2014 Plan, the Board of Directors may grant incentive stock options to Company employees and may grant nonstatutory stock options, restricted stock or stock appreciation rights to Company employees, directors and consultants. The administrator (currently the Compensation Committee of the Board of Directors) has the power to determine the terms of any awards, including the number of shares subject to each award, the exercisability of the awards and the form of consideration. As of June 30, 2017 , 10,249 shares of common stock had been reserved for issuance under the 2014 Plan. Options granted under the 2014 Plan generally expire ten years from the date of grant. Options granted generally vest at a rate of 25% on the first anniversary date of the grant and ratably each month thereafter over the following three years. Restricted stock awards granted under the 2014 Plan generally vest 25% annually over four years from date of grant. Employee Stock Purchase Plan The ESPP is available to eligible employees as defined in the plan document. Under the ESPP, shares of the Company’s common stock may be purchased at a discount (currently 15% ) of the lesser of the closing price of the Company’s common stock on the first trading day or the last trading day of the offering period. The offering period (currently six months) and the offering price are subject to change. Participants may not purchase more than $25 of the Company’s common stock in a calendar year and may not purchase a value of more than 3 shares during an offering period. On the first day of each fiscal year during the term of the ESPP, the number of shares available for sale under the ESPP may be increased by the lesser of (i) two percent ( 2% ) of the Company’s outstanding shares of common stock as of the close of business on the last business day of the prior calendar year, not to exceed 600 shares, or (ii) a lesser amount determined by the Board of Directors. Shares have not been added to the ESPP since 2011. At June 30, 2017, there were 283 shares available for future issuance under the ESPP. Expense Information Under FASB ASC 718 The following table summarizes share-based compensation expense related to employees, directors and consultants under FASB ASC 718 for the three and six months ended June 30, 2017 and 2016 . This expense was allocated as follows: Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 Cost of revenue $ 138 $ 88 $ 269 $ 227 Research and development expenses 502 443 1,003 922 Selling, general and administrative expenses 3,057 2,496 6,053 4,720 Total $ 3,697 $ 3,027 $ 7,325 $ 5,869 |
Segment and Geographic Informat
Segment and Geographic Information | 6 Months Ended |
Jun. 30, 2017 | |
Segment and Geographic Information [Abstract] | |
Segment and Geographic Information | 10. SEGMENT AND GEOGRAPHIC INFORMATION The Company evaluates reporting segments in accordance with FASB ASC 280, “Segment Reporting”. The Company develops, manufactures, and sells devices designed primarily for the surgical ablation of cardiac tissue and systems designed for the exclusion of the left atrial appendage. These devices are developed and marketed to a broad base of medical centers globally. Management considers all such sales to be part of a single reportable segment. Revenue attributed to geographic areas is based on the location of the customers to whom products are sold. Revenue by geographic area was as follows: Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 United States $ 35,534 $ 30,872 $ 68,802 $ 59,144 Europe 5,688 5,408 10,877 10,169 Asia 3,785 3,262 6,436 5,990 Other international 224 130 389 309 Total international 9,697 8,800 17,702 16,468 Total revenue $ 45,231 $ 39,672 $ 86,504 $ 75,612 United States revenue by product type was as follows: Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 Open-heart ablation $ 16,790 $ 14,721 $ 32,495 $ 28,689 Minimally invasive ablation 8,725 7,990 17,007 14,715 AtriClip 9,463 7,348 18,165 14,196 Total ablation and AtriClip 34,978 30,059 67,667 57,600 Valve tools 556 813 1,135 1,544 Total United States $ 35,534 $ 30,872 $ 68,802 $ 59,144 International revenue by product type was as follows: Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 Open-heart ablation $ 5,674 $ 5,438 $ 10,264 $ 9,910 Minimally invasive ablation 2,135 2,186 4,093 4,350 AtriClip 1,777 1,024 3,172 1,889 Total ablation and AtriClip 9,586 8,648 17,529 16,149 Valve tools 111 152 173 319 Total international $ 9,697 $ 8,800 $ 17,702 $ 16,468 The Company’s long-lived assets are located primarily in the United States, except for $870 as of June 30, 2017 and $931 as of December 31, 2016, which are located primarily in Europe. |
Description of Business and S16
Description of Business and Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2017 | |
Description of Business and Summary of Significant Accounting Policies [Abstract] | |
Nature of the Business | Nature of the Business —The “Company” or “AtriCure” consists of AtriCure, Inc. and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The Company is a leading innovator in surgical treatments for atrial fibrillation (Afib) and left atrial appendage (LAA) management, and it sells its products to medical centers globally through its direct sales force and distributors. |
Basis of Presentation | Basis of Presentation —The accompanying interim financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (SEC). The accompanying interim financial statements are unaudited, but in the opinion of the Company’s management, contain all of the normal, recurring adjustments considered necessary to present fairly the financial position, results of operations and cash flows for the periods presented in conformity with accounting principles generally accepted in the United States of America (GAAP) applicable to interim periods. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with GAAP have been omitted or condensed. The Company believes the disclosures herein are adequate to make the information presented not misleading. Results of operations are not necessarily indicative of the results expected for the full year or for any future period. The accompanying Condensed Consolidated Financial Statements should be read in conjunction with the audited financial statements of the Company included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016 filed with the SEC. |
Cash and Cash Equivalents | Cash and Cash Equivalents —The Company considers highly liquid investments with maturities of three months or less at the date of acquisition as cash equivalents in the accompanying Condensed Consolidated Financial Statements. |
Investments | Investments —The Company places its investments primarily in U.S. Government agencies and securities, corporate bonds and commercial paper. The Company classifies all investments as available-for-sale. Investments with maturities of less than one year are classified as short-term investments. Investments are recorded at fair value, with unrealized gains and losses recorded as accumulated other comprehensive income (loss). The Company recognizes gains and losses when these securities are sold using the specific identification method and includes them in interest income or expense in the Condensed Consolidated Statements of Operations and Comprehensive Loss. |
Revenue Recognition | Revenue Recognition —The Company accounts for revenue in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 605, “Revenue Recognition” (ASC 605). The Company recognizes revenue when all of the following criteria are met: (i) there is persuasive evidence that an arrangement exists; (ii) delivery of the products and/or services has occurred; (iii) the selling price is fixed or determinable; and (iv) collectability is reasonably assured. Pursuant to the Company’s standard terms of sale, revenue is recognized when title to the goods and risk of loss transfers to customers and there are no remaining obligations that will affect the customers’ final acceptance of the sale. Generally, the Company’s standard terms of sale define the transfer of title and risk of loss to occur upon shipment to the respective customer. The Company does not normally maintain any post-shipping obligations to the recipients of products. No installation, calibration or testing of products is performed by the Company subsequent to shipment to the customer in order to render it operational. Revenue includes shipping and handling revenue of $300 and $329 for the three months ended June 30, 2017 and 2016 and $640 and $625 for the six months ended June 30, 2017 and 2016. Cost of freight for shipments made to customers is included in cost of revenue. Sales and other value-added taxes collected from customers and remitted to governmental authorities are excluded from revenue. The Company sells its products primarily through its direct sales force, with certain international markets sold through distributors. Terms of sale are generally consistent for both end-users and distributors except that payment terms are generally net 30 days for end-users and net 60 days for distributors with limited exceptions. |
Sales Returns and Allowances | Sales Returns and Allowances —The Company maintains a provision for sales returns and allowances to account for potential returns of defective or damaged products, products shipped in error and invoice adjustments, as well as current deferrals of revenue. The Company estimates such provision on a quarterly basis based on a combination of specific identification and an estimated general reserve based on historical experience. Increases to the provision result in a reduction of revenue. The provision is included in accrued liabilities in the Condensed Consolidated Balance Sheets. |
Allowance for Doubtful Accounts Receivable | Allowance for Doubtful Accounts Receivable —The Company evaluates the collectability of accounts receivable to determine the appropriate reserve for doubtful accounts. In determining the amount of the reserve, the Company considers aging of account balances, historical credit losses, customer-specific information and other relevant factors. An increase to the allowance for doubtful accounts results in a corresponding increase in selling, general and administrative expenses. The Company reviews accounts receivable and adjusts the allowance based on current circumstances and charges off uncollectible receivables against the allowance when all attempts to collect the receivable have failed. The Company’s history of write-offs against the allowance has not been significant. |
Inventories | Inventories —Inventories are stated at the lower of cost or net realizable value based on the first-in, first-out cost method (FIFO). The Company’s industry is characterized by rapid product development and frequent new product introductions. Uncertain timing of product approvals, variability in product launch strategies and variation in product use all impact inventory reserves for excess and obsolete products. An inventory allowance is estimated and recorded quarterly for excess, slow moving and obsolete inventory and for specific inventory if carrying value exceeds net realizable value. An increase to the inventory reserve allowance results in a corresponding increase in cost of revenue. Write-offs are recorded when a product is disposed. Inventories consist of the following: June 30, December 31, 2017 2016 Raw materials $ 5,812 $ 5,719 Work in process 1,787 1,221 Finished goods 12,344 10,720 Inventories $ 19,943 $ 17,660 |
Property and Equipment | Property and Equipment —Property and equipment is stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. The estimated useful life by major asset category is the following: generators and other capital equipment - one to three years; machinery, equipment and vehicles - three to seven years; computer and other office equipment - three years; furniture and fixtures - three to seven years; and leasehold improvements, buildings and equipment under capital leases - the shorter of their useful life or remaining lease term. The Company reassesses the useful lives of property and equipment annually and retires assets no longer in service. Maintenance and repair costs are expensed as incurred. Generators and other capital equipment (such as the Company’s switchbox units and cryosurgical consoles) are placed with certain customers that use the Company’s disposable products. The estimated useful lives of this equipment are based on anticipated usage by customers and the timing and impact of expected new technology rollouts by the Company. To the extent the Company experiences changes in the usage of this equipment or introduces new technologies, the estimated useful lives of this equipment may change in a future period. Depreciation related to these generators was $909 and $879 for the three months ended June 30, 2017 and 2016, and $1,825 and $1,715 for the six months ended June 30, 2017 and 2016, and is recorded in cost of revenue in the Condensed Consolidated Statements of Operations and Comprehensive Loss. As of June 30, 2017 and December 31, 2016 , the net carrying amount of loaned equipment included in net property and equipment in the Condensed Consolidated Balance Sheets was $5,331 and $5,692 . The Company reviews property and equipment for impairment using its best estimates based on reasonable and supportable assumptions and projections of expected cash flows. Property and equipment impairments recorded by the Company have not been significant. |
Intangible Assets | Intangible Assets —Intangible assets with determinable useful lives are amortized on a straight-line basis over the estimated periods benefited. Included in intangible assets is In Process Research and Development (IPR&D). The Company defines IPR&D as the value of acquired technology which has not yet reached technological feasibility. The primary basis for determining the technological feasibility is obtaining specific regulatory approvals. IPR&D is accounted for as an indefinite-lived intangible asset until completion or abandonment of the IPR&D project. Upon completion of the development project, the IPR&D is amortized over its estimated useful life. If the IPR&D project is abandoned, the related IPR&D asset would be written off. The IPR&D asset represents an estimate of the fair value of the pre-market approval (PMA) that could result from the CONVERGE IDE clinical trial. The Company reviews intangible assets for impairment using its best estimates based on reasonable and supportable assumptions and projections. |
Goodwill | Goodwill— Goodwill represents the excess of purchase price over the fair value of the net assets acquired in business combinations. The Company tests goodwill for impairment annually on November 30, or more often if impairment indicators are present. The Company’s goodwill is accounted for in a single reporting unit representing the Company as a whole. |
Other Noncurrent Liabilities | Other Noncurrent Liabilities— Other noncurrent liabilities are primarily contingent consideration recorded in business combinations, long-term deferred revenues and other contractual obligations. |
Other Income (Expense) | Other Income (Expense) — Other income (expense) consists of foreign currency transaction gains and losses. The Company recorded net foreign currency transaction gains (losses) of $5 and $(34) for the three months ended June 30, 2017 and 2016 , and $(13) and $(114) for the six months ended June 30, 2017 and 2016 primarily in connection with settlements of its intercompany balances denominated in Euros and invoices transacted in British Pounds. |
Taxes | Taxes —Deferred income tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities from a change in tax rates is recognized in the period that includes the enactment date. The Company’s estimate of the valuation allowance for deferred income tax assets requires it to make significant estimates and judgments about its future operating results. Deferred income tax assets are reduced by valuation allowances if, based on the consideration of all available evidence, it is more-likely-than-not that some portion of the deferred income tax asset will not be realized. Significant weight is given to evidence that can be objectively verified. The Company evaluates deferred tax income assets on an annual basis to determine if valuation allowances are required by considering all available evidence. Deferred income tax assets are realized by having sufficient future taxable income to allow the related tax benefits to reduce taxes otherwise payable. The sources of taxable income that may be available to realize the benefit of deferred income tax assets are future reversals of existing taxable temporary differences, future taxable income, exclusive of reversing temporary differences and carryforwards, taxable income in carry-back years and tax planning strategies that are both prudent and feasible. In evaluating whether to record a valuation allowance, the applicable accounting standards deem that the existence of cumulative losses in recent years is a significant piece of objectively verifiable negative evidence that must be overcome by objectively verifiable positive evidence to avoid the need to record a valuation allowance. The Company has recorded a full valuation allowance against its net deferred income tax assets as it is more-likely-than-not that the benefit of the deferred income tax assets will not be recognized in future periods. |
Net Loss Per Share | Net Loss Per Share —Basic and diluted net loss per share is computed in accordance with FASB ASC 260, “Earnings Per Share” (ASC 260) by dividing the net loss by the weighted average number of common shares outstanding during the period. Since the Company has experienced net losses for all periods presented, net loss per share excludes the effect of 4,349 and 4,471 stock options and restricted stock shares as of June 30, 2017 and 2016 because they are anti-dilutive. Therefore, the number of shares calculated for basic net loss per share is also used for the diluted net loss per share calculation. |
Comprehensive Loss and Accumulated Other Comprehensive Loss | Comprehensive Loss and Accumulated Other Comprehensive Loss —In addition to net losses, the comprehensive loss includes foreign currency translation adjustments and unrealized gains on investments. Accumulated other comprehensive loss consisted of the following (net of tax): Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 Total accumulated other comprehensive loss at beginning of period $ (393) $ (284) $ (468) $ (611) Unrealized Gains on Investments Balance at beginning of period $ (19) $ 2 $ (21) $ (39) Other comprehensive income before reclassifications 4 13 6 54 Amounts reclassified from accumulated other comprehensive income to other income on the statement of operations and comprehensive loss — — — — Balance at end of period $ (15) $ 15 $ (15) $ 15 Foreign Currency Translation Adjustment Balance at beginning of period $ (374) $ (286) $ (447) $ (572) Other comprehensive income before reclassifications 373 (229) 425 52 Amounts reclassified from accumulated other comprehensive income to other income/expense on the statement of operations and comprehensive loss (31) 10 (10) 15 Balance at end of period $ (32) $ (505) $ (32) $ (505) Total accumulated other comprehensive loss at end of period $ (47) $ (490) $ (47) $ (490) |
Research and Development | Research and Development —Research and development costs are expensed as incurred. These costs include compensation and other internal and external costs associated with the development and research related to new and existing products or concepts, preclinical studies, clinical trials, healthcare compliance and regulatory affairs. |
Advertising Costs | Advertising Costs — The Company expenses advertising costs as incurred. Advertising costs were not significant during the three and six months ended June 30, 2017 and 2016 . |
Share-Based Compensation | Share-Based Compensation —The Company follows FASB ASC 718, “Compensation-Stock Compensation” (ASC 718) to record share-based compensation for all employee share-based payment awards, including stock options, restricted stock and stock purchases related to an employee stock purchase plan, based on estimated fair values. The Company’s share-based compensation expense recognized under ASC 718 for the three months ended June 30, 2017 and 2016 was $3,697 and $3,027, and $7,325 and $5,869 for the six months ended June 30, 2017 and 2016 . ASC 718 requires companies to estimate the fair value of share-based payment awards on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in the Company’s Condensed Consolidated Statement of Operations and Comprehensive Loss. The expense has been reduced for estimated forfeitures. The Company estimates forfeitures at the time of grant and revises them, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The Company estimates the fair value of time-based options on the date of grant using the Black-Scholes option-pricing model (Black-Scholes model). The Company’s determination of fair value of share-based payment awards on the date of grant using an option-pricing model is affected by the Company’s stock price, as well as assumptions regarding a number of subjective variables. These variables include but are not limited to the Company’s expected stock price volatility over the term of the awards and actual and projected employee stock option exercise behaviors. The fair value of market-based performance option grants is estimated at the date of grant using a Monte-Carlo simulation. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in the Condensed Consolidated Statement of Operations and Comprehensive Loss. The Company estimates the fair value of restricted stock based upon the grant date closing market price of the Company’s common stock. The Company’s determination of fair value is affected by the Company’s stock price as well as assumptions regarding the number of shares expected to be granted. The Company also has an employee stock purchase plan (ESPP) which is available to all eligible employees as defined by the plan document. Under the ESPP, shares of the Company’s common stock may be purchased at a discount. The Company estimates the number of shares to be purchased under the ESPP at the beginning of each purchase period and records estimated compensation expense during the period based upon the fair value of the stock at the beginning of the purchase period using the Black-Scholes model. Expense is adjusted at the time of stock purchase. |
Use of Estimates | Use of Estimates —The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting period. Actual results could differ from those estimates. |
Fair Value Disclosures | Fair Value Disclosures —The Company classifies and records cash and investments in U.S. government agencies and securities as Level 1 within the fair value hierarchy. Accounts receivable, short-term other assets, accounts payable and accrued liabilities are also classified as Level 1. The carrying amounts of these assets and liabilities approximate their fair value due to their relatively short-term nature. Cash equivalents and investments in corporate bonds and commercial paper are classified as Level 2 within the fair value hierarchy (see Note 3 – Fair Value for further information). Fixed term debt fair value is determined by calculating the net present value of future debt payments at current market interest rates and is classified as Level 2. The recorded value of the Company’s fixed term debt approximates its fair value as of June 30, 2017. Significant unobservable inputs with respect to the Level 3 fair value measurement of the contingent consideration liability is developed using Company data. When an input is changed, the corresponding valuation models are updated and the results are analyzed for reasonableness. |
Description of Business and S17
Description of Business and Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Description of Business and Summary of Significant Accounting Policies [Abstract] | |
Summary Of Inventories | Inventories consist of the following: June 30, December 31, 2017 2016 Raw materials $ 5,812 $ 5,719 Work in process 1,787 1,221 Finished goods 12,344 10,720 Inventories $ 19,943 $ 17,660 |
Accumulated Other Comprehensive Income (Loss) | Accumulated other comprehensive loss consisted of the following (net of tax): Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 Total accumulated other comprehensive loss at beginning of period $ (393) $ (284) $ (468) $ (611) Unrealized Gains on Investments Balance at beginning of period $ (19) $ 2 $ (21) $ (39) Other comprehensive income before reclassifications 4 13 6 54 Amounts reclassified from accumulated other comprehensive income to other income on the statement of operations and comprehensive loss — — — — Balance at end of period $ (15) $ 15 $ (15) $ 15 Foreign Currency Translation Adjustment Balance at beginning of period $ (374) $ (286) $ (447) $ (572) Other comprehensive income before reclassifications 373 (229) 425 52 Amounts reclassified from accumulated other comprehensive income to other income/expense on the statement of operations and comprehensive loss (31) 10 (10) 15 Balance at end of period $ (32) $ (505) $ (32) $ (505) Total accumulated other comprehensive loss at end of period $ (47) $ (490) $ (47) $ (490) |
Fair Value (Tables)
Fair Value (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value [Abstract] | |
Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis | The following table represents the Company’s fair value hierarchy for its financial assets and liabilities measured at fair value on a recurring basis as of June 30, 2017 : Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Other Unobservable Inputs (Level 3) Total Assets: Money market funds $ — $ 12,074 $ — $ 12,074 U.S. government agencies and securities 6,992 — — 6,992 Corporate bonds — 1,500 — 1,500 Commercial paper — 5,473 — 5,473 Total assets $ 6,992 $ 19,047 $ — $ 26,039 Liabilities: Acquisition-related contingent consideration — — 41,176 41,176 Total liabilities $ — $ — $ 41,176 $ 41,176 There were no changes in the levels or methodology of measurement of financial assets and liabilities during the three and six months ended June 30, 2017 . The following table represents the Company’s fair value hierarchy for its financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2016 : Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Other Unobservable Inputs (Level 3) Total Assets: Money market funds $ — $ 17,085 $ — $ 17,085 Commercial paper — 5,996 — 5,996 U.S. government agencies and securities 7,000 1,529 — 8,529 Corporate bonds — 8,276 — 8,276 Total assets $ 7,000 $ 32,886 $ — $ 39,886 Liabilities: Acquisition-related contingent consideration — — 41,176 41,176 Total liabilities $ — $ — $ 41,176 $ 41,176 |
Level 3 Fair Value Measurements Using Significant Other Unobservable Inputs for Acquisition-Related Contingent Consideration | The following table represents the Company’s Level 3 fair value measurements using significant other unobservable inputs for acquisition-related contingent consideration as of June 30, 2017 : Beginning Balance – January 1, 2017 $ 41,176 Amounts acquired — Transfers in (out) of Level 3 — Changes in fair value included in earnings — Ending Balance – June 30, 2017 $ 41,176 The following table represents the Company’s Level 3 fair value measurements using significant other unobservable inputs for acquisition-related contingent consideration as of December 31, 2016 : Beginning Balance – January 1, 2016 $ 40,207 Amounts acquired — Transfers in (out) of Level 3 — Changes in fair value included in earnings 969 Ending Balance – December 31, 2016 $ 41,176 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Intangible Assets [Abstract] | |
Company's Intangible Assets | The following table provides a summary of the Company’s intangible assets: June 30, December 31, 2017 2016 Cost Accumulated Amortization Cost Accumulated Amortization Fusion technology $ 9,242 $ 3,235 $ 9,242 $ 2,773 Clamp & probe technology 829 829 829 829 SUBTLE access technology 2,179 760 2,179 538 IPR&D 44,021 — 44,021 — Total $ 56,271 $ 4,824 $ 56,271 $ 4,140 |
Future Amortization Expense Related to Intangible Assets with Definite Lives | Future amortization expense related to intangible assets with definite lives is projected as follows: 2017 $ 683 July 1, 2017 through December 31, 2017 2018 1,367 2019 1,367 2020 1,235 2021 924 2022 and thereafter 1,850 Total $ 7,426 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Accrued Liabilities [Abstract] | |
Accrued Liabilities | Accrued liabilities consisted of the following: June 30, December 31, 2017 2016 Accrued commissions $ 4,113 $ 5,737 Accrued bonus 3,802 2,871 Accrued payroll and related benefits 3,578 4,326 Sales returns allowance 1,029 834 Other accrued liabilities 836 929 Accrued taxes and value-added taxes 776 1,289 Accrued royalties 573 481 Total $ 14,707 $ 16,467 |
Indebtedness (Tables)
Indebtedness (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Indebtedness [Abstract] | |
Future Maturities Debt And Capital Lease Obligations | Future maturities of long-term debt and capital lease obligations are projected as follows: 2017 $ 1,914 July 1, 2017 through December 31, 2017 2018 8,610 2019 8,629 2020 8,645 2021 4,071 2022 and thereafter 14,487 Total payments $ 46,356 Imputed interest (7,596) Net long-term debt and capital lease obligations, of which $5,291 is current and $33,469 is noncurrent $ 38,760 |
Equity Compensation Plans (Tabl
Equity Compensation Plans (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Equity Compensation Plans [Abstract] | |
Share-Based Compensation Expense Related to Employee Share-Based Compensation | The following table summarizes share-based compensation expense related to employees, directors and consultants under FASB ASC 718 for the three and six months ended June 30, 2017 and 2016 . This expense was allocated as follows: Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 Cost of revenue $ 138 $ 88 $ 269 $ 227 Research and development expenses 502 443 1,003 922 Selling, general and administrative expenses 3,057 2,496 6,053 4,720 Total $ 3,697 $ 3,027 $ 7,325 $ 5,869 |
Segment and Geographic Inform23
Segment and Geographic Information (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Segment and Geographic Information [Abstract] | |
Revenue by Geographic Area | Revenue by geographic area was as follows: Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 United States $ 35,534 $ 30,872 $ 68,802 $ 59,144 Europe 5,688 5,408 10,877 10,169 Asia 3,785 3,262 6,436 5,990 Other international 224 130 389 309 Total international 9,697 8,800 17,702 16,468 Total revenue $ 45,231 $ 39,672 $ 86,504 $ 75,612 |
Revenue by Product Type | United States revenue by product type was as follows: Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 Open-heart ablation $ 16,790 $ 14,721 $ 32,495 $ 28,689 Minimally invasive ablation 8,725 7,990 17,007 14,715 AtriClip 9,463 7,348 18,165 14,196 Total ablation and AtriClip 34,978 30,059 67,667 57,600 Valve tools 556 813 1,135 1,544 Total United States $ 35,534 $ 30,872 $ 68,802 $ 59,144 International revenue by product type was as follows: Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 Open-heart ablation $ 5,674 $ 5,438 $ 10,264 $ 9,910 Minimally invasive ablation 2,135 2,186 4,093 4,350 AtriClip 1,777 1,024 3,172 1,889 Total ablation and AtriClip 9,586 8,648 17,529 16,149 Valve tools 111 152 173 319 Total international $ 9,697 $ 8,800 $ 17,702 $ 16,468 |
Description of Business and S24
Description of Business and Summary of Significant Accounting Policies (Narrative) (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Description Of Business And Significant Accounting Policies [Line Items] | |||||
Shipping and handling revenue | $ 300 | $ 329 | $ 640 | $ 625 | |
Payment terms for end-users | 30 days | ||||
Payment terms for distributors | 60 days | ||||
Depreciation | $ 3,906 | 3,678 | |||
Net carrying amount of loaned equipment | 29,959 | 29,959 | $ 29,995 | ||
Foreign currency transaction (losses) gains | $ 10 | $ 15 | |||
Options, restricted stock and performance based shares excluded from calculation of net loss per share | 4,349 | 4,471 | |||
Share-based compensation expense recognized | 3,697 | 3,027 | $ 7,325 | $ 5,869 | |
Subsidiaries [Member] | |||||
Description Of Business And Significant Accounting Policies [Line Items] | |||||
Foreign currency transaction (losses) gains | 5 | (34) | $ (13) | (114) | |
Computer and Other Office Equipment [Member] | |||||
Description Of Business And Significant Accounting Policies [Line Items] | |||||
Estimated useful life by major asset category | 3 years | ||||
Generators [Member] | |||||
Description Of Business And Significant Accounting Policies [Line Items] | |||||
Depreciation | 909 | $ 879 | $ 1,825 | $ 1,715 | |
Carrying Amount of Loaned Equipment [Member] | |||||
Description Of Business And Significant Accounting Policies [Line Items] | |||||
Net carrying amount of loaned equipment | $ 5,331 | $ 5,331 | $ 5,692 | ||
Short-term Debt [Member] | |||||
Description Of Business And Significant Accounting Policies [Line Items] | |||||
Maturity period of short term investment | 1 year | ||||
Minimum [Member] | Generators and Other Capital Equipment [Member] | |||||
Description Of Business And Significant Accounting Policies [Line Items] | |||||
Estimated useful life by major asset category | 1 year | ||||
Minimum [Member] | Machinery, Equipment and Vehicles [Member] | |||||
Description Of Business And Significant Accounting Policies [Line Items] | |||||
Estimated useful life by major asset category | 3 years | ||||
Minimum [Member] | Furniture and Fixtures [Member] | |||||
Description Of Business And Significant Accounting Policies [Line Items] | |||||
Estimated useful life by major asset category | 3 years | ||||
Maximum [Member] | Generators and Other Capital Equipment [Member] | |||||
Description Of Business And Significant Accounting Policies [Line Items] | |||||
Estimated useful life by major asset category | 3 years | ||||
Maximum [Member] | Machinery, Equipment and Vehicles [Member] | |||||
Description Of Business And Significant Accounting Policies [Line Items] | |||||
Estimated useful life by major asset category | 7 years | ||||
Maximum [Member] | Furniture and Fixtures [Member] | |||||
Description Of Business And Significant Accounting Policies [Line Items] | |||||
Estimated useful life by major asset category | 7 years |
Description of Business and S25
Description of Business and Summary of Significant Accounting Policies (Summary Of Inventories) (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Description of Business and Summary of Significant Accounting Policies [Abstract] | ||
Raw materials | $ 5,812 | $ 5,719 |
Work in process | 1,787 | 1,221 |
Finished goods | 12,344 | 10,720 |
Inventories | $ 19,943 | $ 17,660 |
Description of Business and S26
Description of Business and Summary of Significant Accounting Policies (Accumulated Other Comprehensive Income (Loss)) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total accumulated other comprehensive loss at beginning of period | $ (393) | $ (284) | $ (468) | $ (611) |
Total accumulated other comprehensive loss at end of period | (47) | (490) | (47) | (490) |
Unrealized Gains on Investments [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total accumulated other comprehensive loss at beginning of period | (19) | 2 | (21) | (39) |
Other comprehensive income before reclassifications | 4 | 13 | 6 | 54 |
Amounts reclassified from accumulated other comprehensive income/expense to other income on the statement of operations and comprehensive loss | ||||
Total accumulated other comprehensive loss at end of period | (15) | 15 | (15) | 15 |
Foreign Currency Translation Adjustment [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total accumulated other comprehensive loss at beginning of period | (374) | (286) | (447) | (572) |
Other comprehensive income before reclassifications | 373 | (229) | 425 | 52 |
Amounts reclassified from accumulated other comprehensive income/expense to other income on the statement of operations and comprehensive loss | (31) | 10 | (10) | 15 |
Total accumulated other comprehensive loss at end of period | $ (32) | $ (505) | $ (32) | $ (505) |
Fair Value (Financial Assets an
Fair Value (Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis) (Details) - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Assets: | ||
Total assets | $ 26,039 | $ 39,886 |
Liabilities: | ||
Acquisition-related contingent consideration | 41,176 | 41,176 |
Total liabilities | 41,176 | 41,176 |
Money Market Funds [Member] | ||
Assets: | ||
Total assets | 12,074 | 17,085 |
Commercial Paper [Member] | ||
Assets: | ||
Total assets | 5,473 | 5,996 |
U.S. Government Agencies and Securities [Member] | ||
Assets: | ||
Total assets | 6,992 | 8,529 |
Corporate Bonds [Member] | ||
Assets: | ||
Total assets | 1,500 | 8,276 |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||
Assets: | ||
Total assets | 6,992 | 7,000 |
Liabilities: | ||
Acquisition-related contingent consideration | ||
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | U.S. Government Agencies and Securities [Member] | ||
Assets: | ||
Total assets | 6,992 | 7,000 |
Significant Other Observable Inputs (Level 2) [Member] | ||
Assets: | ||
Total assets | 19,047 | 32,886 |
Liabilities: | ||
Acquisition-related contingent consideration | ||
Significant Other Observable Inputs (Level 2) [Member] | Money Market Funds [Member] | ||
Assets: | ||
Total assets | 12,074 | 17,085 |
Significant Other Observable Inputs (Level 2) [Member] | Commercial Paper [Member] | ||
Assets: | ||
Total assets | 5,473 | 5,996 |
Significant Other Observable Inputs (Level 2) [Member] | U.S. Government Agencies and Securities [Member] | ||
Assets: | ||
Total assets | 1,529 | |
Significant Other Observable Inputs (Level 2) [Member] | Corporate Bonds [Member] | ||
Assets: | ||
Total assets | 1,500 | 8,276 |
Significant Other Unobservable Inputs (Level 3) [Member] | ||
Liabilities: | ||
Acquisition-related contingent consideration | 41,176 | 41,176 |
Total liabilities | $ 41,176 | $ 41,176 |
Fair Value (Level 3 Fair Value
Fair Value (Level 3 Fair Value Measurements Using Significant Other Unobservable Inputs for Acquisition-Related Contingent Consideration) (Details) - Significant Other Unobservable Inputs (Level 3) [Member] - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2017 | Dec. 31, 2016 | |
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Beginning Balance | $ 41,176 | $ 40,207 |
Amounts acquired | ||
Transfers in (out) of Level 3 | ||
Changes in fair value included in earnings | 969 | |
Ending Balance | $ 41,176 | $ 41,176 |
Intangible Assets (Narative) (D
Intangible Assets (Narative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Intangible Assets [Abstract] | ||||
Amortization of intangible assets | $ 342 | $ 411 | $ 684 | $ 822 |
Intangible Assets (Company's In
Intangible Assets (Company's Intangible Assets) (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Finite-Lived Intangible Assets [Line Items] | ||
Cost | $ 56,271 | $ 56,271 |
Accumulated Amortization | 4,824 | 4,140 |
Fusion Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 9,242 | 9,242 |
Accumulated Amortization | 3,235 | 2,773 |
Clamp and Probe Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 829 | 829 |
Accumulated Amortization | 829 | 829 |
SUBTLE Access Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 2,179 | 2,179 |
Accumulated Amortization | 760 | 538 |
IPR&D [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | $ 44,021 | $ 44,021 |
Intangible Assets (Future Amort
Intangible Assets (Future Amortization Expense Related to Intangible Assets with Definite Lives) (Details) $ in Thousands | Jun. 30, 2017USD ($) |
Intangible Assets [Abstract] | |
2,017 | $ 683 |
2,018 | 1,367 |
2,019 | 1,367 |
2,020 | 1,235 |
2,021 | 924 |
2022 and thereafter | 1,850 |
Total | $ 7,426 |
Accrued Liabilities (Accrued Li
Accrued Liabilities (Accrued Liabilities) (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Accrued Liabilities [Abstract] | ||
Accrued commissions | $ 4,113 | $ 5,737 |
Accrued bonus | 3,802 | 2,871 |
Accrued payroll and related benefits | 3,578 | 4,326 |
Sales returns allowance | 1,029 | 834 |
Other accrued liabilities | 836 | 929 |
Accrued taxes and value-added taxes | 776 | 1,289 |
Accrued royalties | 573 | 481 |
Total | $ 14,707 | $ 16,467 |
Indebtedness (Narrative) (Detai
Indebtedness (Narrative) (Details) - USD ($) | Apr. 25, 2016 | Jun. 30, 2017 |
Line of Credit Facility [Line Items] | ||
Accumulated amortization on the capital leases | $ 1,747,000 | |
Maximum [Member] | ||
Line of Credit Facility [Line Items] | ||
Letter of credit required to landlord | 1,250,000 | |
Silicon Valley Bank Agreement [Member] | Revolving Credit Facility [Member] | ||
Line of Credit Facility [Line Items] | ||
Line of credit | 15,000,000 | |
Line of credit, amount outstanding | 0 | |
Line of credit, availability | $ 15,000,000 | |
Silicon Valley Bank, Second Amended And Restated Loan Agreement [Member] | ||
Line of Credit Facility [Line Items] | ||
Principal payment starting period after inception of loan to maturity | 18 months | |
Silicon Valley Bank, Second Amended And Restated Loan Agreement [Member] | Revolving Credit Facility [Member] | ||
Line of Credit Facility [Line Items] | ||
Maturity date | Apr. 30, 2021 | |
Annual commitment fee | $ 50,000 | |
Building And Computer Equipment [Member] | ||
Line of Credit Facility [Line Items] | ||
Capital lease expiration period | Dec. 31, 2030 | |
Cost of assets under lease | $ 14,467,000 | |
Term Loan [Member] | Silicon Valley Bank, Second Amended And Restated Loan Agreement [Member] | ||
Line of Credit Facility [Line Items] | ||
Loan amount | $ 25,000,000 | |
Loan term | 5 years | |
Additional fee on total term loan | 4.00% | |
Accrued fee amount | 237,000 | |
Mason Lease [Member] | Letter of Credit [Member] | ||
Line of Credit Facility [Line Items] | ||
Letter of credit outstanding | $ 1,250,000 |
Indebtedness (Future Maturities
Indebtedness (Future Maturities On Debt And Capital Lease Obligations) (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Indebtedness [Abstract] | ||
2,017 | $ 1,914 | |
2,018 | 8,610 | |
2,019 | 8,629 | |
2,020 | 8,645 | |
2,021 | 4,071 | |
2022 and thereafter | 14,487 | |
Total payments | 46,356 | |
Imputed interest | (7,596) | |
Net long-term debt and capital lease obligations, of which $5,291 is current and $33,469 is noncurrent | 38,760 | |
Net capital lease obligations, current | 5,291 | $ 1,688 |
Net capital lease obligations, noncurrent | $ 33,469 |
Commitments and Contingencies (
Commitments and Contingencies (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Commitments and Contingencies [Line Items] | ||||
Royalty expense | $ 602 | $ 445 | $ 1,136 | $ 886 |
Minimum [Member] | ||||
Commitments and Contingencies [Line Items] | ||||
Royalty rates | 3.00% | |||
Royalty agreement term | 18 years | |||
Maximum [Member] | ||||
Commitments and Contingencies [Line Items] | ||||
Royalty rates | 5.00% | |||
Royalty agreement term | 20 years | |||
Office, Manufacturing, Warehouse Facilities, And Equipment [Member] | ||||
Commitments and Contingencies [Line Items] | ||||
Operating leases expire at various terms | Dec. 31, 2022 |
Income Tax Provision (Narrative
Income Tax Provision (Narrative) (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Income Tax Provision [Abstract] | ||||
Effective tax rate | (0.25%) | (0.20%) | (0.23%) | (0.12%) |
Equity Compensation Plans (Narr
Equity Compensation Plans (Narrative) (Details) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017USD ($)shares | Jun. 30, 2016USD ($) | Jun. 30, 2017USD ($)itemshares | Jun. 30, 2016USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of share-based incentive plans | item | 2 | |||
Share-based compensation expense | $ | $ 7,325 | $ 5,869 | ||
Participants purchase limit shares | 3 | |||
Offering period | 6 months | |||
Share-based compensation expense recognized | $ | $ 3,697 | $ 3,027 | $ 7,325 | $ 5,869 |
2014 Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expiry of options from the date of grant | 10 years | |||
Common stock reserved for issuance | 10,249 | 10,249 | ||
2008 Employee Stock Purchase Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Common stock reserved for issuance | 283 | 283 | ||
Company's common stock may be purchased at a discount | 15.00% | |||
Participants purchase limit value | $ | $ 25 | $ 25 | ||
Shares available for sale under the ESPP increased | 2.00% | |||
Outstanding shares of common stock exceed | 600 | |||
Employee Stock Option [Member] | 2014 Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Exercisable period beginning | 3 years | |||
Restricted Stock [Member] | 2014 Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 4 years | |||
First Anniversary Date Of Grant [Member] | Employee Stock Option [Member] | 2014 Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Annual vesting percentage | 25.00% | |||
Four Years From Date Of Grant [Member] | Restricted Stock [Member] | 2014 Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Annual vesting percentage | 25.00% |
Equity Compensation Plans (Shar
Equity Compensation Plans (Share-Based Compensation Expense Related to Employee Share-Based Compensation) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Total | $ 3,697 | $ 3,027 | $ 7,325 | $ 5,869 |
Cost of Revenue [Member] | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Total | 138 | 88 | 269 | 227 |
Research and Development Expenses [Member] | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Total | 502 | 443 | 1,003 | 922 |
Selling, General and Administrative Expenses [Member] | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Total | $ 3,057 | $ 2,496 | $ 6,053 | $ 4,720 |
Segment and Geographic Inform39
Segment and Geographic Information (Narrative)(Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Netherlands [Member] | ||
Long-lived assets | $ 870 | $ 931 |
Segment and Geographic Inform40
Segment and Geographic Information (Revenue by Geographic Area) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | $ 45,231 | $ 39,672 | $ 86,504 | $ 75,612 |
United States [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 35,534 | 30,872 | 68,802 | 59,144 |
Europe [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 5,688 | 5,408 | 10,877 | 10,169 |
Asia [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 3,785 | 3,262 | 6,436 | 5,990 |
Other International [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 224 | 130 | 389 | 309 |
International [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | $ 9,697 | $ 8,800 | $ 17,702 | $ 16,468 |
Segment and Geographic Inform41
Segment and Geographic Information (Revenue by Product Type) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Revenue from External Customer [Line Items] | ||||
Revenue | $ 45,231 | $ 39,672 | $ 86,504 | $ 75,612 |
United States [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Revenue | 35,534 | 30,872 | 68,802 | 59,144 |
United States [Member] | Open-heart Ablation [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Revenue | 16,790 | 14,721 | 32,495 | 28,689 |
United States [Member] | Minimally Invasive Ablation [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Revenue | 8,725 | 7,990 | 17,007 | 14,715 |
United States [Member] | AtriClip [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Revenue | 9,463 | 7,348 | 18,165 | 14,196 |
United States [Member] | Ablation and AtriClip [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Revenue | 34,978 | 30,059 | 67,667 | 57,600 |
United States [Member] | Valve Tools [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Revenue | 556 | 813 | 1,135 | 1,544 |
International [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Revenue | 9,697 | 8,800 | 17,702 | 16,468 |
International [Member] | Open-heart Ablation [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Revenue | 5,674 | 5,438 | 10,264 | 9,910 |
International [Member] | Minimally Invasive Ablation [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Revenue | 2,135 | 2,186 | 4,093 | 4,350 |
International [Member] | AtriClip [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Revenue | 1,777 | 1,024 | 3,172 | 1,889 |
International [Member] | Ablation and AtriClip [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Revenue | 9,586 | 8,648 | 17,529 | 16,149 |
International [Member] | Valve Tools [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Revenue | $ 111 | $ 152 | $ 173 | $ 319 |