Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Sep. 30, 2019 | Oct. 25, 2019 | |
Cover page. | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2019 | |
Document Transition Report | false | |
Entity File Number | 001-36324 | |
Entity Registrant Name | VARONIS SYSTEMS, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 57-1222280 | |
Entity Address, Address Line One | 1250 Broadway, 29th Floor | |
Entity Address, City or Town | New York | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 10001 | |
City Area Code | 877 | |
Local Phone Number | 292-8789 | |
Title of 12(b) Security | Common Stock, par value $0.001 per share | |
Trading Symbol | VRNS | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding (in shares) | 30,484,432 | |
Entity Central Index Key | 0001361113 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
Consolidated Balance Sheets (Cu
Consolidated Balance Sheets (Current Period Unaudited) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 52,984 | $ 48,707 |
Marketable securities | 41,397 | 39,770 |
Short-term deposits | 37,000 | 70,438 |
Trade receivables (net of allowance for doubtful accounts of $645 and $483 at September 30, 2019 and December 31, 2018, respectively) | 51,866 | 83,223 |
Prepaid expenses and other current assets | 15,050 | 16,952 |
Total current assets | 198,297 | 259,090 |
Long-term assets: | ||
Other assets | 15,621 | 8,565 |
Operating lease right-of-use asset | 57,046 | |
Property and equipment, net | 27,188 | 17,323 |
Total long-term assets | 99,855 | 25,888 |
Total assets | 298,152 | 284,978 |
Current liabilities: | ||
Trade payables | 2,999 | 2,620 |
Accrued expenses and other short-term liabilities | 53,694 | 55,991 |
Deferred revenues | 76,978 | 87,729 |
Total current liabilities | 133,671 | 146,340 |
Long-term liabilities: | ||
Deferred revenues | 5,489 | 6,487 |
Operating lease liability | 58,667 | |
Other liabilities | 2,555 | 6,781 |
Total long-term liabilities | 66,711 | 13,268 |
Stockholders’ equity: | ||
Common stock of $0.001 par value - Authorized: 200,000,000 shares at September 30, 2019 and December 31, 2018; Issued and outstanding: 30,482,452 shares at September 30, 2019 and 29,576,880 shares at December 31, 2018 | 30 | 30 |
Accumulated other comprehensive income (loss) | 771 | (3,633) |
Additional paid-in capital | 299,051 | 266,941 |
Accumulated deficit | (202,082) | (137,968) |
Total stockholders’ equity | 97,770 | 125,370 |
Total liabilities and stockholders’ equity | $ 298,152 | $ 284,978 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 645 | $ 483 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized (in shares) | 200,000,000 | 200,000,000 |
Common stock, issued (in shares) | 30,482,452 | 29,576,880 |
Common stock, outstanding (in shares) | 30,482,452 | 29,576,880 |
Unaudited Consolidated Statemen
Unaudited Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Revenues: | ||||
Revenue | $ 65,649 | $ 67,052 | $ 181,630 | $ 182,770 |
Cost of revenues | 8,768 | 7,052 | 25,492 | 19,934 |
Gross profit | 56,881 | 60,000 | 156,138 | 162,836 |
Operating costs and expenses: | ||||
Research and development | 20,400 | 17,267 | 58,890 | 50,526 |
Sales and marketing | 42,117 | 40,792 | 125,769 | 122,113 |
General and administrative | 10,339 | 8,774 | 33,461 | 23,832 |
Total operating expenses | 72,856 | 66,833 | 218,120 | 196,471 |
Operating loss | (15,975) | (6,833) | (61,982) | (33,635) |
Financial income (expenses), net | (482) | 99 | (545) | 266 |
Loss before income taxes | (16,457) | (6,734) | (62,527) | (33,369) |
Income taxes | (530) | (583) | (1,587) | (1,677) |
Net loss | $ (16,987) | $ (7,317) | $ (64,114) | $ (35,046) |
Net loss per share of common stock, basic and diluted (in dollars per share) | $ (0.56) | $ (0.25) | $ (2.13) | $ (1.21) |
Weighted average number of shares used in computing net loss per share of common stock, basic and diluted (in shares) | 30,380,154 | 29,281,701 | 30,167,161 | 28,859,156 |
Perpetual licenses | ||||
Revenues: | ||||
Revenue | $ 8,269 | $ 33,432 | $ 35,304 | $ 89,789 |
Subscriptions | ||||
Revenues: | ||||
Revenue | 23,327 | 2,539 | 45,169 | 4,901 |
Maintenance and services | ||||
Revenues: | ||||
Revenue | $ 34,053 | $ 31,081 | $ 101,157 | $ 88,080 |
Unaudited Consolidated Statem_2
Unaudited Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (16,987) | $ (7,317) | $ (64,114) | $ (35,046) |
Other comprehensive income (loss): | ||||
Unrealized income (loss) on marketable securities, net of tax | (13) | 6 | 37 | 33 |
Gains (losses) on marketable securities reclassified into earnings, net of tax | 4 | (4) | (2) | (20) |
Total | (9) | 2 | 35 | 13 |
Unrealized income (loss) on derivative instruments, net of tax | 883 | (100) | 4,199 | (3,985) |
Losses (gains) on derivative instruments reclassified into earnings, net of tax | (361) | 1,194 | 170 | 2,094 |
Total | 522 | 1,094 | 4,369 | (1,891) |
Total other comprehensive income | 513 | 1,096 | 4,404 | (1,878) |
Comprehensive loss | $ (16,474) | $ (6,221) | $ (59,710) | $ (36,924) |
Unaudited Consolidated Statem_3
Unaudited Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands | Total | Common stock | Additional paid-in capital | Accumulated other comprehensive income (loss) | Accumulated deficit |
Balance (in shares) at Dec. 31, 2017 | 28,146,162 | ||||
Balance at Dec. 31, 2017 | $ 114,642 | $ 28 | $ 223,868 | $ 136 | $ (109,390) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation expense | 6,927 | 6,927 | |||
Common stock issued under employee stock plans, net (in shares) | 602,469 | ||||
Common stock issued under employee stock plans, net | 1,066 | $ 1 | 1,065 | ||
Unrealized gains (losses) on derivative instruments | (2,101) | (2,101) | |||
Unrealized gains (losses) on available for sale securities | (8) | (8) | |||
Net loss | (15,046) | (15,046) | |||
Balance at Mar. 31, 2018 | 105,480 | $ 29 | 231,860 | (1,973) | (124,436) |
Ending (in shares) at Mar. 31, 2018 | 28,748,631 | ||||
Balance (in shares) at Dec. 31, 2017 | 28,146,162 | ||||
Balance at Dec. 31, 2017 | 114,642 | $ 28 | 223,868 | 136 | (109,390) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Unrealized gains (losses) on derivative instruments | (1,891) | ||||
Unrealized gains (losses) on available for sale securities | 13 | ||||
Net loss | (35,046) | ||||
Balance at Sep. 30, 2018 | 110,062 | $ 29 | 256,211 | (1,742) | (144,436) |
Ending (in shares) at Sep. 30, 2018 | 29,424,275 | ||||
Balance (in shares) at Mar. 31, 2018 | 28,748,631 | ||||
Balance at Mar. 31, 2018 | 105,480 | $ 29 | 231,860 | (1,973) | (124,436) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation expense | 8,848 | 8,848 | |||
Common stock issued under employee stock plans, net (in shares) | 469,399 | ||||
Common stock issued under employee stock plans, net | 3,026 | $ 0 | 3,026 | ||
Unrealized gains (losses) on derivative instruments | (884) | (884) | |||
Unrealized gains (losses) on available for sale securities | 19 | 19 | |||
Net loss | (12,683) | (12,683) | |||
Balance at Jun. 30, 2018 | 103,806 | $ 29 | 243,734 | (2,838) | (137,119) |
Ending (in shares) at Jun. 30, 2018 | 29,218,030 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation expense | 8,399 | 8,399 | |||
Common stock issued under employee stock plans, net (in shares) | 206,245 | ||||
Common stock issued under employee stock plans, net | 4,078 | $ 0 | 4,078 | ||
Unrealized gains (losses) on derivative instruments | 1,094 | 1,094 | |||
Unrealized gains (losses) on available for sale securities | 2 | 2 | |||
Net loss | (7,317) | (7,317) | |||
Balance at Sep. 30, 2018 | 110,062 | $ 29 | 256,211 | (1,742) | (144,436) |
Ending (in shares) at Sep. 30, 2018 | 29,424,275 | ||||
Balance (in shares) at Dec. 31, 2018 | 29,576,880 | ||||
Balance at Dec. 31, 2018 | 125,370 | $ 30 | 266,941 | (3,633) | (137,968) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation expense | 8,961 | 8,961 | |||
Common stock issued under employee stock plans, net (in shares) | 686,357 | ||||
Common stock issued under employee stock plans, net | (4,642) | $ 0 | (4,642) | ||
Unrealized gains (losses) on derivative instruments | 2,935 | 2,935 | |||
Unrealized gains (losses) on available for sale securities | 10 | 10 | |||
Net loss | (22,639) | (22,639) | |||
Balance at Mar. 31, 2019 | 109,995 | $ 30 | 271,260 | (688) | (160,607) |
Ending (in shares) at Mar. 31, 2019 | 30,263,237 | ||||
Balance (in shares) at Dec. 31, 2018 | 29,576,880 | ||||
Balance at Dec. 31, 2018 | 125,370 | $ 30 | 266,941 | (3,633) | (137,968) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Unrealized gains (losses) on derivative instruments | 4,369 | ||||
Unrealized gains (losses) on available for sale securities | 35 | ||||
Net loss | (64,114) | ||||
Balance at Sep. 30, 2019 | 97,770 | $ 30 | 299,051 | 771 | (202,082) |
Ending (in shares) at Sep. 30, 2019 | 30,482,452 | ||||
Balance (in shares) at Mar. 31, 2019 | 30,263,237 | ||||
Balance at Mar. 31, 2019 | 109,995 | $ 30 | 271,260 | (688) | (160,607) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation expense | 14,796 | 14,796 | |||
Common stock issued under employee stock plans, net (in shares) | 63,790 | ||||
Common stock issued under employee stock plans, net | (1,055) | $ 0 | (1,055) | ||
Unrealized gains (losses) on derivative instruments | 912 | 912 | |||
Unrealized gains (losses) on available for sale securities | 34 | 34 | |||
Net loss | (24,488) | (24,488) | |||
Balance at Jun. 30, 2019 | 100,194 | $ 30 | 285,001 | 258 | (185,095) |
Ending (in shares) at Jun. 30, 2019 | 30,327,027 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation expense | 11,022 | 11,022 | |||
Common stock issued under employee stock plans, net (in shares) | 155,425 | ||||
Common stock issued under employee stock plans, net | 3,028 | $ 0 | 3,028 | ||
Unrealized gains (losses) on derivative instruments | 522 | 522 | |||
Unrealized gains (losses) on available for sale securities | (9) | (9) | |||
Net loss | (16,987) | (16,987) | |||
Balance at Sep. 30, 2019 | $ 97,770 | $ 30 | $ 299,051 | $ 771 | $ (202,082) |
Ending (in shares) at Sep. 30, 2019 | 30,482,452 |
Unaudited Consolidated Statem_4
Unaudited Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Cash flows from operating activities: | ||
Net loss | $ (64,114) | $ (35,046) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation | 4,320 | 2,480 |
Stock-based compensation | 34,779 | 24,174 |
Amortization of deferred commissions | 10,530 | 9,718 |
Amortization of operating lease right-of-use asset | 7,009 | 0 |
Capital loss (gain) from sale of fixed assets | 24 | (27) |
Changes in assets and liabilities: | ||
Trade receivables | 31,357 | 22,658 |
Prepaid expenses and other current assets | (2,239) | (927) |
Deferred commissions | (13,401) | (9,864) |
Other long term assets | 50 | 5 |
Trade payables | 379 | 2,510 |
Accrued expenses and other short-term liabilities | (7,675) | 1,922 |
Deferred revenues | (11,749) | (1,183) |
Other long term liabilities | 54 | (155) |
Net cash provided by (used in) operating activities | (10,676) | 16,265 |
Cash flows from investing activities: | ||
Decrease (increase) in short-term deposits | 33,474 | (10,213) |
Increase in marketable securities | (1,627) | (120) |
Increase in long-term deposits | (16) | (319) |
Proceeds from sale of property and equipment | 10 | 27 |
Purchase of property and equipment | (14,219) | (3,177) |
Net cash provided by (used in) investing activities | 17,622 | (13,802) |
Cash flows from financing activities: | ||
Proceeds (withholdings) from employee stock plans, net | (2,669) | |
Proceeds (withholdings) from employee stock plans, net | 8,169 | |
Net cash provided (used in) by financing activities | (2,669) | 8,169 |
Increase in cash, cash equivalents and restricted cash | 4,277 | 10,632 |
Cash, cash equivalents and restricted cash at beginning of period | 48,707 | 57,236 |
Cash, cash equivalents and restricted cash at end of period | 52,984 | 67,868 |
Supplemental disclosure of cash flow information: | ||
Cash paid for income taxes | 3,566 | $ 561 |
Net lease liabilities arising from obtaining right-of-use assets | $ 8,908 |
General
General | 9 Months Ended |
Sep. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
General | GENERAL a. Description of Business: Varonis Systems, Inc. (“VSI” and together with its subsidiaries, collectively, the “Company”) was incorporated under the laws of the State of Delaware on November 3, 2004 and commenced operations on January 1, 2005 . VSI has ten wholly-owned subsidiaries: Varonis Systems Ltd. (“VSL”) incorporated under the laws of Israel on November 24, 2004 ; Varonis (UK) Limited (“VSUK”) incorporated under the laws of England on March 14, 2007; Varonis Systems (Deutschland) GmbH (“VSG”) incorporated under the laws of Germany on July 6, 2011; Varonis France SAS (“VSF”) incorporated under the laws of France on February 22, 2012; Varonis Systems Corp. (“VSC”) incorporated under the laws of British Columbia, Canada on February 19, 2013; Varonis Systems (Ireland) Limited ("VIRE") incorporated under the laws of Ireland on November 11, 2016; Varonis Systems (Australia) Pty Ltd (“VAUS”) incorporated under the laws of Victoria, Australia on February 28, 2017; Varonis Systems (Netherlands) B.V. ("VNL") incorporated under the laws of the Netherlands on March 13, 2018; Varonis U.S. Public Sector LLC ("VPS") incorporated under the laws of the State of Delaware on May 14, 2018; and Varonis Systems (Luxemburg) S.à r.l. (“VLUX”) incorporated under the laws of Luxembourg on August 5, 2019. The Company’s software products and services allow enterprises to manage, analyze and secure enterprise data. Varonis focuses on protecting enterprise data: sensitive files and emails; confidential customer, patient and employee data; financial records; strategic and product plans; and other intellectual property. Through its products DatAdvantage (including the Automation Engine), DatAlert (including Varonis Edge), DataPrivilege, Data Classification Engine (including Policy Pack and Data Classification Labels), Data Transport Engine and DatAnswers, the software platform allows enterprises to protect sensitive data from insider threats and cyberattacks, and realize the value of their enterprise data in ways that are not resource-intensive and easy to implement. VSI and VPS market and sell products and services mainly in the United States. VSUK, VSG, VSF, VSC, VIRE, VAUS, VNL and VLUX resell the Company’s products and services mainly in the United Kingdom, Germany, France, Canada, Ireland, Australia, the Netherlands and Belgium and Luxembourg, respectively. The Company primarily sells its products and services to a global network of distributors and Value Added Resellers (VARs), which sell the products to end user customers. b. Basis of Presentation: The accompanying unaudited consolidated interim financial statements have been prepared in accordance with Article 10 of Regulation S-X, “Interim Financial Statements” and the rules and regulations for Form 10-Q of the Securities and Exchange Commission (the “SEC”). Pursuant to those rules and regulations, the Company has condensed or omitted certain information and footnote disclosure it normally includes in its annual consolidated financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). Certain amounts in prior periods' financial statements have been recast and reclassified to conform to the current year's presentation. In management’s opinion, the Company has made all adjustments (consisting only of normal, recurring adjustments, except as otherwise indicated) necessary to fairly present its consolidated financial position, results of operations and cash flows. The Company’s interim period operating results do not necessarily indicate the results that may be expected for any other interim period or for the full fiscal year. These financial statements and accompanying notes should be read in conjunction with the 2018 consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for its fiscal year ended December 31, 2018 filed with the SEC on February 12, 2019 (the “ 2018 Form 10-K”). There have been no changes in the significant accounting policies from those that were disclosed in the audited consolidated financial statements for the fiscal year ended December 31, 2018 included in the 2018 Form 10-K, except as follows: Effective as of January 1, 2019, the Company adopted Accounting Standards Update 2016-02, “Leases” (“ASU 2016-02”) using the modified retrospective approach. For information regarding ASU 2016-02, please refer to Note 3. c. Revenue Recognition: The Company generates revenues in the form of software license fees and related maintenance and services fees. Subscription revenues are comprised of time-based licenses whereby customers use our software with related maintenance (including support and unspecified upgrades and enhancements when and if they are available) for a specified period. Subscriptions are sold on premises with the same functionality as the perpetual license and are recognized from sales of subscription and maintenance licenses to new and existing customers. When products are purchased as a subscription, the associated maintenance is included as part of the subscription revenues. Perpetual license revenues consist of the revenues recognized from sales of perpetual licenses to new and existing customers. Maintenance and services primarily consist of fees for maintenance services of perpetual license sales (including support and unspecified upgrades and enhancements when and if they are available) and to a lesser extent professional services which focus on both operationalizing the software and training the Company’s customers to fully leverage the use of its products although the user can benefit from the software without the Company’s assistance. The Company sells its products worldwide directly to a network of distributors and VARs, and payment is typically due within 30 to 60 calendar days of the invoice date. The Company recognizes revenues in accordance with ASC No. 606, “Revenue from Contracts with Customers”. As such, the Company identifies a contract with a customer, identifies the performance obligations in the contract, determines the transaction price, allocates the transaction price to each performance obligation in the contract and recognizes revenues when (or as) the Company satisfies a performance obligation. Subscription software and perpetual license revenues are recognized at the point of time when the software license has been delivered and the benefit of the asset has transferred. The Company recognizes revenues from maintenance of perpetual license sales ratably over the term of the underlying maintenance contract. The term of the maintenance contract is usually one year . Renewals of maintenance contracts create new performance obligations that are satisfied over the term with the revenues recognized ratably over the period. Revenues from professional services consist mostly of time and material services. The performance obligations are satisfied, and revenues are recognized, when the services are provided or once the service term has expired. The Company enters into contracts that can include combinations of products and services, which are generally capable of being distinct and accounted for as separate performance obligations. The license is distinct upon delivery as the customer can derive the economic benefit of the software without any professional services, updates or technical support. The Company allocates the transaction price to each performance obligation based on its relative standalone selling price out of the total consideration of the contract. For maintenance, the Company determines the standalone selling prices based on the price at which the Company separately sells a renewal contract. For professional services, the Company determines the standalone selling prices based on the price at which the Company separately sells those services. For software licenses, the Company uses the residual approach to determine the standalone selling prices due to the lack of history of selling software license on a standalone basis and the highly variable sales price. Trade and other receivables are primarily comprised of trade receivables that are recorded at the invoice amount, net of an allowance for doubtful accounts. Deferred revenues represent mostly unrecognized fees billed or collected for maintenance and professional services. Deferred revenues are recognized as (or when) the Company performs under the contract. Deferred revenues do not include multi-year subscription contracts with an automatic renewal component for which the associated revenues have not been recognized and the customers have not yet been invoiced. The amount of revenues recognized in the period that was included in the opening deferred revenues balance was $76,026 for the nine months ended September 30, 2019 . The Company does not grant a right of return to its customers, except for one of its resellers. In 2018 and for the nine months ended September 30, 2019 , there were no returns from this reseller. For information regarding disaggregated revenues, please refer to Note 5. d. Contract Costs: The Company pays sales commissions to sales and marketing and certain management personnel based on their attainment of certain predetermined sales goals. Sales commissions earned by its employees are considered incremental and recoverable costs of obtaining a contract with a customer. Sales commissions paid for initial contracts, which are not commensurate with sales commissions paid for renewal contracts, are capitalized and amortized over an expected period of benefit. Based on its technology, customer contracts and other factors, the Company has determined the expected period of benefit to be approximately four years . Sales commissions for renewal contracts are capitalized and then amortized on a straight line basis over the related contractual renewal period. Amortization expenses related to these costs are mostly included in sales and marketing expenses in the accompanying consolidated statements of operations. e. Derivative Instruments: The Company’s primary objective for holding derivative instruments is to reduce its exposure to foreign currency rate changes. The Company reduces its exposure by entering into forward foreign exchange contracts with respect to operating expenses that are forecasted to be incurred in currencies other than the U.S. dollar. A majority of the Company’s revenues and operating expenditures are transacted in U.S. dollars. However, certain operating expenditures are incurred in or exposed to other currencies, primarily the New Israeli Shekel (“NIS”). The Company has established forecasted transaction currency risk management programs to protect against fluctuations in fair value and the volatility of future cash flows caused by changes in exchange rates. The Company’s currency risk management program includes forward foreign exchange contracts designated as cash flow hedges. These forward foreign exchange contracts generally mature within 12 months. The Company does not enter into derivative financial instruments for trading purposes. In addition, the Company enters into forward contracts to hedge a portion of its monetary items in the balance sheet, such as trade receivables and payables, denominated in Pound Sterling and Euro for short term periods (the “Fair Value Hedging Program”). The purpose of the Fair Value Hedging Program is to protect the fair value of the monetary assets from foreign exchange rate fluctuations. Gains and losses from derivatives related to the Fair Value Hedging Program are not designated as hedging instruments. Derivative instruments measured at fair value and their classification on the consolidated balance sheets are presented in the following table (in thousands): Assets (liabilities) as of Liabilities as of Notional Amount Fair Value Notional Amount Fair Value Foreign exchange forward contract derivatives in cash flow hedging relationships included in other current assets and accrued expenses and other short term liabilities $ 22,413 $ 731 $ 75,153 $ (3,628 ) Foreign exchange forward contract derivatives for monetary items included in other short term liabilities $ 17,823 $ (5 ) $ 29,162 $ (18 ) For the three and nine months ended September 30, 2019 , the unaudited consolidated statements of operations reflect a gain of $361 and a loss of $170 , respectively, related to the effective portion of the cash flow hedges. For the three and nine months ended September 30, 2018 , the unaudited consolidated statements of operations reflect a loss of $1,194 and $2,094 , respectively, related to the effective portion of the cash flow hedges. Any ineffective portion of the cash flow hedges is recognized in financial income (expenses), net in the consolidated statement of operations. No material ineffective hedges were recognized in financial income (expenses), net for the three and nine months ended September 30, 2019 and 2018 . For the three and nine months ended September 30, 2019 , the unaudited consolidated statements of operations reflect a gain of $951 and $1,404 , respectively, in financial income (expenses), net, related to the Fair Value Hedging Program. For the three and nine months ended September 30, 2018 , the unaudited consolidated statements of operations reflect a loss of $199 in financial income (expenses), net, related to the Fair Value Hedging Program. f. Cash, Cash Equivalents, Marketable Securities and Short-Term Investments: The Company accounts for investments in marketable securities in accordance with ASC No. 320, “Investments—Debt and Equity Securities”. The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. Cash and cash equivalents consist of cash on hand, highly liquid investments in money market funds and various deposit accounts. The Company considers all high quality investments purchased with original maturities at the date of purchase greater than three but less than twelve months to be short-term deposits. Cash equivalents, marketable securities and short-term deposits are classified as available for sale and are, therefore, recorded at fair value on the consolidated balance sheet, with any unrealized gains and losses reported in accumulated other comprehensive income (loss), which is reflected as a separate component of stockholders’ equity in the Company’s consolidated balance sheets, until realized. The Company uses the specific identification method to compute gains and losses on the investments. The amortized cost of securities is adjusted for amortization of premiums and accretion of discounts to maturity. Such amortization and accretion is included as a component of financial income (expenses), net in the consolidated statement of operations. Cash, cash equivalents, marketable securities and short-term deposits consist of the following (in thousands): As of September 30, 2019 (unaudited) Amortized Cost Gross Unrealized Gains Gross Unrealized Loss Fair Value Cash and cash equivalents Money market funds $ 4,788 $ — $ — $ 4,788 Total $ 4,788 $ — $ — $ 4,788 Marketable securities US Treasury securities $ 41,367 $ 31 $ (1 ) $ 41,397 Total $ 41,367 $ 31 $ (1 ) $ 41,397 Short-term deposits Term bank deposits $ 37,000 $ — $ — $ 37,000 Total $ 37,000 $ — $ — $ 37,000 As of December 31, 2018 Amortized Cost Gross Unrealized Gains Gross Unrealized Loss Fair Value Cash and cash equivalents Money market funds $ 2,594 $ — $ — $ 2,594 Total $ 2,594 $ — $ — $ 2,594 Marketable securities US Treasury securities $ 39,776 $ *) $ (6 ) $ 39,770 Total $ 39,776 $ *) $ (6 ) $ 39,770 Short-term deposits Term bank deposits $ 70,438 $ — $ — $ 70,438 Total $ 70,438 $ — $ — $ 70,438 *) Represents an amount lower than $1 All the US Treasury securities in marketable securities have a stated effective maturity of less than 12 months as of September 30, 2019 and December 31, 2018 . The gross unrealized gains and losses related to these short-term investments was due primarily to changes in interest rates. The Company reviews its short-term investments on a regular basis to evaluate whether or not any security has experienced an other than temporary decline in fair value. The Company considers factors such as length of time and extent to which the market value has been less than the cost, the financial condition and near-term prospects of the issuer and its intent to sell, or whether it is more likely than not the Company will be required to sell the investment before recovery of the investment’s amortized cost basis. If the Company believes that an other than temporary decline exists in one of these securities, the Company writes down these investments to fair value. For debt securities, the portion of the write-down related to credit loss would be recorded to other income (expenses), net in the Company’s consolidated statements of operations. Any portion not related to credit loss would be recorded to accumulated other comprehensive income (loss), which is reflected as a separate component of stockholders’ equity in the Company’s condensed consolidated balance sheets. During the nine months ended September 30, 2019 , the Company did not consider any of its investments to be other-than-temporarily impaired. g. Credit Facility: On March 31, 2014, the Company entered into a promissory note and related security documents with Bank Leumi USA, which the Company has extended a number of times. The Company may borrow up to $7,000 against certain of its accounts receivable outstanding amount, based on several conditions, at an annual interest rate of the Wall Street Journal Prime Rate plus 0.05% , provided that the annual interest rate applicable to advances will not be lower than 4.10% . As of September 30, 2019 , that rate amounted to 5.05% . This promissory note enables the Company, among other things, to engage in foreign currency hedging transactions with Bank Leumi USA to manage exposure to foreign currency risk without restricted cash requirements. The Company may borrow under the promissory note until November 15, 2020 at which time the principal sum of each such loan, together with accrued and unpaid interest payable, will become due and payable. As of September 30, 2019 , the Company had no balance outstanding under the promissory note. As part of the transaction, the Company granted the lender a security interest in its personal property, excluding intellectual property and other intangible assets. The promissory note also contains customary events of default. h. Recently Adopted Accounting Pronouncements: In February 2016, the Financial Accounting Standards Board ("FASB") issued ASU 2016-02, “Leases” ("ASC 842"), on the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors). The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight line basis over the term of the lease, respectively. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for in a manner similar to the accounting under the prior guidance (ASC 840). The new standard requires lessors to account for leases using an approach that is substantially equivalent to ASC 840 guidance for sales-type leases, direct financing leases and operating leases. The new standard supersedes the previous leases standard, ASC 840, "Leases". The Company adopted the new standard as of January 1, 2019, using the modified retrospective approach. Consequently, prior period balances and disclosures have not been restated. The Company has elected to utilize the available package of practical expedients permitted under the transition guidance within the new standard which does not require it to reassess the prior conclusions about lease identification, lease classification and initial direct costs. The adoption of ASC 842 resulted in the elimination of deferred rent of $1,313 and $4,236 in current and long-term liabilities in the Company’s consolidated balance sheets, respectively. Additionally, the Company included in its balance sheet at adoption an operating right-of-use assets, short term operating lease liabilities and long term operating lease liabilities of $ 53,274 , $2,349 and $ 55,676 , respectively. The standard did not materially impact the Company's net earnings and had no impact on cash flows. For additional information regarding the Company's accounting for leases, please refer to Note 3. In June 2018, the FASB issued ASU No. 2018-07, “Compensation - Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting.” These amendments expand the scope of Topic 718, Compensation - Stock Compensation (which currently only includes share-based payments to employees) to include share-based payments issued to nonemployees for goods or services. Consequently, the accounting for share-based payments to nonemployees and employees will be substantially aligned. This ASU supersedes Subtopic 505-50, Equity - Equity-Based Payments to Non-Employees. Adoption of this standard had an immaterial impact on the Company's consolidated financial statements. i. Recently Issued Accounting Pronouncements Not Yet Adopted: In August 2018, the FASB issued ASU 2018-15, “Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract,” which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The new standard requires capitalized costs to be amortized on a straight-line basis generally over the term of the arrangement, and the financial statement presentation for these capitalized costs would be the same as that of the fees related to the hosting arrangements. This new standard is effective for our interim and annual periods beginning January 1, 2020, and earlier adoption is permitted. This standard could be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. The Company will adopt this standard on a prospective basis as of January 1, 2020 and is evaluating the impact of the pending adoption of this standard on its consolidated financial statements. In January 2016, the FASB issued ASU 2016-13, “Financial Instruments – Credit Losses on Financial Instruments”, which requires that expected credit losses relating to financial assets measured on an amortized cost basis and available for sale debt securities be recorded through an allowance for credit losses. ASU 2016-13 limits the amount of credit losses to be recognized for available for sale debt securities to the amount by which carrying value exceeds fair value and also requires the reversal of previously recognized credit losses if fair value increases. The new standard will be effective for interim and annual periods beginning after January 1, 2020, and early adoption is permitted. The Company does not expect this standard to have a material effect on its consolidated financial statements. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | FAIR VALUE MEASUREMENTS The Company evaluates assets and liabilities subject to fair value measurements on a recurring basis to determine the appropriate level to classify them for each reporting period. There have been no transfers between fair value measurements levels during the three months ended September 30, 2019 . The authoritative guidance on fair value measurements establishes a consistent framework for measuring fair value on either a recurring or nonrecurring basis whereby inputs, used in valuation techniques, are assigned a hierarchical level. The following are the hierarchical levels of inputs to measure fair value: • Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. • Level 2: Observable inputs that reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means. • Level 3: Unobservable inputs reflecting the Company’s own assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available. The following table sets forth the Company’s assets and liabilities that were measured at fair value as of September 30, 2019 and December 31, 2018 by level within the fair value hierarchy (in thousands): As of September 30, 2019 As of December 31, 2018 Level I Level II Level III Fair Value Level I Level II Level III Fair Value Financial assets: Cash equivalents: Money market funds 4,788 — — 4,788 2,594 — — 2,594 Marketable securities: US Treasury securities 41,397 — — 41,397 39,770 — — 39,770 Other current assets: Forward foreign exchange contracts — 731 — 731 — — — — Financial liabilities: Accrued expenses and other short term liabilities: Forward foreign exchange contracts — (5 ) — (5 ) — (3,647 ) — (3,647 ) Total financial assets (liabilities) $ 46,185 $ 726 $ — $ 46,911 $ 42,364 $ (3,647 ) $ — $ 38,717 |
Leases
Leases | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Leases | LEASES In February 2016, the FASB issued ASU 2016-02, “Leases”, on the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors). The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease, respectively. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. The Company has elected the short-term lease exception for leases with a term of 12 months or less. As part of this election it will not recognize right-of-use assets and lease liabilities on the balance sheet for leases with terms less than 12 months. The Company also elected the practical expedient to not separate lease and non-lease components for all its leases. This will result in the initial and subsequent measurement of the balances of the right-of-use asset and lease liability being greater than if the policy election was not applied. Some leases include one or more options to renew. The exercise of lease renewal options is typically at the Company's sole discretion; therefore, the majority of renewals to extend the lease terms are not included in our right of use assets and lease liabilities as they are not reasonably certain of exercise. The Company regularly evaluates the renewal options, and, when it is reasonably certain of exercise, it will include the renewal period in its lease term. New lease modifications result in remeasurement of the right of use asset and lease liability. The right-of-use asset and lease liability are initially measured at the present value of the lease payments, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company's incremental borrowing rate based on the information available at the date of adoption in determining the present value of the lease payments. The Company's incremental borrowing rate is estimated to approximate the interest rate on similar terms and payments and in economic environments where the leased asset is located. Some of the real estate leases contain variable lease payments, including payments based on a Consumer Price Index ("CPI"). Variable lease payments based on a CPI are initially measured using the index in effect at lease adoption. Additional payments based on the change in a CPI are recorded as a period expense when incurred. The Company has various operating leases for office space, vehicles and office equipment that expire through 2030. Its lease agreements generally do not contain any material residual value guarantees or material restrictive covenants. Below is a summary of our operating right-of-use assets and operating lease liabilities as of September 30, 2019 : September 30, 2019 (unaudited) Operating right-of-use assets $ 57,046 Operating lease liabilities, current $ 7,287 Operating lease liabilities long-term 58,667 Total operating lease liabilities $ 65,954 Operating lease liabilities, current are included within accrued expenses and other short term liabilities in the consolidated balance sheet. Minimum lease payments for our right of use assets over the remaining lease periods as of September 30, 2019 , are as follows: September 30, 2019 (unaudited) 2019 $ 1,791 2020 11,065 2021 9,121 2022 9,136 2023 8,953 Thereafter 38,885 Total undiscounted lease payments $ 78,951 Less: Interest (12,997 ) Present value of lease liabilities $ 65,954 The weighted average remaining lease terms and discount rates for all of operating leases were as follows as of September 30, 2019 : Remaining lease term and discount rate: Weighted average remaining lease term (years) 8.56 Weighted average discount rate 4.02 % Total rent expenses for the three and nine months ended September 30, 2019 were $2,980 and $6,283 , respectively. Total rent expenses for the three and nine months ended September 30, 2018 were $1,370 and $4,011 |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2019 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | STOCKHOLDERS’ EQUITY a. On December 30, 2005, the Company’s board of directors adopted the Varonis Systems, Inc. 2005 Stock Plan (the “2005 Stock Plan”). As of December 31, 2013, the Company had reserved 4,713,319 shares of common stock available for issuance to employees, directors, officers and consultants of the Company and its subsidiaries. The options generally vest over four years . No awards were granted under the 2005 Stock Plan subsequent to December 31, 2013, and no further awards will be granted under the 2005 Stock Plan. On November 14, 2013, the Company’s board of directors adopted the Varonis Systems, Inc. 2013 Omnibus Equity Incentive Plan (the “2013 Plan”) which was subsequently approved by the Company’s stockholders. The Company initially reserved 1,904,633 shares of common stock for issuance under the 2013 Plan to employees, directors, officers and consultants of the Company and its subsidiaries. The number of shares of common stock available for issuance under the 2013 Plan was increased on January 1, 2016 and has been, and will be, increased on each January 1 thereafter by four percent ( 4% ) of the number of shares of common stock issued and outstanding on each December 31 immediately prior to the date of increase (rounded down to the nearest whole share), but the amount of each increase will be limited to the number of shares of common stock necessary to bring the total number of shares of Common Stock available for grant and issuance under the 2013 Plan to five percent ( 5% ) of the number of shares of common stock issued and outstanding on each December 31. On January 1, 2019, 2018, 2017 and 2016, the share reserve under the 2013 Plan was automatically increased by 1,183,075 , 1,125,846 , 1,072,870 and 1,042,766 shares, respectively. Awards granted under the 2013 Plan generally vest over four years . Any award that is forfeited or canceled before expiration becomes available for future grants under the 2013 Plan. A summary of employees’ stock options activities during the nine months ended September 30, 2019 is as follows: Nine Months Ended Number Weighted average exercise price Aggregate intrinsic value (in thousands) Weighted average remaining contractual life (years) Options outstanding as of January 1, 2019 709,668 $ 17.941 $ 24,810 4.513 Granted — $ — Exercised (205,933 ) $ 10.352 Forfeited — $ — Options outstanding as of September 30, 2019 503,735 $ 21.043 $ 19,513 4.464 Options exercisable as of September 30, 2019 498,525 $ 21.086 $ 19,290 4.443 The aggregate intrinsic value in the table above represents the total intrinsic value that would have been received by the option holders had all option holders exercised their options on the last date of the period. Total intrinsic value of options exercised for the nine months ended September 30, 2019 was $10,117 . b. The options outstanding as of September 30, 2019 (unaudited) have been separated into ranges of exercise price as follows: Range of exercise price Options outstanding as of September 30, 2019 Weighted average remaining contractual life (years) Weighted average exercise price Options exercisable as of September 30, 2019 Weighted average remaining contractual life (years) Weighted average exercise price of options exercisable $1.576 8,470 0.410 $ 1.576 8,470 0.410 $ 1.576 $ 6.230 — 8.800 11,856 2.244 $ 8.084 11,856 2.244 $ 8.084 $ 12.470 — 16.870 131,925 4.290 $ 14.100 126,715 4.204 $ 13.960 $ 19.510 — 21.660 186,690 4.720 $ 21.170 186,690 4.720 $ 21.170 $ 22.010 — 24.230 73,048 4.276 $ 22.425 73,048 4.276 $ 22.425 $29.880 57,379 5.397 $ 29.880 57,379 5.397 $ 29.880 $39.860 34,367 4.339 $ 39.860 34,367 4.339 $ 39.860 503,735 4.464 $ 21.043 498,525 4.443 $ 21.086 c. Options issued to consultants: The Company’s outstanding options granted to consultants for services as of September 30, 2019 (unaudited) were as follows: Options for shares of common stock Exercise price per share Options exercisable Exercisable through (number) (number) February 2013 1,500 $ 12.470 1,500 February 2023 August 2013 4,000 $ 21.140 4,000 August 2023 March 2014 5,550 $ 39.860 5,550 March 2024 May 2014 3,700 $ 22.010 3,700 May 2024 November 2014 5,468 $ 21.660 5,468 November 2024 May 2015 1,137 $ 19.510 1,137 May 2025 February 2016 2,138 $ 16.870 1,875 February 2026 23,493 23,230 d. Restricted stock units: A summary of restricted stock units and performance stock units for employees, consultants and non-employee directors of the Company for the nine months ended September 30, 2019 (unaudited) is as follows: Number of shares underlying outstanding restricted stock units Weighted- average grant date fair value Unvested balance - January 1, 2019 2,440,027 $ 40.00 Granted 1,262,834 $ 57.75 Vested (760,408 ) $ 36.32 Forfeited (306,866 ) $ 46.10 Unvested balance – September 30, 2019 2,635,587 $ 48.90 e. As of September 30, 2019 , there was $107,699 and $34 of total unrecognized compensation cost related to employees and non-employees unvested restricted stock units and stock options, respectively. This cost is expected to be recognized over a period of 2.585 years and 0.34 0 years for restricted stock units and stock options, respectively. f. 2015 Employee Stock Purchase Plan On May 5, 2015, the Company’s stockholders approved the Varonis Systems, Inc. 2015 Employee Stock Purchase Plan (the “ESPP”), which the Company’s board of directors had adopted on March 19, 2015. The ESPP became effective as of June 30, 2015. The ESPP allows eligible employees to purchase shares of the Company’s common stock at a discount through payroll deductions of up to 15% of their eligible compensation, at not less than 85% of the fair market value of the Company’s common stock on the first day or last trading day in the offering period, subject to any plan limitations. The Company initially reserved 500,000 shares of common stock for issuance under the ESPP. The number of shares available for issuance under the ESPP was increased on January 1, 2016 and has been, and will be, increased each January 1 thereafter, by an amount equal to the lesser of (i) one percent ( 1% ) of the number of shares of common stock issued and outstanding on each December 31 immediately prior to the date of increase, except that the amount of each such increase will be limited to the number of shares of common stock necessary to bring the total number of shares of common stock available for issuance under the ESPP to two percent ( 2% ) of the number of shares of common stock issued and outstanding on each such December 31, or (ii) 400,000 shares of common stock. On January 1, 2019, 2018, 2017 and 2016, the share reserve under the ESPP was automatically increased by 177,358 , 188,813 , 158,695 and 21,383 shares, respectively. The ESPP will continue in effect until the earlier of (i) the date when no shares of common stock are available for issuance thereunder or (ii) June 30, 2025; unless terminated prior thereto by the Company’s board of directors or compensation committee, each of which has the right to terminate the ESPP at any time. g. Stock-based compensation expense for employees and consultants: The Company recognized non-cash stock-based compensation expense in the consolidated statements of operations as follows: Three Months Ended Nine Months Ended 2019 2018 2019 2018 (unaudited) (in thousands) (unaudited) (in thousands) Cost of revenues $ 637 $ 470 $ 1,967 $ 1,300 Research and development 3,476 2,097 9,674 7,180 Sales and marketing 3,932 3,600 11,015 10,349 General and administrative 2,977 2,232 12,123 5,345 Total $ 11,022 $ 8,399 $ 34,779 $ 24,174 h. Since the Company is in a net loss position for all periods presented, basic net loss per share is the same as diluted net loss per share for all the periods as the inclusion of all potential shares of common stock outstanding would have been anti-dilutive. There were 3,162,815 and 3,354,028 potentially dilutive shares from the conversion of outstanding restricted stock units and stock options that were not included in the calculation of diluted net loss per share as of September 30, 2019 and 2018 |
Geographic Information and Majo
Geographic Information and Major Customer and Product Data | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
Geographic Information and Major Customer and Product Data | GEOGRAPHIC INFORMATION AND MAJOR CUSTOMER AND PRODUCT DATA Summary information about geographic areas: ASC 280, “Segment Reporting,” establishes standards for reporting information about operating segments. 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. The Company manages its business on the basis of one reportable segment and derives revenues from licensing of software and sales of professional services, maintenance and technical support (see Note 1 for a brief description of the Company’s business). The following is a summary of revenues within geographic areas: Three Months Ended Nine Months Ended 2019 2018 2019 2018 (unaudited) (unaudited) (in thousands) (in thousands) Revenues based on customer’s location: North America $ 47,411 $ 44,890 $ 125,243 $ 114,951 EMEA (*) 16,719 19,778 50,672 61,606 Rest of World 1,519 2,384 5,715 6,213 Total revenues $ 65,649 $ 67,052 $ 181,630 $ 182,770 (*) Sales to customers in France did not exceed 10% of total revenues for the nine months ended September 30, 2019 and accounted for $19,813 of the Company’s revenues for the nine months ended September 30, 2018 . Sales to customers in the United Kingdom did not exceed 10% of total revenues for the nine months ended September 30, 2019 and accounted for $18,708 of the Company’s revenues for the nine months ended September 30, 2018 . September 30, 2019 December 31, 2018 (unaudited) (in thousands) Long-lived assets by geographic region: United States $ 12,422 $ 7,612 Israel 13,013 7,834 France 1,036 1,243 Other 717 634 $ 27,188 $ 17,323 |
General (Policies)
General (Policies) | 9 Months Ended |
Sep. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | b. Basis of Presentation: The accompanying unaudited consolidated interim financial statements have been prepared in accordance with Article 10 of Regulation S-X, “Interim Financial Statements” and the rules and regulations for Form 10-Q of the Securities and Exchange Commission (the “SEC”). Pursuant to those rules and regulations, the Company has condensed or omitted certain information and footnote disclosure it normally includes in its annual consolidated financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). Certain amounts in prior periods' financial statements have been recast and reclassified to conform to the current year's presentation. In management’s opinion, the Company has made all adjustments (consisting only of normal, recurring adjustments, except as otherwise indicated) necessary to fairly present its consolidated financial position, results of operations and cash flows. The Company’s interim period operating results do not necessarily indicate the results that may be expected for any other interim period or for the full fiscal year. These financial statements and accompanying notes should be read in conjunction with the 2018 consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for its fiscal year ended December 31, 2018 filed with the SEC on February 12, 2019 (the “ 2018 Form 10-K”). There have been no changes in the significant accounting policies from those that were disclosed in the audited consolidated financial statements for the fiscal year ended December 31, 2018 included in the 2018 Form 10-K, except as follows: Effective as of January 1, 2019, the Company adopted Accounting Standards Update 2016-02, “Leases” (“ASU 2016-02”) using the modified retrospective approach. For information regarding ASU 2016-02, please refer to Note 3. |
Revenue Recognition | d. Contract Costs: The Company pays sales commissions to sales and marketing and certain management personnel based on their attainment of certain predetermined sales goals. Sales commissions earned by its employees are considered incremental and recoverable costs of obtaining a contract with a customer. Sales commissions paid for initial contracts, which are not commensurate with sales commissions paid for renewal contracts, are capitalized and amortized over an expected period of benefit. Based on its technology, customer contracts and other factors, the Company has determined the expected period of benefit to be approximately four years . Sales commissions for renewal contracts are capitalized and then amortized on a straight line basis over the related contractual renewal period. Amortization expenses related to these costs are mostly included in sales and marketing expenses in the accompanying consolidated statements of operations. c. Revenue Recognition: The Company generates revenues in the form of software license fees and related maintenance and services fees. Subscription revenues are comprised of time-based licenses whereby customers use our software with related maintenance (including support and unspecified upgrades and enhancements when and if they are available) for a specified period. Subscriptions are sold on premises with the same functionality as the perpetual license and are recognized from sales of subscription and maintenance licenses to new and existing customers. When products are purchased as a subscription, the associated maintenance is included as part of the subscription revenues. Perpetual license revenues consist of the revenues recognized from sales of perpetual licenses to new and existing customers. Maintenance and services primarily consist of fees for maintenance services of perpetual license sales (including support and unspecified upgrades and enhancements when and if they are available) and to a lesser extent professional services which focus on both operationalizing the software and training the Company’s customers to fully leverage the use of its products although the user can benefit from the software without the Company’s assistance. The Company sells its products worldwide directly to a network of distributors and VARs, and payment is typically due within 30 to 60 calendar days of the invoice date. The Company recognizes revenues in accordance with ASC No. 606, “Revenue from Contracts with Customers”. As such, the Company identifies a contract with a customer, identifies the performance obligations in the contract, determines the transaction price, allocates the transaction price to each performance obligation in the contract and recognizes revenues when (or as) the Company satisfies a performance obligation. Subscription software and perpetual license revenues are recognized at the point of time when the software license has been delivered and the benefit of the asset has transferred. The Company recognizes revenues from maintenance of perpetual license sales ratably over the term of the underlying maintenance contract. The term of the maintenance contract is usually one year . Renewals of maintenance contracts create new performance obligations that are satisfied over the term with the revenues recognized ratably over the period. Revenues from professional services consist mostly of time and material services. The performance obligations are satisfied, and revenues are recognized, when the services are provided or once the service term has expired. The Company enters into contracts that can include combinations of products and services, which are generally capable of being distinct and accounted for as separate performance obligations. The license is distinct upon delivery as the customer can derive the economic benefit of the software without any professional services, updates or technical support. The Company allocates the transaction price to each performance obligation based on its relative standalone selling price out of the total consideration of the contract. For maintenance, the Company determines the standalone selling prices based on the price at which the Company separately sells a renewal contract. For professional services, the Company determines the standalone selling prices based on the price at which the Company separately sells those services. For software licenses, the Company uses the residual approach to determine the standalone selling prices due to the lack of history of selling software license on a standalone basis and the highly variable sales price. Trade and other receivables are primarily comprised of trade receivables that are recorded at the invoice amount, net of an allowance for doubtful accounts. |
Derivative Instruments | e. Derivative Instruments: The Company’s primary objective for holding derivative instruments is to reduce its exposure to foreign currency rate changes. The Company reduces its exposure by entering into forward foreign exchange contracts with respect to operating expenses that are forecasted to be incurred in currencies other than the U.S. dollar. A majority of the Company’s revenues and operating expenditures are transacted in U.S. dollars. However, certain operating expenditures are incurred in or exposed to other currencies, primarily the New Israeli Shekel (“NIS”). The Company has established forecasted transaction currency risk management programs to protect against fluctuations in fair value and the volatility of future cash flows caused by changes in exchange rates. The Company’s currency risk management program includes forward foreign exchange contracts designated as cash flow hedges. These forward foreign exchange contracts generally mature within 12 months. The Company does not enter into derivative financial instruments for trading purposes. In addition, the Company enters into forward contracts to hedge a portion of its monetary items in the balance sheet, such as trade receivables and payables, denominated in Pound Sterling and Euro for short term periods (the “Fair Value Hedging Program”). The purpose of the Fair Value Hedging Program is to protect the fair value of the monetary assets from foreign exchange rate fluctuations. Gains and losses from derivatives related to the Fair Value Hedging Program are not designated as hedging instruments. |
Cash, Cash Equivalents and Short-term Investments | f. Cash, Cash Equivalents, Marketable Securities and Short-Term Investments: The Company accounts for investments in marketable securities in accordance with ASC No. 320, “Investments—Debt and Equity Securities”. The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. Cash and cash equivalents consist of cash on hand, highly liquid investments in money market funds and various deposit accounts. |
Restricted Cash | All the US Treasury securities in marketable securities have a stated effective maturity of less than 12 months as of September 30, 2019 and December 31, 2018 . The gross unrealized gains and losses related to these short-term investments was due primarily to changes in interest rates. The Company reviews its short-term investments on a regular basis to evaluate whether or not any security has experienced an other than temporary decline in fair value. The Company considers factors such as length of time and extent to which the market value has been less than the cost, the financial condition and near-term prospects of the issuer and its intent to sell, or whether it is more likely than not the Company will be required to sell the investment before recovery of the investment’s amortized cost basis. If the Company believes that an other than temporary decline exists in one of these securities, the Company writes down these investments to fair value. For debt securities, the portion of the write-down related to credit loss would be recorded to other income (expenses), net in the Company’s consolidated statements of operations. Any portion not related to credit loss would be recorded to accumulated other comprehensive income (loss), which is reflected as a separate component of stockholders’ equity in the Company’s condensed consolidated balance sheets. During the nine months ended September 30, 2019 , the Company did not consider any of its investments to be other-than-temporarily impaired. |
Recently Issued Accounting Pronouncements | h. Recently Adopted Accounting Pronouncements: In February 2016, the Financial Accounting Standards Board ("FASB") issued ASU 2016-02, “Leases” ("ASC 842"), on the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors). The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight line basis over the term of the lease, respectively. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for in a manner similar to the accounting under the prior guidance (ASC 840). The new standard requires lessors to account for leases using an approach that is substantially equivalent to ASC 840 guidance for sales-type leases, direct financing leases and operating leases. The new standard supersedes the previous leases standard, ASC 840, "Leases". The Company adopted the new standard as of January 1, 2019, using the modified retrospective approach. Consequently, prior period balances and disclosures have not been restated. The Company has elected to utilize the available package of practical expedients permitted under the transition guidance within the new standard which does not require it to reassess the prior conclusions about lease identification, lease classification and initial direct costs. The adoption of ASC 842 resulted in the elimination of deferred rent of $1,313 and $4,236 in current and long-term liabilities in the Company’s consolidated balance sheets, respectively. Additionally, the Company included in its balance sheet at adoption an operating right-of-use assets, short term operating lease liabilities and long term operating lease liabilities of $ 53,274 , $2,349 and $ 55,676 , respectively. The standard did not materially impact the Company's net earnings and had no impact on cash flows. For additional information regarding the Company's accounting for leases, please refer to Note 3. In June 2018, the FASB issued ASU No. 2018-07, “Compensation - Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting.” These amendments expand the scope of Topic 718, Compensation - Stock Compensation (which currently only includes share-based payments to employees) to include share-based payments issued to nonemployees for goods or services. Consequently, the accounting for share-based payments to nonemployees and employees will be substantially aligned. This ASU supersedes Subtopic 505-50, Equity - Equity-Based Payments to Non-Employees. Adoption of this standard had an immaterial impact on the Company's consolidated financial statements. i. Recently Issued Accounting Pronouncements Not Yet Adopted: In August 2018, the FASB issued ASU 2018-15, “Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract,” which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The new standard requires capitalized costs to be amortized on a straight-line basis generally over the term of the arrangement, and the financial statement presentation for these capitalized costs would be the same as that of the fees related to the hosting arrangements. This new standard is effective for our interim and annual periods beginning January 1, 2020, and earlier adoption is permitted. This standard could be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. The Company will adopt this standard on a prospective basis as of January 1, 2020 and is evaluating the impact of the pending adoption of this standard on its consolidated financial statements. In January 2016, the FASB issued ASU 2016-13, “Financial Instruments – Credit Losses on Financial Instruments”, which requires that expected credit losses relating to financial assets measured on an amortized cost basis and available for sale debt securities be recorded through an allowance for credit losses. ASU 2016-13 limits the amount of credit losses to be recognized for available for sale debt securities to the amount by which carrying value exceeds fair value and also requires the reversal of previously recognized credit losses if fair value increases. The new standard will be effective for interim and annual periods beginning after January 1, 2020, and early adoption is permitted. The Company does not expect this standard to have a material effect on its consolidated financial statements. |
General (Tables)
General (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | Derivative instruments measured at fair value and their classification on the consolidated balance sheets are presented in the following table (in thousands): Assets (liabilities) as of Liabilities as of Notional Amount Fair Value Notional Amount Fair Value Foreign exchange forward contract derivatives in cash flow hedging relationships included in other current assets and accrued expenses and other short term liabilities $ 22,413 $ 731 $ 75,153 $ (3,628 ) Foreign exchange forward contract derivatives for monetary items included in other short term liabilities $ 17,823 $ (5 ) $ 29,162 $ (18 ) |
Cash, Cash Equivalents and Investments | Cash, cash equivalents, marketable securities and short-term deposits consist of the following (in thousands): As of September 30, 2019 (unaudited) Amortized Cost Gross Unrealized Gains Gross Unrealized Loss Fair Value Cash and cash equivalents Money market funds $ 4,788 $ — $ — $ 4,788 Total $ 4,788 $ — $ — $ 4,788 Marketable securities US Treasury securities $ 41,367 $ 31 $ (1 ) $ 41,397 Total $ 41,367 $ 31 $ (1 ) $ 41,397 Short-term deposits Term bank deposits $ 37,000 $ — $ — $ 37,000 Total $ 37,000 $ — $ — $ 37,000 As of December 31, 2018 Amortized Cost Gross Unrealized Gains Gross Unrealized Loss Fair Value Cash and cash equivalents Money market funds $ 2,594 $ — $ — $ 2,594 Total $ 2,594 $ — $ — $ 2,594 Marketable securities US Treasury securities $ 39,776 $ *) $ (6 ) $ 39,770 Total $ 39,776 $ *) $ (6 ) $ 39,770 Short-term deposits Term bank deposits $ 70,438 $ — $ — $ 70,438 Total $ 70,438 $ — $ — $ 70,438 *) Represents an amount lower than $1 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following table sets forth the Company’s assets and liabilities that were measured at fair value as of September 30, 2019 and December 31, 2018 by level within the fair value hierarchy (in thousands): As of September 30, 2019 As of December 31, 2018 Level I Level II Level III Fair Value Level I Level II Level III Fair Value Financial assets: Cash equivalents: Money market funds 4,788 — — 4,788 2,594 — — 2,594 Marketable securities: US Treasury securities 41,397 — — 41,397 39,770 — — 39,770 Other current assets: Forward foreign exchange contracts — 731 — 731 — — — — Financial liabilities: Accrued expenses and other short term liabilities: Forward foreign exchange contracts — (5 ) — (5 ) — (3,647 ) — (3,647 ) Total financial assets (liabilities) $ 46,185 $ 726 $ — $ 46,911 $ 42,364 $ (3,647 ) $ — $ 38,717 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Summary of Right-of-Use Assets and Lease Liabilities | The Company has various operating leases for office space, vehicles and office equipment that expire through 2030. Its lease agreements generally do not contain any material residual value guarantees or material restrictive covenants. Below is a summary of our operating right-of-use assets and operating lease liabilities as of September 30, 2019 : September 30, 2019 (unaudited) Operating right-of-use assets $ 57,046 Operating lease liabilities, current $ 7,287 Operating lease liabilities long-term 58,667 Total operating lease liabilities $ 65,954 |
Lessee, Operating Lease, Liability, Maturity | Minimum lease payments for our right of use assets over the remaining lease periods as of September 30, 2019 , are as follows: September 30, 2019 (unaudited) 2019 $ 1,791 2020 11,065 2021 9,121 2022 9,136 2023 8,953 Thereafter 38,885 Total undiscounted lease payments $ 78,951 Less: Interest (12,997 ) Present value of lease liabilities $ 65,954 |
Summary of Weighted Average Remaining Lease Terms and Discount Rates | The weighted average remaining lease terms and discount rates for all of operating leases were as follows as of September 30, 2019 : Remaining lease term and discount rate: Weighted average remaining lease term (years) 8.56 Weighted average discount rate 4.02 % |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Stockholders' Equity Note [Abstract] | |
Share-based Compensation, Stock Options, Activity | A summary of employees’ stock options activities during the nine months ended September 30, 2019 is as follows: Nine Months Ended Number Weighted average exercise price Aggregate intrinsic value (in thousands) Weighted average remaining contractual life (years) Options outstanding as of January 1, 2019 709,668 $ 17.941 $ 24,810 4.513 Granted — $ — Exercised (205,933 ) $ 10.352 Forfeited — $ — Options outstanding as of September 30, 2019 503,735 $ 21.043 $ 19,513 4.464 Options exercisable as of September 30, 2019 498,525 $ 21.086 $ 19,290 4.443 |
Schedule of Share-based Compensation, Shares Authorized under Stock Option Plans, by Exercise Price Range | The options outstanding as of September 30, 2019 (unaudited) have been separated into ranges of exercise price as follows: Range of exercise price Options outstanding as of September 30, 2019 Weighted average remaining contractual life (years) Weighted average exercise price Options exercisable as of September 30, 2019 Weighted average remaining contractual life (years) Weighted average exercise price of options exercisable $1.576 8,470 0.410 $ 1.576 8,470 0.410 $ 1.576 $ 6.230 — 8.800 11,856 2.244 $ 8.084 11,856 2.244 $ 8.084 $ 12.470 — 16.870 131,925 4.290 $ 14.100 126,715 4.204 $ 13.960 $ 19.510 — 21.660 186,690 4.720 $ 21.170 186,690 4.720 $ 21.170 $ 22.010 — 24.230 73,048 4.276 $ 22.425 73,048 4.276 $ 22.425 $29.880 57,379 5.397 $ 29.880 57,379 5.397 $ 29.880 $39.860 34,367 4.339 $ 39.860 34,367 4.339 $ 39.860 503,735 4.464 $ 21.043 498,525 4.443 $ 21.086 |
Schedule of Stockholders' Equity Note, Warrants or Rights | The Company’s outstanding options granted to consultants for services as of September 30, 2019 (unaudited) were as follows: Options for shares of common stock Exercise price per share Options exercisable Exercisable through (number) (number) February 2013 1,500 $ 12.470 1,500 February 2023 August 2013 4,000 $ 21.140 4,000 August 2023 March 2014 5,550 $ 39.860 5,550 March 2024 May 2014 3,700 $ 22.010 3,700 May 2024 November 2014 5,468 $ 21.660 5,468 November 2024 May 2015 1,137 $ 19.510 1,137 May 2025 February 2016 2,138 $ 16.870 1,875 February 2026 23,493 23,230 |
Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity | A summary of restricted stock units and performance stock units for employees, consultants and non-employee directors of the Company for the nine months ended September 30, 2019 (unaudited) is as follows: Number of shares underlying outstanding restricted stock units Weighted- average grant date fair value Unvested balance - January 1, 2019 2,440,027 $ 40.00 Granted 1,262,834 $ 57.75 Vested (760,408 ) $ 36.32 Forfeited (306,866 ) $ 46.10 Unvested balance – September 30, 2019 2,635,587 $ 48.90 |
Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs | The Company recognized non-cash stock-based compensation expense in the consolidated statements of operations as follows: Three Months Ended Nine Months Ended 2019 2018 2019 2018 (unaudited) (in thousands) (unaudited) (in thousands) Cost of revenues $ 637 $ 470 $ 1,967 $ 1,300 Research and development 3,476 2,097 9,674 7,180 Sales and marketing 3,932 3,600 11,015 10,349 General and administrative 2,977 2,232 12,123 5,345 Total $ 11,022 $ 8,399 $ 34,779 $ 24,174 |
Geographic Information and Ma_2
Geographic Information and Major Customer and Product Data (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
Revenue from External Customers by Geographic Areas | The following is a summary of revenues within geographic areas: Three Months Ended Nine Months Ended 2019 2018 2019 2018 (unaudited) (unaudited) (in thousands) (in thousands) Revenues based on customer’s location: North America $ 47,411 $ 44,890 $ 125,243 $ 114,951 EMEA (*) 16,719 19,778 50,672 61,606 Rest of World 1,519 2,384 5,715 6,213 Total revenues $ 65,649 $ 67,052 $ 181,630 $ 182,770 (*) Sales to customers in France did not exceed 10% of total revenues for the nine months ended September 30, 2019 and accounted for $19,813 of the Company’s revenues for the nine months ended September 30, 2018 . Sales to customers in the United Kingdom did not exceed 10% of total revenues for the nine months ended September 30, 2019 and accounted for $18,708 of the Company’s revenues for the nine months ended September 30, 2018 . |
Long-lived Assets by Geographic Areas | September 30, 2019 December 31, 2018 (unaudited) (in thousands) Long-lived assets by geographic region: United States $ 12,422 $ 7,612 Israel 13,013 7,834 France 1,036 1,243 Other 717 634 $ 27,188 $ 17,323 |
General (Details Textual)
General (Details Textual) | Sep. 30, 2019USD ($)subsidiary | Dec. 31, 2018 | Mar. 31, 2014USD ($) | Sep. 30, 2019USD ($)subsidiary | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($)subsidiary | Sep. 30, 2018USD ($) | Dec. 31, 2018USD ($) | Jan. 01, 2019USD ($) |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||
Operations commenced date | Jan. 1, 2005 | ||||||||
Subsidiary or equity method investee, number | subsidiary | 10 | 10 | 10 | ||||||
Entity incorporation, date of incorporation | Nov. 24, 2004 | ||||||||
Deferred revenue, revenue recognized | $ 76,026,000 | ||||||||
Sales returns | $ 0 | $ 0 | |||||||
Capitalized contract cost, amortization period (years) | 4 years | 4 years | 4 years | ||||||
Ineffective hedges recognized | $ 0 | $ 0 | |||||||
Gain in financial income, net | 951,000 | $ 1,404,000 | |||||||
Loss in financial income, net | 199,000 | $ 199,000 | |||||||
Other than temporary impairment losses, investments, available-for-sale securities | 0 | ||||||||
Operating lease right-of-use asset | $ 57,046,000 | 57,046,000 | 57,046,000 | ||||||
Operating lease liabilities, current | (7,287,000) | (7,287,000) | (7,287,000) | ||||||
Operating lease liabilities long-term | $ (58,667,000) | (58,667,000) | (58,667,000) | ||||||
Foreign Exchange Contract | |||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||
Derivative, gain (loss) on derivative, net, total | $ 361,000 | $ (1,194,000) | (170,000) | (2,094,000) | |||||
Ineffective hedges recognized | $ 0 | $ 0 | |||||||
US Treasury Securities | Maximum | Short-term deposits | |||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||
Short-term Investment, maturity period | 1 year | 1 year | |||||||
Promissory Note | |||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||
Line of credit facility, maximum borrowing capacity | $ 7,000,000 | ||||||||
Basis spread on variable rate (percentage) | 0.05% | ||||||||
Interest rate at period end | 5.05% | 5.05% | 5.05% | ||||||
Long-term line of credit | $ 0 | $ 0 | $ 0 | ||||||
Promissory Note | Minimum | |||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||
Interest rate, effective percentage | 4.10% | ||||||||
Accounting Standards Update 2016-02 | |||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||
Elimination of deferred rent, current | $ 1,313,000 | ||||||||
Elimination of deferred rent, noncurrent | 4,236,000 | ||||||||
Operating lease right-of-use asset | 53,274,000 | ||||||||
Operating lease liabilities, current | (2,349,000) | ||||||||
Operating lease liabilities long-term | $ (55,676,000) | ||||||||
Maintenance | |||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||
Revenue, performance obligation, description of timing | one year |
Derivative Instruments Measured
Derivative Instruments Measured at Fair Value (Details) - Other Current Assets, Accrued Expenses and Other Short Term Liabilities - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Derivative [Line Items] | ||
Notional amount | $ 17,823 | $ 29,162 |
Derivative liabilities, fair value | (5) | (18) |
Cash Flow Hedging | ||
Derivative [Line Items] | ||
Notional amount | 22,413 | 75,153 |
Derivative assets, fair value | $ 731 | |
Derivative liabilities, fair value | $ (3,628) |
Cash, Cash Equivalents and Shor
Cash, Cash Equivalents and Short-term Investments (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Cash and cash equivalents | ||
Amortized Cost | $ 4,788 | $ 2,594 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Loss | 0 | 0 |
Fair Value | 4,788 | 2,594 |
Cash and cash equivalents | Money market funds | ||
Amortized Cost | 4,788 | 2,594 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Loss | 0 | 0 |
Fair Value | 4,788 | 2,594 |
Marketable securities | ||
Amortized Cost | 41,367 | 39,776 |
Gross Unrealized Gains | 31 | 0 |
Gross Unrealized Loss | (1) | (6) |
Fair Value | 41,397 | 39,770 |
Marketable securities | US Treasury securities | ||
Amortized Cost | 41,367 | 39,776 |
Gross Unrealized Gains | 31 | 0 |
Gross Unrealized Loss | (1) | (6) |
Fair Value | 41,397 | 39,770 |
Short-term deposits | ||
Amortized Cost | 37,000 | 70,438 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Loss | 0 | 0 |
Fair Value | 37,000 | 70,438 |
Short-term deposits | Term bank deposits | ||
Amortized Cost | 37,000 | 70,438 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Loss | 0 | 0 |
Fair Value | $ 37,000 | $ 70,438 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured at Fair Value (Details) - Fair Value, Recurring - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total financial assets (liabilities) | $ 46,911 | $ 38,717 |
Forward foreign exchange contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets | 731 | 0 |
Derivative liabilities | (5) | (3,647) |
Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 4,788 | 2,594 |
US Treasury securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 41,397 | 39,770 |
Level I | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total financial assets (liabilities) | 46,185 | 42,364 |
Level I | Forward foreign exchange contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets | 0 | 0 |
Derivative liabilities | 0 | 0 |
Level I | Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 4,788 | 2,594 |
Level I | US Treasury securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 41,397 | 39,770 |
Level II | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total financial assets (liabilities) | 726 | (3,647) |
Level II | Forward foreign exchange contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets | 731 | 0 |
Derivative liabilities | (5) | (3,647) |
Level II | Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Level II | US Treasury securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Level III | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total financial assets (liabilities) | 0 | 0 |
Level III | Forward foreign exchange contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets | 0 | 0 |
Derivative liabilities | 0 | 0 |
Level III | Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Level III | US Treasury securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | $ 0 | $ 0 |
Leases - Summary of RIght-of-Us
Leases - Summary of RIght-of-Use Assets and Lease Liabilities (Details) $ in Thousands | Sep. 30, 2019USD ($) |
Leases [Abstract] | |
Operating lease right-of-use asset | $ 57,046 |
Operating lease liabilities, current | 7,287 |
Operating lease liabilities long-term | 58,667 |
Total operating lease liabilities | $ 65,954 |
Leases - Minimum Lease Payments
Leases - Minimum Lease Payments for Right-of-Use Assets (Details) $ in Thousands | Sep. 30, 2019USD ($) |
Leases [Abstract] | |
2019 | $ 1,791 |
2020 | 11,065 |
2021 | 9,121 |
2022 | 9,136 |
2023 | 8,953 |
Thereafter | 38,885 |
Total undiscounted lease payments | 78,951 |
Less: Interest | (12,997) |
Present value of lease liabilities | $ 65,954 |
Leases - Summary of Weighted Av
Leases - Summary of Weighted Average Remaining Lease Terms and Discount Rates (Details) | Sep. 30, 2019 |
Leases [Abstract] | |
Weighted average remaining lease term (years) | 8 years 6 months 21 days |
Weighted average discount rate | 4.02% |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Leases [Abstract] | ||||
Operating leases, rent expense | $ 2,980 | $ 1,370 | $ 6,283 | $ 4,011 |
Stockholders' Equity (Details T
Stockholders' Equity (Details Textual) - USD ($) $ in Thousands | Jan. 01, 2019 | Jan. 01, 2018 | Jan. 01, 2017 | Jan. 01, 2016 | Jun. 30, 2015 | Nov. 14, 2013 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2013 | Mar. 31, 2018 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Granted (in shares) | 0 | |||||||||
Capital shares reserved for future issuance, annual increase, maximum (in shares) | 1,183,075 | 1,125,846 | 1,072,870 | 1,042,766 | ||||||
Exercises in period, intrinsic value | $ 10,117 | |||||||||
Restricted Stock Units and Stock Options | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Antidilutive securities excluded from computation of Earnings Per Share, amount (in shares) | 3,162,815 | 3,354,028 | ||||||||
Employee Stock Option | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Compensation cost not yet recognized | $ 34 | |||||||||
Compensation cost not yet recognized, period for recognition | 4 months 4 days | |||||||||
Restricted Stock Units (RSUs) | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Compensation cost not yet recognized | $ 107,699 | |||||||||
Compensation cost not yet recognized, period for recognition | 2 years 7 months 1 day | |||||||||
The 2005 Stock Plan | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Common stock, capital shares reserved for future issuance (in shares) | 4,713,319 | |||||||||
Vesting period (in years) | 4 years | |||||||||
Granted (in shares) | 0 | |||||||||
Shares available for grant (in shares) | 0 | |||||||||
The 2013 Omnibus Equity Award Plan | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Common stock, capital shares reserved for future issuance (in shares) | 1,904,633 | |||||||||
Percentage of outstanding stock reserved for grant | 4.00% | |||||||||
Percentage of outstanding stock maximum | 5.00% | |||||||||
The 2013 Omnibus Equity Award Plan | Employee Stock Option | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Vesting period (in years) | 4 years | |||||||||
2015 ESPP | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Maximum employee subscription rate | 15.00% | |||||||||
Purchase price of common stock, percent | 85.00% | |||||||||
Number of shares authorized (in shares) | 500,000 | |||||||||
Percent of shares increase, employee stock purchase plan | 1.00% | |||||||||
Common stock availability threshold, Employee Stock Purchase Plan | 2.00% | |||||||||
Shares increase threshold, employee stock purchase plan (in shares) | 400,000 | |||||||||
Number of additional shares authorized (in shares) | 177,358 | 188,813 | 158,695 | 21,383 |
Stockholders' Equity - Stock Op
Stockholders' Equity - Stock Options Activities (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Number | |||
Options outstanding, Balance (in shares) | 709,668 | ||
Granted (in shares) | 0 | ||
Exercised (in shares) | (205,933) | ||
Forfeited (in shares) | 0 | ||
Options outstanding, Balance (in shares) | 503,735 | ||
Options exercisable at the end of the year (in shares) | 498,525 | ||
Weighted average exercise price | |||
Options outstanding, weighted average exercise price (in dollars per share) | $ 17.941 | ||
Granted, weighted average exercise price (in dollars per share) | 0 | ||
Exercised, weighted average exercise price (in dollars per share) | 10.352 | ||
Forfeited, weighted average exercise price (in dollars per share) | 0 | ||
Options outstanding, weighted average exercise price (in dollars per share) | 21.043 | ||
Options exercisable at the end of the year, weighted average exercise price (in dollars per share) | $ 21.086 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | |||
Options outstanding, aggregate intrinsic value | $ 19,513 | $ 24,810 | |
Options outstanding, weighted average remaining contractual life (Year) | 4 years 5 months 17 days | 4 years 6 months 5 days | |
Options exercisable at the end of the year, aggregate intrinsic value | $ 19,290 | ||
Options exercisable at the end of the year, weighted average remaining contractual life (Year) | 4 years 5 months 10 days |
Stockholders' Equity - Options
Stockholders' Equity - Options Outstanding Separated Into Range of Exercise Price (Details) | 9 Months Ended |
Sep. 30, 2019$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options outstanding (in shares) | shares | 503,735 |
Weighted average remaining contractual life (Year) | 4 years 5 months 17 days |
Weighted average exercise price (in dollars per share) | $ 21.043 |
Options exercisable (in shares) | shares | 498,525 |
Weighted average remaining contractual life, exercisable (Year) | 4 years 5 months 10 days |
Weighted average exercise price of options exercisable (in dollars per share) | $ 21.086 |
Range One | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options outstanding (in shares) | shares | 8,470 |
Weighted average remaining contractual life (Year) | 4 months 28 days |
Weighted average exercise price (in dollars per share) | $ 1.576 |
Options exercisable (in shares) | shares | 8,470 |
Weighted average remaining contractual life, exercisable (Year) | 4 months 28 days |
Weighted average exercise price of options exercisable (in dollars per share) | $ 1.576 |
Range Two | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Lower range of exercise price (in dollars per share) | 6.230 |
Upper range of exercise price (in dollars per share) | $ 8.800 |
Options outstanding (in shares) | shares | 11,856 |
Weighted average remaining contractual life (Year) | 2 years 2 months 28 days |
Weighted average exercise price (in dollars per share) | $ 8.084 |
Options exercisable (in shares) | shares | 11,856 |
Weighted average remaining contractual life, exercisable (Year) | 2 years 2 months 28 days |
Weighted average exercise price of options exercisable (in dollars per share) | $ 8.084 |
Range Three | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Lower range of exercise price (in dollars per share) | 12.470 |
Upper range of exercise price (in dollars per share) | $ 16.870 |
Options outstanding (in shares) | shares | 131,925 |
Weighted average remaining contractual life (Year) | 4 years 3 months 15 days |
Weighted average exercise price (in dollars per share) | $ 14.100 |
Options exercisable (in shares) | shares | 126,715 |
Weighted average remaining contractual life, exercisable (Year) | 4 years 2 months 14 days |
Weighted average exercise price of options exercisable (in dollars per share) | $ 13.960 |
Range Four | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Lower range of exercise price (in dollars per share) | 19.510 |
Upper range of exercise price (in dollars per share) | $ 21.660 |
Options outstanding (in shares) | shares | 186,690 |
Weighted average remaining contractual life (Year) | 4 years 8 months 19 days |
Weighted average exercise price (in dollars per share) | $ 21.170 |
Options exercisable (in shares) | shares | 186,690 |
Weighted average remaining contractual life, exercisable (Year) | 4 years 8 months 19 days |
Weighted average exercise price of options exercisable (in dollars per share) | $ 21.170 |
Range Five | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Lower range of exercise price (in dollars per share) | 22.010 |
Upper range of exercise price (in dollars per share) | $ 24.230 |
Options outstanding (in shares) | shares | 73,048 |
Weighted average remaining contractual life (Year) | 4 years 3 months 9 days |
Weighted average exercise price (in dollars per share) | $ 22.425 |
Options exercisable (in shares) | shares | 73,048 |
Weighted average remaining contractual life, exercisable (Year) | 4 years 3 months 9 days |
Weighted average exercise price of options exercisable (in dollars per share) | $ 22.425 |
Range Six | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options outstanding (in shares) | shares | 57,379 |
Weighted average remaining contractual life (Year) | 5 years 4 months 23 days |
Weighted average exercise price (in dollars per share) | $ 29.880 |
Options exercisable (in shares) | shares | 57,379 |
Weighted average remaining contractual life, exercisable (Year) | 5 years 4 months 23 days |
Weighted average exercise price of options exercisable (in dollars per share) | $ 29.880 |
Range Seven | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options outstanding (in shares) | shares | 34,367 |
Weighted average remaining contractual life (Year) | 4 years 4 months 2 days |
Weighted average exercise price (in dollars per share) | $ 39.860 |
Options exercisable (in shares) | shares | 34,367 |
Weighted average remaining contractual life, exercisable (Year) | 4 years 4 months 2 days |
Weighted average exercise price of options exercisable (in dollars per share) | $ 39.860 |
Stockholders' Equity - Outstand
Stockholders' Equity - Outstanding Options Granted to Consultants for Sales and Pre-marketing Services (Details) | 9 Months Ended |
Sep. 30, 2019$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Granted, weighted average exercise price (in dollars per share) | $ / shares | $ 0 |
Options exercisable at the end of the year (in shares) | 498,525 |
Consultants | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options for shares of common stock (in shares) | 23,493 |
Options exercisable at the end of the year (in shares) | 23,230 |
February 2013 | Consultants | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options for shares of common stock (in shares) | 1,500 |
Granted, weighted average exercise price (in dollars per share) | $ / shares | $ 12.470 |
Options exercisable at the end of the year (in shares) | 1,500 |
Exercisable through | February 2023 |
August 2013 | Consultants | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options for shares of common stock (in shares) | 4,000 |
Granted, weighted average exercise price (in dollars per share) | $ / shares | $ 21.140 |
Options exercisable at the end of the year (in shares) | 4,000 |
Exercisable through | August 2023 |
March 2014 | Consultants | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options for shares of common stock (in shares) | 5,550 |
Granted, weighted average exercise price (in dollars per share) | $ / shares | $ 39.860 |
Options exercisable at the end of the year (in shares) | 5,550 |
Exercisable through | March 2024 |
May 2014 | Consultants | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options for shares of common stock (in shares) | 3,700 |
Granted, weighted average exercise price (in dollars per share) | $ / shares | $ 22.010 |
Options exercisable at the end of the year (in shares) | 3,700 |
Exercisable through | May 2024 |
November 2014 | Consultants | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options for shares of common stock (in shares) | 5,468 |
Granted, weighted average exercise price (in dollars per share) | $ / shares | $ 21.660 |
Options exercisable at the end of the year (in shares) | 5,468 |
Exercisable through | November 2024 |
May 2015 | Consultants | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options for shares of common stock (in shares) | 1,137 |
Granted, weighted average exercise price (in dollars per share) | $ / shares | $ 19.510 |
Options exercisable at the end of the year (in shares) | 1,137 |
Exercisable through | May 2025 |
February 2016 | Consultants | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options for shares of common stock (in shares) | 2,138 |
Granted, weighted average exercise price (in dollars per share) | $ / shares | $ 16.870 |
Options exercisable at the end of the year (in shares) | 1,875 |
Exercisable through | February 2026 |
Stockholders' Equity - Restrict
Stockholders' Equity - Restricted Stock Unit Activity (Details) - Restricted Stock Units (RSUs) | 9 Months Ended |
Sep. 30, 2019$ / sharesshares | |
Number of shares underlying outstanding restricted stock units | |
Beginning Balance, restricted stock units (in shares) | shares | 2,440,027 |
Granted, restricted stock units (in shares) | shares | 1,262,834 |
Vested, restricted stock units (in shares) | shares | (760,408) |
Forfeited, restricted stock units (in shares) | shares | (306,866) |
Ending Balance, restricted stock units (in shares) | shares | 2,635,587 |
Weighted- average grant date fair value | |
Beginning Balance, weighted average grant date fair value on restricted stock units (in dollars per share) | $ / shares | $ 40 |
Granted, weighted average grant date fair value on restricted stock units (in dollars per share) | $ / shares | 57.75 |
Vested, weighted average grant date fair value on restricted stock units (in dollars per share) | $ / shares | 36.32 |
Forfeited, weighted average grant date fair value on restricted stock units (in dollars per share) | $ / shares | 46.10 |
Ending Balance, weighted average grant date fair value on restricted stock units (in dollars per share) | $ / shares | $ 48.90 |
Stockholders' Equity - Non-cash
Stockholders' Equity - Non-cash Stock-based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation | $ 11,022 | $ 8,399 | $ 34,779 | $ 24,174 |
Cost of revenues | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation | 637 | 470 | 1,967 | 1,300 |
Research and development | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation | 3,476 | 2,097 | 9,674 | 7,180 |
Sales and marketing | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation | 3,932 | 3,600 | 11,015 | 10,349 |
General and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation | $ 2,977 | $ 2,232 | $ 12,123 | $ 5,345 |
Geographic Information and Ma_3
Geographic Information and Major Customer and Product Data (Details Textual) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($)segment | Sep. 30, 2018USD ($) | |
Segment Reporting Information [Line Items] | ||||
Number of reportable segments | segment | 1 | |||
Revenue | $ 65,649 | $ 67,052 | $ 181,630 | $ 182,770 |
France | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 19,813 | |||
United Kingdom | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | $ 18,708 |
Geographic Information and Ma_4
Geographic Information and Major Customer and Product Data - Revenues Within Geographical Areas (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | ||
Segment Reporting Information [Line Items] | |||||
Revenue | $ 65,649 | $ 67,052 | $ 181,630 | $ 182,770 | |
North America | |||||
Segment Reporting Information [Line Items] | |||||
Revenue | 47,411 | 44,890 | 125,243 | 114,951 | |
EMEA | |||||
Segment Reporting Information [Line Items] | |||||
Revenue | [1] | 16,719 | 19,778 | 50,672 | 61,606 |
Rest of World | |||||
Segment Reporting Information [Line Items] | |||||
Revenue | $ 1,519 | $ 2,384 | $ 5,715 | $ 6,213 | |
[1] | Sales to customers in France did not exceed 10% of total revenues for the nine months ended September 30, 2019 and accounted for $19,813 of the Company’s revenues for the nine months ended September 30, 2018 . Sales to customers in the United Kingdom did not exceed 10% of total revenues for the nine months ended September 30, 2019 and accounted for $18,708 of the Company’s revenues for the nine months ended September 30, 2018 . |
Geographic Information and Ma_5
Geographic Information and Major Customer and Product Data - Long-lived Assets by Geographic Region (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Segment Reporting Information [Line Items] | ||
Long-lived assets | $ 27,188 | $ 17,323 |
United States | ||
Segment Reporting Information [Line Items] | ||
Long-lived assets | 12,422 | 7,612 |
Israel | ||
Segment Reporting Information [Line Items] | ||
Long-lived assets | 13,013 | 7,834 |
France | ||
Segment Reporting Information [Line Items] | ||
Long-lived assets | 1,036 | 1,243 |
Other | ||
Segment Reporting Information [Line Items] | ||
Long-lived assets | $ 717 | $ 634 |