Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Feb. 29, 2016 | Mar. 31, 2016 | Aug. 31, 2015 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Feb. 29, 2016 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | CUDA | ||
Entity Registrant Name | BARRACUDA NETWORKS INC | ||
Entity Central Index Key | 1,348,334 | ||
Current Fiscal Year End Date | --02-29 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 52,151,782 | ||
Entity Public Float | $ 541.8 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Feb. 29, 2016 | Feb. 28, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 118,654 | $ 151,373 |
Marketable securities | 36,394 | 40,754 |
Accounts receivable, net of allowance for doubtful accounts of $2,018 and $1,531 as of February 29, 2016 and February 28, 2015, respectively | 36,520 | 40,725 |
Inventories, net | 5,648 | 4,454 |
Prepaid income taxes | 7,645 | 8,245 |
Deferred costs | 31,943 | 30,221 |
Deferred income taxes | 0 | 479 |
Other current assets | 4,805 | 4,015 |
Total current assets | 241,609 | 280,266 |
Property and equipment, net | 31,910 | 27,839 |
Deferred costs, non-current | 27,019 | 27,715 |
Deferred income taxes, non-current | 2,992 | 443 |
Other non-current assets | 7,293 | 4,123 |
Intangible assets, net | 39,386 | 9,217 |
Goodwill | 69,595 | 39,742 |
Total assets | 419,804 | 389,345 |
Current liabilities: | ||
Accounts payable | 15,939 | 16,356 |
Accrued payroll and related benefits | 12,371 | 11,656 |
Other accrued liabilities | 19,495 | 12,465 |
Deferred revenue | 235,411 | 209,904 |
Deferred income taxes | 0 | 563 |
Note payable | 268 | 252 |
Total current liabilities | 283,484 | 251,196 |
Long-term liabilities: | ||
Deferred revenue, non-current | 157,363 | 163,253 |
Deferred income taxes, non-current | 2,478 | 2,396 |
Note payable, non-current | 4,115 | 4,383 |
Other long-term liabilities | $ 4,462 | $ 7,201 |
Commitments and contingencies | ||
Stockholders’ deficit: | ||
Preferred stock, $0.001 par value; 20,000,000 shares authorized; zero shares issued and outstanding as of February 29, 2016 and February 28, 2015, respectively | $ 0 | $ 0 |
Common stock, $0.001 par value; 1,000,000,000 shares authorized; 52,135,194 and 52,881,002 shares issued and outstanding as of February 29, 2016 and February 28, 2015, respectively | 52 | 53 |
Additional paid-in capital | 337,439 | 316,035 |
Accumulated other comprehensive loss | (4,509) | (4,233) |
Accumulated deficit | (365,080) | (350,939) |
Total stockholders’ deficit | (32,098) | (39,084) |
Total liabilities and stockholders’ deficit | $ 419,804 | $ 389,345 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Feb. 29, 2016 | Feb. 28, 2015 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance for doubtful accounts | $ 2,018 | $ 1,531 |
Preferred stock, par value (in usd per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 20,000,000 | 20,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in usd per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued (in shares) | 52,135,194 | 52,881,002 |
Common stock, shares outstanding (in shares) | 52,135,194 | 52,881,002 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Feb. 29, 2016 | Feb. 28, 2015 | Feb. 28, 2014 | |
Revenue: | |||
Appliance | $ 89,275 | $ 83,146 | $ 71,914 |
Subscription | 230,883 | 194,300 | 161,873 |
Total revenue | 320,158 | 277,446 | 233,787 |
Cost of revenue | 70,132 | 58,667 | 53,768 |
Gross profit | 250,026 | 218,779 | 180,019 |
Operating expenses: | |||
Research and development | 71,251 | 58,737 | 47,142 |
Sales and marketing | 138,324 | 125,526 | 114,024 |
General and administrative | 47,338 | 35,438 | 29,856 |
Total operating expenses | 256,913 | 219,701 | 191,022 |
Loss from operations | (6,887) | (922) | (11,003) |
Other income (expense), net | (262) | (3,674) | 51 |
Loss before income taxes and non-controlling interest | (7,149) | (4,596) | (10,952) |
Benefit from (provision for) income taxes | 2,727 | (62,902) | 6,565 |
Consolidated net loss | (4,422) | (67,498) | (4,387) |
Net loss attributable to non-controlling interest | 0 | 0 | 761 |
Net loss attributable to Barracuda Networks, Inc. | $ (4,422) | $ (67,498) | $ (3,626) |
Net loss per share attributable to Barracuda Networks, Inc. common stockholders: | |||
Basic and diluted (usd per share) | $ (0.08) | $ (1.30) | $ (0.10) |
Weighted-average shares used to compute net loss per share attributable to Barracuda Networks, Inc. common stockholders: | |||
Basic and diluted (in shares) | 53,070 | 51,898 | 35,355 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 29, 2016 | Feb. 28, 2015 | Feb. 28, 2014 | |
Statement of Comprehensive Income [Abstract] | |||
Net loss attributable to Barracuda Networks, Inc. | $ (4,422) | $ (67,498) | $ (3,626) |
Other comprehensive income (loss), net of tax: | |||
Change in net foreign currency translation adjustment | (669) | (3,408) | 352 |
Available-for-sale investments: | |||
Change in net unrealized gain (loss) (net of tax effect of $0, $5 and $13) | 403 | (8) | (19) |
Less: reclassification adjustment for net gains included in net loss (net of tax effect of $5, $0 and $23) | (10) | 0 | (38) |
Net change | 393 | (8) | (57) |
Other comprehensive income (loss) | (276) | (3,416) | 295 |
Comprehensive loss attributable to Barracuda Networks, Inc. | $ (4,698) | $ (70,914) | $ (3,331) |
Consolidated Statements of Com6
Consolidated Statements of Comprehensive Loss (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 29, 2016 | Feb. 28, 2015 | Feb. 28, 2014 | |
Statement of Comprehensive Income [Abstract] | |||
Change in net unrealized gain (loss), tax | $ 0 | $ 5 | $ 13 |
Reclassification adjustment for net gains included in net loss, tax | $ 5 | $ 0 | $ 23 |
Consolidated Statements of Rede
Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders' Deficit - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Accumulated Deficit | Total Stockholders' Deficit Controlling Interest | Total Stockholders' Deficit Non-controlling Interest | Initial Public Offering | Initial Public OfferingCommon Stock | Initial Public OfferingAdditional Paid-In Capital | Initial Public OfferingTotal Stockholders' Deficit Controlling Interest | Series A Redeemable Convertible Preferred Stock | Series B Redeemable Convertible Preferred Stock |
Redeemable convertible preferred stock, Beginning balance (in shares) at Feb. 28, 2013 | 10,050,254 | 7,575,973 | |||||||||||
Redeemable convertible preferred stock, Beginning balance at Feb. 28, 2013 | $ 40,010 | $ 127,544 | |||||||||||
Beginning balance (in shares) at Feb. 28, 2013 | 28,091,081 | ||||||||||||
Beginning balance at Feb. 28, 2013 | $ (259,620) | $ 28 | $ 23,080 | $ (1,112) | $ (279,131) | $ (257,135) | $ (2,485) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||
Issuance of common stock in connection with initial public offering, net of offering costs (in shares) | 4,761,000 | ||||||||||||
Issuance of common stock in connection with initial public offering, net of offering costs | $ 75,490 | $ 5 | $ 75,485 | $ 75,490 | |||||||||
Conversion of convertible preferred stock to common stock in connection with initial public offering (in shares) | 17,626,227 | (10,050,254) | (7,575,973) | ||||||||||
Conversion of convertible preferred stock to common stock in connection with initial public offering | 167,554 | $ 18 | 167,536 | 167,554 | $ (40,010) | $ (127,544) | |||||||
Issuance of common stock (in shares) | 769,191 | ||||||||||||
Issuance of common stock | 3,310 | $ 1 | 3,309 | 3,310 | |||||||||
Tax withholding related to net share settlement of equity awards (in shares) | (158,049) | ||||||||||||
Tax withholding related to net share settlement of equity awards | (3,101) | (3,101) | (3,101) | ||||||||||
Repurchase of common stock (in shares) | (44,254) | ||||||||||||
Repurchase of common stock | (723) | (39) | (684) | (723) | |||||||||
Stock-based compensation | 10,837 | 10,837 | 10,837 | ||||||||||
Excess tax benefits from equity compensation plans | 1,513 | 1,513 | 1,513 | ||||||||||
Repayment of employee loans, net | 3,048 | 3,048 | 3,048 | ||||||||||
Options assumed in acquisition | 129 | 129 | 129 | ||||||||||
Non-controlling interest | (3,246) | (3,246) | 3,246 | ||||||||||
Change in unrealized gain (loss) on available-for-sale securities, net of tax effect | (57) | (57) | (57) | ||||||||||
Foreign currency translation adjustment | 352 | 352 | 352 | ||||||||||
Net loss attributable to Barracuda Networks, Inc. | (3,626) | ||||||||||||
Net loss | (4,387) | (3,626) | (3,626) | $ (761) | |||||||||
Redeemable convertible preferred stock, Ending balance (in shares) at Feb. 28, 2014 | 0 | ||||||||||||
Redeemable convertible preferred stock, Ending balance at Feb. 28, 2014 | $ 0 | ||||||||||||
Ending balance (in shares) at Feb. 28, 2014 | 51,045,196 | ||||||||||||
Ending balance at Feb. 28, 2014 | (5,655) | $ 52 | 278,551 | (817) | (283,441) | (5,655) | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||
Issuance of common stock (in shares) | 2,012,749 | ||||||||||||
Issuance of common stock | 16,476 | $ 1 | 16,475 | 16,476 | |||||||||
Tax withholding related to net share settlement of equity awards (in shares) | (176,943) | ||||||||||||
Tax withholding related to net share settlement of equity awards | (5,369) | (5,369) | (5,369) | ||||||||||
Stock-based compensation | 17,058 | 17,058 | 17,058 | ||||||||||
Excess tax benefits from equity compensation plans | 8,947 | 8,947 | 8,947 | ||||||||||
Repayment of employee loans, net | 373 | 373 | 373 | ||||||||||
Change in unrealized gain (loss) on available-for-sale securities, net of tax effect | (8) | (8) | (8) | ||||||||||
Foreign currency translation adjustment | (3,408) | (3,408) | (3,408) | ||||||||||
Net loss attributable to Barracuda Networks, Inc. | (67,498) | ||||||||||||
Net loss | $ (67,498) | (67,498) | (67,498) | ||||||||||
Ending balance (in shares) at Feb. 28, 2015 | 52,881,002 | 52,881,002 | |||||||||||
Ending balance at Feb. 28, 2015 | $ (39,084) | $ 53 | 316,035 | (4,233) | (350,939) | (39,084) | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||
Issuance of common stock (in shares) | 382,529 | 1,019,686 | |||||||||||
Issuance of common stock | $ 4,845 | $ 1 | 4,844 | 4,845 | |||||||||
Tax withholding related to net share settlement of equity awards (in shares) | (262,511) | ||||||||||||
Tax withholding related to net share settlement of equity awards | $ (6,734) | (6,734) | (6,734) | ||||||||||
Repurchase of common stock (in shares) | (1,503,000) | (1,502,983) | |||||||||||
Repurchase of common stock | $ (19,216) | $ (2) | (9,495) | (9,719) | (19,216) | ||||||||
Stock-based compensation | 28,846 | 28,846 | 28,846 | ||||||||||
Excess tax benefits from equity compensation plans | 3,788 | 3,788 | 3,788 | ||||||||||
Repayment of employee loans, net | 155 | 155 | 155 | ||||||||||
Change in unrealized gain (loss) on available-for-sale securities, net of tax effect | 393 | 393 | 393 | ||||||||||
Foreign currency translation adjustment | (669) | (669) | (669) | ||||||||||
Net loss attributable to Barracuda Networks, Inc. | (4,422) | ||||||||||||
Net loss | $ (4,422) | (4,422) | |||||||||||
Ending balance (in shares) at Feb. 29, 2016 | 52,135,194 | 52,135,194 | |||||||||||
Ending balance at Feb. 29, 2016 | $ (32,098) | $ 52 | $ 337,439 | $ (4,509) | $ (365,080) | $ (32,098) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 29, 2016 | Feb. 28, 2015 | Feb. 28, 2014 | |
Operating activities | |||
Consolidated net loss | $ (4,422) | $ (67,498) | $ (4,387) |
Depreciation, amortization and impairment expense | 13,300 | 8,631 | 9,109 |
Adjustments to reconcile consolidated net loss to net cash provided by operating activities: | |||
Stock-based compensation expense | 28,846 | 17,058 | 10,837 |
Excess tax benefits from equity compensation plans | (3,788) | (8,947) | (1,513) |
Deferred income taxes | (6,592) | 59,261 | (12,633) |
Other | (865) | 486 | 243 |
Changes in operating assets and liabilities: | |||
Accounts receivable, net | 4,427 | (12,945) | (3,631) |
Inventories, net | (1,193) | 1,189 | (509) |
Income taxes, net | 2,756 | (485) | 2,696 |
Deferred costs | (1,112) | (8,189) | (10,809) |
Other assets | (2,187) | (2,158) | (348) |
Accounts payable | (720) | 2,835 | 1,183 |
Accrued payroll and related benefits | 3,339 | 1,959 | (212) |
Other liabilities | (1,526) | 3,566 | 387 |
Deferred revenue | 19,003 | 59,341 | 51,797 |
Net cash provided by operating activities | 49,266 | 54,104 | 42,210 |
Investing activities | |||
Purchase of marketable securities | (26,021) | (41,977) | 0 |
Proceeds from the sale of marketable securities | 10,310 | 249 | 1,516 |
Proceeds from maturity of marketable securities | 20,047 | 735 | 0 |
Purchase of investment in non-marketable equity and debt securities | (1,400) | (1,200) | (310) |
Purchase of property and equipment | (7,818) | (12,517) | (7,616) |
Purchase of intangible assets | 0 | (38) | (28) |
Business combinations, net of cash acquired | (56,862) | (4,791) | (8,475) |
Net cash used in investing activities | (61,744) | (59,539) | (14,913) |
Financing activities | |||
Net proceeds from initial public offering | 0 | 0 | 75,490 |
Proceeds from issuance of common stock | 4,845 | 16,476 | 3,310 |
Taxes paid related to net share settlement of equity awards | (6,734) | (5,369) | (3,101) |
Dividends paid | 0 | 0 | (1,419) |
Repurchase of common stock | (19,216) | 0 | (723) |
Excess tax benefits from equity compensation plans | 3,788 | 8,947 | 1,513 |
Repayment of employee loans, net of loans extended | (2,464) | 1,921 | 3,655 |
Repayment of note payable | (285) | (237) | (222) |
Other | (330) | (34) | 0 |
Net cash provided by (used in) financing activities | (20,396) | 21,704 | 78,503 |
Effect of exchange rate changes on cash and cash equivalents | 155 | (775) | (16) |
Net increase (decrease) in cash and cash equivalents | (32,719) | 15,494 | 105,784 |
Cash and cash equivalents at beginning of period | 151,373 | 135,879 | 30,095 |
Cash and cash equivalents at end of period | 118,654 | 151,373 | 135,879 |
Cash paid during the period for: | |||
Interest | 287 | 326 | 447 |
Income taxes, net of tax refunds | 353 | 3,191 | 2,565 |
Non-cash financing and investing activities: | |||
Conversion of preferred stock into common stock | 0 | 0 | 167,554 |
Ownership increase in non-controlling interest | $ 0 | $ 0 | $ 3,246 |
Organization and Summary of Sig
Organization and Summary of Significant Accounting Policies | 12 Months Ended |
Feb. 29, 2016 | |
Accounting Policies [Abstract] | |
Organization and Summary of Significant Accounting Policies | Organization and Summary of Significant Accounting Policies Nature of Operations Barracuda Networks, Inc., also referred to in this report as "we," "our," "us," "Barracuda" or "the Company," is headquartered in Campbell, California, and designs and delivers powerful yet easy-to-use security and data protection solutions. We offer cloud-enabled solutions that help our customers address security threats, improve network performance and protect and store their data. Our solutions are designed to simplify IT operations for our customers, allowing them to enhance their return on technology investments. We refer to the fiscal years ended February 29, 2016 , February 28, 2015 and February 28, 2014 as fiscal 2016 , fiscal 2015 and fiscal 2014 , respectively. Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States ("GAAP") and include the accounts of Barracuda Networks, Inc. and our wholly and majority-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. We evaluate our estimates on an ongoing basis, including those related to the fair values of stock-based awards, income taxes and contingent liabilities, among others. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results could differ from those estimates and such differences could be material to our consolidated financial position and results of operations. Reclassifications We have reclassified certain prior period amounts between line items to conform to our current fiscal year presentation. Cash and Cash Equivalents Cash and cash equivalents consist of cash on deposit with banks and money market funds with an original maturity of three months or less. Marketable Securities Marketable securities have been classified as available-for-sale securities in the consolidated balance sheets. Available-for-sale securities are carried at fair value, and realized gains and losses and declines in value determined to be other than temporary are included in other income (expense), net in the consolidated statements of operations. Interest income on securities classified as available-for-sale securities is also included in other income (expense), net. The cost of securities sold is based on the specific-identification method. We periodically review our marketable securities for other-than-temporary impairment. We consider factors such as the duration, severity and the reason for the decline in value, the potential recovery period and whether we intend to sell. For marketable debt securities, we also consider whether (i) it is more likely than not that we will be required to sell the debt securities before recovery of their amortized cost basis, and (ii) the amortized cost basis cannot be recovered as a result of credit losses. Fair Value The carrying value of our financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities, approximates fair value because of the short-term nature of such financial instruments. We measure certain assets, including goodwill, intangible assets, net, and other investments in non-marketable securities at fair value on a nonrecurring basis when there are identifiable events or changes in circumstances that may have a significant adverse impact on the fair value of these assets. Concentration of Credit Risk and Significant Customers Financial instruments that potentially subject us to concentrations of credit risk consist principally of cash and cash equivalents, marketable securities and accounts receivable. We primarily invest only in high-quality credit instruments and maintain our cash, cash equivalents and marketable securities with high-quality institutions. Deposits held with banks, including those held in foreign branches of global banks, may exceed the amount of insurance provided on such deposits. These deposits may be redeemed upon demand and bear minimal risk. We believe that the institutions that hold our instruments are financially sound and are subject to minimal credit risk. Our accounts receivable are derived from customers located in the United States and certain foreign countries and regions, including Europe, the Middle East, Latin America and Asia-Pacific. Sales to foreign customers accounted for 31% , 32% and 32% of total revenue in fiscal 2016 , 2015 and 2014 , respectively. We perform ongoing credit evaluations of our customers’ financial condition and typically require no collateral from our customers. Credit risk with respect to accounts receivable is dispersed due to the large number of customers. As of February 29, 2016 , no customer accounted for more than 10% of receivables. One distribution partner accounted for 13% of receivables as of February 28, 2015 . One distribution partner accounted for 22% , 20% and 18% of total revenue in fiscal 2016 , 2015 and 2014 , respectively. We currently depend on a single source or a limited number of sources for certain components used in the manufacture of our appliances. The inability of any supplier to fulfill our supply requirements could negatively impact future operating results. Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are recorded at the invoiced amount, net of allowances for doubtful accounts. The allowance for doubtful accounts is based on our assessment of the collectability of accounts. We regularly review the adequacy of the allowance of doubtful accounts by considering the age of outstanding invoices, customers’ expected ability to pay, and collection history, when applicable, to determine whether a specific allowance is appropriate. Accounts receivable deemed uncollectible are charged against the allowance for doubtful accounts when identified. Inventories Inventories are recorded at the lower of cost (using the first-in, first-out ("FIFO") method) or market. Cost is derived using actual cost on a FIFO basis. Our inventories include material, labor, and manufacturing overhead costs. We evaluate our ending inventories for estimated excess quantities and obsolescence. This evaluation includes analysis of usage rate and projected future demand. Inventories in excess of estimated future demand are written down and charged to cost of revenue. In addition, we assess the impact of changing technology to our inventories and we write down inventories that are considered obsolete. Property and Equipment Property and equipment are stated at cost, less accumulated depreciation and amortization. Land is not depreciated. Depreciation is calculated using the straight-line method over the following estimated useful lives: Asset Classification Estimated Useful Life Buildings 39 years Computer equipment and software 3 years Vehicles, machinery and equipment 5 years Leasehold improvements Lesser of the useful life of the asset, generally 5 years, or remaining lease term Business Combinations We include the results of operations of the businesses that we acquire as of the respective dates of acquisition. We allocate the fair value of the purchase price of our acquisitions to the assets acquired and liabilities assumed based on their estimated fair values. The excess of the fair value of the purchase price over the fair values of these identifiable assets and liabilities is recorded as goodwill. Intangible Assets and Impairment of Long-Lived Assets Intangible assets consist of customer relationships, trade names, acquired technology, developed software, in-process research and development and patents. Intangible assets are recorded at fair values at the date of the acquisition and, for those assets having finite useful lives, are amortized using the straight-line method over their estimated useful lives, which generally range from three to ten years . In-process research and development is recorded as an indefinite-lived asset until the underlying project is completed, at which time the intangible asset is amortized over the estimated useful life. We periodically review our intangible and other long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Determination of recoverability is based on the lowest level of identifiable estimated undiscounted cash flows resulting from use of the asset and its eventual disposition. If not recoverable, an impairment loss would be calculated based on the excess of the carrying amount over the fair value. In fiscal 2016 , 2015 and 2014 , we recorded impairment charges of $1.2 million , $0 and $0 , respectively. Refer to Note 2 to Consolidated Financial Statements for additional information. Goodwill Goodwill represents the excess of the purchase price over the fair value of assets acquired and liabilities assumed. We test goodwill for impairment at least annually or more frequently if events or changes in circumstances indicate that this asset may be impaired. We have elected to first assess the qualitative factors to determine whether it is more likely than not that the fair value of our single reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the two-step goodwill impairment test. If we determine that it is more likely than not that its fair value is less than its carrying amount, then the two-step goodwill impairment test will be performed. The first step, identifying a potential impairment, compares the fair value of the reporting unit with its carrying amount. If the carrying amount exceeds its fair value, the second step will be performed; otherwise, no further step is required. The second step, measuring the impairment loss, compares the implied fair value of the goodwill with the carrying amount of the goodwill. Any excess of the goodwill carrying amount over the applied fair value is recognized as an impairment loss, and the carrying value of goodwill is written down to fair value. Revenue Recognition We typically provide access to our solutions through appliances and related subscription agreements, whereby the customer is charged an upfront fee for the appliance and is required to purchase a related subscription agreement. The subscription agreements are subject to customer renewal at the end of each subscription period. Our appliances contain hardware and embedded proprietary software. The subscriptions, referred to as Barracuda Energize Updates, provide hourly spam, anti-malware and security updates, and are required to be purchased to access our solutions. The subscriptions also entitle customers to phone support and software updates on a when and if available basis. We have determined that the elements of our customer arrangements, where an appliance and subscription are purchased, do not qualify for treatment as a separate unit of accounting. Accordingly, all fees received under these customer agreements are accounted for as a single unit of accounting, and, except for any upfront fees for the appliance, such fees are recognized ratably on a daily basis over the term of the subscription agreement. Subscription revenue also includes revenue from fixed term licenses of our managed service provider solutions, virtual appliance software, support and maintenance. Subscription revenue is recognized ratably over the term of the license. Recognition of revenue commences when there is persuasive evidence of an arrangement, the fee is fixed and determinable, collectability is deemed reasonably assured and the services have commenced. We receive an upfront fee from customers for delivery and transfer of title for their appliance. No further fees related to the appliance are required to be paid by the customer in subsequent periods. Because the appliance does not have value to the customer on a stand-alone basis and requires a subscription agreement to access our solutions, the delivery of the appliance does not represent the culmination of a separate earnings process associated with the payment of the upfront fee. Accordingly, the amount of the upfront fee is recorded as deferred revenue upon invoicing and the amount is recognized as revenue ratably on a daily basis over the estimated average customer relationship period of three years. Customers have a 30 -day right to return, after which time the arrangement is non-cancelable. We make estimates and maintain a reserve for expected customer cancellations. These estimates involve inherent uncertainties and management judgment. Cost of Revenue Cost of revenue consists of costs related to our appliance and subscription revenue. Such costs include hardware, manufacturing, shipping and logistics, customer support, warranty, personnel costs, data center costs and amortization of intangible assets related to acquired technology. We jointly manage the cost of providing appliances and subscription services and, accordingly, we present aggregate cost of revenue. Deferred Revenue Deferred revenue represents amounts billed to customers or payments received from customers for which revenue has not yet been recognized. Deferred revenue that is expected to be recognized as revenue within one year is recorded as current deferred revenue and the remaining portion is recorded as non-current deferred revenue. Warranty and Instant Replacement Service We provide a standard one-year warranty on our appliances. We also offer separately priced extended warranty contracts on our appliances, which entitle customers to expedited replacement hardware, with next business day shipping, on our appliances. Such separately-priced extended warranty contracts are available to customers coterminous with the standard one-year warranty. Revenue from extended warranty contracts is recognized ratably over the contractual term. Costs associated with our standard warranty and extended warranty contracts are expensed as incurred. Total warranty costs, including costs incurred under our instant replacement extended warranty contracts and costs to support our standard one-year appliance warranty, in fiscal 2016 , 2015 and 2014 were $4.4 million , $4.6 million and $5.2 million , respectively. Deferred Appliance Costs We receive an upfront fee from our customers related to the sale of our appliance. We defer the costs of the appliance, including shipping costs, as they are directly related to the revenues that we derive from the sale of the appliance. Such deferred costs are amortized ratably over the estimated average customer relationship period of three years . Amortization of deferred appliance costs is included in cost of revenue in the consolidated statements of operations. Deferred Commissions We capitalize commission costs that are incremental and directly related to the acquisition of customer contracts. Sales commissions are deferred when earned and amortized over the same period that revenues are recognized. Commission payments are paid in full after the customer has paid. Amortization of deferred commission costs is included in sales and marketing expense in the consolidated statements of operations. Income Taxes We account for income taxes using the liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the financial statements or in our tax returns. Deferred taxes are determined based on the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. Changes in deferred tax assets and liabilities are recorded in the provision for income taxes. We assess the likelihood that our deferred tax assets will be recovered from future taxable income and, to the extent we believe, based upon the weight of available evidence, that it is more likely than not that all or a portion of deferred tax assets will not be realized, a valuation allowance is established through a charge to income tax expense. Potential for recovery of deferred tax assets is evaluated by estimating the future taxable profits expected from each subsidiary and considering prudent and feasible tax planning strategies. We account for uncertainty in income taxes recognized in our financial statements by applying a two-step process to determine the amount of tax benefit to be recognized. First, the tax position must be evaluated to determine the likelihood that it will be sustained upon examination by the taxing authorities, based on the technical merits of the position. If the tax position is deemed more-likely-than-not to be sustained, the tax position is then assessed to determine the amount of benefit to recognize in the financial statements. The amount of the benefit that may be recognized is the largest amount that has a greater than 50% likelihood of being realized upon ultimate settlement. The provision for income taxes includes the effects of any resulting tax reserves, or unrecognized tax benefits, that are considered appropriate as well as the related net interest and penalties. Software Development Costs Software development costs incurred prior to the establishment of technological feasibility are charged to research and development expense as incurred. Technological feasibility is established upon completion of a working model, which is typically demonstrated by initial beta shipment. Software development costs incurred subsequent to the time a product’s technological feasibility has been established through the time the product is available for general release to customers are capitalized if material. No software development costs have been capitalized in the periods presented. Advertising Costs We expense advertising costs as incurred. Advertising expense totaled $58.2 million , $58.7 million and $56.7 million for fiscal 2016 , 2015 and 2014 , respectively. Stock-Based Compensation We record stock-based compensation awards based on fair value as of the grant date. We use the Black-Scholes-Merton option-pricing model to estimate the fair value of our stock options and our employee stock purchase plan ("ESPP") shares. The fair value of restricted stock units is based on the fair value of our common stock, which is the closing market price of our common stock on the grant date. Given our limited history with employee grants, we use the "simplified" method in estimating the expected term for stock option awards. The "simplified" method, as permitted by the SEC, is calculated as the average of the contractual term and the average vesting period. Estimated volatility is based upon the historical volatility of similar entities whose share prices are publicly available, as we did not have sufficient trading history for our common stock. The risk-free interest rate is based on the yield curve of a zero-coupon U.S. Treasury bond on the date the stock option award is granted, with a maturity equal to the expected term of the stock option award. The expected dividend assumption is based on our current expectations about our anticipated dividend policy. We amortize the fair value of an award expected to vest on a straight-line basis over the requisite service period of the award, which is generally the period from the grant date to the end of the vesting period. For awards with service only conditions and a graded vesting schedule, we elected to recognize costs on a straight-line basis. We use historical data to estimate the number of future forfeitures. Foreign Currency For those subsidiaries whose functional currency is not the U.S. dollar, assets and liabilities are translated into U.S. dollar equivalents at the exchange rate in effect on the balance sheet date and revenues and expenses are translated into U.S. dollars using the average exchange rate over the period. Resulting currency translation adjustments are recorded in accumulated other comprehensive income (loss) in the consolidated balance sheets. We record net gains (losses) resulting from foreign exchange transactions in other income (expense), net in the consolidated statements of operations. For fiscal 2016 , net gains (losses) were not significant. For fiscal 2015 and 2014 , we recorded net gains (losses) of $(3.6) million and $0.1 million , respectively, We have foreign subsidiaries that operate and sell our products in various markets around the world. As a result, we are exposed to foreign exchange risks. We utilize foreign exchange forward contracts to manage foreign currency risk associated with foreign currency denominated monetary assets and liabilities, primarily trade receivables, and to reduce the volatility of earnings and cash flows related to foreign currency transactions. The fair value of our contracts as of February 29, 2016 is not significant. The change in the fair value of these foreign currency forward contracts is recorded as gain (loss) in other income (expense), net in the consolidated statements of operations. Accumulated Other Comprehensive Income (Loss) The accumulated other comprehensive income (loss) balance consists of unrealized gains and losses on available-for-sale securities and translation gains and losses related to our international subsidiaries with functional currencies other than the U.S. dollar, primarily the Euro. Recent Accounting Pronouncements In March 2016, the Financial Accounting Standards Board (the "FASB") issued an accounting standard to simplify employee shared-based payment accounting. The standard update is effective for fiscal years beginning after December 15, 2016 and interim periods within those fiscal years, and early adoption is permitted in any interim or annual period. If early adopted in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. Early adoption requires the adoption of all the amendments in the same period. Amendments related to the timing of when excess tax benefits are recognized, minimum statutory withholding requirements, forfeitures, and intrinsic value should be applied using a modified retrospective transition method by means of a cumulative-effect adjustment to equity as of the beginning of the period in which the guidance is adopted. Amendments related to the presentation of employee taxes paid on the statement of cash flows when an employer withholds shares to meet the minimum statutory withholding requirement should be applied retrospectively. Amendments requiring recognition of excess tax benefits and tax deficiencies in the income statement and the practical expedient for estimating expected term should be applied prospectively. An entity may elect to apply the amendments related to the presentation of excess tax benefits on the statement of cash flows using either a prospective transition method or a retrospective transition method. We are currently evaluating the impact of adopting this update on our consolidated financial statements. In March 2016, the FASB issued an accounting standard to eliminate the requirement to retroactively adopt the equity method of accounting for an investment that qualifies for use of the equity method as a result of an increase in the level of ownership interest or degree of influence. The standard update requires that the equity method investor add the cost of acquiring the additional interest in the investee to the current basis of the investor’s previously held interest and adopt the equity method of accounting as of the date the investment becomes qualified for equity method accounting. For an available-for-sale equity security that becomes qualified for the equity method of accounting, an entity is required to recognize through earnings the unrealized holding gain or loss in accumulated other comprehensive income (loss) at the date the investment becomes qualified for use of the equity method. The standard update is effective for fiscal years beginning after December 15, 2016 and interim periods within those years, and early adoption is permitted. The standard is to be applied prospectively upon their effective date to increases in the level of ownership interest or degree of influence that result in the adoption of the equity method. We do not expect the adoption of this update to have a material impact on our consolidated financial statements. In February 2016, the FASB issued an accounting standard to amend lease accounting requirements and requires entities to generally recognize on the balance sheet operating and financing lease liabilities and corresponding right-of-use assets. The new standard will require significant additional disclosures about the amount, timing and uncertainty of cash flows from leases. The standard update is effective for fiscal years beginning after December 15, 2018 and interim periods within those years, and early adoption is permitted. The standard is to be applied using a modified retrospective approach and includes a number of optional practical expedients that entities may elect to apply. We are currently evaluating the impact of adopting this update on our consolidated financial statements and expect that most of our operating lease commitments will be subject to the standard update and recognized as operating lease liabilities and right-of-use assets upon the adoption. In January 2016, the FASB issued an accounting standard to enhance the reporting model for financial instruments by amending certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. The standard update is effective for fiscal years beginning after December 15, 2017 and interim periods within those years. Early application to financial statements of fiscal years or interim periods that have not yet been issued is permitted by presenting separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk if we elected to measure the liability at fair value in accordance with the fair value option for financial instruments, otherwise, early adoption is not permitted. The standard is to be applied with a cumulative-effect adjustment to the balance sheet as of the beginning of the fiscal year of adoption. The amendments related to equity securities without readily determinable fair values (including disclosure requirements) should be applied prospectively to equity investments that exist as of the date of adoption. We are currently evaluating the impact of adopting this update on our consolidated financial statements. In November 2015, the FASB issued an accounting standard to simplify the presentation of deferred income taxes by requiring that deferred tax assets and liabilities, along with any related valuation allowance, be classified as non-current in a classified statement of financial position, which would be a change from our historical presentation whereby certain of our deferred tax assets and liabilities were classified as current and the remainder were classified as non-current. The standard update is effective for fiscal years beginning after December 15, 2016 and interim periods within those years, and early adoption is permitted. We early adopted the standard in fiscal 2016 on a prospective basis and have presented both deferred tax assets and liabilities as non-current in our consolidated balance sheet as of February 29, 2016 . Prior balance sheets have not been retrospectively adjusted. The adoption did not have an impact on our results of operations or cash flows as it related to balance sheet presentation only. In September 2015, the FASB issued an accounting standard to simplify the accounting for measurement period adjustments in connection with business combinations by requiring that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The standard update is effective for fiscal years beginning after December 15, 2015 and interim periods within those fiscal years. The standard update is to be applied prospectively to adjustments of provisional amounts that occur after the effective date with earlier application permitted for financial statements that have not been issued. We do not expect the adoption of this update to have an impact on our consolidated financial statements. In July 2015, the FASB issued an accounting standard to simplify the measurement of inventory by changing the subsequent measurement guidance from the lower of cost or market to the lower of cost and net realizable value for inventory. The standard update is effective for fiscal years beginning after December 15, 2016 and interim periods within those years, and early adoption is permitted. The standard is to be applied prospectively. We do not expect the adoption of this update to have an impact on our consolidated financial statements. In April 2015, the FASB issued an accounting standard providing guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, then the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. The new guidance does not change the accounting for a customer’s accounting for service contracts. The standard update is effective for fiscal years beginning after December 15, 2015 and interim periods within those years and early adoption is permitted. The standard allows for adoption retrospectively or prospectively to all arrangements entered into or materially modified after the effective date. We do not expect the adoption of this update to have an impact on our consolidated financial statements. In February 2015, the FASB issued an accounting standard to improve consolidation guidance for legal entities and affect the consolidation evaluation for reporting organizations. The standard update is effective for fiscal years beginning after December 15, 2015 and interim periods within those years and early adoption is permitted. The standard allows for adoption retrospectively or with a modified retrospective approach by recording a cumulative-effect adjustment to equity as of the beginning of the fiscal year of adoption. We do not expect the adoption of this update to have an impact on our consolidated financial statements. In May 2014, the FASB issued an accounting standard which completes the joint effort by the FASB and the International Accounting Standards Board to clarify the principles for recognizing revenue and improving financial reporting by creating common revenue recognition guidance for GAAP and International Financial Reporting Standards. The core principle of this update is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The original effective date would have required us to adopt this update in the first quarter of fiscal 2018. However, in August 2015, the FASB amended the standard to provide a one-year deferral of the effective date, as well as providing the option to early adopt the standard on the original effective date. Accordingly, we may adopt the standard in either the first quarter of fiscal 2018 or the first quarter of fiscal 2019. The standard allows for full retrospective adoption applied to all periods presented or retrospective adoption with the cumulative effect of initially applying this update recognized at the date of initial application. We are currently evaluating the timing and the impact of adopting this update on our consolidated financial statements. |
Balance Sheet Information and F
Balance Sheet Information and Fair Value | 12 Months Ended |
Feb. 29, 2016 | |
Balance Sheet Information and Fair Value [Abstract] | |
Balance Sheet Information and Fair Value | Balance Sheet Information and Fair Value Cash, Cash Equivalents and Marketable Securities The following table summarizes our cash and cash equivalents by category (in thousands): As of February 28/29, 2016 2015 Cash and cash equivalents: Cash $ 60,252 $ 97,187 Money market funds 58,402 54,186 $ 118,654 $ 151,373 The following table summarizes our marketable securities by category (in thousands): As of February 29, 2016 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Asset-backed securities $ 4,717 $ 9 $ (3 ) $ 4,723 Corporate debt securities 19,135 11 (22 ) 19,124 Equity securities 3,095 380 — 3,475 Foreign government bonds 205 — — 205 Mortgage-backed securities 2,341 — (13 ) 2,328 U.S. government agency securities 2,242 6 (14 ) 2,234 U.S. government notes 4,279 26 — 4,305 $ 36,014 $ 432 $ (52 ) $ 36,394 As of February 28, 2015 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Asset-backed securities $ 4,846 $ 3 $ (4 ) $ 4,845 Corporate debt securities 21,241 17 (13 ) 21,245 Equity securities 1,211 37 (32 ) 1,216 Foreign government bonds 201 — — 201 Mortgage-backed securities 2,716 4 (10 ) 2,710 U.S. government agency securities 7,310 8 (24 ) 7,294 U.S. government notes 3,242 1 — 3,243 $ 40,767 $ 70 $ (83 ) $ 40,754 The gross realized gains and losses from the sale of our marketable securities classified as available-for-sale were insignificant in all periods presented. We reflect these gains and losses as a component of other income (expense), net in the consolidated statements of operations. The following table presents gross unrealized losses and fair values for those marketable securities that were in an unrealized loss position aggregated by investment category and the length of time that individual securities have been in a continuous loss position (in thousands): As of February 29, 2016 Less Than 12 Months 12 Months or Greater Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Asset-backed securities $ 1,788 $ (3 ) $ — $ — $ 1,788 $ (3 ) Corporate debt securities 12,088 (22 ) — — 12,088 (22 ) Mortgage-backed securities 1,746 (8 ) 385 (5 ) 2,131 (13 ) U.S. government agency securities 887 (10 ) 622 (4 ) 1,509 (14 ) $ 16,509 $ (43 ) $ 1,007 $ (9 ) $ 17,516 $ (52 ) As of February 28, 2015 Less Than 12 Months 12 Months or Greater Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Asset-backed securities $ 2,385 $ (4 ) $ — $ — $ 2,385 $ (4 ) Corporate debt securities 11,346 (13 ) — — 11,346 (13 ) Equity securities 978 (32 ) — — 978 (32 ) Mortgage-backed securities 1,923 (10 ) — — 1,923 (10 ) U.S. government agency securities 4,331 (24 ) — — 4,331 (24 ) $ 20,963 $ (83 ) $ — $ — $ 20,963 $ (83 ) Unrealized losses related to these investments are due to interest rate fluctuations as opposed to changes in credit quality. We do not intend to sell and it is not more likely than not that we would be required to sell these investments before recovery of their amortized cost basis, which may be at maturity. As of February 29, 2016 , we have recognized no other-than-temporary impairment loss. The following table classifies our marketable debt securities by contractual maturities (in thousands): As of February 29, 2016 Due in 1 year $ 12,409 Due in 1 year through 5 years 16,018 Due in 5 years through 10 years 559 Due after 10 years 3,933 $ 32,919 Fair Value Measurements We determine fair value based on the fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value assumes that the transaction to sell the asset or transfer the liability occurs in the principal or most advantageous market for the asset or liability and establishes that the fair value of an asset or liability shall be determined based on the assumptions that market participants would use in pricing the asset or liability. The classification of a financial asset or liability within the hierarchy is based upon the lowest level input that is significant to the fair value measurement. The fair value hierarchy prioritizes the inputs into three levels that may be used to measure fair value: Level 1: Inputs are unadjusted quoted prices in active markets for identical assets or liabilities. Level 2: Inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument. Level 3: Inputs are unobservable inputs based on our assumptions. Cash equivalents and marketable equity securities are classified within Level 1 because they are valued using quoted market prices or alternative pricing sources and models utilizing market observable inputs. Marketable debt securities and derivative assets are classified within Level 2 if the investments are valued using model driven valuations which use observable inputs such as quoted market prices, benchmark yields, reported trades, broker/dealer quotes or alternative pricing sources with reasonable levels of price transparency. Our marketable securities are held by custodians who obtain investment prices from a third-party pricing provider that incorporates standard inputs in various asset price models. We estimated the fair value of our Level 3 contingent consideration liabilities based on a weighted probability assessment of achieving the milestones related to certain of our acquisitions. Significant increases (decreases) in the probability assumptions in isolation would result in a significantly higher (lower) fair value measurement. In developing these estimates, we considered unobservable inputs that are supported by little or no market activity and reflect our own assumptions. Financial assets measured at fair value on a recurring basis are summarized below (in thousands): As of February 29, 2016 Level 1 Level 2 Level 3 Total Cash equivalents: Money market funds $ 58,402 $ — $ — $ 58,402 Marketable securities: Asset-backed securities $ — $ 4,723 $ — $ 4,723 Corporate debt securities $ — $ 19,124 $ — $ 19,124 Equity securities $ 3,475 $ — $ — $ 3,475 Foreign government bonds $ — $ 205 $ — $ 205 Mortgage-backed securities $ — $ 2,328 $ — $ 2,328 U.S. government agency securities $ — $ 2,234 $ — $ 2,234 U.S. government notes $ — $ 4,305 $ — $ 4,305 Other accrued liabilities (current): Contingent consideration liability $ — $ — $ 1,160 $ 1,160 Other long-term liabilities: Contingent consideration liability $ — $ — $ 161 $ 161 As of February 28, 2015 Level 1 Level 2 Level 3 Total Cash equivalents: Money market funds $ 54,186 $ — $ — $ 54,186 Marketable securities: Asset-backed securities $ — $ 4,845 $ — $ 4,845 Corporate debt securities $ — $ 21,245 $ — $ 21,245 Equity securities $ 1,216 $ — $ — $ 1,216 Foreign government bonds $ — $ 201 $ — $ 201 Mortgage-backed securities $ — $ 2,710 $ — $ 2,710 U.S. government agency securities $ — $ 7,294 $ — $ 7,294 U.S. government notes $ — $ 3,243 $ — $ 3,243 Derivative assets not designated (current): Foreign exchange contracts $ — $ 31 $ — $ 31 Other accrued liabilities (current): Contingent consideration liability $ — $ — $ 1,150 $ 1,150 Other long-term liabilities: Contingent consideration liability $ — $ — $ 1,878 $ 1,878 The following table summarizes the change in fair value of our Level 3 contingent consideration amounts (in thousands): Balance as of February 28, 2015 $ 3,028 Acquisition addition 334 Total remeasurement recognized in earnings (1,867 ) Settlements (174 ) Balance as of February 29, 2016 $ 1,321 The contingent consideration remeasurement was recognized within research and development and sales and marketing expenses in the consolidated statements of operations. Refer to Note 3 to the Consolidated Financial Statements for additional information. Assets Measured at Fair Value on a Non-Recurring Basis We periodically review our intangible and other long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Determination of recoverability is based on the lowest level of identifiable estimated undiscounted cash flows resulting from use of the asset and its eventual disposition. If not recoverable, an impairment loss would be calculated based on the excess of the carrying amount over the fair value. We utilized an income approach to estimate the fair value and the inputs used are classified as Level 3 within the fair value hierarchy due to the significance of unobservable inputs using company-specific information. During the fourth quarter of fiscal 2016 , we determined there was an impairment due to a decrease in the projected cash flows related to certain developed technologies and customer relationships. We recorded an impairment charge of $1.2 million associated with these assets, included as amortization expense within cost of revenue and sales and marketing expense in the consolidated statements of operations. No impairment charges were recorded in fiscal 2015 and 2014 . Inventories, Net Inventories, net consisted of the following (in thousands): As of February 28/29, 2016 2015 Raw materials $ 2,459 $ 2,455 Finished goods 3,659 2,729 Reserves (470 ) (730 ) $ 5,648 $ 4,454 Deferred Costs Deferred costs consisted of the following (in thousands): As of 2016 2015 Appliance $ 41,548 $ 41,052 Commissions 17,414 16,884 $ 58,962 $ 57,936 Property and Equipment, Net Property and equipment, net consisted of the following (in thousands): As of 2016 2015 Land $ 9,578 $ 9,354 Building 6,549 6,549 Computer hardware and software 26,450 17,860 Vehicles, machinery and equipment 4,711 3,546 Leasehold improvements 4,401 2,965 51,689 40,274 Accumulated depreciation and amortization (19,779 ) (12,435 ) $ 31,910 $ 27,839 Depreciation and amortization expense related to property and equipment was $7.7 million , $5.2 million and $3.8 million for fiscal 2016 , 2015 and 2014 , respectively. Other Investments As of February 29, 2016 and February 28, 2015 , we held approximately $1.6 million and $1.3 million , respectively, or approximately 24% ownership interest, in stock of a privately-held company that was accounted for under the equity method. We recognize our proportional share of earnings and losses of the investee in other income (expense), net in the statements of operations and adjust the carrying amount of our investment accordingly. For fiscal 2016 , our proportionate share of the investee’s losses was $0.4 million . For fiscal 2015 and 2014 , our proportionate share of the investee’s earnings and losses was not material. As of February 29, 2016 and February 28, 2015 , we held approximately $1.6 million and $0.6 million , respectively, in stock of a privately-held company, which was accounted for under the cost method. Other investments are classified in other non-current assets in the consolidated balance sheets and are reviewed periodically for impairment. Accumulated Other Comprehensive Income (Loss) The components of accumulated other comprehensive income (loss), net of tax, were as follows (in thousands): Foreign Currency Translation Adjustments Unrealized Gain (Loss) on Available-for- Sale Investments Total Balance as of February 28, 2015 $ (4,225 ) $ (8 ) $ (4,233 ) Other comprehensive income (loss) before reclassifications (669 ) 403 (266 ) Amounts reclassified from accumulated other comprehensive income (loss) — (10 ) (10 ) Other comprehensive income (loss) (669 ) 393 (276 ) Balance as of February 29, 2016 $ (4,894 ) $ 385 $ (4,509 ) |
Acquisitions
Acquisitions | 12 Months Ended |
Feb. 29, 2016 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions Fiscal 2016 Intronis, Inc. In October 2015, we acquired all outstanding equity interests of Intronis, a leader in providing data protection solutions to managed service providers. The acquisition is expected to expand our channel reach with the addition of Intronis’ existing customer base and its purpose-built platform designed to streamline how MSPs service the data protection needs of their end-customers. The initial fair values of assets acquired and liabilities assumed were based on a preliminary valuation and our estimates and assumptions were subject to change within the measurement period of one year from the acquisition date. The primary areas of the purchase price allocation that were not yet finalized were related to the valuation of deferred income taxes and residual goodwill. In the fourth quarter of fiscal 2016 , we have finalized the purchase price allocation and valuation of assets acquired and liabilities assumed. The measurement period adjustments impacted the preliminary amounts previously recorded for goodwill and deferred tax liabilities, and do not impact the results of operations. The adjustments decreased the total purchase consideration by $0.2 million for working capital adjustments, which reduced the initial amount held back and the deferred tax liabilities by $0.1 million . The aggregate purchase consideration was $65.3 million in cash. As of February 29, 2016 , $6.8 million of the purchase consideration is being held back for potential indemnification obligations of the equityholders of Intronis. We recorded the assets acquired and liabilities assumed at their estimated fair value, with the difference between the fair value of the net assets acquired and the purchase consideration reflected as goodwill. The following table reflects the fair values of assets acquired and liabilities assumed subsequent to the measurement period adjustments (in thousands): Cash $ 2,327 Accounts receivable 376 Other current assets 654 Property and equipment 4,203 Other non-current assets 750 Developed technology 21,500 Customer relationships 11,870 Trade name 300 Goodwill 29,718 Accounts payable (685 ) Accrued expenses (1,149 ) Deferred revenue (current) (649 ) Deferred tax liabilities (3,930 ) Total value of assets acquired and liabilities assumed $ 65,285 As of the acquisition date, Intronis’ developed technology, customer relationships and trade name had weighted-average useful lives of 7.0 years , 7.0 years and 4.0 years , respectively. The total weighted-average useful life of these acquired intangible assets is 7.0 years . The goodwill is primarily attributed to the synergies expected to be realized following the acquisition. Goodwill is not expected to be deductible for income tax purposes. Included in our results of operations for fiscal 2016 are $9.4 million and $1.3 million of revenue and net loss, respectively, attributable to Intronis since the acquisition. The following unaudited pro forma information presents the combined results of operations of Barracuda and Intronis as if the acquisition had been completed on March 1, 2014, the beginning of the comparable prior annual reporting period. The unaudited pro forma information includes (i) amortization associated with estimates for the acquired intangible assets; and (ii) the associated tax impact on these unaudited pro forma adjustments and certain changes in judgment of valuation allowance as a combined business. The unaudited pro forma information does not reflect any cost saving synergies from operating efficiencies or the effect of the incremental costs incurred in integrating the two companies. Accordingly, this unaudited pro forma information is presented for informational purposes only and is not necessarily indicative of what the actual results of operations of the combined company would have been if the acquisition had occurred at the beginning of the period presented, nor are they indicative of future results of operations. Year Ended February 28/29, 2016 2015 (in thousands) Pro forma revenue $ 333,963 $ 295,738 Pro forma net loss attributable to Barracuda Networks, Inc. $ (12,727 ) $ (67,665 ) Other In July 2015, we completed an acquisition for total consideration of approximately $1.1 million , which included an estimated fair value for contingent consideration of $0.3 million . $0.7 million was allocated to intangible assets and $0.3 million to goodwill. The goodwill is primarily attributed to the synergies expected to be realized following the acquisition and is expected to be deductible for income tax purposes. As of the acquisition date, customer relationships and developed technology had weighted-average useful lives of 7.0 years and 1.0 year , respectively. The results of operations, since the acquisition date, and pro forma information were not material to our consolidated results of operations for the year ended February 29, 2016 . As of February 29, 2016 , we estimated the fair value for the contingent consideration liability to be $0.1 million . The decrease was due to settlement payments made during fiscal 2016 . Prior Year Acquisition C2C Systems Limited In August 2014 , we completed our acquisition of C2C, a provider of personal storage table file management, email archiving and information management solutions based in the United Kingdom, and were required to pay contingent consideration up to $4.9 million upon the attainment of certain billings levels and performance integration targets through August 2017. As of February 29, 2016 and February 28, 2015 , we estimated the fair value for the contingent consideration liability to be $1.2 million and $3.0 million , respectively. Adjustments were recorded based on the weighted probability assessment of achieving the milestones and resulted in a reversal of the contingent consideration liability, which was recorded in fiscal 2016 as a reduction of research and development and sales and marketing expenses of $1.9 million . As of February 29, 2016 , the remaining contingent consideration payable is a maximum of $4.1 million as certain milestone periods have expired. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Feb. 29, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets The changes in the carrying amount of goodwill are summarized as follows (in thousands): Balance as of February 28, 2015 $ 39,742 Goodwill acquired 30,054 Effect of foreign exchange rates (201 ) Balance as of February 29, 2016 $ 69,595 As of February 29, 2016 , no impairment of goodwill has been identified. Intangible assets subject to amortization are summarized as follows (in thousands): As of February 29, 2016 Gross Carrying Amount Accumulated Amortization Net Carrying Value Acquired developed technology $ 50,082 $ (25,643 ) $ 24,439 Software license 400 (400 ) — Customer relationships 19,809 (7,313 ) 12,496 Patents 2,999 (1,295 ) 1,704 Trade name 812 (259 ) 553 Acquired developed software 200 (200 ) — $ 74,302 $ (35,110 ) $ 39,192 As of February 28, 2015 Gross Carrying Amount Accumulated Amortization Net Carrying Value Acquired developed technology $ 28,799 $ (22,987 ) $ 5,812 Software license 400 (400 ) — Customer relationships 8,233 (6,032 ) 2,201 Patents 1,625 (1,058 ) 567 Trade name 513 (172 ) 341 Acquired developed software 200 (200 ) — $ 39,770 $ (30,849 ) $ 8,921 In addition to the above, we maintain other intangible assets not subject to amortization of $0.2 million and $0.3 million as of February 29, 2016 and February 28, 2015 , respectively. Amortization expense, including impairment charges, for fiscal 2016 , 2015 and 2014 was $5.6 million , $3.4 million and $5.4 million , respectively. As of February 29, 2016 , amortization expense for intangible assets for each of the next five years is as follows: $7.2 million in fiscal 2017 , $6.9 million in fiscal 2018 , $6.0 million in fiscal 2019 , $5.8 million in fiscal 2020 , $5.3 million in fiscal 2021 and $8.0 million thereafter. |
Redeemable Convertible Preferre
Redeemable Convertible Preferred Stock | 12 Months Ended |
Feb. 29, 2016 | |
Equity [Abstract] | |
Redeemable Convertible Preferred Stock | Redeemable Convertible Preferred Stock Prior to our initial public offering in November 2013, we had Series A and B redeemable convertible preferred stock (collectively "Convertible Preferred Stock"), all of which converted to 17,626,227 shares of common stock on a one-to-one basis in connection with our initial public offering (the "IPO"). Significant terms were as follows: Conversion —Each share of Convertible Preferred Stock was convertible at the option of the holder into common stock using a conversion rate of $3.98 and $16.84 per share, respectively, and would automatically convert into common stock in the event of an underwritten public offering of our common stock or upon the request of at least two thirds of the Preferred Stock then outstanding. Voting —Convertible Preferred Stock had voting rights, on an as-if-converted basis, identical to common stock and should vote together with common stock, and not as separate classes. Dividends —Any dividends declared or paid in any fiscal year would be made among the holders of Convertible Preferred Stock and common stock then outstanding in proportion to the greatest number of shares of common stock that would be held by each such holder if all Convertible Preferred Stock were converted at the then-effective conversion rate. Liquidation —In the event of liquidation, the Series B holders were entitled to receive in preference to any distribution to Series A or common stock holders, a liquidation preference equal to the greater of (i) $21.04 and (ii) the amount to which such holder of Series B would be entitled to receive upon a liquidation if such holders of Series B were converted into common stock, plus any dividends declared but unpaid on such shares. The holders of Series A were entitled to receive in preference to any distribution to holders of common stock, a liquidation preference equal to the greater of (i) $5.97 and (ii) the amount to which such holder of Series A would be entitled to receive upon a liquidation if such holders of Series A were converted into common stock, plus any dividends declared but unpaid on such shares. Any surplus assets or funds would then be distributed ratably between the holders of common stock. If assets and funds were insufficient to meet the liquidation preference of the Convertible Preferred Stock such assets and funds would first be distributed ratably between the holders of Series B in proportion to the full amounts they would otherwise be entitled to receive and then to holders of Series A in proportion to the full amounts they would otherwise be entitled to receive. Redemption —In October 2017, all outstanding shares of Convertible Preferred Stock would be eligible to be redeemed for cash in full upon a written notice by at least two-thirds of the holders of the outstanding Convertible Preferred Stock. In the event of redemption, each holder of the Convertible Preferred Stock would be entitled to receive the original issue price per share ( $3.98 for each share of Series A and $16.84 for each share of Series B), plus all unpaid dividends on such shares that were declared. Costs related to the issuance of Convertible Preferred Stock have been accreted to additional paid-in capital. |
Stockholders' Deficit
Stockholders' Deficit | 12 Months Ended |
Feb. 29, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stockholders' Deficit | Stockholders’ Deficit Authorized Stock The Company is authorized to issue 1,020,000,000 shares, consisting of 1,000,000,000 shares of common stock, par value $0.001 per share, and 20,000,000 shares of preferred stock, par value $0.001 per share. Our board of directors is authorized, without stockholder approval, except as required by the listing standards of the New York Stock Exchange, to issue additional shares of our capital stock. Common Stock Dividend Rights —Subject to preferences that may apply to any shares of preferred stock outstanding at the time, the holders of our common stock are entitled to receive dividends out of funds legally available if our board of directors, in its discretion, determines to issue dividends and then only at the times and in the amounts that our board of directors may determine. Voting Rights —Holders of our common stock are entitled to one vote for each share held on all matters submitted to a vote of stockholders. Preemptive or Similar Rights —Our common stock is not entitled to preemptive rights, and is not subject to conversion, redemption or sinking fund provisions. Liquidation Distributions —If we become subject to a liquidation, dissolution or winding-up, the assets legally available for distribution to our stockholders would be distributable ratably among the holders of our common stock and any participating preferred stock outstanding at that time, subject to prior satisfaction of all outstanding debt and liabilities and the preferential rights of and the payment of liquidation preferences, if any, on any outstanding shares of preferred stock. Preferred Stock Our board of directors is authorized to issue preferred stock in one or more series, to establish the number of shares to be included in each series, and to fix the designation, powers, preferences and rights of the shares of each series and any of its qualifications, limitations or restrictions. Our board of directors may also authorize the issuance of preferred stock with voting or conversion rights that could adversely affect the voting power or other rights of the holders of our common stock. Employee Stock Purchase Plan Our ESPP allows eligible employee participants to purchase shares of our common stock at a discount through payroll deductions. The ESPP consists of offering periods that are approximately six months in length and employees may purchase shares in each period at 85% of the lower of our fair market value on the first trading day of each offering period or on the purchase date. The ESPP will continue until the earlier to occur of (i) the termination of the ESPP by our board of directors, or (ii) June 15, 2035. As of February 29, 2016 , we had reserved 750,000 shares of our common stock for issuance under the ESPP and all such shares remain available for future issuance. The following weighted-average input assumptions were used to estimate the fair value of ESPP grants: Year Ended February 29, 2016 Expected volatility 42 % Expected term (in years) 0.50 Risk-free interest rate 0.27 % Dividend yield — Estimated fair value of stock options granted during the year $ 5.37 Stock Option Plan and Restricted Stock Units Our 2004 Stock Option Plan (the "2004 Plan") authorized the board of directors to grant incentive stock options and non-statutory stock options, as well as issue shares of restricted stock, to employees, directors and contractors. In 2012, our board of directors approved the termination of the 2004 Plan and the introduction of the 2012 Equity Incentive Plan (the "2012 Plan"), which provides for the grant of stock options, stock appreciation rights, restricted stock and restricted stock units ("RSUs") to employees, directors and contractors. Options granted are exercisable for periods not to exceed 10 years . Options and RSUs granted typically vest over four years contingent upon employment or service with us on the vesting date. The following table presents shares authorized and available for grant: Shares Available for Grant Balance at February 28, 2015 5,768,991 Authorized 2,379,645 Granted (2,465,037 ) Canceled/forfeited 677,078 Balance at February 29, 2016 6,360,677 The following weighted-average input assumptions were used to estimate the fair value of employee stock option grants: Year Ended February 28/29, 2016 2015 2014 Expected volatility 43 % 45 % 46 % Expected term (in years) 6.25 6.25 6.25 Risk-free interest rate 1.80 % 1.87 % 1.67 % Dividend yield — — — Estimated fair value of stock options granted during the year $ 13.80 $ 13.98 $ 9.48 The following table summarizes stock option activity under our plans: Options Outstanding Shares Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term Aggregate Intrinsic Value (in years) (in thousands) Balance at February 28, 2015 4,051,904 $ 17.98 Granted 757,285 $ 31.21 Exercised (382,529 ) $ 12.67 Canceled/forfeited (218,459 ) $ 26.16 Balance at February 29, 2016 4,208,201 $ 20.42 As of February 29, 2016: Vested and exercisable 2,478,287 $ 16.34 6.20 $ 1,456,297 Vested and expected to vest 4,063,692 $ 20.02 7.03 $ 1,565,624 During fiscal 2016 , 2015 and 2014 , the total grant-date fair value of stock options vested was $10.5 million , $7.5 million and $6.0 million , respectively. During fiscal 2016 , 2015 and 2014 , the aggregate intrinsic value of stock option awards exercised, which is measured as the difference between the exercise price and the value of our common stock at the date of exercise, was $8.6 million , $33.1 million and $6.5 million , respectively. As of February 29, 2016 , there was $17.4 million of unrecognized compensation cost related to outstanding stock options, net of forecasted forfeitures, expected to be recognized over a weighted-average period of 2.50 years . To the extent the actual forfeiture rate is different from what we have estimated, stock-based compensation related to these options will be different from our expectations. The following table summarizes RSU activity under our plan: Unvested Restricted Stock Units Number of Shares Weighted- Average Grant Date Fair Value Unvested at February 28, 2015 1,576,332 $ 23.16 Granted 1,707,752 $ 25.75 Vested (637,157 ) $ 19.60 Canceled/forfeited (196,108 ) $ 29.53 Unvested at February 29, 2016 2,450,819 $ 25.38 Expected to vest after February 29, 2016 2,167,186 $ 25.40 As of February 29, 2016 , there was $45.8 million of unrecognized compensation cost related to unvested RSUs, net of forecasted forfeitures. This amount is expected to be recognized over a weighted-average period of 3.02 years . To the extent the actual forfeiture rate is different from what we have estimated, stock-based compensation related to these RSUs will be different from our expectations. Total stock-based compensation expense has been classified as follows in the consolidated statements of operations (in thousands): Year Ended February 28//29, 2016 2015 2014 Cost of revenue $ 1,062 $ 389 $ 201 Research and development 8,247 4,410 2,374 Sales and marketing 6,566 3,811 2,067 General and administrative 12,971 8,448 6,195 $ 28,846 $ 17,058 $ 10,837 Stock Repurchase Program In September 2015, our board of directors authorized a stock repurchase program to repurchase shares of our common stock for an aggregate purchase price not to exceed $50.0 million through September 30, 2017. The stock repurchase program does not obligate us to repurchase any specific dollar amount or to acquire any specific number of shares. Stock will be purchased from time to time, in the open market or through private transactions, subject to market condition, in compliance with applicable state and federal securities laws. The timing and amount of repurchases, if any, will depend upon several factors, including market and business conditions, the trading price of our common stock and the nature of other investment opportunities. The following table summarizes our common stock repurchases for fiscal 2016 (in thousands, except per share data): Fiscal 2016 Total number of shares repurchased 1,503 Dollar amount of shares repurchased $ 19,216 Average price paid per share $ 12.79 Remaining amount authorized as of February 29, 2016 $ 30,784 Change in Non-controlling Interest During the fourth quarter of fiscal 2014, we obtained the remaining ownership interest in a subsidiary in which we had previously owned approximately 67% . As a result, the carrying amount of the non-controlling interest was adjusted and recognized in additional paid-in capital attributable to the Company. Prior to becoming wholly-owned, the non-controlling interest was reported in the consolidated balance sheet within stockholders’ deficit separately from the Company and its net income and loss were reported in the consolidated statement of operations, which included the amounts attributable to the Company and the non-controlling interest. |
Income Taxes
Income Taxes | 12 Months Ended |
Feb. 29, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Income (loss) before income taxes and non-controlling interest consists of the following (in thousands): Year Ended February 28/29, 2016 2015 2014 United States $ (7,792 ) $ (7,326 ) $ (6,165 ) Foreign 643 2,730 (4,787 ) $ (7,149 ) $ (4,596 ) $ (10,952 ) The provision for (benefit from) income taxes consists of the following (in thousands): Year Ended February 28/29, 2016 2015 2014 Current: Federal $ 2,519 $ 2,479 $ 4,760 State 839 299 574 Foreign 507 863 734 3,865 3,641 6,068 Deferred: Federal (2,707 ) 51,820 (10,231 ) State (850 ) 4,674 (1,109 ) Foreign (3,035 ) 2,767 (1,293 ) (6,592 ) 59,261 (12,633 ) $ (2,727 ) $ 62,902 $ (6,565 ) Deferred tax assets (liabilities) comprise the following (in thousands): As of February 28/29, 2016 2015 Deferred tax assets: Deferred revenue $ 63,357 $ 58,886 Stock-based compensation 6,983 3,344 Reserves and other 4,606 4,294 Research and development credits 6,484 4,935 Net operating losses 12,705 5,431 Total deferred tax assets 94,135 76,890 Valuation allowance (73,399 ) (74,357 ) Total deferred tax assets, net of valuation allowance 20,736 2,533 Deferred tax liabilities: Depreciation and amortization (14,954 ) (3,622 ) Prepaid expense and other (1,151 ) (717 ) Deferred sales commission (4,117 ) — Other deferred tax liabilities — (231 ) Total deferred tax liabilities (20,222 ) (4,570 ) Net deferred tax assets (liabilities) $ 514 $ (2,037 ) The following is a reconciliation of the statutory federal income tax rate to our effective tax rate (in thousands): Year Ended February 28/29, 2016 2015 2014 Tax benefit at federal statutory rate $ (2,502 ) $ (1,608 ) $ (3,833 ) State taxes, net of federal benefit (363 ) 4,845 (713 ) Non-deductible expenses 368 823 736 Stock-based compensation 2,134 520 1,227 Legal entity rationalization — — (3,541 ) Transaction costs 732 (1,454 ) — Change in valuation allowance 1,674 58,685 346 Foreign rate differential (2,752 ) 2,730 790 Research and development credits (2,482 ) (1,792 ) (933 ) Domestic production activities deduction (63 ) — (445 ) Litigation settlements 584 — — Other (57 ) 153 (199 ) $ (2,727 ) $ 62,902 $ (6,565 ) In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of deferred assets will be realized. The ultimate realization of the deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. In fiscal 2015 , we established a valuation allowance against a significant portion of our deferred tax assets, including U.S. federal and state deferred tax assets and certain foreign deferred tax assets, because realization of these tax benefits through future taxable income did not meet the more-likely-than-not threshold. We intend to maintain the valuation allowances until sufficient positive evidence exists to support its reversal. A valuation allowance of $73.4 million and $74.4 million is provided against our deferred tax assets as of February 29, 2016 and February 28, 2015 , respectively, primarily related to temporary differences, foreign net operating losses, research credits and net operating losses acquired as part of our acquisitions. The net change in valuation allowance for the year ended February 29, 2016 was $1.0 million and primarily related to the change in judgment in the foreign valuation allowance position. Net excess tax benefits resulting from our equity compensation plans are recorded as an increase in stockholders’ equity and were $3.8 million , $8.9 million and $1.5 million in fiscal 2016 , 2015 and 2014 , respectively. As of February 29, 2016 , we had $21.8 million of federal and $10.7 million of state net operating loss carryforwards available. If not utilized, the federal net operating losses expire in various fiscal years ending between 2019 and 2035 . The state net operating losses expire in various fiscal years ending between 2017 and 2035 . We have foreign net operating losses of $14.6 million . Of these, $13.9 million of the net operating losses can be carried forward indefinitely. The remaining foreign net operating losses expire in various fiscal years, starting with fiscal 2017 , if not utilized. Approximately $3.8 million of state net operating losses relate to stock-based compensation deductions in excess of book expense, the tax effect of which will be recorded to equity when realized. We had research and development credit carryforwards of $2.4 million , $5.5 million and $0.2 million for federal, California and other state income tax purposes, respectively. If not utilized, the federal research and development credit begins to expire in fiscal 2029 while the California credit can be carried forward indefinitely. If not utilized, other state research and development credit begins to expire in fiscal 2021 . We have a California Enterprise Zone credit of $0.3 million , which will begin to expire in fiscal 2024 , if not utilized. Utilization of our net operating loss and credit carryforwards may be subject to annual limitations due to ownership change provisions by the Internal Revenue Code of 1986, as amended, and similar state provisions. The annual limitation may result in the expiration of net operating losses and tax credits before utilization. We have performed an analysis under Section 382 of the Internal Revenue Code on behalf of our recent acquisition of Intronis as of October 12, 2015 and it does not appear that Intronis has experienced an ownership change prior to our acquisition. As a result, the existing net operating losses and tax credits are not currently subject to limitations arising from an ownership change, other than the annual limitation arising from our acquisition of Intronis. Future changes in our stock ownership, some of which are outside of our control, could result in an ownership change under Section 382 of the Internal Revenue Code and result in a limitation on our net operating losses and tax credits. As of February 29, 2016 , we had $10.4 million of cumulative undistributed earnings of our foreign subsidiaries. Deferred tax liabilities have not been recognized for undistributed earnings of foreign subsidiaries because we intend to permanently reinvest such undistributed earnings outside the United States. If these foreign earnings were to be repatriated in the future, the related U.S. tax liability may be reduced by any foreign income taxes previously paid on these earnings. Determination of the amount of an unrecognized deferred tax liability related to these earnings is not practicable. Our total unrecognized tax benefits as of February 29, 2016 , February 28, 2015 and February 28, 2014 were $6.4 million , $5.3 million and $5.0 million , respectively. Total unrecognized tax benefits that, if recognized, would affect our effective tax rate were $2.6 million , $4.3 million and $4.0 million as of February 29, 2016 , February 28, 2015 and February 28, 2014 , respectively. The following table summarizes the activity related to our gross unrecognized tax benefits (in thousands): Year Ended February 28/29, 2016 2015 2014 Balance at beginning of year $ 5,322 $ 4,980 $ 3,971 Tax positions related to the current year: Increases 1,841 1,050 1,208 Tax positions related to prior years: Increases 231 58 — Decreases (4 ) (53 ) (1 ) Settlements with taxing authorities: Settlements (710 ) — — Releases—statute of limitations expired (292 ) (713 ) (198 ) Balance at the end of the year $ 6,388 $ 5,322 $ 4,980 We recognize interest and/or penalties related to uncertain tax positions in income tax expense. To the extent accrued interest and penalties do not ultimately become payable, amounts accrued will be reduced and reflected as a reduction of the overall income tax provision in the period that such determination is made. During fiscal 2016 , interest and penalties recorded in the consolidated statement of operations was insignificant, while during fiscal years 2015 and 2014 , we recorded $0.1 million and $0.2 million in the consolidated statements of operations, respectively. The amounts of accrued interest and penalties recorded on the consolidated balance sheets as of February 29, 2016 and February 28, 2015 were $0.8 million and $0.8 million , respectively. We do not believe there will be material changes in our unrecognized tax positions over the next 12 months . Our policy to include interest and penalties related to gross unrecognized tax benefits within our provision for income taxes did not change. We file income tax returns in the U.S. federal jurisdiction, various states and certain foreign jurisdictions. The statute of limitations have not expired for audits of fiscal 2012 through 2016 and fiscal 2011 through 2016 in the U.S. federal and state jurisdictions, respectively, and for fiscal 2010 through 2016 in foreign jurisdictions. In fiscal 2016 , we have effectively settled the tax audits of fiscal years 2012 and 2013 by the Internal Revenue Service ("IRS"). |
Segment Information
Segment Information | 12 Months Ended |
Feb. 29, 2016 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. Our chief operating decision maker is our chief executive officer. Our chief executive officer reviews financial information presented on a consolidated basis, accompanied by information about sales by geographic region, for purposes of allocating resources and evaluating financial performance. We have one business activity and there are no segment managers who are held accountable for operations, operating results and plans for levels or components below the consolidated level. Accordingly, we have determined that we have a single reportable segment and operating unit structure. Revenue by geographic region is presented as follows (in thousands): Year Ended February 28/29, 2016 2015 2014 North America $ 235,275 $ 201,724 $ 169,896 United States 222,210 189,640 159,036 Other 13,065 12,084 10,860 Latin America 4,322 3,345 3,380 Asia-Pacific 18,772 18,158 16,245 EMEA 61,789 54,219 44,266 $ 320,158 $ 277,446 $ 233,787 Revenue earned in any one foreign country did not exceed 10% of total revenue in fiscal 2016 , 2015 and 2014 . Long-lived assets, excluding intercompany receivables, investments in subsidiaries, intangible assets and deferred tax assets, by geographic region are presented as follows (in thousands): As of February 28/29, 2016 2015 United States $ 60,619 $ 54,772 International 5,603 4,905 $ 66,222 $ 59,677 |
Borrowings
Borrowings | 12 Months Ended |
Feb. 29, 2016 | |
Debt Disclosure [Abstract] | |
Borrowings | Borrowings Note Payable We have a note payable with a financial institution which bears interest at 6.23% per annum. The estimated fair value of the note payable approximates its carrying value. The debt is repayable in equal monthly payments of principal and interest of $44,445 , with a final payment of unpaid principal and interest in July 2017. Penalty interest of 0.0625% is due on default of payments, and prepayment of amounts owed are subject to a prepayment fee calculated as the greater of a) 1% of the principal being repaid and b) the present value of the future principal and interest payments less the principal repaid. Interest expense for fiscal 2016 , 2015 and 2014 was $0.3 million , $0.3 million and $0.3 million , respectively, and was recorded in other income (expense), net of the consolidated statements of operations. Future principal and interest payments for our note payable are as follows (in thousands): Fiscal Years 2017 $ 533 2018 4,220 $ 4,753 Credit Facility Our original $40.0 million credit facility with SVB consisted of a revolving loan facility which included a letter of credit sub facility of up to $10.0 million . In fiscal 2014, the credit facility was amended to reduce the amount to $25.0 million and, in fiscal 2016 , we extended the expiration date to November 2016. The credit facility includes an option to request an increase of the available funds to $50.0 million and is secured by a security interest on substantially all of our assets and contains restrictive covenants. Upon drawing the credit facility, the financial covenants will require us to maintain a minimum adjusted EBITDA, as defined in the credit facility, and a minimum adjusted quick ratio. The credit facility also sets forth specified events of default. No amounts had been drawn under the credit facility through February 29, 2016 . |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Feb. 29, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Lease Arrangements We lease facilities and equipment under non-cancelable operating lease arrangements with various expiration dates through fiscal 2021 . Certain of these arrangements provide for free or escalating rent payment provisions and for options to renew, which could increase future minimum lease payments if exercised. We account for rent of our facilities on a straight-line basis over the respective lease terms. Rent expense was $3.5 million , $3.1 million and $2.9 million in fiscal 2016 , 2015 and 2014 , respectively. Future minimum payments under our operating leases agreements are as follows (in thousands): Fiscal Years Ending February 28/29: 2017 $ 3,178 2018 2,616 2019 1,819 2020 1,243 2021 461 $ 9,317 Unrecognized Purchase Commitments We have future unrecognized contractual obligations, primarily for purchase commitments of goods and services related to inventory, advertising and marketing, royalty and licensing arrangements and data center operations. Future minimum payments for these unrecognized purchase commitments are as follows (in thousands): Fiscal Years Ending February 28/29: 2017 $ 21,306 2018 5,889 2019 1,411 $ 28,606 Intellectual Property Settlement In fiscal 2016 , we entered into an intellectual property settlement agreement (the "Agreement"), whereby we resolved all current and potential future claims between us and a third party relating to certain patents. Under the terms of the Agreement, we agreed to make future settlement payments in exchange for a license to the relevant patents and a covenant by the third party not to sue for any past or future infringement of such licensed patents. We accounted for the Agreement as a multiple-element arrangement and allocated the fair value of the consideration to the identifiable elements based on their estimated fair values. We determined that the primary benefit of the arrangement is avoided litigation costs and the release of any potential past claims. $2.3 million was allocated to the resolution of any past claims and recorded as a legal settlement charge within general and administrative expense in fiscal 2016 , while $1.4 million was ascribed to patent assets based on the estimated future economic benefits of the license acquired in the Agreement. Legal Matters In late 2011, following a voluntary internal review of our compliance with U.S. export control and sanctions laws, our management team became aware that certain of our physical appliances had been sold indirectly into embargoed countries via our distributors and resellers, potentially in violation of U.S. export control and economic sanctions laws. In addition, certain of our solutions incorporate encryption components and may be exported from the United States only with the required approvals; in the past, we may have exported products prior to receiving these required authorizations. After completion of a comprehensive internal investigation conducted by outside counsel, we submitted voluntary disclosures regarding these matters to the U.S. Commerce Department, Bureau of Industry and Security ("BIS"), and to the U.S. Treasury Department, Office of Foreign Assets Control ("OFAC"). These disclosures summarized potential violations of export controls and economic sanctions laws, including reexports by third parties and provision of services to end users in embargoed countries including Iran, Sudan and Syria. In May 2015, we agreed to a settlement with OFAC pursuant to which we agreed to pay $38,930 as consideration for the final resolution of all issues related to the voluntary disclosure that we submitted to OFAC. In November 2015, we agreed to a settlement with BIS pursuant to which we agreed to pay $1.5 million as consideration for the final resolution of all issues related to the voluntary disclosure that we submitted to BIS. On April 18, 2016, R. David Hunt, as Seller Representative of stockholders of C2C, filed a lawsuit against us in the Court of Chancery of the State of Delaware, for alleged breach of contract of the Share Purchase Agreement dated August 13, 2014, pursuant to which we acquired all of the assets and liabilities of C2C. To date, we have not yet responded to the complaint, but intend to vigorously defend the lawsuit. Given the early stage of the litigation, we are unable to estimate a possible loss or range of possible loss, if any. We may, from time to time, be party to litigation and subject to claims that arise in the ordinary course of business. In addition, third parties may, from time to time, assert claims against us in the form of letters and other communications. We currently believe that these ordinary course matters will not have a material adverse effect on our business, consolidated financial position, results of operations or cash flows; however, the results of litigation and claims are inherently unpredictable. Regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors. |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Feb. 29, 2016 | |
Postemployment Benefits [Abstract] | |
Employee Benefit Plan | Employee Benefit Plan Our 401(k) tax-deferred savings plan (the "401(k) Plan") permits eligible U.S. participants to make contributions by salary deduction pursuant to Section 401(k) of the Internal Revenue Code of 1986, as amended. Under the 401(k) Plan, participating employees may defer a portion of their pre-tax earnings, up to the IRS annual contribution limit. We began to match our employees’ contributions in fiscal 2014 up to a certain amount of each employee’s eligible earnings. We incurred 401(k) Plan contribution expenses of $1.2 million , $1.0 million and $0.8 million in fiscal 2016 , 2015 and 2014 , respectively. |
Other Income (Expense), Net
Other Income (Expense), Net | 12 Months Ended |
Feb. 29, 2016 | |
Other Income and Expenses [Abstract] | |
Other Income (Expense), Net | Other Income (Expense), Net The components of other income (expense), net, are presented as follows (in thousands): Year Ended February 28/29, 2016 2015 2014 Interest and miscellaneous income $ 344 $ 579 $ 788 Interest expense (308 ) (417 ) (604 ) Foreign currency exchange gains (losses), net (14 ) (3,558 ) 86 Other (284 ) (278 ) (219 ) $ (262 ) $ (3,674 ) $ 51 |
Net Loss Per Share
Net Loss Per Share | 12 Months Ended |
Feb. 29, 2016 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | Net Loss Per Share Basic and diluted net income (loss) per share attributable to common stockholders was presented in conformity with the two-class method required for participating securities. Prior to the date of our IPO, we considered our Series A and Series B redeemable convertible preferred stock as participating securities. In the event a dividend was declared or paid on our common stock, holders of Series A and Series B redeemable convertible preferred stock were entitled to a proportionate share of such dividend in proportion to the holders of common stock on an as-if converted basis. Immediately after the completion of our IPO in November 2013, all outstanding shares of redeemable convertible preferred stock were converted into common stock. Through the date of our IPO, we utilized the two-class method to compute net income (loss) per share. Under the two-class method, basic net income (loss) per share attributable to common stockholders was computed by dividing the net income (loss) attributable to common stockholders by the weighted-average number of common shares outstanding during the period. Net income (loss) attributable to common stockholders was determined by allocating undistributed earnings between common and redeemable convertible preferred stockholders. Diluted net income (loss) per share attributable to common stockholders was computed by using the weighted-average number of shares of common stock outstanding, including potential dilutive common shares assuming the dilutive effect of outstanding stock options and RSUs using the treasury stock method. For periods in which there was a net loss, the number of shares used in the computation of diluted net loss per share was the same as that used for the computation of basic net loss per share, as the inclusion of dilutive common shares would be anti-dilutive. Under the two-class method, the net income (loss) attributable to common stockholders was not allocated to the convertible redeemable preferred stock as the convertible redeemable preferred stock did not have a contractual obligation to share in our losses. The following table presents the calculation of basic and diluted net loss per share attributable to common stockholders under the two-class method (in thousands, except per share amounts): Year Ended February 28/29, 2016 2015 2014 Net loss attributable to Barracuda Networks, Inc. $ (4,422 ) $ (67,498 ) $ (3,626 ) Shares used to compute net loss per share attributable to Barracuda Networks, Inc. common stockholders: Weighted-average shares used to compute net loss per share, basic 53,070 51,898 35,355 Dilutive shares from stock options and RSUs — — — Weighted-average shares used to compute net loss per share, diluted 53,070 51,898 35,355 Net loss per share attributable to Barracuda Networks, Inc. common stockholders: Net loss per share, basic $ (0.08 ) $ (1.30 ) $ (0.10 ) Net loss per share, diluted $ (0.08 ) $ (1.30 ) $ (0.10 ) |
Subsequent Event
Subsequent Event | 12 Months Ended |
Feb. 29, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Event | Subsequent Event On March 17, 2016, we completed the acquisition of Sookasa Inc., a Delaware corporation ("Sookasa"), for aggregate cash consideration of $0.3 million and the issuance of 10,000 shares of the Company’s common stock, which included the repayment of certain indebtedness of Sookasa. |
Schedule II-Valuation and Quali
Schedule II-Valuation and Qualifying Accounts | 12 Months Ended |
Feb. 29, 2016 | |
Valuation and Qualifying Accounts [Abstract] | |
Schedule II-Valuation and Qualifying Accounts | SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS Year Ended February 28/29, 2016 2015 2014 (in thousands) Allowance for doubtful accounts: Beginning balance $ 1,531 $ 2,134 $ 1,252 Charged to costs and expenses 586 289 885 Bad debt write-offs (99 ) (892 ) (3 ) Ending balance $ 2,018 $ 1,531 $ 2,134 Sales return reserve: Beginning balance $ 1,849 $ 1,862 $ 2,371 Charged to deferred revenue 25,340 18,151 16,901 Sales returns (25,163 ) (18,164 ) (17,410 ) Ending balance $ 2,026 $ 1,849 $ 1,862 All other schedules have been omitted because the information called for is not required or is shown either in the consolidated financial statements or in the notes thereto. |
Organization and Summary of S24
Organization and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Feb. 29, 2016 | |
Accounting Policies [Abstract] | |
Nature of Operations | Nature of Operations Barracuda Networks, Inc., also referred to in this report as "we," "our," "us," "Barracuda" or "the Company," is headquartered in Campbell, California, and designs and delivers powerful yet easy-to-use security and data protection solutions. We offer cloud-enabled solutions that help our customers address security threats, improve network performance and protect and store their data. Our solutions are designed to simplify IT operations for our customers, allowing them to enhance their return on technology investments. We refer to the fiscal years ended February 29, 2016 , February 28, 2015 and February 28, 2014 as fiscal 2016 , fiscal 2015 and fiscal 2014 , respectively. |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States ("GAAP") and include the accounts of Barracuda Networks, Inc. and our wholly and majority-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. We evaluate our estimates on an ongoing basis, including those related to the fair values of stock-based awards, income taxes and contingent liabilities, among others. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results could differ from those estimates and such differences could be material to our consolidated financial position and results of operations. |
Reclassifications | Reclassifications We have reclassified certain prior period amounts between line items to conform to our current fiscal year presentation. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents consist of cash on deposit with banks and money market funds with an original maturity of three months or less. |
Marketable Securities | Marketable Securities Marketable securities have been classified as available-for-sale securities in the consolidated balance sheets. Available-for-sale securities are carried at fair value, and realized gains and losses and declines in value determined to be other than temporary are included in other income (expense), net in the consolidated statements of operations. Interest income on securities classified as available-for-sale securities is also included in other income (expense), net. The cost of securities sold is based on the specific-identification method. We periodically review our marketable securities for other-than-temporary impairment. We consider factors such as the duration, severity and the reason for the decline in value, the potential recovery period and whether we intend to sell. For marketable debt securities, we also consider whether (i) it is more likely than not that we will be required to sell the debt securities before recovery of their amortized cost basis, and (ii) the amortized cost basis cannot be recovered as a result of credit losses. |
Fair Value | Fair Value The carrying value of our financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities, approximates fair value because of the short-term nature of such financial instruments. We measure certain assets, including goodwill, intangible assets, net, and other investments in non-marketable securities at fair value on a nonrecurring basis when there are identifiable events or changes in circumstances that may have a significant adverse impact on the fair value of these assets. |
Concentration of Credit Risk and Significant Customers | Concentration of Credit Risk and Significant Customers Financial instruments that potentially subject us to concentrations of credit risk consist principally of cash and cash equivalents, marketable securities and accounts receivable. We primarily invest only in high-quality credit instruments and maintain our cash, cash equivalents and marketable securities with high-quality institutions. Deposits held with banks, including those held in foreign branches of global banks, may exceed the amount of insurance provided on such deposits. These deposits may be redeemed upon demand and bear minimal risk. We believe that the institutions that hold our instruments are financially sound and are subject to minimal credit risk. Our accounts receivable are derived from customers located in the United States and certain foreign countries and regions, including Europe, the Middle East, Latin America and Asia-Pacific. Sales to foreign customers accounted for 31% , 32% and 32% of total revenue in fiscal 2016 , 2015 and 2014 , respectively. We perform ongoing credit evaluations of our customers’ financial condition and typically require no collateral from our customers. Credit risk with respect to accounts receivable is dispersed due to the large number of customers. As of February 29, 2016 , no customer accounted for more than 10% of receivables. One distribution partner accounted for 13% of receivables as of February 28, 2015 . One distribution partner accounted for 22% , 20% and 18% of total revenue in fiscal 2016 , 2015 and 2014 , respectively. We currently depend on a single source or a limited number of sources for certain components used in the manufacture of our appliances. The inability of any supplier to fulfill our supply requirements could negatively impact future operating results. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are recorded at the invoiced amount, net of allowances for doubtful accounts. The allowance for doubtful accounts is based on our assessment of the collectability of accounts. We regularly review the adequacy of the allowance of doubtful accounts by considering the age of outstanding invoices, customers’ expected ability to pay, and collection history, when applicable, to determine whether a specific allowance is appropriate. Accounts receivable deemed uncollectible are charged against the allowance for doubtful accounts when identified. |
Inventories | Inventories Inventories are recorded at the lower of cost (using the first-in, first-out ("FIFO") method) or market. Cost is derived using actual cost on a FIFO basis. Our inventories include material, labor, and manufacturing overhead costs. We evaluate our ending inventories for estimated excess quantities and obsolescence. This evaluation includes analysis of usage rate and projected future demand. Inventories in excess of estimated future demand are written down and charged to cost of revenue. In addition, we assess the impact of changing technology to our inventories and we write down inventories that are considered obsolete. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost, less accumulated depreciation and amortization. Land is not depreciated. Depreciation is calculated using the straight-line method over the following estimated useful lives: Asset Classification Estimated Useful Life Buildings 39 years Computer equipment and software 3 years Vehicles, machinery and equipment 5 years Leasehold improvements Lesser of the useful life of the asset, generally 5 years, or remaining lease term |
Business Combinations | Business Combinations We include the results of operations of the businesses that we acquire as of the respective dates of acquisition. We allocate the fair value of the purchase price of our acquisitions to the assets acquired and liabilities assumed based on their estimated fair values. The excess of the fair value of the purchase price over the fair values of these identifiable assets and liabilities is recorded as goodwill. |
Intangible Assets and Impairment of Long-Lived Assets | Intangible Assets and Impairment of Long-Lived Assets Intangible assets consist of customer relationships, trade names, acquired technology, developed software, in-process research and development and patents. Intangible assets are recorded at fair values at the date of the acquisition and, for those assets having finite useful lives, are amortized using the straight-line method over their estimated useful lives, which generally range from three to ten years . In-process research and development is recorded as an indefinite-lived asset until the underlying project is completed, at which time the intangible asset is amortized over the estimated useful life. We periodically review our intangible and other long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Determination of recoverability is based on the lowest level of identifiable estimated undiscounted cash flows resulting from use of the asset and its eventual disposition. If not recoverable, an impairment loss would be calculated based on the excess of the carrying amount over the fair value. |
Goodwill | Goodwill Goodwill represents the excess of the purchase price over the fair value of assets acquired and liabilities assumed. We test goodwill for impairment at least annually or more frequently if events or changes in circumstances indicate that this asset may be impaired. We have elected to first assess the qualitative factors to determine whether it is more likely than not that the fair value of our single reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the two-step goodwill impairment test. If we determine that it is more likely than not that its fair value is less than its carrying amount, then the two-step goodwill impairment test will be performed. The first step, identifying a potential impairment, compares the fair value of the reporting unit with its carrying amount. If the carrying amount exceeds its fair value, the second step will be performed; otherwise, no further step is required. The second step, measuring the impairment loss, compares the implied fair value of the goodwill with the carrying amount of the goodwill. Any excess of the goodwill carrying amount over the applied fair value is recognized as an impairment loss, and the carrying value of goodwill is written down to fair value. |
Revenue Recognition | Revenue Recognition We typically provide access to our solutions through appliances and related subscription agreements, whereby the customer is charged an upfront fee for the appliance and is required to purchase a related subscription agreement. The subscription agreements are subject to customer renewal at the end of each subscription period. Our appliances contain hardware and embedded proprietary software. The subscriptions, referred to as Barracuda Energize Updates, provide hourly spam, anti-malware and security updates, and are required to be purchased to access our solutions. The subscriptions also entitle customers to phone support and software updates on a when and if available basis. We have determined that the elements of our customer arrangements, where an appliance and subscription are purchased, do not qualify for treatment as a separate unit of accounting. Accordingly, all fees received under these customer agreements are accounted for as a single unit of accounting, and, except for any upfront fees for the appliance, such fees are recognized ratably on a daily basis over the term of the subscription agreement. Subscription revenue also includes revenue from fixed term licenses of our managed service provider solutions, virtual appliance software, support and maintenance. Subscription revenue is recognized ratably over the term of the license. Recognition of revenue commences when there is persuasive evidence of an arrangement, the fee is fixed and determinable, collectability is deemed reasonably assured and the services have commenced. We receive an upfront fee from customers for delivery and transfer of title for their appliance. No further fees related to the appliance are required to be paid by the customer in subsequent periods. Because the appliance does not have value to the customer on a stand-alone basis and requires a subscription agreement to access our solutions, the delivery of the appliance does not represent the culmination of a separate earnings process associated with the payment of the upfront fee. Accordingly, the amount of the upfront fee is recorded as deferred revenue upon invoicing and the amount is recognized as revenue ratably on a daily basis over the estimated average customer relationship period of three years. Customers have a 30 -day right to return, after which time the arrangement is non-cancelable. We make estimates and maintain a reserve for expected customer cancellations. These estimates involve inherent uncertainties and management judgment. |
Cost of Revenue | Cost of Revenue Cost of revenue consists of costs related to our appliance and subscription revenue. Such costs include hardware, manufacturing, shipping and logistics, customer support, warranty, personnel costs, data center costs and amortization of intangible assets related to acquired technology. We jointly manage the cost of providing appliances and subscription services and, accordingly, we present aggregate cost of revenue. |
Deferred Revenue | Deferred Revenue Deferred revenue represents amounts billed to customers or payments received from customers for which revenue has not yet been recognized. Deferred revenue that is expected to be recognized as revenue within one year is recorded as current deferred revenue and the remaining portion is recorded as non-current deferred revenue. |
Warranty and Instant Replacement Service | Warranty and Instant Replacement Service We provide a standard one-year warranty on our appliances. We also offer separately priced extended warranty contracts on our appliances, which entitle customers to expedited replacement hardware, with next business day shipping, on our appliances. Such separately-priced extended warranty contracts are available to customers coterminous with the standard one-year warranty. Revenue from extended warranty contracts is recognized ratably over the contractual term. Costs associated with our standard warranty and extended warranty contracts are expensed as incurred. Total warranty costs, including costs incurred under our instant replacement extended warranty contracts and costs to support our standard one-year appliance warranty, in fiscal 2016 , 2015 and 2014 were $4.4 million , $4.6 million and $5.2 million , respectively. |
Deferred Appliance Costs | Deferred Appliance Costs We receive an upfront fee from our customers related to the sale of our appliance. We defer the costs of the appliance, including shipping costs, as they are directly related to the revenues that we derive from the sale of the appliance. Such deferred costs are amortized ratably over the estimated average customer relationship period of three years . Amortization of deferred appliance costs is included in cost of revenue in the consolidated statements of operations. |
Deferred Commissions | Deferred Commissions We capitalize commission costs that are incremental and directly related to the acquisition of customer contracts. Sales commissions are deferred when earned and amortized over the same period that revenues are recognized. Commission payments are paid in full after the customer has paid. Amortization of deferred commission costs is included in sales and marketing expense in the consolidated statements of operations. |
Income Taxes | Income Taxes We account for income taxes using the liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the financial statements or in our tax returns. Deferred taxes are determined based on the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. Changes in deferred tax assets and liabilities are recorded in the provision for income taxes. We assess the likelihood that our deferred tax assets will be recovered from future taxable income and, to the extent we believe, based upon the weight of available evidence, that it is more likely than not that all or a portion of deferred tax assets will not be realized, a valuation allowance is established through a charge to income tax expense. Potential for recovery of deferred tax assets is evaluated by estimating the future taxable profits expected from each subsidiary and considering prudent and feasible tax planning strategies. We account for uncertainty in income taxes recognized in our financial statements by applying a two-step process to determine the amount of tax benefit to be recognized. First, the tax position must be evaluated to determine the likelihood that it will be sustained upon examination by the taxing authorities, based on the technical merits of the position. If the tax position is deemed more-likely-than-not to be sustained, the tax position is then assessed to determine the amount of benefit to recognize in the financial statements. The amount of the benefit that may be recognized is the largest amount that has a greater than 50% likelihood of being realized upon ultimate settlement. The provision for income taxes includes the effects of any resulting tax reserves, or unrecognized tax benefits, that are considered appropriate as well as the related net interest and penalties. |
Software Development Costs | Software Development Costs Software development costs incurred prior to the establishment of technological feasibility are charged to research and development expense as incurred. Technological feasibility is established upon completion of a working model, which is typically demonstrated by initial beta shipment. Software development costs incurred subsequent to the time a product’s technological feasibility has been established through the time the product is available for general release to customers are capitalized if material. No software development costs have been capitalized in the periods presented. |
Advertising Costs | Advertising Costs We expense advertising costs as incurred. |
Stock-Based Compensation | Stock-Based Compensation We record stock-based compensation awards based on fair value as of the grant date. We use the Black-Scholes-Merton option-pricing model to estimate the fair value of our stock options and our employee stock purchase plan ("ESPP") shares. The fair value of restricted stock units is based on the fair value of our common stock, which is the closing market price of our common stock on the grant date. Given our limited history with employee grants, we use the "simplified" method in estimating the expected term for stock option awards. The "simplified" method, as permitted by the SEC, is calculated as the average of the contractual term and the average vesting period. Estimated volatility is based upon the historical volatility of similar entities whose share prices are publicly available, as we did not have sufficient trading history for our common stock. The risk-free interest rate is based on the yield curve of a zero-coupon U.S. Treasury bond on the date the stock option award is granted, with a maturity equal to the expected term of the stock option award. The expected dividend assumption is based on our current expectations about our anticipated dividend policy. We amortize the fair value of an award expected to vest on a straight-line basis over the requisite service period of the award, which is generally the period from the grant date to the end of the vesting period. For awards with service only conditions and a graded vesting schedule, we elected to recognize costs on a straight-line basis. We use historical data to estimate the number of future forfeitures. |
Foreign Currency | Foreign Currency For those subsidiaries whose functional currency is not the U.S. dollar, assets and liabilities are translated into U.S. dollar equivalents at the exchange rate in effect on the balance sheet date and revenues and expenses are translated into U.S. dollars using the average exchange rate over the period. Resulting currency translation adjustments are recorded in accumulated other comprehensive income (loss) in the consolidated balance sheets. We record net gains (losses) resulting from foreign exchange transactions in other income (expense), net in the consolidated statements of operations. For fiscal 2016 , net gains (losses) were not significant. For fiscal 2015 and 2014 , we recorded net gains (losses) of $(3.6) million and $0.1 million , respectively, We have foreign subsidiaries that operate and sell our products in various markets around the world. As a result, we are exposed to foreign exchange risks. We utilize foreign exchange forward contracts to manage foreign currency risk associated with foreign currency denominated monetary assets and liabilities, primarily trade receivables, and to reduce the volatility of earnings and cash flows related to foreign currency transactions. The fair value of our contracts as of February 29, 2016 is not significant. The change in the fair value of these foreign currency forward contracts is recorded as gain (loss) in other income (expense), net in the consolidated statements of operations. |
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Income (Loss) The accumulated other comprehensive income (loss) balance consists of unrealized gains and losses on available-for-sale securities and translation gains and losses related to our international subsidiaries with functional currencies other than the U.S. dollar, primarily the Euro. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In March 2016, the Financial Accounting Standards Board (the "FASB") issued an accounting standard to simplify employee shared-based payment accounting. The standard update is effective for fiscal years beginning after December 15, 2016 and interim periods within those fiscal years, and early adoption is permitted in any interim or annual period. If early adopted in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. Early adoption requires the adoption of all the amendments in the same period. Amendments related to the timing of when excess tax benefits are recognized, minimum statutory withholding requirements, forfeitures, and intrinsic value should be applied using a modified retrospective transition method by means of a cumulative-effect adjustment to equity as of the beginning of the period in which the guidance is adopted. Amendments related to the presentation of employee taxes paid on the statement of cash flows when an employer withholds shares to meet the minimum statutory withholding requirement should be applied retrospectively. Amendments requiring recognition of excess tax benefits and tax deficiencies in the income statement and the practical expedient for estimating expected term should be applied prospectively. An entity may elect to apply the amendments related to the presentation of excess tax benefits on the statement of cash flows using either a prospective transition method or a retrospective transition method. We are currently evaluating the impact of adopting this update on our consolidated financial statements. In March 2016, the FASB issued an accounting standard to eliminate the requirement to retroactively adopt the equity method of accounting for an investment that qualifies for use of the equity method as a result of an increase in the level of ownership interest or degree of influence. The standard update requires that the equity method investor add the cost of acquiring the additional interest in the investee to the current basis of the investor’s previously held interest and adopt the equity method of accounting as of the date the investment becomes qualified for equity method accounting. For an available-for-sale equity security that becomes qualified for the equity method of accounting, an entity is required to recognize through earnings the unrealized holding gain or loss in accumulated other comprehensive income (loss) at the date the investment becomes qualified for use of the equity method. The standard update is effective for fiscal years beginning after December 15, 2016 and interim periods within those years, and early adoption is permitted. The standard is to be applied prospectively upon their effective date to increases in the level of ownership interest or degree of influence that result in the adoption of the equity method. We do not expect the adoption of this update to have a material impact on our consolidated financial statements. In February 2016, the FASB issued an accounting standard to amend lease accounting requirements and requires entities to generally recognize on the balance sheet operating and financing lease liabilities and corresponding right-of-use assets. The new standard will require significant additional disclosures about the amount, timing and uncertainty of cash flows from leases. The standard update is effective for fiscal years beginning after December 15, 2018 and interim periods within those years, and early adoption is permitted. The standard is to be applied using a modified retrospective approach and includes a number of optional practical expedients that entities may elect to apply. We are currently evaluating the impact of adopting this update on our consolidated financial statements and expect that most of our operating lease commitments will be subject to the standard update and recognized as operating lease liabilities and right-of-use assets upon the adoption. In January 2016, the FASB issued an accounting standard to enhance the reporting model for financial instruments by amending certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. The standard update is effective for fiscal years beginning after December 15, 2017 and interim periods within those years. Early application to financial statements of fiscal years or interim periods that have not yet been issued is permitted by presenting separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk if we elected to measure the liability at fair value in accordance with the fair value option for financial instruments, otherwise, early adoption is not permitted. The standard is to be applied with a cumulative-effect adjustment to the balance sheet as of the beginning of the fiscal year of adoption. The amendments related to equity securities without readily determinable fair values (including disclosure requirements) should be applied prospectively to equity investments that exist as of the date of adoption. We are currently evaluating the impact of adopting this update on our consolidated financial statements. In November 2015, the FASB issued an accounting standard to simplify the presentation of deferred income taxes by requiring that deferred tax assets and liabilities, along with any related valuation allowance, be classified as non-current in a classified statement of financial position, which would be a change from our historical presentation whereby certain of our deferred tax assets and liabilities were classified as current and the remainder were classified as non-current. The standard update is effective for fiscal years beginning after December 15, 2016 and interim periods within those years, and early adoption is permitted. We early adopted the standard in fiscal 2016 on a prospective basis and have presented both deferred tax assets and liabilities as non-current in our consolidated balance sheet as of February 29, 2016 . Prior balance sheets have not been retrospectively adjusted. The adoption did not have an impact on our results of operations or cash flows as it related to balance sheet presentation only. In September 2015, the FASB issued an accounting standard to simplify the accounting for measurement period adjustments in connection with business combinations by requiring that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The standard update is effective for fiscal years beginning after December 15, 2015 and interim periods within those fiscal years. The standard update is to be applied prospectively to adjustments of provisional amounts that occur after the effective date with earlier application permitted for financial statements that have not been issued. We do not expect the adoption of this update to have an impact on our consolidated financial statements. In July 2015, the FASB issued an accounting standard to simplify the measurement of inventory by changing the subsequent measurement guidance from the lower of cost or market to the lower of cost and net realizable value for inventory. The standard update is effective for fiscal years beginning after December 15, 2016 and interim periods within those years, and early adoption is permitted. The standard is to be applied prospectively. We do not expect the adoption of this update to have an impact on our consolidated financial statements. In April 2015, the FASB issued an accounting standard providing guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, then the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. The new guidance does not change the accounting for a customer’s accounting for service contracts. The standard update is effective for fiscal years beginning after December 15, 2015 and interim periods within those years and early adoption is permitted. The standard allows for adoption retrospectively or prospectively to all arrangements entered into or materially modified after the effective date. We do not expect the adoption of this update to have an impact on our consolidated financial statements. In February 2015, the FASB issued an accounting standard to improve consolidation guidance for legal entities and affect the consolidation evaluation for reporting organizations. The standard update is effective for fiscal years beginning after December 15, 2015 and interim periods within those years and early adoption is permitted. The standard allows for adoption retrospectively or with a modified retrospective approach by recording a cumulative-effect adjustment to equity as of the beginning of the fiscal year of adoption. We do not expect the adoption of this update to have an impact on our consolidated financial statements. In May 2014, the FASB issued an accounting standard which completes the joint effort by the FASB and the International Accounting Standards Board to clarify the principles for recognizing revenue and improving financial reporting by creating common revenue recognition guidance for GAAP and International Financial Reporting Standards. The core principle of this update is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The original effective date would have required us to adopt this update in the first quarter of fiscal 2018. However, in August 2015, the FASB amended the standard to provide a one-year deferral of the effective date, as well as providing the option to early adopt the standard on the original effective date. Accordingly, we may adopt the standard in either the first quarter of fiscal 2018 or the first quarter of fiscal 2019. The standard allows for full retrospective adoption applied to all periods presented or retrospective adoption with the cumulative effect of initially applying this update recognized at the date of initial application. We are currently evaluating the timing and the impact of adopting this update on our consolidated financial statements. |
Fair Value Measurements | Fair Value Measurements We determine fair value based on the fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value assumes that the transaction to sell the asset or transfer the liability occurs in the principal or most advantageous market for the asset or liability and establishes that the fair value of an asset or liability shall be determined based on the assumptions that market participants would use in pricing the asset or liability. The classification of a financial asset or liability within the hierarchy is based upon the lowest level input that is significant to the fair value measurement. The fair value hierarchy prioritizes the inputs into three levels that may be used to measure fair value: Level 1: Inputs are unadjusted quoted prices in active markets for identical assets or liabilities. Level 2: Inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument. Level 3: Inputs are unobservable inputs based on our assumptions. Cash equivalents and marketable equity securities are classified within Level 1 because they are valued using quoted market prices or alternative pricing sources and models utilizing market observable inputs. Marketable debt securities and derivative assets are classified within Level 2 if the investments are valued using model driven valuations which use observable inputs such as quoted market prices, benchmark yields, reported trades, broker/dealer quotes or alternative pricing sources with reasonable levels of price transparency. Our marketable securities are held by custodians who obtain investment prices from a third-party pricing provider that incorporates standard inputs in various asset price models. We estimated the fair value of our Level 3 contingent consideration liabilities based on a weighted probability assessment of achieving the milestones related to certain of our acquisitions. Significant increases (decreases) in the probability assumptions in isolation would result in a significantly higher (lower) fair value measurement. In developing these estimates, we considered unobservable inputs that are supported by little or no market activity and reflect our own assumptions. |
Other Investments | Other Investments As of February 29, 2016 and February 28, 2015 , we held approximately $1.6 million and $1.3 million , respectively, or approximately 24% ownership interest, in stock of a privately-held company that was accounted for under the equity method. We recognize our proportional share of earnings and losses of the investee in other income (expense), net in the statements of operations and adjust the carrying amount of our investment accordingly. For fiscal 2016 , our proportionate share of the investee’s losses was $0.4 million . For fiscal 2015 and 2014 , our proportionate share of the investee’s earnings and losses was not material. As of February 29, 2016 and February 28, 2015 , we held approximately $1.6 million and $0.6 million , respectively, in stock of a privately-held company, which was accounted for under the cost method. Other investments are classified in other non-current assets in the consolidated balance sheets and are reviewed periodically for impairment. |
Segment Information | Segment Information Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. Our chief operating decision maker is our chief executive officer. Our chief executive officer reviews financial information presented on a consolidated basis, accompanied by information about sales by geographic region, for purposes of allocating resources and evaluating financial performance. We have one business activity and there are no segment managers who are held accountable for operations, operating results and plans for levels or components below the consolidated level. Accordingly, we have determined that we have a single reportable segment and operating unit structure. |
Net Loss Per Share | Net Loss Per Share Basic and diluted net income (loss) per share attributable to common stockholders was presented in conformity with the two-class method required for participating securities. Prior to the date of our IPO, we considered our Series A and Series B redeemable convertible preferred stock as participating securities. In the event a dividend was declared or paid on our common stock, holders of Series A and Series B redeemable convertible preferred stock were entitled to a proportionate share of such dividend in proportion to the holders of common stock on an as-if converted basis. Immediately after the completion of our IPO in November 2013, all outstanding shares of redeemable convertible preferred stock were converted into common stock. Through the date of our IPO, we utilized the two-class method to compute net income (loss) per share. Under the two-class method, basic net income (loss) per share attributable to common stockholders was computed by dividing the net income (loss) attributable to common stockholders by the weighted-average number of common shares outstanding during the period. Net income (loss) attributable to common stockholders was determined by allocating undistributed earnings between common and redeemable convertible preferred stockholders. Diluted net income (loss) per share attributable to common stockholders was computed by using the weighted-average number of shares of common stock outstanding, including potential dilutive common shares assuming the dilutive effect of outstanding stock options and RSUs using the treasury stock method. For periods in which there was a net loss, the number of shares used in the computation of diluted net loss per share was the same as that used for the computation of basic net loss per share, as the inclusion of dilutive common shares would be anti-dilutive. Under the two-class method, the net income (loss) attributable to common stockholders was not allocated to the convertible redeemable preferred stock as the convertible redeemable preferred stock did not have a contractual obligation to share in our losses. |
Organization and Summary of S25
Organization and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Feb. 29, 2016 | |
Accounting Policies [Abstract] | |
Schedule of Useful Lives of Assets | Depreciation is calculated using the straight-line method over the following estimated useful lives: Asset Classification Estimated Useful Life Buildings 39 years Computer equipment and software 3 years Vehicles, machinery and equipment 5 years Leasehold improvements Lesser of the useful life of the asset, generally 5 years, or remaining lease term |
Balance Sheet Information and26
Balance Sheet Information and Fair Value (Tables) | 12 Months Ended |
Feb. 29, 2016 | |
Balance Sheet Information and Fair Value [Abstract] | |
Cash and Cash Equivalents | The following table summarizes our cash and cash equivalents by category (in thousands): As of February 28/29, 2016 2015 Cash and cash equivalents: Cash $ 60,252 $ 97,187 Money market funds 58,402 54,186 $ 118,654 $ 151,373 |
Marketable Securities | The following table summarizes our marketable securities by category (in thousands): As of February 29, 2016 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Asset-backed securities $ 4,717 $ 9 $ (3 ) $ 4,723 Corporate debt securities 19,135 11 (22 ) 19,124 Equity securities 3,095 380 — 3,475 Foreign government bonds 205 — — 205 Mortgage-backed securities 2,341 — (13 ) 2,328 U.S. government agency securities 2,242 6 (14 ) 2,234 U.S. government notes 4,279 26 — 4,305 $ 36,014 $ 432 $ (52 ) $ 36,394 As of February 28, 2015 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Asset-backed securities $ 4,846 $ 3 $ (4 ) $ 4,845 Corporate debt securities 21,241 17 (13 ) 21,245 Equity securities 1,211 37 (32 ) 1,216 Foreign government bonds 201 — — 201 Mortgage-backed securities 2,716 4 (10 ) 2,710 U.S. government agency securities 7,310 8 (24 ) 7,294 U.S. government notes 3,242 1 — 3,243 $ 40,767 $ 70 $ (83 ) $ 40,754 |
Summary of Securities with Gross Unrealized Loss Positions and Fair Values | The following table presents gross unrealized losses and fair values for those marketable securities that were in an unrealized loss position aggregated by investment category and the length of time that individual securities have been in a continuous loss position (in thousands): As of February 29, 2016 Less Than 12 Months 12 Months or Greater Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Asset-backed securities $ 1,788 $ (3 ) $ — $ — $ 1,788 $ (3 ) Corporate debt securities 12,088 (22 ) — — 12,088 (22 ) Mortgage-backed securities 1,746 (8 ) 385 (5 ) 2,131 (13 ) U.S. government agency securities 887 (10 ) 622 (4 ) 1,509 (14 ) $ 16,509 $ (43 ) $ 1,007 $ (9 ) $ 17,516 $ (52 ) As of February 28, 2015 Less Than 12 Months 12 Months or Greater Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Asset-backed securities $ 2,385 $ (4 ) $ — $ — $ 2,385 $ (4 ) Corporate debt securities 11,346 (13 ) — — 11,346 (13 ) Equity securities 978 (32 ) — — 978 (32 ) Mortgage-backed securities 1,923 (10 ) — — 1,923 (10 ) U.S. government agency securities 4,331 (24 ) — — 4,331 (24 ) $ 20,963 $ (83 ) $ — $ — $ 20,963 $ (83 ) |
Schedule of Marketable Debt Securities | The following table classifies our marketable debt securities by contractual maturities (in thousands): As of February 29, 2016 Due in 1 year $ 12,409 Due in 1 year through 5 years 16,018 Due in 5 years through 10 years 559 Due after 10 years 3,933 $ 32,919 |
Summary of Assets or Liabilities Measured at Fair Value | Financial assets measured at fair value on a recurring basis are summarized below (in thousands): As of February 29, 2016 Level 1 Level 2 Level 3 Total Cash equivalents: Money market funds $ 58,402 $ — $ — $ 58,402 Marketable securities: Asset-backed securities $ — $ 4,723 $ — $ 4,723 Corporate debt securities $ — $ 19,124 $ — $ 19,124 Equity securities $ 3,475 $ — $ — $ 3,475 Foreign government bonds $ — $ 205 $ — $ 205 Mortgage-backed securities $ — $ 2,328 $ — $ 2,328 U.S. government agency securities $ — $ 2,234 $ — $ 2,234 U.S. government notes $ — $ 4,305 $ — $ 4,305 Other accrued liabilities (current): Contingent consideration liability $ — $ — $ 1,160 $ 1,160 Other long-term liabilities: Contingent consideration liability $ — $ — $ 161 $ 161 As of February 28, 2015 Level 1 Level 2 Level 3 Total Cash equivalents: Money market funds $ 54,186 $ — $ — $ 54,186 Marketable securities: Asset-backed securities $ — $ 4,845 $ — $ 4,845 Corporate debt securities $ — $ 21,245 $ — $ 21,245 Equity securities $ 1,216 $ — $ — $ 1,216 Foreign government bonds $ — $ 201 $ — $ 201 Mortgage-backed securities $ — $ 2,710 $ — $ 2,710 U.S. government agency securities $ — $ 7,294 $ — $ 7,294 U.S. government notes $ — $ 3,243 $ — $ 3,243 Derivative assets not designated (current): Foreign exchange contracts $ — $ 31 $ — $ 31 Other accrued liabilities (current): Contingent consideration liability $ — $ — $ 1,150 $ 1,150 Other long-term liabilities: Contingent consideration liability $ — $ — $ 1,878 $ 1,878 |
Summary of Change in Fair Value of Level 3 Contingent Consideration Liability | The following table summarizes the change in fair value of our Level 3 contingent consideration amounts (in thousands): Balance as of February 28, 2015 $ 3,028 Acquisition addition 334 Total remeasurement recognized in earnings (1,867 ) Settlements (174 ) Balance as of February 29, 2016 $ 1,321 |
Inventories, Net | Inventories, net consisted of the following (in thousands): As of February 28/29, 2016 2015 Raw materials $ 2,459 $ 2,455 Finished goods 3,659 2,729 Reserves (470 ) (730 ) $ 5,648 $ 4,454 |
Deferred Costs | Deferred costs consisted of the following (in thousands): As of 2016 2015 Appliance $ 41,548 $ 41,052 Commissions 17,414 16,884 $ 58,962 $ 57,936 |
Property and Equipment, Net | Property and equipment, net consisted of the following (in thousands): As of 2016 2015 Land $ 9,578 $ 9,354 Building 6,549 6,549 Computer hardware and software 26,450 17,860 Vehicles, machinery and equipment 4,711 3,546 Leasehold improvements 4,401 2,965 51,689 40,274 Accumulated depreciation and amortization (19,779 ) (12,435 ) $ 31,910 $ 27,839 |
Components of Accumulated Other Comprehensive Loss, Net of Tax | The components of accumulated other comprehensive income (loss), net of tax, were as follows (in thousands): Foreign Currency Translation Adjustments Unrealized Gain (Loss) on Available-for- Sale Investments Total Balance as of February 28, 2015 $ (4,225 ) $ (8 ) $ (4,233 ) Other comprehensive income (loss) before reclassifications (669 ) 403 (266 ) Amounts reclassified from accumulated other comprehensive income (loss) — (10 ) (10 ) Other comprehensive income (loss) (669 ) 393 (276 ) Balance as of February 29, 2016 $ (4,894 ) $ 385 $ (4,509 ) |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Feb. 29, 2016 | |
Business Combinations [Abstract] | |
Schedule of Fair Values of Assets Acquired and Liabilities Assumed | The following table reflects the fair values of assets acquired and liabilities assumed subsequent to the measurement period adjustments (in thousands): Cash $ 2,327 Accounts receivable 376 Other current assets 654 Property and equipment 4,203 Other non-current assets 750 Developed technology 21,500 Customer relationships 11,870 Trade name 300 Goodwill 29,718 Accounts payable (685 ) Accrued expenses (1,149 ) Deferred revenue (current) (649 ) Deferred tax liabilities (3,930 ) Total value of assets acquired and liabilities assumed $ 65,285 |
Schedule of Pro Forma Revenue and Net Loss | The following unaudited pro forma information presents the combined results of operations of Barracuda and Intronis as if the acquisition had been completed on March 1, 2014, the beginning of the comparable prior annual reporting period. The unaudited pro forma information includes (i) amortization associated with estimates for the acquired intangible assets; and (ii) the associated tax impact on these unaudited pro forma adjustments and certain changes in judgment of valuation allowance as a combined business. The unaudited pro forma information does not reflect any cost saving synergies from operating efficiencies or the effect of the incremental costs incurred in integrating the two companies. Accordingly, this unaudited pro forma information is presented for informational purposes only and is not necessarily indicative of what the actual results of operations of the combined company would have been if the acquisition had occurred at the beginning of the period presented, nor are they indicative of future results of operations. Year Ended February 28/29, 2016 2015 (in thousands) Pro forma revenue $ 333,963 $ 295,738 Pro forma net loss attributable to Barracuda Networks, Inc. $ (12,727 ) $ (67,665 ) |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Feb. 29, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill are summarized as follows (in thousands): Balance as of February 28, 2015 $ 39,742 Goodwill acquired 30,054 Effect of foreign exchange rates (201 ) Balance as of February 29, 2016 $ 69,595 |
Schedule of Intangible Assets Subject to Amortization | Intangible assets subject to amortization are summarized as follows (in thousands): As of February 29, 2016 Gross Carrying Amount Accumulated Amortization Net Carrying Value Acquired developed technology $ 50,082 $ (25,643 ) $ 24,439 Software license 400 (400 ) — Customer relationships 19,809 (7,313 ) 12,496 Patents 2,999 (1,295 ) 1,704 Trade name 812 (259 ) 553 Acquired developed software 200 (200 ) — $ 74,302 $ (35,110 ) $ 39,192 As of February 28, 2015 Gross Carrying Amount Accumulated Amortization Net Carrying Value Acquired developed technology $ 28,799 $ (22,987 ) $ 5,812 Software license 400 (400 ) — Customer relationships 8,233 (6,032 ) 2,201 Patents 1,625 (1,058 ) 567 Trade name 513 (172 ) 341 Acquired developed software 200 (200 ) — $ 39,770 $ (30,849 ) $ 8,921 |
Stockholders' Deficit (Tables)
Stockholders' Deficit (Tables) | 12 Months Ended |
Feb. 29, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary of Weighted-Average Input Assumptions Used to Estimate Fair Value of Employee Stock Purchase Plan Grants | The following weighted-average input assumptions were used to estimate the fair value of ESPP grants: Year Ended February 29, 2016 Expected volatility 42 % Expected term (in years) 0.50 Risk-free interest rate 0.27 % Dividend yield — Estimated fair value of stock options granted during the year $ 5.37 |
Schedule of Shares Authorized and Available for Grant | The following table presents shares authorized and available for grant: Shares Available for Grant Balance at February 28, 2015 5,768,991 Authorized 2,379,645 Granted (2,465,037 ) Canceled/forfeited 677,078 Balance at February 29, 2016 6,360,677 |
Summary of Weighted-Average Input Assumptions Used to Estimate Fair Value of Employee Stock Option Grants | The following weighted-average input assumptions were used to estimate the fair value of employee stock option grants: Year Ended February 28/29, 2016 2015 2014 Expected volatility 43 % 45 % 46 % Expected term (in years) 6.25 6.25 6.25 Risk-free interest rate 1.80 % 1.87 % 1.67 % Dividend yield — — — Estimated fair value of stock options granted during the year $ 13.80 $ 13.98 $ 9.48 |
Summary of Stock Option Activity | The following table summarizes stock option activity under our plans: Options Outstanding Shares Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term Aggregate Intrinsic Value (in years) (in thousands) Balance at February 28, 2015 4,051,904 $ 17.98 Granted 757,285 $ 31.21 Exercised (382,529 ) $ 12.67 Canceled/forfeited (218,459 ) $ 26.16 Balance at February 29, 2016 4,208,201 $ 20.42 As of February 29, 2016: Vested and exercisable 2,478,287 $ 16.34 6.20 $ 1,456,297 Vested and expected to vest 4,063,692 $ 20.02 7.03 $ 1,565,624 |
Summary of Restricted Stock Units Activity | The following table summarizes RSU activity under our plan: Unvested Restricted Stock Units Number of Shares Weighted- Average Grant Date Fair Value Unvested at February 28, 2015 1,576,332 $ 23.16 Granted 1,707,752 $ 25.75 Vested (637,157 ) $ 19.60 Canceled/forfeited (196,108 ) $ 29.53 Unvested at February 29, 2016 2,450,819 $ 25.38 Expected to vest after February 29, 2016 2,167,186 $ 25.40 |
Schedule of Total Stock-Based Compensation Expense | Total stock-based compensation expense has been classified as follows in the consolidated statements of operations (in thousands): Year Ended February 28//29, 2016 2015 2014 Cost of revenue $ 1,062 $ 389 $ 201 Research and development 8,247 4,410 2,374 Sales and marketing 6,566 3,811 2,067 General and administrative 12,971 8,448 6,195 $ 28,846 $ 17,058 $ 10,837 |
Summary of Common Stock Repurchases | The following table summarizes our common stock repurchases for fiscal 2016 (in thousands, except per share data): Fiscal 2016 Total number of shares repurchased 1,503 Dollar amount of shares repurchased $ 19,216 Average price paid per share $ 12.79 Remaining amount authorized as of February 29, 2016 $ 30,784 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Feb. 29, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income (Loss) Before Income Taxes and Non-Controlling Interest | Income (loss) before income taxes and non-controlling interest consists of the following (in thousands): Year Ended February 28/29, 2016 2015 2014 United States $ (7,792 ) $ (7,326 ) $ (6,165 ) Foreign 643 2,730 (4,787 ) $ (7,149 ) $ (4,596 ) $ (10,952 ) |
Schedule of Provision for (Benefit from) Income Taxes | The provision for (benefit from) income taxes consists of the following (in thousands): Year Ended February 28/29, 2016 2015 2014 Current: Federal $ 2,519 $ 2,479 $ 4,760 State 839 299 574 Foreign 507 863 734 3,865 3,641 6,068 Deferred: Federal (2,707 ) 51,820 (10,231 ) State (850 ) 4,674 (1,109 ) Foreign (3,035 ) 2,767 (1,293 ) (6,592 ) 59,261 (12,633 ) $ (2,727 ) $ 62,902 $ (6,565 ) |
Components of Deferred Tax Assets (Liabilities) | Deferred tax assets (liabilities) comprise the following (in thousands): As of February 28/29, 2016 2015 Deferred tax assets: Deferred revenue $ 63,357 $ 58,886 Stock-based compensation 6,983 3,344 Reserves and other 4,606 4,294 Research and development credits 6,484 4,935 Net operating losses 12,705 5,431 Total deferred tax assets 94,135 76,890 Valuation allowance (73,399 ) (74,357 ) Total deferred tax assets, net of valuation allowance 20,736 2,533 Deferred tax liabilities: Depreciation and amortization (14,954 ) (3,622 ) Prepaid expense and other (1,151 ) (717 ) Deferred sales commission (4,117 ) — Other deferred tax liabilities — (231 ) Total deferred tax liabilities (20,222 ) (4,570 ) Net deferred tax assets (liabilities) $ 514 $ (2,037 ) |
Reconciliation of Statutory Federal Income Tax Rate to Effective Tax Rate | The following is a reconciliation of the statutory federal income tax rate to our effective tax rate (in thousands): Year Ended February 28/29, 2016 2015 2014 Tax benefit at federal statutory rate $ (2,502 ) $ (1,608 ) $ (3,833 ) State taxes, net of federal benefit (363 ) 4,845 (713 ) Non-deductible expenses 368 823 736 Stock-based compensation 2,134 520 1,227 Legal entity rationalization — — (3,541 ) Transaction costs 732 (1,454 ) — Change in valuation allowance 1,674 58,685 346 Foreign rate differential (2,752 ) 2,730 790 Research and development credits (2,482 ) (1,792 ) (933 ) Domestic production activities deduction (63 ) — (445 ) Litigation settlements 584 — — Other (57 ) 153 (199 ) $ (2,727 ) $ 62,902 $ (6,565 ) |
Summary of Gross Unrecognized Tax Benefits | The following table summarizes the activity related to our gross unrecognized tax benefits (in thousands): Year Ended February 28/29, 2016 2015 2014 Balance at beginning of year $ 5,322 $ 4,980 $ 3,971 Tax positions related to the current year: Increases 1,841 1,050 1,208 Tax positions related to prior years: Increases 231 58 — Decreases (4 ) (53 ) (1 ) Settlements with taxing authorities: Settlements (710 ) — — Releases—statute of limitations expired (292 ) (713 ) (198 ) Balance at the end of the year $ 6,388 $ 5,322 $ 4,980 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Feb. 29, 2016 | |
Segment Reporting [Abstract] | |
Schedule of Revenue by Geographic Region | Revenue by geographic region is presented as follows (in thousands): Year Ended February 28/29, 2016 2015 2014 North America $ 235,275 $ 201,724 $ 169,896 United States 222,210 189,640 159,036 Other 13,065 12,084 10,860 Latin America 4,322 3,345 3,380 Asia-Pacific 18,772 18,158 16,245 EMEA 61,789 54,219 44,266 $ 320,158 $ 277,446 $ 233,787 |
Schedule of Long Lived Assets | Long-lived assets, excluding intercompany receivables, investments in subsidiaries, intangible assets and deferred tax assets, by geographic region are presented as follows (in thousands): As of February 28/29, 2016 2015 United States $ 60,619 $ 54,772 International 5,603 4,905 $ 66,222 $ 59,677 |
Borrowings (Tables)
Borrowings (Tables) | 12 Months Ended |
Feb. 29, 2016 | |
Debt Disclosure [Abstract] | |
Schedule of Future Principal and Interest Payments of Note Payable | Future principal and interest payments for our note payable are as follows (in thousands): Fiscal Years 2017 $ 533 2018 4,220 $ 4,753 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Feb. 29, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Payments under Operating Leases Agreements | Future minimum payments under our operating leases agreements are as follows (in thousands): Fiscal Years Ending February 28/29: 2017 $ 3,178 2018 2,616 2019 1,819 2020 1,243 2021 461 $ 9,317 |
Schedule of Future Minimum Payments for Unrecognized Purchase Commitments | Future minimum payments for these unrecognized purchase commitments are as follows (in thousands): Fiscal Years Ending February 28/29: 2017 $ 21,306 2018 5,889 2019 1,411 $ 28,606 |
Other Income (Expense), Net Oth
Other Income (Expense), Net Other Income (Expense), Net (Tables) | 12 Months Ended |
Feb. 29, 2016 | |
Other Income and Expenses [Abstract] | |
Schedule of the Components of Other Income (Expense), Net | The components of other income (expense), net, are presented as follows (in thousands): Year Ended February 28/29, 2016 2015 2014 Interest and miscellaneous income $ 344 $ 579 $ 788 Interest expense (308 ) (417 ) (604 ) Foreign currency exchange gains (losses), net (14 ) (3,558 ) 86 Other (284 ) (278 ) (219 ) $ (262 ) $ (3,674 ) $ 51 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 12 Months Ended |
Feb. 29, 2016 | |
Earnings Per Share [Abstract] | |
Calculation of Basic and Diluted Net Loss Per Share Attributable to Common Stockholders | The following table presents the calculation of basic and diluted net loss per share attributable to common stockholders under the two-class method (in thousands, except per share amounts): Year Ended February 28/29, 2016 2015 2014 Net loss attributable to Barracuda Networks, Inc. $ (4,422 ) $ (67,498 ) $ (3,626 ) Shares used to compute net loss per share attributable to Barracuda Networks, Inc. common stockholders: Weighted-average shares used to compute net loss per share, basic 53,070 51,898 35,355 Dilutive shares from stock options and RSUs — — — Weighted-average shares used to compute net loss per share, diluted 53,070 51,898 35,355 Net loss per share attributable to Barracuda Networks, Inc. common stockholders: Net loss per share, basic $ (0.08 ) $ (1.30 ) $ (0.10 ) Net loss per share, diluted $ (0.08 ) $ (1.30 ) $ (0.10 ) |
Organization and Summary of S36
Organization and Summary of Significant Accounting Policies - Additional Information (Detail) $ in Millions | 12 Months Ended | ||
Feb. 29, 2016USD ($)Customer | Feb. 28, 2015USD ($)Customer | Feb. 28, 2014USD ($)Customer | |
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Revenue Recognition, Customer Relationship Period | 3 years | ||
Warranty Term | 1 year | ||
Impairment of long-lived assets | $ 1.2 | $ 0 | $ 0 |
Standard product warranty | We provide a standard one-year warranty on our appliances. | ||
Extended product warranty | We also offer separately priced extended warranty contracts on our appliances, which entitle customers to expedited replacement hardware, with next business day shipping, on our appliances. | ||
Product warranty expense | $ 4.4 | 4.6 | 5.2 |
Estimated average customer relationship period | 3 years | ||
Advertising expense | $ 58.2 | 58.7 | 56.7 |
Gains and losses from foreign exchange transactions | $ (3.6) | $ 0.1 | |
Revenue Recognition, Customer Right Of Return Period | 30 days | ||
Minimum | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Amortization periods for identifiable intangible assets | 3 years | ||
Maximum | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Amortization periods for identifiable intangible assets | 10 years | ||
Distribution partner | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Number of customer accounted over 10% of total revenue | Customer | 1 | 1 | 1 |
Distribution partner | Maximum | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Number of customer accounted over 10% of receivable | Customer | 0 | 1 | |
Sales revenue, net | Geographic Concentration Risk | Foreign customers | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Credit risk, percentage | 31.00% | 32.00% | 32.00% |
Sales revenue, net | Geographic Concentration Risk | Distribution partner | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Credit risk, percentage | 22.00% | 20.00% | 18.00% |
Accounts receivable | Credit Concentration Risk | Distribution partner | Maximum | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Credit risk, percentage | 13.00% | ||
Leasehold improvements | |||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||
Useful life of property, plant and equipment, net | 5 years |
Organization and Summary of S37
Organization and Summary of Significant Accounting Policies - Schedule of Useful Lives of Assets (Detail) | 12 Months Ended |
Feb. 29, 2016 | |
Building | |
Property, Plant and Equipment [Line Items] | |
Useful life of property, plant and equipment, net | 39 years |
Computer equipment and software | |
Property, Plant and Equipment [Line Items] | |
Useful life of property, plant and equipment, net | 3 years |
Vehicles, machinery and equipment | |
Property, Plant and Equipment [Line Items] | |
Useful life of property, plant and equipment, net | 5 years |
Leasehold improvements | |
Property, Plant and Equipment [Line Items] | |
Useful life of property, plant and equipment, net | 5 years |
Useful life of leasehold improvements, net | Lesser of the useful life of the asset, generally 5 years, or remaining lease term |
Balance Sheet Information and38
Balance Sheet Information and Fair Value - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 29, 2016 | Feb. 28, 2015 | Feb. 28, 2014 | |
Property, Plant and Equipment [Line Items] | |||
Impairment of long-lived assets | $ 1,200 | $ 0 | $ 0 |
Depreciation, amortization and impairment expense | 13,300 | 8,631 | 9,109 |
Equity method investment in privately-held company | $ 1,600 | $ 1,300 | |
Percentage of ownership interest | 24.00% | 24.00% | |
Proportionate share of investee's losses, equity method | $ 400 | ||
Cost method investment in privately-held company | 1,600 | $ 600 | |
Property and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation, amortization and impairment expense | $ 7,700 | $ 5,200 | $ 3,800 |
Balance Sheet Information and39
Balance Sheet Information and Fair Value - Cash and Cash Equivalents (Detail) - USD ($) $ in Thousands | Feb. 29, 2016 | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
Cash and cash equivalents: | ||||
Cash | $ 60,252 | $ 97,187 | ||
Money market funds | 58,402 | 54,186 | ||
Total cash and cash equivalents | $ 118,654 | $ 151,373 | $ 135,879 | $ 30,095 |
Balance Sheet Information and40
Balance Sheet Information and Fair Value - Marketable Securities (Detail) - USD ($) $ in Thousands | Feb. 29, 2016 | Feb. 28, 2015 |
Schedule of Available-for-sale Securities [Line Items] | ||
Marketable securities, Amortized Cost | $ 36,014 | $ 40,767 |
Marketable securities, Gross Unrealized Gains | 432 | 70 |
Marketable securities, Gross Unrealized Losses | (52) | (83) |
Marketable securities, Fair Value | 36,394 | 40,754 |
Asset-backed securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Marketable securities, Amortized Cost | 4,717 | 4,846 |
Marketable securities, Gross Unrealized Gains | 9 | 3 |
Marketable securities, Gross Unrealized Losses | (3) | (4) |
Marketable securities, Fair Value | 4,723 | 4,845 |
Corporate debt securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Marketable securities, Amortized Cost | 19,135 | 21,241 |
Marketable securities, Gross Unrealized Gains | 11 | 17 |
Marketable securities, Gross Unrealized Losses | (22) | (13) |
Marketable securities, Fair Value | 19,124 | 21,245 |
Equity securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Marketable securities, Amortized Cost | 3,095 | 1,211 |
Marketable securities, Gross Unrealized Gains | 380 | 37 |
Marketable securities, Gross Unrealized Losses | 0 | (32) |
Marketable securities, Fair Value | 3,475 | 1,216 |
Foreign government bonds | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Marketable securities, Amortized Cost | 205 | 201 |
Marketable securities, Fair Value | 205 | 201 |
Mortgage-backed securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Marketable securities, Amortized Cost | 2,341 | 2,716 |
Marketable securities, Gross Unrealized Gains | 0 | 4 |
Marketable securities, Gross Unrealized Losses | (13) | (10) |
Marketable securities, Fair Value | 2,328 | 2,710 |
U.S. government agency securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Marketable securities, Amortized Cost | 2,242 | 7,310 |
Marketable securities, Gross Unrealized Gains | 6 | 8 |
Marketable securities, Gross Unrealized Losses | (14) | (24) |
Marketable securities, Fair Value | 2,234 | 7,294 |
U.S. government notes | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Marketable securities, Amortized Cost | 4,279 | 3,242 |
Marketable securities, Gross Unrealized Gains | 26 | 1 |
Marketable securities, Fair Value | $ 4,305 | $ 3,243 |
Balance Sheet Information and41
Balance Sheet Information and Fair Value - Summary of Securities with Gross Unrealized Loss Positions and Fair Values (Detail) - USD ($) $ in Thousands | Feb. 29, 2016 | Feb. 28, 2015 |
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months, Fair Value | $ 16,509 | $ 20,963 |
Less Than 12 Months, Unrealized Losses | (43) | (83) |
12 Months or Greater, Fair Value | 1,007 | 0 |
12 Months or Greater, Unrealized Losses | (9) | 0 |
Total, Fair Value | 17,516 | 20,963 |
Total, Unrealized Losses | (52) | (83) |
Asset-backed securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months, Fair Value | 1,788 | 2,385 |
Less Than 12 Months, Unrealized Losses | (3) | (4) |
12 Months or Greater, Fair Value | 0 | 0 |
12 Months or Greater, Unrealized Losses | 0 | 0 |
Total, Fair Value | 1,788 | 2,385 |
Total, Unrealized Losses | (3) | (4) |
Corporate debt securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months, Fair Value | 12,088 | 11,346 |
Less Than 12 Months, Unrealized Losses | (22) | (13) |
12 Months or Greater, Fair Value | 0 | 0 |
12 Months or Greater, Unrealized Losses | 0 | 0 |
Total, Fair Value | 12,088 | 11,346 |
Total, Unrealized Losses | (22) | (13) |
Mortgage-backed securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months, Fair Value | 1,746 | 1,923 |
Less Than 12 Months, Unrealized Losses | (8) | (10) |
12 Months or Greater, Fair Value | 385 | 0 |
12 Months or Greater, Unrealized Losses | (5) | 0 |
Total, Fair Value | 2,131 | 1,923 |
Total, Unrealized Losses | (13) | (10) |
U.S. government agency securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months, Fair Value | 887 | 4,331 |
Less Than 12 Months, Unrealized Losses | (10) | (24) |
12 Months or Greater, Fair Value | 622 | 0 |
12 Months or Greater, Unrealized Losses | (4) | 0 |
Total, Fair Value | 1,509 | 4,331 |
Total, Unrealized Losses | $ (14) | (24) |
Equity securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months, Fair Value | 978 | |
Less Than 12 Months, Unrealized Losses | (32) | |
12 Months or Greater, Fair Value | 0 | |
12 Months or Greater, Unrealized Losses | 0 | |
Total, Fair Value | 978 | |
Total, Unrealized Losses | $ (32) |
Balance Sheet Information and42
Balance Sheet Information and Fair Value - Schedule of Marketable Debt Securities (Detail) $ in Thousands | Feb. 29, 2016USD ($) |
Balance Sheet Information and Fair Value [Abstract] | |
Due in 1 year | $ 12,409 |
Due in 1 year through 5 years | 16,018 |
Due in 5 years through 10 years | 559 |
Due after 10 years | 3,933 |
Total | $ 32,919 |
Balance Sheet Information and43
Balance Sheet Information and Fair Value - Summary of Assets or Liabilities Measured at Fair Value (Detail) - USD ($) $ in Thousands | Feb. 29, 2016 | Feb. 28, 2015 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities, debt | $ 32,919 | |
Marketable securities | 36,394 | $ 40,754 |
Contingent consideration liability (current) | 1,160 | 1,150 |
Contingent consideration liability (non-current) | 161 | 1,878 |
Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 58,402 | 54,186 |
Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities, debt | 4,723 | 4,845 |
Corporate debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities, debt | 19,124 | 21,245 |
Equity securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 3,475 | 1,216 |
Foreign government bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities, debt | 205 | 201 |
Mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities, debt | 2,328 | 2,710 |
U.S. government agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities, debt | 2,234 | 7,294 |
U.S. government notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities, debt | 4,305 | 3,243 |
Foreign exchange contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets not designated (current) | 31 | |
Level 1 | Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 58,402 | 54,186 |
Level 1 | Equity securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 3,475 | 1,216 |
Level 2 | Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities, debt | 4,723 | 4,845 |
Level 2 | Corporate debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities, debt | 19,124 | 21,245 |
Level 2 | Foreign government bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities, debt | 205 | 201 |
Level 2 | Mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities, debt | 2,328 | 2,710 |
Level 2 | U.S. government agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities, debt | 2,234 | 7,294 |
Level 2 | U.S. government notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities, debt | 4,305 | 3,243 |
Level 2 | Foreign exchange contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets not designated (current) | 31 | |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Contingent consideration liability (current) | 1,160 | 1,150 |
Contingent consideration liability (non-current) | $ 161 | $ 1,878 |
Balance Sheet Information and44
Balance Sheet Information and Fair Value - Summary of Change in Fair Value of Level 3 Contingent Consideration Liability (Detail) $ in Thousands | 12 Months Ended |
Feb. 29, 2016USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Balance at beginning of fiscal year | $ 3,028 |
Acquisition addition | 334 |
Total remeasurement recognized in earnings | (1,867) |
Settlements | (174) |
Balance at end of fiscal year | $ 1,321 |
Balance Sheet Information and45
Balance Sheet Information and Fair Value - Inventories, Net (Detail) - USD ($) $ in Thousands | Feb. 29, 2016 | Feb. 28, 2015 |
Balance Sheet Information and Fair Value [Abstract] | ||
Raw materials | $ 2,459 | $ 2,455 |
Finished goods | 3,659 | 2,729 |
Reserves | (470) | (730) |
Total inventories, net | $ 5,648 | $ 4,454 |
Balance Sheet Information and46
Balance Sheet Information and Fair Value - Deferred Costs (Detail) - USD ($) $ in Thousands | Feb. 29, 2016 | Feb. 28, 2015 |
Deferred Cost [Line Items] | ||
Total deferred costs | $ 58,962 | $ 57,936 |
Appliance | ||
Deferred Cost [Line Items] | ||
Total deferred costs | 41,548 | 41,052 |
Commissions | ||
Deferred Cost [Line Items] | ||
Total deferred costs | $ 17,414 | $ 16,884 |
Balance Sheet Information and47
Balance Sheet Information and Fair Value - Property and Equipment, Net (Detail) - USD ($) $ in Thousands | Feb. 29, 2016 | Feb. 28, 2015 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 51,689 | $ 40,274 |
Accumulated depreciation and amortization | (19,779) | (12,435) |
Property and equipment, net | 31,910 | 27,839 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 9,578 | 9,354 |
Building | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 6,549 | 6,549 |
Computer hardware and software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 26,450 | 17,860 |
Vehicles, machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 4,711 | 3,546 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 4,401 | $ 2,965 |
Balance Sheet Information and48
Balance Sheet Information and Fair Value - Components of Accumulated Other Comprehensive Loss, Net of Tax (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 29, 2016 | Feb. 28, 2015 | Feb. 28, 2014 | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |||
Other comprehensive income (loss) before reclassifications | $ (266) | ||
Amounts reclassified from accumulated other comprehensive income (loss) | (10) | ||
Other comprehensive income (loss) | (276) | $ (3,416) | $ 295 |
Foreign Currency Translation Adjustments | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |||
Beginning balance | (4,225) | ||
Other comprehensive income (loss) before reclassifications | (669) | ||
Amounts reclassified from accumulated other comprehensive income (loss) | 0 | ||
Other comprehensive income (loss) | (669) | ||
Ending balance | (4,894) | (4,225) | |
Unrealized Gain (Loss) on Available-for- Sale Investments | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |||
Beginning balance | (8) | ||
Other comprehensive income (loss) before reclassifications | 403 | ||
Amounts reclassified from accumulated other comprehensive income (loss) | (10) | ||
Other comprehensive income (loss) | 393 | ||
Ending balance | 385 | (8) | |
AOCI Attributable to Parent | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |||
Beginning balance | (4,233) | ||
Ending balance | $ (4,509) | $ (4,233) |
Acquisitions - Additional Infor
Acquisitions - Additional Information (Detail) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Oct. 31, 2015 | Jul. 31, 2015 | Feb. 29, 2016 | Feb. 29, 2016 | Feb. 28, 2015 | Aug. 31, 2014 | |
Business Acquisition [Line Items] | ||||||
Consideration attributed to goodwill | $ 30,054 | |||||
Intronis Inc | ||||||
Business Acquisition [Line Items] | ||||||
Business acquisition, purchase price adjustment, increase (decrease) in working capital | $ (200) | |||||
Business acquisition, purchase price adjustment, increase (decrease) in deferred tax liabilities | (100) | |||||
Business acquisition, aggregate purchase consideration | 65,300 | |||||
Business acquisition, purchase consideration held back for potential indemnification obligations | 6,800 | 6,800 | ||||
Weighted-average useful lives | 7 years | |||||
Revenue included in results of operations | 9,400 | |||||
Net loss included in results of operations | 1,300 | |||||
Intronis Inc | Acquired developed technology | ||||||
Business Acquisition [Line Items] | ||||||
Weighted-average useful lives | 7 years | |||||
Consideration attributed to intangible assets | $ 21,500 | |||||
Intronis Inc | Customer relationships | ||||||
Business Acquisition [Line Items] | ||||||
Weighted-average useful lives | 7 years | |||||
Consideration attributed to intangible assets | $ 11,870 | |||||
Intronis Inc | Trade name | ||||||
Business Acquisition [Line Items] | ||||||
Weighted-average useful lives | 4 years | |||||
Consideration attributed to intangible assets | $ 300 | |||||
Other Acquisition | ||||||
Business Acquisition [Line Items] | ||||||
Total consideration | $ 1,100 | |||||
Estimated fair value of contingent consideration | 300 | 100 | 100 | |||
Consideration attributed to intangible assets | 700 | |||||
Consideration attributed to goodwill | $ 300 | |||||
Other Acquisition | Acquired developed technology | ||||||
Business Acquisition [Line Items] | ||||||
Weighted-average useful lives | 1 year | |||||
Other Acquisition | Customer relationships | ||||||
Business Acquisition [Line Items] | ||||||
Weighted-average useful lives | 7 years | |||||
C2C Systems Limited | ||||||
Business Acquisition [Line Items] | ||||||
Estimated fair value of contingent consideration | 1,200 | $ 1,200 | $ 3,000 | |||
Acquisition date | Aug. 31, 2014 | |||||
Contingent cash consideration upon continued employment | $ 4,100 | $ 4,100 | $ 4,900 | |||
Contingent consideration payable description | Upon the attainment of certain billings levels and performance integration targets through August 2017. | |||||
Adjustment of contingent consideration, reduction of research and development and sales and marketing expenses | $ 1,900 |
Acquisitions - Schedule of Fair
Acquisitions - Schedule of Fair Values of Assets Acquired and Liabilities Assumed (Detail) - USD ($) $ in Thousands | Feb. 29, 2016 | Oct. 31, 2015 | Feb. 28, 2015 |
Business Acquisition [Line Items] | |||
Goodwill | $ 69,595 | $ 39,742 | |
Intronis Inc | |||
Business Acquisition [Line Items] | |||
Cash | $ 2,327 | ||
Accounts receivable | 376 | ||
Other current assets | 654 | ||
Property and equipment | 4,203 | ||
Other non-current assets | 750 | ||
Goodwill | 29,718 | ||
Accounts payable | (685) | ||
Accrued expenses | (1,149) | ||
Deferred revenue (current) | (649) | ||
Deferred tax liabilities | (3,930) | ||
Total value of assets acquired and liabilities assumed | 65,285 | ||
Acquired developed technology | Intronis Inc | |||
Business Acquisition [Line Items] | |||
Intangible assets | 21,500 | ||
Customer relationships | Intronis Inc | |||
Business Acquisition [Line Items] | |||
Intangible assets | 11,870 | ||
Trade name | Intronis Inc | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 300 |
Acquisitions - Schedule of Pro
Acquisitions - Schedule of Pro Forma Revenue and Net Loss (Detail) - Intronis Inc - USD ($) $ in Thousands | 12 Months Ended | |
Feb. 29, 2016 | Feb. 28, 2015 | |
Business Acquisition [Line Items] | ||
Pro forma revenue | $ 333,963 | $ 295,738 |
Pro forma net loss attributable to Barracuda Networks, Inc. | $ (12,727) | $ (67,665) |
Goodwill and Intangible Asset52
Goodwill and Intangible Assets - Schedule of Changes in Carrying Amount of Goodwill (Detail) | 12 Months Ended |
Feb. 29, 2016USD ($) | |
Goodwill [Roll Forward] | |
Balance at beginning of fiscal year | $ 39,742,000 |
Goodwill acquired | 30,054,000 |
Effect of foreign exchange rates | (201,000) |
Balance at end of fiscal year | 69,595,000 |
Goodwill impairment | $ 0 |
Goodwill and Intangible Asset53
Goodwill and Intangible Assets - Schedule of Intangible Assets Subject to Amortization (Detail) - USD ($) $ in Thousands | Feb. 29, 2016 | Feb. 28, 2015 |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 74,302 | $ 39,770 |
Accumulated Amortization | (35,110) | (30,849) |
Net Carrying Value | 39,192 | 8,921 |
Acquired developed technology | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 50,082 | 28,799 |
Accumulated Amortization | (25,643) | (22,987) |
Net Carrying Value | 24,439 | 5,812 |
Software license | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 400 | 400 |
Accumulated Amortization | (400) | (400) |
Net Carrying Value | 0 | 0 |
Customer relationships | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 19,809 | 8,233 |
Accumulated Amortization | (7,313) | (6,032) |
Net Carrying Value | 12,496 | 2,201 |
Patents | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 2,999 | 1,625 |
Accumulated Amortization | (1,295) | (1,058) |
Net Carrying Value | 1,704 | 567 |
Trade name | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 812 | 513 |
Accumulated Amortization | (259) | (172) |
Net Carrying Value | 553 | 341 |
Acquired developed software | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 200 | 200 |
Accumulated Amortization | (200) | (200) |
Net Carrying Value | $ 0 | $ 0 |
Goodwill and Intangible Asset54
Goodwill and Intangible Assets - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Feb. 29, 2016 | Feb. 28, 2015 | Feb. 28, 2014 | |
Finite-Lived Intangible Assets [Line Items] | |||
Goodwill impairment | $ 0 | ||
Other intangible assets not subject to amortization | 200,000 | $ 300,000 | |
Amortization expense, including impairment charges | 5,600,000 | $ 3,400,000 | $ 5,400,000 |
Amortization expense for the remainder of fiscal year 2017 | 7,200,000 | ||
Amortization expense for fiscal year 2018 | 6,900,000 | ||
Amortization expense for fiscal year 2019 | 6,000,000 | ||
Amortization expense for fiscal year 2020 | 5,800,000 | ||
Amortization expense for fiscal year 2021 | 5,300,000 | ||
Amortization expense thereafter | $ 8,000,000 |
Redeemable Convertible Prefer55
Redeemable Convertible Preferred Stock - Additional Information (Detail) - $ / shares | 12 Months Ended | |
Feb. 29, 2016 | Nov. 30, 2013 | |
Class of Stock [Line Items] | ||
Number of redeemable convertible preferred stock converted to common stock (in shares) | 17,626,227 | |
Conversion ratio | 1 | |
Convertible Preferred Stock, Threshold Approval Percentage for Automatic Conversion | 66.67% | |
Series A Redeemable Convertible Preferred Stock | ||
Class of Stock [Line Items] | ||
Conversion rate of convertible preferred stock to common stock (usd per share) | $ 3.98 | |
Liquidation preference price per share (usd per share) | 5.97 | |
Redemption price per share (usd per share) | 3.98 | |
Series B Redeemable Convertible Preferred Stock | ||
Class of Stock [Line Items] | ||
Conversion rate of convertible preferred stock to common stock (usd per share) | 16.84 | |
Liquidation preference price per share (usd per share) | 21.04 | |
Redemption price per share (usd per share) | $ 16.84 |
Stockholders' Deficit - Additio
Stockholders' Deficit - Additional Information (Detail) | 12 Months Ended | |||
Feb. 29, 2016USD ($)vote$ / sharesshares | Feb. 28, 2015USD ($)$ / sharesshares | Feb. 28, 2014USD ($) | Sep. 30, 2015USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Common and preferred shares authorized (in shares) | shares | 1,020,000,000 | |||
Common stock, shares authorized (in shares) | shares | 1,000,000,000 | 1,000,000,000 | ||
Common stock, par value (in usd per share) | $ / shares | $ 0.001 | $ 0.001 | ||
Preferred stock, shares authorized (in shares) | shares | 20,000,000 | 20,000,000 | ||
Preferred stock, par value (in usd per share) | $ / shares | $ 0.001 | $ 0.001 | ||
Common stock voting rights | Voting Rights—Holders of our common stock are entitled to one vote for each share held on all matters submitted to a vote of stockholders. | |||
Options granted are exercisable for periods | 10 years | |||
Grant-date fair value of stock options vested | $ 10,500,000 | $ 7,500,000 | $ 6,000,000 | |
Aggregate intrinsic value of stock option awards exercised | $ 8,600,000 | $ 33,100,000 | $ 6,500,000 | |
Non-controlling interest, ownership percentage | 67.00% | |||
Voting Rights, Number of Votes | vote | 1 | |||
Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock repurchase program, aggregate purchase price | $ 50,000,000 | |||
Stock Options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options and RSUs granted vesting period | 4 years | |||
Unrecognized compensation cost related to outstanding stock options | $ 17,400,000 | |||
Expected period for recognizing compensation expense | 2 years 6 months | |||
Restricted Stock Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options and RSUs granted vesting period | 4 years | |||
Expected period for recognizing compensation expense | 3 years 7 days | |||
Unrecognized compensation cost related to unvested RSUs | $ 45,800,000 | |||
Employee Stock Purchase Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Sharebased Compensation Arrangement By Sharebased Payment Award, Offering Period | 6 months | |||
Purchase price of stock, percent of lower of fair market value | 85.00% | |||
Common stock, reserved for issuance under the Employee Stock Purchase Program (in shares) | shares | 750,000 |
Stockholders' Deficit Stockhold
Stockholders' Deficit Stockholders' Deficit - Summary of Weighted-Average Input Assumptions Used to Estimate Fair Value of Employee Stock Purchase Plan Grants (Details) - $ / shares | 12 Months Ended | ||
Feb. 29, 2016 | Feb. 28, 2015 | Feb. 28, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility | 43.00% | 45.00% | 46.00% |
Expected term (in years) | 6 years 3 months | 6 years 3 months | 6 years 3 months |
Risk-free interest rate | 1.80% | 1.87% | 1.67% |
Dividend yield | 0.00% | 0.00% | 0.00% |
Estimated fair value of stock options granted during the year (in usd per share) | $ 13.80 | $ 13.98 | $ 9.48 |
Employee Stock Purchase Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility | 42.00% | ||
Expected term (in years) | 6 months | ||
Risk-free interest rate | 0.27% | ||
Dividend yield | 0.00% | ||
Estimated fair value of stock options granted during the year (in usd per share) | $ 5.37 |
Stockholders' Deficit - Schedul
Stockholders' Deficit - Schedule of Shares Authorized and Available for Grant (Detail) | 12 Months Ended |
Feb. 29, 2016shares | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Granted [Roll Forward] | |
Shares Available for Grant, Beginning balance | 5,768,991 |
Shares Available for Grant, Authorized | 2,379,645 |
Shares Available for Grant, Granted | (2,465,037) |
Shares Available for Grant, Canceled/forfeited | 677,078 |
Shares Available for Grant, Ending balance | 6,360,677 |
Stockholders' Deficit - Summary
Stockholders' Deficit - Summary of Weighted-Average Input Assumptions Used to Estimate Fair Value of Employee Stock Option Grants (Detail) - $ / shares | 12 Months Ended | ||
Feb. 29, 2016 | Feb. 28, 2015 | Feb. 28, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility | 43.00% | 45.00% | 46.00% |
Expected term (in years) | 6 years 3 months | 6 years 3 months | 6 years 3 months |
Risk-free interest rate | 1.80% | 1.87% | 1.67% |
Dividend yield | 0.00% | 0.00% | 0.00% |
Estimated fair value of stock options granted during the year (in usd per share) | $ 13.80 | $ 13.98 | $ 9.48 |
Stockholders' Deficit - Summa60
Stockholders' Deficit - Summary of Stock Option Activity (Detail) $ / shares in Units, $ in Thousands | 12 Months Ended |
Feb. 29, 2016USD ($)$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |
Shares, Beginning balance | shares | 4,051,904 |
Shares, Granted | shares | 757,285 |
Shares, Exercised | shares | (382,529) |
Shares, Canceled/forfeited | shares | (218,459) |
Shares, Ending balance | shares | 4,208,201 |
Shares, Vested and exercisable | shares | 2,478,287 |
Shares, Vested and expected to vest | shares | 4,063,692 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | |
Weighted-Average Exercise Price, Outstanding, Beginning Balance (in usd per share) | $ / shares | $ 17.98 |
Weighted-Average Exercise Price, Granted (in usd per share) | $ / shares | 31.21 |
Weighted-Average Exercise Price, Exercised (in usd per share) | $ / shares | 12.67 |
Weighted-Average Exercise Price, Canceled/Forfeited (in usd per share) | $ / shares | 26.16 |
Weighted-Average Exercise Price, Outstanding, Ending Balance (in usd per share) | $ / shares | 20.42 |
Weighted-Average Exercise Price, Vested and exercisable (in usd per share) | $ / shares | 16.34 |
Weighted-Average Exercise Price, Vested and expected to vest (in usd per share) | $ / shares | $ 20.02 |
Share-based Compensation Arrangement by Share-based Payment Award Options Outstanding Weighted Average Term [Abstract] | |
Weighted-Average Remaining Contractual Term, Vested and exercisable, Ending Balance | 6 years 2 months 11 days |
Weighted-Average Remaining Contractual Term, Vested and expected to vest, Ending Balance | 7 years 10 days |
Share-based Compensation Arrangement by Share-based Payment Award Options Aggregate Intrinsic Value [Abstract] | |
Aggregate Intrinsic Value, Vested and Exercisable, Ending Balance | $ | $ 1,456,297 |
Aggregate Intrinsic Value, Vested and expected to vest | $ | $ 1,565,624 |
Stockholders' Deficit - Summa61
Stockholders' Deficit - Summary of Restricted Stock Units Activity (Detail) - Restricted Stock Units | 12 Months Ended |
Feb. 29, 2016$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
Unvested Restricted Stock Units, Beginning Balance (in shares) | shares | 1,576,332 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | shares | 1,707,752 |
Unvested Restricted Stock Units, Vested (in shares) | shares | (637,157) |
Unvested Restricted Stock Units, Canceled/forfeited (in shares) | shares | (196,108) |
Unvested Restricted Stock Units, Ending Balance (in shares) | shares | 2,450,819 |
Unvested Restricted Stock Units, Expected to vest (in shares) | shares | 2,167,186 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |
Unvested Restricted Stock Units, Weighted Average Grant Date Fair Value, Beginning Balance (in usd per share) | $ / shares | $ 23.16 |
Unvested Restricted Stock Units, Granted, Weighted Average Grant Date Fair Value (in usd per share) | $ / shares | 25.75 |
Unvested Restricted Stock Units, Vested, Weighted Average Grant Date Fair Value (in usd per share) | $ / shares | 19.60 |
Unvested Restricted Stock Units, Canceled/forfeited, Weighted Average Grant Date Fair Value (in usd per share) | $ / shares | 29.53 |
Unvested Restricted Stock Units, Weighted Average Grant Date Fair Value, Ending Balance (in usd per share) | $ / shares | 25.38 |
Unvested Restricted Stock Units, Expected to vest, Weighted Average Grant Date Fair Value (in usd per share) | $ / shares | $ 25.40 |
Stockholders' Deficit - Sched62
Stockholders' Deficit - Schedule of Total Stock-Based Compensation Expense (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 29, 2016 | Feb. 28, 2015 | Feb. 28, 2014 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock-based compensation expense | $ 28,846 | $ 17,058 | $ 10,837 |
Cost of Revenue | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock-based compensation expense | 1,062 | 389 | 201 |
Research and Development | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock-based compensation expense | 8,247 | 4,410 | 2,374 |
Selling and Marketing | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock-based compensation expense | 6,566 | 3,811 | 2,067 |
General and Administrative | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock-based compensation expense | $ 12,971 | $ 8,448 | $ 6,195 |
Stockholders' Deficit Stockho63
Stockholders' Deficit Stockholders' Deficit - Summary of Common Stock Repurchase (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |
Feb. 29, 2016 | Feb. 28, 2014 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||
Repurchase of common stock (in shares) | (1,503) | |
Repurchase of common stock | $ 19,216 | $ 723 |
Stock repurchased and retired during period average cost per share (in usd per share) | $ 12.79 | |
Remaining amount authorized as of February 29, 2016 | $ 30,784 |
Income Taxes - Schedule of Inco
Income Taxes - Schedule of Income (Loss) Before Income Taxes and Non-Controlling Interest (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 29, 2016 | Feb. 28, 2015 | Feb. 28, 2014 | |
Income Tax Disclosure [Abstract] | |||
United States | $ (7,792) | $ (7,326) | $ (6,165) |
Foreign | 643 | 2,730 | (4,787) |
Loss before income taxes and non-controlling interest | $ (7,149) | $ (4,596) | $ (10,952) |
Income Taxes - Schedule of Prov
Income Taxes - Schedule of Provision for (Benefit from) Income Taxes (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 29, 2016 | Feb. 28, 2015 | Feb. 28, 2014 | |
Current: | |||
Federal | $ 2,519 | $ 2,479 | $ 4,760 |
State | 839 | 299 | 574 |
Foreign | 507 | 863 | 734 |
Total | 3,865 | 3,641 | 6,068 |
Deferred: | |||
Federal | (2,707) | 51,820 | (10,231) |
State | (850) | 4,674 | (1,109) |
Foreign | (3,035) | 2,767 | (1,293) |
Total | (6,592) | 59,261 | (12,633) |
Provision for (benefit from) income taxes | $ (2,727) | $ 62,902 | $ (6,565) |
Income Taxes - Components of De
Income Taxes - Components of Deferred Tax Assets (Liabilities) (Detail) - USD ($) $ in Thousands | Feb. 29, 2016 | Feb. 28, 2015 |
Deferred tax assets: | ||
Deferred revenue | $ 63,357 | $ 58,886 |
Stock-based compensation | 6,983 | 3,344 |
Reserves and other | 4,606 | 4,294 |
Research and development credits | 6,484 | 4,935 |
Net operating losses | 12,705 | 5,431 |
Total deferred tax assets | 94,135 | 76,890 |
Valuation allowance | (73,399) | (74,357) |
Total deferred tax assets, net of valuation allowance | 20,736 | 2,533 |
Deferred tax liabilities: | ||
Depreciation and amortization | (14,954) | (3,622) |
Prepaid expense and other | (1,151) | (717) |
Deferred sales commission | (4,117) | 0 |
Other deferred tax liabilities | 0 | (231) |
Deferred Tax Liabilities, Gross | (20,222) | (4,570) |
Net deferred tax assets (liabilities) | $ 514 | |
Net deferred tax assets (liabilities) | $ (2,037) |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Statutory Federal Income Tax Rate to Effective Tax Rate (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 29, 2016 | Feb. 28, 2015 | Feb. 28, 2014 | |
Income Tax Disclosure [Abstract] | |||
Tax benefit at federal statutory rate | $ (2,502) | $ (1,608) | $ (3,833) |
State taxes, net of federal benefit | (363) | 4,845 | (713) |
Non-deductible expenses | 368 | 823 | 736 |
Stock-based compensation | 2,134 | 520 | 1,227 |
Legal entity rationalization | 0 | 0 | (3,541) |
Transaction costs | 732 | (1,454) | 0 |
Change in valuation allowance | 1,674 | 58,685 | 346 |
Foreign rate differential | (2,752) | 2,730 | 790 |
Research and development credits | (2,482) | (1,792) | (933) |
Domestic production activities deduction | (63) | 0 | (445) |
Litigation settlements | 584 | 0 | 0 |
Other | (57) | 153 | (199) |
Provision for (benefit from) income taxes | $ (2,727) | $ 62,902 | $ (6,565) |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | |||
Feb. 29, 2016 | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 | |
Income Tax Examination [Line Items] | ||||
Valuation allowance | $ (73,399) | $ (74,357) | ||
Increase in valuation allowance | 1,000 | |||
Excess tax benefits from equity compensation plans | 3,788 | 8,947 | $ 1,513 | |
Federal net operating loss carryforwards | 21,800 | |||
State net operating loss carryforwards | $ 10,700 | |||
Federal operating losses expiration, beginning period | 2,019 | |||
Federal operating losses expiration, ending period | 2,035 | |||
State operating losses expiration, beginning period | 2,017 | |||
State operating losses expiration, ending period | 2,035 | |||
Foreign net operating loss carryforwards | $ 14,600 | |||
Operating losses can be carried forward indefinitely | $ 13,900 | |||
Remaining foreign net operating losses expiration period | 2,017 | |||
Stock-based compensation | $ 6,983 | 3,344 | ||
Research and development credit carryforwards | $ 6,484 | 4,935 | ||
Federal research and development credit expiration beginning period | 2,029 | |||
Other state research and development credit expiration beginning period | 2,021 | |||
Undistributed earnings of its foreign subsidiaries | $ 10,400 | |||
Total unrecognized tax benefits | 6,388 | 5,322 | 4,980 | $ 3,971 |
Unrecognized tax benefits that, if recognized, would affect our effective tax rate | 2,600 | 4,300 | 4,000 | |
Interest and penalties recorded in the consolidated statements of operations | 100 | 200 | ||
Accrued interest and penalties recorded on the consolidated balance sheets | 800 | 800 | ||
Federal | ||||
Income Tax Examination [Line Items] | ||||
Research and development credit carryforwards | 2,400 | |||
California | ||||
Income Tax Examination [Line Items] | ||||
Research and development credit carryforwards | 5,500 | |||
Enterprise zone tax credit carryforwards | $ 300 | |||
Tax credit expiration beginning period | 2,024 | |||
Other state | ||||
Income Tax Examination [Line Items] | ||||
Stock-based compensation | $ 3,800 | |||
Research and development credit carryforwards | 200 | |||
Additional Paid-In Capital | ||||
Income Tax Examination [Line Items] | ||||
Excess tax benefits from equity compensation plans | $ 3,788 | $ 8,947 | $ 1,513 |
Income Taxes - Summary of Gross
Income Taxes - Summary of Gross Unrecognized Tax Benefits (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 29, 2016 | Feb. 28, 2015 | Feb. 28, 2014 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Balance at beginning of year | $ 5,322 | $ 4,980 | $ 3,971 |
Tax positions related to the current year, Increases | 1,841 | 1,050 | 1,208 |
Tax positions related to prior years, Increases | 231 | 58 | 0 |
Tax positions related to prior years, Decreases | (4) | (53) | (1) |
Settlements | (710) | 0 | 0 |
Releases-statute of limitations expired | (292) | (713) | (198) |
Balance at the end of the year | $ 6,388 | $ 5,322 | $ 4,980 |
Segment Information - Additiona
Segment Information - Additional Information (Detail) | 12 Months Ended |
Feb. 29, 2016Segment | |
Segment Reporting [Abstract] | |
Number of reporting segment | 1 |
Segment Information - Schedule
Segment Information - Schedule of Revenue by Geographic Region (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 29, 2016 | Feb. 28, 2015 | Feb. 28, 2014 | |
Segment Reporting Information [Line Items] | |||
Revenue | $ 320,158 | $ 277,446 | $ 233,787 |
North America | |||
Segment Reporting Information [Line Items] | |||
Revenue | 235,275 | 201,724 | 169,896 |
United States | |||
Segment Reporting Information [Line Items] | |||
Revenue | 222,210 | 189,640 | 159,036 |
Other | |||
Segment Reporting Information [Line Items] | |||
Revenue | 13,065 | 12,084 | 10,860 |
Latin America | |||
Segment Reporting Information [Line Items] | |||
Revenue | 4,322 | 3,345 | 3,380 |
Asia-Pacific | |||
Segment Reporting Information [Line Items] | |||
Revenue | 18,772 | 18,158 | 16,245 |
EMEA | |||
Segment Reporting Information [Line Items] | |||
Revenue | $ 61,789 | $ 54,219 | $ 44,266 |
Segment Information - Schedul72
Segment Information - Schedule of Long Lived Asset (Detail) - USD ($) $ in Thousands | Feb. 29, 2016 | Feb. 28, 2015 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long Lived Assets | $ 66,222 | $ 59,677 |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long Lived Assets | 60,619 | 54,772 |
International | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long Lived Assets | $ 5,603 | $ 4,905 |
Borrowings - Additional Informa
Borrowings - Additional Information (Detail) - USD ($) | 12 Months Ended | |||
Feb. 29, 2016 | Feb. 28, 2015 | Feb. 28, 2014 | Nov. 30, 2013 | |
Debt Instrument [Line Items] | ||||
Note payable, interest rate | 6.23% | |||
Debt repayable principal and interest | $ 44,445 | |||
Note payable payment terms | The debt is repayable in equal monthly payments of principal and interest of $44,445, with a final payment of unpaid principal and interest in July 2017. Penalty interest of 0.0625% is due on default of payments, and prepayment of amounts owed are subject to a prepayment fee calculated as the greater of a) 1% of the principal being repaid and b) the present value of the future principal and interest payments less the principal repaid. | |||
Penalty interest rate | 0.0625% | |||
Prepayment fee as a percentage of principal amount | 1.00% | |||
Interest expense | $ 300,000 | $ 300,000 | $ 300,000 | |
Credit facility maximum borrowing capacity | $ 25,000,000 | |||
Revolving loan facility | ||||
Debt Instrument [Line Items] | ||||
Credit facility maximum borrowing capacity | $ 40,000,000 | |||
Letter of credit | ||||
Debt Instrument [Line Items] | ||||
Credit facility maximum borrowing capacity | $ 10,000,000 | |||
Second amendment agreement | ||||
Debt Instrument [Line Items] | ||||
Credit facility maximum borrowing capacity | 50,000,000 | |||
Amount drawn under credit facility | $ 0 |
Borrowings - Schedule of Future
Borrowings - Schedule of Future Principal and Interest Payments of Note Payable (Detail) $ in Thousands | Feb. 29, 2016USD ($) |
Maturities of Long-term Debt [Abstract] | |
2,017 | $ 533 |
2,018 | 4,220 |
Total | $ 4,753 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) - USD ($) | 1 Months Ended | 12 Months Ended | |||
Nov. 30, 2015 | May. 31, 2015 | Feb. 29, 2016 | Feb. 28, 2015 | Feb. 28, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | |||||
Operating lease arrangements expiration period | 2,021 | ||||
Rent expense | $ 3,500,000 | $ 3,100,000 | $ 2,900,000 | ||
Loss Contingencies [Line Items] | |||||
Finite-Lived Intangible Assets, Net | 39,192,000 | 8,921,000 | |||
Office Of Foreign Assets Control | |||||
Loss Contingencies [Line Items] | |||||
Settlement payments | $ 38,930 | ||||
Bureau Of Industry And Security Legal Matters | |||||
Loss Contingencies [Line Items] | |||||
Settlement payments | $ 1,500,000 | ||||
Settled Litigation | Intellectual Property Settlement | |||||
Loss Contingencies [Line Items] | |||||
Settlement payments | 2,300,000 | ||||
Patents | |||||
Loss Contingencies [Line Items] | |||||
Finite-Lived Intangible Assets, Net | 1,704,000 | $ 567,000 | |||
Patents | Intellectual Property Settlement | |||||
Loss Contingencies [Line Items] | |||||
Finite-Lived Intangible Assets, Net | $ 1,400,000 |
Commitments and Contingencies76
Commitments and Contingencies - Schedule of Future Minimum Payments under Operating Leases Agreements (Detail) $ in Thousands | Feb. 29, 2016USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,017 | $ 3,178 |
2,018 | 2,616 |
2,019 | 1,819 |
2,020 | 1,243 |
2,021 | 461 |
Total | $ 9,317 |
Commitments and Contingencies77
Commitments and Contingencies - Schedule of Future Minimum Payments for Unrecognized Purchase Commitments (Detail) $ in Thousands | Feb. 29, 2016USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,017 | $ 21,306 |
2,018 | 5,889 |
2,019 | 1,411 |
Total | $ 28,606 |
Employee Benefit Plan - Additio
Employee Benefit Plan - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Feb. 29, 2016 | Feb. 28, 2015 | Feb. 28, 2014 | |
Compensation and Retirement Disclosure [Abstract] | |||
Contribution of employee's eligible earnings under 401(k) Plan | $ 1.2 | $ 1 | $ 0.8 |
Other Income (Expense), Net O79
Other Income (Expense), Net Other Income (Expense), Net (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 29, 2016 | Feb. 28, 2015 | Feb. 28, 2014 | |
Other Income and Expenses [Abstract] | |||
Interest and miscellaneous income | $ 344 | $ 579 | $ 788 |
Interest expense | (308) | (417) | (604) |
Foreign currency exchange gains (losses), net | (14) | (3,558) | 86 |
Other | (284) | (278) | (219) |
Other income (expense), net | $ (262) | $ (3,674) | $ 51 |
Net Loss Per Share - Calculatio
Net Loss Per Share - Calculation of Basic and Diluted Net Loss Per Share Attributable to Common Stockholders (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Feb. 29, 2016 | Feb. 28, 2015 | Feb. 28, 2014 | |
Net loss attributable to common stockholders: | |||
Net loss attributable to Barracuda Networks, Inc. | $ (4,422) | $ (67,498) | $ (3,626) |
Shares used to compute net loss per share attributable to common stockholders: | |||
Weighted-average shares used to compute net loss per share, basic (in shares) | 53,070 | 51,898 | 35,355 |
Weighted-average shares used to compute net loss per share, diluted (in shares) | 53,070 | 51,898 | 35,355 |
Net loss per share attributable to Barracuda Networks, Inc. common stockholders: | |||
Net loss per share, basic (in usd per share) | $ (0.08) | $ (1.30) | $ (0.10) |
Net loss per share, diluted (in usd per share) | $ (0.08) | $ (1.30) | $ (0.10) |
Subsequent Event Subsequent Eve
Subsequent Event Subsequent Event (Details) - Sookasa Inc. - Subsequent event $ in Millions | Mar. 17, 2016USD ($)shares |
Subsequent Event [Line Items] | |
Business acquisition, aggregate cash considersation to acquire Sookasa Inc. | $ | $ 0.3 |
Business acquisition, issuance of common stock to acquire Sookasa Inc. (in shares) | shares | 10,000 |
Schedule II-Valuation and Qua82
Schedule II-Valuation and Qualifying Accounts (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 29, 2016 | Feb. 28, 2015 | Feb. 28, 2014 | |
Allowance for Doubtful Accounts | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Beginning balance | $ 1,531 | $ 2,134 | $ 1,252 |
Charged to costs and expenses | 586 | 289 | 885 |
Bad debt write-offs | (99) | (892) | (3) |
Ending balance | 2,018 | 1,531 | 2,134 |
Sales Return Reserve | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Beginning balance | 1,849 | 1,862 | 2,371 |
Charged to deferred revenue | 25,340 | 18,151 | 16,901 |
Sales returns | (25,163) | (18,164) | (17,410) |
Ending balance | $ 2,026 | $ 1,849 | $ 1,862 |