Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Jan. 25, 2020 | Feb. 25, 2020 | |
Document and Entity Information | ||
Entity Registrant Name | AEROVIRONMENT, INC. | |
Entity File Number | 001-33261 | |
Entity Central Index Key | 0001368622 | |
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Jan. 25, 2020 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 95-2705790 | |
Amendment Flag | false | |
Trading Symbol | AVAV | |
Title of 12(b) Security | Common Stock, par value $0.0001 per share | |
Security Exchange Name | NASDAQ | |
Entity Interactive Data Current | Yes | |
Current Fiscal Year End Date | --04-30 | |
Entity Address, Address Line One | 900 Innovators Way | |
Entity Address, City or Town | Simi Valley | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 93065 | |
City Area Code | 805 | |
Local Phone Number | 520-8350 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 23,995,109 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Small Business | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jan. 25, 2020 | Apr. 30, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 131,496 | $ 172,708 |
Short-term investments | 148,502 | 150,487 |
Accounts receivable, net of allowance for doubtful accounts of $1,039 at January 25, 2020 and $1,041 at April 30, 2019 | 27,936 | 31,051 |
Unbilled receivables and retentions (inclusive of related party unbilled receivables of $28,849 at January 25, 2020 and $9,028 at April 30, 2019) | 77,411 | 53,047 |
Inventories | 65,156 | 54,056 |
Prepaid expenses and other current assets | 6,833 | 7,418 |
Income taxes receivable | 821 | |
Total current assets | 457,334 | 469,588 |
Long-term investments | 26,409 | 9,386 |
Property and equipment, net | 19,877 | 16,905 |
Operating lease right-of-use assets | 9,472 | |
Deferred income taxes | 8,296 | 6,685 |
Intangibles, net | 14,357 | 459 |
Goodwill | 6,340 | |
Other assets | 16,995 | 5,821 |
Total assets | 559,080 | 508,844 |
Current liabilities: | ||
Accounts payable | 14,269 | 15,972 |
Wages and related accruals | 17,636 | 18,507 |
Customer advances | 10,633 | 2,962 |
Current operating lease liabilities | 2,083 | |
Income taxes payable | 2,809 | |
Other current liabilities | 13,046 | 7,425 |
Total current liabilities | 60,476 | 44,866 |
Deferred rent | 1,173 | |
Non-current operating lease liabilities | 7,556 | |
Other non-current liabilities | 250 | 150 |
Deferred tax liability | 29 | 29 |
Liability for uncertain tax positions | 51 | 51 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Authorized shares-10,000,000; none issued or outstanding at January 25, 2020 and April 30, 2019 | ||
Issued and outstanding shares-23,995,109 shares at January 25, 2020 and 23,946,293 shares at April 30, 2019 | 2 | 2 |
Additional paid-in capital | 180,051 | 176,216 |
Accumulated other comprehensive loss | 69 | 2 |
Retained earnings | 310,619 | 286,351 |
Total AeroVironment stockholders' equity | 490,741 | 462,571 |
Noncontrolling interest | (23) | 4 |
Total equity | 490,718 | 462,575 |
Total liabilities and stockholders' equity | $ 559,080 | $ 508,844 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jan. 25, 2020 | Apr. 30, 2019 |
Consolidated Balance Sheets | ||
Accounts receivable, allowance for doubtful accounts (in dollars) | $ 1,039 | $ 1,041 |
Due from Related Parties | $ 28,849 | $ 9,028 |
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, Authorized shares | 10,000,000 | 10,000,000 |
Preferred stock, issued shares | 0 | 0 |
Preferred stock, outstanding shares | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, Authorized shares | 100,000,000 | 100,000,000 |
Common stock, Issued shares | 23,995,109 | 23,946,293 |
Common stock, outstanding shares | 23,995,109 | 23,946,293 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Revenue: | ||||
Total revenue | $ 61,891 | $ 75,322 | $ 232,073 | $ 226,344 |
Cost of sales: | ||||
Cost of sales | 38,395 | 44,930 | 132,139 | 134,964 |
Gross margin: | ||||
Total gross margin | 23,496 | 30,392 | 99,934 | 91,380 |
Selling, general and administrative | 13,223 | 14,464 | 43,146 | 40,066 |
Research and development | 11,381 | 8,087 | 30,948 | 22,631 |
(Loss) income from continuing operations | (1,108) | 7,841 | 25,840 | 28,683 |
Other income: | ||||
Interest income, net | 1,122 | 1,272 | 3,717 | 3,246 |
Other income, net | 120 | 962 | 632 | 10,641 |
Income from continuing operations before income taxes | 134 | 10,075 | 30,189 | 42,570 |
(Benefit from) provision for income taxes | (38) | 946 | 3,203 | 4,724 |
Equity method investment loss, net of tax | (1,200) | (717) | (3,410) | (2,071) |
Net income from continuing operations | (1,028) | 8,412 | 23,576 | 35,775 |
Discontinued operations: | ||||
Gain on sale of business, net of tax expense of $2,463 | 8,452 | |||
Loss from discontinued operations, net of tax | (62) | (2,511) | ||
Net (loss) income from discontinued operations | (62) | 5,941 | ||
Net (loss) income | (1,028) | 8,350 | 23,576 | 41,716 |
Net loss attributable to noncontrolling interest | 20 | 19 | 27 | 40 |
Net (loss) income attributable to AeroVironment | $ (1,008) | $ 8,369 | $ 23,603 | $ 41,756 |
Net (loss) income per share attributable to AeroVironment-Basic | ||||
Basic, continuing (in dollars per share) | $ (0.04) | $ 0.35 | $ 0.99 | $ 1.52 |
Basic, discontinuing (in dollars per share) | 0.25 | |||
Net (loss) income per share attributable to AeroVironment-Basic (in dollars per share) | (0.04) | 0.35 | 0.99 | 1.77 |
Net (loss) income per share attributable to AeroVironment-Diluted | ||||
Diluted, continuing (in dollars per share) | (0.04) | 0.35 | 0.98 | 1.49 |
Diluted, discontinued (in dollars per share) | 0.25 | |||
Net (loss) income per share attributable to AeroVironment-Diluted | $ (0.04) | $ 0.35 | $ 0.98 | $ 1.74 |
Weighted-average shares outstanding: | ||||
Basic (in shares) | 23,821,145 | 23,687,672 | 23,790,788 | 23,643,866 |
Diluted (in shares) | 23,821,145 | 24,081,819 | 24,076,195 | 24,064,008 |
Product sales | ||||
Revenue: | ||||
Revenue | $ 36,432 | $ 50,024 | $ 159,657 | $ 152,393 |
Cost of sales: | ||||
Cost of sales | 21,034 | 26,780 | 82,244 | 83,158 |
Gross margin: | ||||
Total gross margin | 15,398 | 23,244 | 77,413 | 69,235 |
Contract services | ||||
Revenue: | ||||
Revenue | 25,459 | 25,298 | 72,416 | 73,951 |
Cost of sales: | ||||
Cost of sales | 17,361 | 18,150 | 49,895 | 51,806 |
Gross margin: | ||||
Total gross margin | $ 8,098 | $ 7,148 | $ 22,521 | $ 22,145 |
Consolidated Statements of Op_2
Consolidated Statements of Operations (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Consolidated Statements of Operations | ||||
Revenue from Related Parties | $ 11,762 | $ 13,586 | $ 37,491 | $ 37,981 |
Tax expense | $ 2,463 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive (Loss) Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Consolidated Statements of Comprehensive (Loss) Income | ||||
Net income | $ (1,028) | $ 8,350 | $ 23,576 | $ 41,716 |
Other comprehensive (loss) income: | ||||
Change in foreign currency translation adjustments | (112) | (1) | 67 | (32) |
Unrealized gain on investments, net of deferred tax expense of $51 | 57 | |||
Total comprehensive (loss) income | (1,140) | 8,349 | 23,643 | 41,741 |
Net loss attributable to noncontrolling interest | 20 | 19 | 27 | 40 |
Comprehensive (loss) income attributable to AeroVironment | $ (1,120) | $ 8,368 | $ 23,670 | $ 41,781 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive (Loss) Income (Parenthetical) $ in Thousands | 9 Months Ended |
Jan. 26, 2019USD ($) | |
Consolidated Statements of Comprehensive (Loss) Income | |
Unrealized gain on investments, net of deferred tax expense | $ 51 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Parent | Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Non-controlling Interest | Total |
Balance at Apr. 30, 2018 | $ 409,033 | $ 2 | $ 170,139 | $ 238,913 | $ (21) | $ 23 | |
Balance (in shares) at Apr. 30, 2018 | 23,908,736 | ||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Beginning Balance at Apr. 30, 2018 | $ 409,056 | ||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Net income (loss) | 41,756 | 41,756 | (40) | 41,716 | |||
Net Income (Loss), Including Portion Attributable to Nonredeemable Noncontrolling Interest | 41,716 | ||||||
Unrealized gain on investments | 57 | 57 | 57 | ||||
Foreign currency translation | (32) | (32) | (32) | ||||
Stock options exercised | 71 | 71 | 71 | ||||
Stock options exercised (in shares) | 12,725 | ||||||
Restricted stock awards (in shares) | 39,823 | ||||||
Restricted stock awards forfeited (in shares) | (15,100) | ||||||
Tax withholding payment related to net share settlement of equity awards | (1,033) | (1,033) | (1,033) | ||||
Tax withholding payment related to net share settlement of equity awards (in shares) | (13,724) | ||||||
Stock-based compensation | 5,714 | 5,714 | 5,714 | ||||
Balance at Jan. 26, 2019 | 455,566 | $ 2 | 174,891 | 280,669 | 4 | (17) | |
Balance (in shares) at Jan. 26, 2019 | 23,932,460 | ||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance at Jan. 26, 2019 | 455,549 | ||||||
Balance at Oct. 27, 2018 | 444,174 | $ 2 | 171,867 | 272,300 | 5 | 2 | 444,176 |
Balance (in shares) at Oct. 27, 2018 | 23,928,373 | ||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Net income (loss) | 8,369 | 8,369 | (19) | 8,350 | |||
Net Income (Loss), Including Portion Attributable to Nonredeemable Noncontrolling Interest | 8,350 | ||||||
Foreign currency translation | (1) | (1) | (1) | ||||
Restricted stock awards (in shares) | 5,377 | ||||||
Restricted stock awards forfeited (in shares) | (445) | ||||||
Tax withholding payment related to net share settlement of equity awards | (58) | (58) | (58) | ||||
Tax withholding payment related to net share settlement of equity awards (in shares) | (845) | ||||||
Stock-based compensation | 3,082 | 3,082 | 3,082 | ||||
Balance at Jan. 26, 2019 | 455,566 | $ 2 | 174,891 | 280,669 | 4 | (17) | |
Balance (in shares) at Jan. 26, 2019 | 23,932,460 | ||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance at Jan. 26, 2019 | 455,549 | ||||||
Balance at Apr. 30, 2019 | 462,571 | $ 2 | 176,216 | 286,351 | 2 | 4 | 462,571 |
Balance (in shares) at Apr. 30, 2019 | 23,946,293 | ||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Beginning Balance at Apr. 30, 2019 | 462,575 | ||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Net income (loss) | 23,603 | 23,603 | (27) | 23,576 | |||
Net Income (Loss), Including Portion Attributable to Nonredeemable Noncontrolling Interest | 23,576 | ||||||
Foreign currency translation | 67 | 67 | 67 | ||||
Stock options exercised | 93 | 93 | 93 | ||||
Stock options exercised (in shares) | 3,000 | ||||||
Restricted stock awards (in shares) | 74,892 | ||||||
Restricted stock awards forfeited (in shares) | (11,769) | ||||||
Tax withholding payment related to net share settlement of equity awards | (1,009) | (1,009) | (1,009) | ||||
Tax withholding payment related to net share settlement of equity awards (in shares) | (17,307) | ||||||
Stock-based compensation | 4,751 | 4,751 | 4,751 | ||||
Balance at Jan. 25, 2020 | 490,741 | $ 2 | 180,051 | 310,619 | 69 | (23) | 490,741 |
Balance (in shares) at Jan. 25, 2020 | 23,995,109 | ||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance at Jan. 25, 2020 | 490,718 | ||||||
Balance at Oct. 26, 2019 | 490,360 | $ 2 | 178,550 | 311,627 | 181 | (3) | |
Balance (in shares) at Oct. 26, 2019 | 23,990,616 | ||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Beginning Balance at Oct. 26, 2019 | 490,357 | ||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Net income (loss) | (1,008) | (1,008) | (20) | (1,028) | |||
Net Income (Loss), Including Portion Attributable to Nonredeemable Noncontrolling Interest | (1,028) | ||||||
Foreign currency translation | (112) | (112) | (112) | ||||
Restricted stock awards (in shares) | 9,200 | ||||||
Restricted stock awards forfeited (in shares) | (764) | ||||||
Tax withholding payment related to net share settlement of equity awards | (266) | (266) | (266) | ||||
Tax withholding payment related to net share settlement of equity awards (in shares) | (3,943) | ||||||
Stock-based compensation | 1,767 | 1,767 | 1,767 | ||||
Balance at Jan. 25, 2020 | 490,741 | $ 2 | $ 180,051 | 310,619 | $ 69 | $ (23) | 490,741 |
Balance (in shares) at Jan. 25, 2020 | 23,995,109 | ||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance at Jan. 25, 2020 | 490,718 | ||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Adoption of ASU | ASU 2018-09 | $ 665 | $ 665 | $ 665 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Jan. 25, 2020 | Jan. 26, 2019 | |
Operating activities | ||
Net income | $ 23,576 | $ 41,716 |
Gain on sale of business, net of tax | (8,452) | |
Loss from discontinued operations, net of tax | 2,511 | |
Net income from continuing operations | 23,576 | 35,775 |
Adjustments to reconcile net income from continuing operations to cash provided by operating activities from continuing operations: | ||
Depreciation and amortization | 7,107 | 5,530 |
Loss from equity method investment | 3,410 | 2,071 |
Provision for doubtful accounts | (2) | (33) |
Other non-cash gain, net | (719) | |
Non-cash lease expense | 3,453 | |
Gains on foreign currency transactions | (10) | |
Deferred income taxes | (946) | (1,214) |
Stock-based compensation | 4,751 | 5,599 |
(Gain) loss on sale of property and equipment | (71) | 51 |
Amortization of debt securities | (1,291) | (941) |
Changes in operating assets and liabilities, net of acquisitions: | ||
Accounts receivable | 3,245 | 22,817 |
Unbilled receivables and retentions | (24,364) | (34,760) |
Inventories | (10,766) | (12,954) |
Income tax receivable | 821 | |
Prepaid expenses and other assets | 216 | (1,791) |
Accounts payable | (1,301) | (10,645) |
Other liabilities | 7,947 | (2,598) |
Net cash provided by operating activities of continuing operations | 15,066 | 6,897 |
Investing activities | ||
Acquisition of property and equipment | (8,504) | (6,806) |
Equity method investments | (9,551) | |
Business acquisition, net of cash acquired | (18,641) | |
Proceeds from sale of business | 31,994 | |
Proceeds from sale of property and equipment | 81 | |
Redemptions of held-to-maturity investments | 166,917 | 191,455 |
Purchases of held-to-maturity investments | (162,517) | (211,120) |
Redemptions of available-for-sale investments | 41,150 | 2,250 |
Purchases of available-for-sale investments | (59,297) | |
Net cash (used in) provided by investing activities from continuing operations | (50,362) | 7,773 |
Financing activities | ||
Principal payments of capital lease obligations | (154) | |
Tax withholding payment related to net settlement of equity awards | (1,009) | (1,033) |
Exercise of stock options | 93 | 71 |
Net cash used in financing activities from continuing operations | (916) | (1,116) |
Discontinued operations | ||
Operating activities of discontinued operations | 0 | (7,250) |
Investing activities of discontinued operations | 0 | (452) |
Net cash used in discontinued operations | (7,702) | |
Net (decrease) increase in cash, cash equivalents, and restricted cash | (36,212) | 5,852 |
Cash, cash equivalents, and restricted cash at beginning of period | 172,708 | 143,517 |
Cash, cash equivalents, and restricted cash at end of period | 136,496 | 149,369 |
Cash paid, net during the period for: | ||
Income taxes | 518 | 6,777 |
Non-cash activities | ||
Unrealized gain on investments, net of deferred tax expense of $51 | 57 | |
Change in foreign currency translation adjustments | 67 | (32) |
Acquisitions of property and equipment included in accounts payable | $ 263 | $ 58 |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Parenthetical) $ in Thousands | 9 Months Ended |
Jan. 26, 2019USD ($) | |
Consolidated Statements of Cash Flows | |
Unrealized change in fair value of investments recorded in other comprehensive income (loss), net of deferred taxes | $ 51 |
Organization and Significant Ac
Organization and Significant Accounting Policies | 9 Months Ended |
Jan. 25, 2020 | |
Organization and Significant Accounting Policies | |
Organization and Significant Accounting Policies | AeroVironment, Inc. Notes to Consolidated Financia l Statements (Unaudited) 1. Organization and Significant Accounting Policies Organization AeroVironment, Inc., a Delaware corporation (the “Company”), is engaged in the design, development, production, support and operation of unmanned aircraft systems (“UAS”) for various industries and governmental agencies. Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information and with the instructions of Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments, consisting only of normal recurring adjustments necessary for a fair presentation with respect to the interim financial statements have been included. The results of operations for the three and nine months ended January 25, 2020 are not necessarily indicative of the results for the full year ending April 30, 2020. For further information, refer to the consolidated financial statements and footnotes thereto for the year ended April 30, 2019, included in the Company’s Annual Report on Form 10-K. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions, including estimates of anticipated contract costs and revenue utilized in the revenue recognition process, that affect the reported amounts in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. The Company’s consolidated financial statements include the assets, liabilities and operating results of wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated. In December 2017, the Company and SoftBank Corp. (“SoftBank”) formed a joint venture, HAPSMobile, Inc. (“HAPSMobile”). As the Company has the ability to exercise significant influence over the operating and financial policies of HAPSMobile, the Company’s investment has been accounted for as an equity method investment. The Company has presented its proportion of HAPSMobile’s net loss in equity method investment activity, net of tax in the consolidated statements of operations. The carrying value of the investment in HAPSMobile was recorded in other assets. Refer to Note 6—Equity Method Investments for further details. On June 29, 2018, the Company completed the sale of substantially all of the assets and related liabilities of its Efficient Energy Systems business segment (the “EES Business”) to Webasto Charging Systems, Inc. (“Webasto”) pursuant to an Asset Purchase Agreement (the “Purchase Agreement”) between Webasto and the Company. The Company determined that the EES Business met the criteria for classification as an asset held for sale at April 30, 2018 and represents a strategic shift in the Company’s operations. Therefore, the assets and liabilities and the results of operations of the EES Business are reported as discontinued operations for all periods presented. Refer to Note 2—Discontinued Operations for further details. On June 10, 2019, the Company purchased 100% of the issued and outstanding member units of Pulse Aerospace, LLC (“Pulse”) pursuant to the terms of a Unit Purchase Agreement (the “Pulse Purchase Agreement”). The assets, liabilities and operating results of Pulse have been included in the Company’s consolidated financial statements. Refer to Note 18—Business Acquisitions for further details. During the three months ended October 27, 2019, the Company dissolved its wholly-owned subsidiary, Skytower, Inc., the results of which were not material to the consolidated financial statements. Recently Adopted Accounting Standards Effective May 1, 2019, the Company adopted Accounting Standards Update (“ASU”) 2016-02, Leases In July 2018, the FASB issued ASU 2018-09, “Codification Improvements” (“ASU 2018-09”). ASU 2018-09 provides technical corrections, clarifications and other improvements across a variety of accounting topics. Among the clarifications, ASU 2018-09 clarifies that an entity should recognize excess tax benefits in the period in which the amount of the deduction is determined. This includes deductions that are taken on the entity’s return in a different period from when the event that gives rise to the tax deduction occurs and the uncertainty about whether the entity will receive a tax deduction and the amount of the tax deduction is resolved. Certain amendments were applicable immediately while others provide transition guidance and are effective in the Company’s first quarter of fiscal year 2020. The Company adopted ASU 2018-09 on May 1, 2019 using the modified retrospective method. The adoption of ASU 2018-09 resulted in a cumulative adjustment to increase retained earnings by $665,000 at May 1, 2019. Reclassifications Certain prior year amounts have been reclassified to conform to the current year presentation. Specifically, the Company’s existing intangible assets have been reclassified from other assets to intangibles, net on the consolidated balance sheet for all periods presented. Restricted Cash The Company classifies cash accounts which are not available for general use as restricted cash. Pursuant to the terms of the Pulse Purchase Agreement, the Company maintains an escrow account to satisfy the payment of contingent consideration due to the sellers if certain objectives are met. The restricted funds in the escrow account are recorded in other assets on the consolidated balance sheet. As of January 25, 2020 restricted cash was $5,000,000. During the three months ended January 25, 2020, one of the research and development milestones was achieved, and the requirements for the remaining contingent consideration were concluded to not have been met. On February 26, 2020, $2,500,000 of contingent consideration was paid to the sellers for the achieved milestone, and the remaining $2,500,000 is no longer restricted. The Company had no restricted cash as of April 30, 2019. Revenue Recognition The Company’s revenue is generated pursuant to written contractual arrangements to design, develop, manufacture and/or modify complex products and to provide related engineering, technical and other services according to the specifications of the customers. These contracts may be firm fixed price (“FFP”), cost plus fixed fee (“CPFF”), or time and materials (“T&M”). The Company considers all such contracts to be within the scope of ASC Topic 606. Performance Obligations A performance obligation is a promise in a contract to transfer distinct goods or services to a customer, and it is the unit of account in ASC Topic 606. A contract’s transaction price is allocated to each distinct performance obligation and revenue is recognized when each performance obligation under the terms of a contract is satisfied. Revenue is measured at the amount of consideration the Company expects to receive in exchange for transferring goods or providing services. For contracts with multiple performance obligations, the Company allocates the contract’s transaction price to each performance obligation using its observable standalone selling price for products and services. When the standalone selling price is not directly observable, the Company uses its best estimate of the standalone selling price of each distinct good or service in the contract using the cost plus margin approach. This approach estimates the Company’s expected costs of satisfying the performance obligation and then adds an appropriate margin for that distinct good or service. Contract modifications are routine in the performance of the Company’s contracts. In most instances, contract modifications are for additional goods and/or services that are distinct and, therefore, accounted for as new contracts. The Company’s performance obligations are satisfied over time or at a point in time. Performance obligations are satisfied over time if the customer receives the benefits as the Company performs, if the customer controls the asset as it is being developed or produced, or if the product being produced for the customer has no alternative use and the Company has a contractual right to payment for the Company’s costs incurred to date plus a reasonable margin. The contractual right to payment is generally supported by termination for convenience clauses that allow the customer to unilaterally terminate the contract for convenience, pay the Company for costs incurred plus a reasonable profit, and take control of any work in process. Revenue for tactical missile systems (“TMS”) product deliveries and Customer-Funded Research and Development contracts is recognized over time as costs are incurred. Contract services revenue is composed of revenue recognized on contracts for the provision of services, including repairs and maintenance, training, engineering design, development and prototyping activities, and technical support services. Contract services revenue is recognized over time as services are rendered. Typically, revenue is recognized over time using an input measure (e.g., costs incurred to date relative to total estimated costs at completion) to measure progress. Training services are recognized over time using an output method based on days of training completed. For performance obligations satisfied over time, revenue is generally recognized using costs incurred to date relative to total estimated costs at completion to measure progress. Incurred costs represent work performed, which correspond with, and thereby best depict, transfer of control to the customer. Contract costs include labor, materials, subcontractors’ costs, other direct costs, and indirect costs applicable on government and commercial contracts. For performance obligations which are not satisfied over time per the aforementioned criteria above, revenue is recognized at the point in time in which each performance obligation is fully satisfied. The Company’s small UAS product sales revenue is composed of revenue recognized on contracts for the delivery of small UAS systems and spare parts. Revenue is recognized at the point in time when control transfers to the customer, which generally occurs when title and risk of loss have passed to the customer. On January 25, 2020, the Company had approximately $125,958,000 of remaining performance obligations under fully funded contracts with its customers, which the Company also refers to as funded backlog. The Company currently expects to recognize approximately 75% of the remaining performance obligations as revenue in fiscal 2020 , an additional 24% in fiscal 2021, and the balance thereafter. The Company collects sales, value added, and other taxes concurrent with revenue producing activities, which are excluded from revenue when they are both imposed on a specific transaction and collected from a customer. Contract Estimates Accounting for contracts and programs primarily with a duration of less than six months involves the use of various techniques to estimate total contract revenue and costs. For long-term contracts, the Company estimates the total expected costs to complete the contract and recognizes revenue based on the percentage of costs incurred at period end. Typically, revenue is recognized over time using costs incurred to date relative to total estimated costs at completion to measure progress toward satisfying the Company’s performance obligations. Incurred costs represent work performed, which corresponds with, and thereby best depicts, the transfer of control to the customer. Contract costs include labor, materials, subcontractors’ costs, other direct costs, and indirect costs applicable on government and commercial contracts. Contract estimates are based on various assumptions to project the outcome of future events that may span several years. These assumptions include labor productivity and availability, the complexity of the work to be performed, the cost and availability of materials, the performance of subcontractors, and the availability and timing of funding from the customer. The nature of the Company’s contracts gives rise to several types of variable consideration, including penalty fees and incentive awards generally for late delivery and early delivery, respectively. The Company generally estimates such variable consideration as the most likely amount. In addition, the Company includes the estimated variable consideration to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the related uncertainty is resolved. These estimates are based on historical award experience, anticipated performance and the Company’s best judgment at the time. Because of the certainty in estimating these amounts, they are included in the transaction price of the Company’s contracts and the associated remaining performance obligations. As a significant change in one or more of these estimates could affect the profitability of the Company’s contracts, the Company regularly reviews and updates its contract-related estimates. Changes in cumulative revenue estimates, due to changes in the estimated transaction price or cost estimates, are recorded using a cumulative catch-up adjustment in the period identified for contracts with performance obligations recognized over time. If at any time the estimate of contract profitability indicates an anticipated loss on the contract, the Company recognizes the total loss in the quarter it is identified, and it is recorded in other current liabilities. The impact of adjustments in contract estimates on the Company’s operating earnings can be reflected in either operating costs and expenses or revenue. The aggregate net favorable impact of adjustments in contract estimates on revenue related to performance obligations satisfied or partially satisfied in previous periods was approximately $1,152,000 and $1,169,000 for the three and nine month periods ended January 25, 2020, respectively. No adjustment on any one contract was material to the Company’s unaudited consolidated financial statements for the three month period ended January 25, 2020. During the nine month period ended January 25, 2020, the Company revised its estimates of the total expected costs to complete a contract associated with a design and development agreement. The impact of the revised estimate on this contract on revenue related to performance obligations satisfied or partially satisfied in previous periods was an increase of approximately $1,036,000. The aggregate net unfavorable impact of adjustments in contract estimates on revenue related to performance obligations satisfied or partially satisfied in previous periods was approximately $1,705,000 for the three months ended January 26, 2019. For the three months ended January 26, 2019, the Company revised its estimates of the total expected costs to complete a TMS contract due to ongoing test and evaluation resulting from some systems not passing the customer’s final lot acceptance tests which the Company anticipates to be resolved in a future period. The impact of the revised estimate on this contract on revenue related to performance obligations satisfied or partially satisfied in previous periods was a reduction of approximately $1,519,000. The aggregate impact of adjustments in contract estimates on revenue related to performance obligations satisfied or partially satisfied in previous periods was not significant for the nine month period ended January 26, 2019. No adjustment on any one contract was material to the Company’s unaudited consolidated financial statements for the nine month period ended January 26, 2019. Revenue by Category The following tables present the Company’s revenue disaggregated by major product line, contract type, customer category and geographic location (in thousands): Three Months Ended Nine Months Ended January 25, January 26, January 25, January 26, Revenue by major product line/program 2020 2019 2020 2019 Small UAS $ 36,965 $ 47,704 $ 162,868 $ 131,119 TMS 7,908 11,270 21,419 49,055 HAPS 11,762 13,586 37,490 37,981 Other 5,256 2,762 10,296 8,189 Total revenue $ 61,891 $ 75,322 $ 232,073 $ 226,344 Three Months Ended Nine Months Ended January 25, January 26, January 25, January 26, Revenue by contract type 2020 2019 2020 2019 FFP $ 40,145 $ 52,833 $ 168,607 $ 160,890 CPFF 20,863 22,370 60,384 65,223 T&M 883 119 3,082 231 Total revenue $ 61,891 $ 75,322 $ 232,073 $ 226,344 Each of these contract types presents advantages and disadvantages. Typically, the Company assumes more risk with FFP contracts. However, these types of contracts generally offer additional profits when the Company completes the work for less than originally estimated. CPFF contracts generally subject the Company to lower risk. Accordingly, the associated base fees are usually lower than fees on FFP contracts. Under T&M contracts, the Company’s profit may vary if actual labor hour rates vary significantly from the negotiated rates. Three Months Ended Nine Months Ended January 25, January 26, January 25, January 26, Revenue by customer category 2020 2019 2020 2019 U.S. government: $ 25,535 $ 52,383 $ 124,971 $ 135,232 Non-U.S. government 36,356 22,939 107,102 91,112 Total revenue $ 61,891 $ 75,322 $ 232,073 $ 226,344 Three Months Ended Nine Months Ended January 25, January 26, January 25, January 26, Revenue by geographic location 2020 2019 2020 2019 Domestic $ 27,626 $ 34,436 $ 116,399 $ 116,514 International 34,265 40,886 115,674 109,830 Total revenue $ 61,891 $ 75,322 $ 232,073 $ 226,344 Contract Balances The timing of revenue recognition, billings, and cash collections results in billed accounts receivable, unbilled receivables, and customer advances and deposits on the consolidated balance sheet. In the Company’s services contracts, amounts are billed as work progresses in accordance with agreed-upon contractual terms, either at periodic intervals, which is generally monthly, or upon the achievement of contractual milestones. Generally, billing occurs subsequent to revenue recognition, resulting in contract assets recorded in unbilled receivables and retentions on the consolidated balance sheet. However, the Company sometimes receives advances or deposits from its customers before revenue is recognized, resulting in contract liabilities recorded in customer advances on the consolidated balance sheet. Contract liabilities are not a significant financing component as they are generally utilized to pay for contract costs within a one-year period or are used to ensure the customer meets contractual requirements. These assets and liabilities are reported on the consolidated balance sheet on a contract-by-contract basis at the end of each reporting period. For the Company’s product revenue, the Company generally receives cash payments subsequent to satisfying the performance obligation via delivery of the product, resulting in billed accounts receivable. Changes in the contract asset and liability balances during the nine month period ended January 25, 2020 were not materially impacted by any other factors. For the Company’s contracts, there are no significant gaps between the receipt of payment and the transfer of the associated goods and services to the customer for material amounts of consideration. Revenue recognized for the three and nine month periods ended January 25, 2020 that was included in contract liability balances at April 30, 2019 were $12,000 and $1,670,000, respectively; and revenue recognized for the three and nine month periods ended January 26, 2019 that was included in contract liability balances at April 30, 2018 were $10,000 and $1,587,000, respectively. 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 (“CODM”) in deciding how to allocate resources and in assessing performance. The Company’s CODM, who is the Chief Executive Officer, makes operating decisions, assesses performance and makes resource allocation decisions, including the focus of research and development (“R&D”), on a consolidated basis for the Company’s continuing operations. Accordingly, the Company operates its business as a single reportable segment. Investments The Company’s investments are accounted for as held-to-maturity reported at amortized cost, available-for-sale reported at cost less impairment, and available-for-sale reported at fair value, which approximates book value. The Company has elected to measure available-for-sale investments that do not have readily determinable fair values at cost minus impairment, if any, adjusted for changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. Fair Values of Financial Instruments Fair values of cash and cash equivalents, accounts receivable, unbilled receivables and retentions, and accounts payable approximate cost due to the short period of time to maturity. Government Contracts Payments to the Company on government CPFF or T&M contracts are based on provisional, or estimated indirect rates, which are subject to an annual audit by the Defense Contract Audit Agency (“DCAA”). The cost audits result in the negotiation and determination of the final indirect cost rates that the Company may use for the period(s) audited. The final rates, if different from the provisional rates, may create an additional receivable or liability for the Company. For example, during the course of its audits, the DCAA may question the Company’s incurred costs, and if the DCAA believes the Company has accounted for such costs in a manner inconsistent with the requirements under Federal Acquisition Regulations, the DCAA auditor may recommend to the Company’s administrative contracting officer to disallow such costs. Historically, the Company has not experienced material disallowed costs as a result of government audits. However, the Company can provide no assurance that the DCAA or other government audits will not result in material disallowances for incurred costs in the future. The Company’s revenue recognition policy calls for revenue recognized on all CPFF or T&M government contracts to be recorded at actual rates to the extent it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur. During the fiscal year ended April 30, 2019, the Company settled rates for its incurred cost claims with the DCAA for fiscal years 2016 and 2017 without payment of any consideration. At January 25, 2020 and April 30, 2019, the Company had $275,000 and $93,000 reserved for incurred cost claim audits, respectively. Intangibles Assets — Acquired in Business Combinations The Company performs valuations of assets acquired and liabilities assumed on each acquisition accounted for as a business combination and allocates the purchase price of the acquired business to the respective net tangible and intangible assets. Acquired intangible assets include technology, in-process research and development, customer relationships, trademarks and tradenames, and non-compete agreements. The Company determines the appropriate useful life by performing an analysis of expected cash flows based on historical experience of the acquired businesses and the Company’s comparable businesses. Intangible assets are amortized over their estimated useful lives using the straight-line method which approximates the pattern in which the economic benefits are consumed. Goodwill Goodwill represents the excess of the cost of an acquired entity over the fair value of the acquired net assets. Goodwill is tested for impairment annually during the fourth quarter of the Company’s fiscal year or when events or circumstances change in a manner that indicates goodwill might be impaired. Events or circumstances that could trigger an impairment review include, but are not limited to, a significant adverse change in legal factors or in the business or political climate, an adverse action or assessment by a regulator, unanticipated competition, a loss of key personnel, significant changes in the manner of the Company’s use of the acquired assets or the strategy for the Company’s overall business, significant negative industry or economic trends or significant underperformance relative to projected future results of operations. (Loss) Earnings Per Share Basic (loss) earnings per share is computed using the weighted-average number of common shares outstanding, excluding shares of unvested restricted stock. The reconciliation of basic to diluted shares is as follows (in thousands except share data): Three Months Ended Nine Months Ended (Loss) income from January 25, 2020 January 26, 2019 January 25, 2020 January 26, 2019 Continuing operations attributable to AeroVironment $ (1,008) $ 8,431 $ 23,603 $ 35,815 Discontinued operations, net of tax — (62) — 5,941 Net (loss) income attributable to AeroVironment $ (1,008) $ 8,369 $ 23,603 $ 41,756 Denominator for basic (loss) earnings per share: Weighted average common shares 23,821,145 23,687,672 23,790,788 23,643,866 Dilutive effect of employee stock options, restricted stock and restricted stock units — 394,147 285,407 420,142 Denominator for diluted (loss) earnings per share 23,821,145 24,081,819 24,076,195 24,064,008 Due to the net loss for the three months ended January 25, 2020, no shares reserved for issuance upon exercise of stock options or shares of unvested restricted stock were included in the computation of diluted loss per share as their inclusion would have been anti-dilutive. Potentially dilutive shares not included in the computation of diluted weighted-average common shares because their effect would have been anti-dilutive were 287,408 and 3,076 for the three and nine months ended January 25, 2020, respectively. Potentially dilutive shares not included in the computation of diluted weighted-average common shares because their effect would have been anti-dilutive were 1,705 and 5,519 for the three and nine months ended January 26, 2019, respectively. Recently Issued Accounting Standards In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments In August 2018, the FASB issued ASU 2018-13, Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement . In August 2018, the FASB issued ASU 2018-15, Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract . In December 2019, the FASB issued ASU 2019-12, Simplifying the Accounting for Income Taxes . In January 2020, the FASB issued ASU 2020-01, Clarifying the Interactions between Topic 321, Topic 323, and Topic 815 . |
Discontinued Operations
Discontinued Operations | 9 Months Ended |
Jan. 25, 2020 | |
Discontinued Operations. | |
Discontinued Operations | 2. Discontinued Operations On June 29, 2018, the Company completed the sale of the EES Business to Webasto. In accordance with the terms of the Purchase Agreement, as amended by a side letter agreement executed at the closing, the Company received cash consideration of $31,994,000 upon closing, which resulted in a gain of $11,420,000 and has been recorded in gain on sale of business, net of tax in the consolidated statements of operations. During the nine months ended January 26, 2019, the Company recorded a reduction to the gain resulting from a working capital adjustment of $505,000. In addition, the Company and Webasto have engaged an independent accounting firm to resolve a working capital dispute in the amount of $922,000 pursuant to the terms of the Purchase Agreement. No amounts have been recorded in the consolidated financial statements related to the additional working capital dispute as the Company has assessed the likelihood of a loss to be less than probable. The Company is entitled to receive additional cash consideration of $6,500,000 (the “Holdback”) upon tendering consents to assignment of two remaining customer contracts to Webasto. The Holdback was not recorded in the Company’s consolidated financial statements as the amount was not realized or realizable as of January 25, 2020. The Company’s satisfaction of the requirements for the payment of the Holdback is currently in dispute. On February 22, 2019, Webasto filed a lawsuit alleging several claims against the Company for breach of contract, indemnity, and bad faith, including allegations regarding inaccuracy of certain diligence disclosures, failure to provide certain consents to contract assignments and related to a previously announced product recall. Webasto seeks to recover the costs of the recall and other damages totaling a minimum of $6,500,000 in addition to attorneys’ fees, costs, and punitive damages. On August 16, 2019, the Company filed a counterclaim against Webasto seeking payment of the Holdback and declaratory relief regarding Webasto’s cancellation of an assigned contract. The Company believes that the allegations are generally meritless and is mounting a vigorous defense. On October 29, 2019, P.B.M S.r.l. (“PBM”), filed a Notice of Arbitration naming Webasto and the Company as defendants, alleging over $1,700,000 , plus attorneys’ fees, for unpaid invoices and reliance damages stemming from a 2017 agreement that the Company assigned to Webasto in the sale of the EES Business. In December 2019, the Company reached a settlement with PBM, and PBM settled its claims against Webasto, concurrently. PBM has withdrawn its Notice of Arbitration, and the Company considers this matter closed. Parties to the Webasto lawsuit will amend their pleadings to reflect that any claims associated with PBM are no longer in dispute. During the three months ended October 27, 2018, Webasto filed a recall report with the National Highway Traffic Safety Administration that named certain of the Company’s EES products as subject to the recall. The Company is continuing to assess the facts giving rise to the recall. Under the terms of the Purchase Agreement, the Company may be responsible for certain costs of such recall of named products the Company manufactured, sold or serviced prior to the closing of the sale of the EES Business. On August 14, 2019, Benchmark Electronics, Inc. (“Benchmark”), the company that assembled the products subject to the recall, served a demand for arbitration to the Company and Webasto, and a third-party part supplier pursuant to its contracts with the Company and Webasto, respectively. The Company filed a responsive pleading in the Benchmark arbitration on October 29, 2019, consisting of a general denial, affirmative defenses, and a reservation of the right to file counter-claims at a later date. Webasto challenged the validity of the Benchmark arbitration by filing an action in New York Superior Court. In December 2019, Webasto and Benchmark reached a settlement of their disputed claims. Benchmark withdrew its Notice of Arbitration against Webasto and the Company, but reserved its right to pursue indemnity claims against suppliers. The recall remains a significant part of the Webasto lawsuit. Concurrent with the execution of the Purchase Agreement, the Company entered into a transition services agreement (the “TSA”) to provide certain general and administrative services to Webasto for a defined period. Income from performing services under the TSA was $57,000 and $545,000 has been recorded in other income, net in the consolidated statements of operations for three and nine months ended January 25, 2020, respectively, and $657,000 and $2,013,000 for three and nine months ended January 26, 2019, respectively. The Company determined that the EES Business met the criteria for classification as an asset held for sale as of April 30, 2018 and represents a strategic shift in the Company’s operations. Therefore, the assets and liabilities and the results of operations of the EES Business are reported as discontinued operations for all periods presented. The table below presents the statements of operations data for the EES Business (in thousands). Three Months Ended Nine Months Ended January 26, January 26, 2019 2019 Net sales $ — $ 4,256 Cost of sales 54 5,080 Gross margin (54) (824) Selling, general and administrative 14 1,517 Research and development 34 1,075 Other income, net — 1 Loss from discontinued operations before income taxes (102) (3,415) Benefit for income taxes (41) (904) Net loss from discontinued operations $ (61) $ (2,511) Gain on sale of business, net of tax expense of $2,463 (1) 8,452 Net (loss) income from discontinued operations $ (62) $ 5,941 |
Investments
Investments | 9 Months Ended |
Jan. 25, 2020 | |
Investments | |
Investments | 3. Investments Investments consist of the following (in thousands): January 25, April 30, 2020 2019 Short-term investments: Held-to-maturity securities: Municipal securities $ 7,565 $ 5,332 U.S. government securities 45,439 63,205 Corporate bonds 82,298 81,950 Total held-to-maturity investments 135,302 150,487 Available-for-sale securities: Variable rate demand notes 13,200 — Total available-for-sale investments 13,200 — Total short-term investments $ 148,502 $ 150,487 Long-term investments: Held-to-maturity securities: Municipal securities 15,887 — U.S. government securities — 7,404 Corporate bonds 4,558 1,982 Certificates of deposit 1,017 — Total held-to-maturity investments 21,462 9,386 Available-for-sale securities: Investment in limited partnership fund 4,947 — Total available-for-sale investments 4,947 — Total long-term investments $ 26,409 $ 9,386 Held-To-Maturity Securities As of January 25, 2020 and April 30, 2019, the balance of held-to-maturity securities consisted of state and local government municipal securities, U.S. government securities, U.S. government agency securities, highly rated corporate bonds, and certificates of deposit. Interest earned from these investments is recorded in interest income. The amortized cost, gross unrealized gains, gross unrealized losses, and estimated fair value of the held-to-maturity investments as of January 25, 2020 were as follows (in thousands): January 25, 2020 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value Municipal securities $ 23,452 $ 12 $ (4) $ 23,460 U.S. government securities 45,439 63 — 45,502 Corporate bonds 86,856 57 — 86,913 Certificates of deposit 1,017 4 — 1,021 Total held-to-maturity investments $ 156,764 $ 136 $ (4) $ 156,896 The amortized cost, gross unrealized gains, gross unrealized losses, and estimated fair value of the held-to-maturity investments as of April 30, 2019 were as follows (in thousands): April 30, 2019 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value Municipal securities $ 5,332 $ 2 $ (1) $ 5,333 U.S. government securities 70,609 78 (52) 70,635 Corporate bonds 83,932 20 (5) 83,947 Total held-to-maturity investments $ 159,873 $ 100 $ (58) $ 159,915 The amortized cost and fair value of the held-to-maturity securities by contractual maturity at January 25, 2020 were as follows (in thousands): Cost Fair Value Due within one year $ 135,302 $ 135,418 Due after one year through five years 21,462 21,478 Total $ 156,764 $ 156,896 Available-For-Sale Securities Variable Rate Demand Notes Variable rate demand notes (“VRDNs”) are floating rate municipal instruments usually with long maturities (commonly 20 one The amortized cost and fair value of the available-for-sale debt securities by contractual maturity at January 25, 2020 were as follows (in thousands): Cost Fair Value Due after 20 years $ 13,200 $ 13,200 Total $ 13,200 $ 13,200 Investment in Limited Partnership Fund During the three months ended July 27, 2019, the Company made its initial capital contribution to a limited partnership fund focusing on highly relevant technologies and start-up companies serving defense and industrial markets. This investment does not have readily determinable fair values. The Company has elected to measure equity investments that do not have readily determinable fair values at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. The following table is a summary of the activity related to the available-for-sale investments recorded in short-term and long-term investments (in thousands): April 30, 2019 Changes in January 25, 2020 Carrying Fair Value Sales or Carrying Value Reflected in Net Income Purchases Value Variable rate demand notes $ — $ — $ 13,200 $ 13,200 Investment in limited partnership — — 4,947 4,947 Total available-for-sale investments $ — $ — $ 18,147 $ 18,147 Auction Rate Securities As of April 30, 2018, the balance of available-for-sale auction rate securities consisted of two investment grade auction rate municipal bonds with maturities ranging from 1 to 16 years. These investments have characteristics similar to short term investments. During the three months ended July 28, 2018, the remaining investment grade auction rate municipal bonds were redeemed at par value. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Jan. 25, 2020 | |
Fair Value Measurements | |
Fair Value Measurements | 4. Fair Value Measurements Fair value is the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value hierarchy contains three levels as follows: ● ● ● The Company’s financial liabilities measured at fair value on a recurring basis at January 25, 2020, were as follows (in thousands): Fair Value Measurement Using Significant Quoted prices in other Significant active markets for observable unobservable identical assets inputs inputs Description (Level 1) (Level 2) (Level 3) Total Variable rate demand notes $ — $ 13,200 $ — $ 13,200 Contingent consideration — — 2,500 2,500 Total $ — $ 13,200 $ 2,500 $ 15,700 The following table provides a reconciliation between the beginning and ending balances of items measured at fair value on a recurring basis that used significant unobservable inputs (Level 3) (in thousands): Fair Value Measurements Using Significant Unobservable Inputs Description (Level 3) Balance at May 1, 2019 $ — Business acquisition 1,703 Transfers to Level 3 — Total (gains) losses (realized or unrealized) Included in inventories 380 Included in product cost of sales 767 Included in selling, general and administrative (703) Included in research and development 353 Included in other comprehensive income — Settlements — Balance at January 25, 2020 $ 2,500 The amount of total (gains) or losses for the period included in earnings attributable to the change in unrealized gains or losses relating to assets or liabilities still held at January 25, 2020 $ — Pursuant to the Pulse Purchase Agreement, the sellers may receive up to a maximum of $5,000,000 in additional cash consideration (“contingent consideration”), if specific research and development milestones are achieved by December 10, 2021 and the continued employment of specific key employees. The contingent consideration was valued using a probability weighted discounted cash flow model. The analysis considered, among other items, contractual terms of the Pulse Purchase Agreement, the Company’s discount rate, the timing of expected future cash flows and the probability that the milestones required for payment of the contingent consideration will be achieved. See Note 18—Business Acquisitions. During the three months ended January 25, 2020, one of the research and development milestones was achieved, and the requirements for the payout of remaining contingent consideration were concluded to not have been met. As a result, the Company recorded a gain of $832,000, which was recorded in selling, general, and administrative expense in the consolidated statements of operations. On February 26, 2020, $2,500,000 of contingent consideration was paid to the sellers for the achieved milestone, and the remaining $2,500,000 is no longer restricted. |
Inventories, net
Inventories, net | 9 Months Ended |
Jan. 25, 2020 | |
Inventories, net | |
Inventories, net | 5. Inventories, net Inventories consist of the following (in thousands): January 25, April 30, 2020 2019 Raw materials $ 19,119 $ 16,792 Work in process 33,005 19,162 Finished goods 23,169 25,926 Inventories, gross 75,293 61,880 Reserve for inventory excess and obsolescence (10,137) (7,824) Inventories, net $ 65,156 $ 54,056 During the nine months ended January 25, 2020, the Company recorded inventory reserve charges of approximately $2,600,000 to impair the remaining net book value of the Company’s Quantix commercial UAS solution. For the three and nine months ended January 25, 2020, the Company recorded inventory reserve charges of $617,000 and $3,807,000, respectively. For the three and nine months end January 26, 2019 the Company recorded inventory impairment charges of $1,889,000 and $3,079,000, respectively. |
Equity Method Investments
Equity Method Investments | 9 Months Ended |
Jan. 25, 2020 | |
Equity Method Investments | |
Equity Method Investments | 6. Equity Method Investments In December of 2017, the Company and SoftBank formed a joint venture, HAPSMobile, which is a Japanese corporation. As of January 25, 2020, the Company’s ownership stake in HAPSMobile was approximately 7%, with the remaining 93% held by SoftBank. In connection with the formation of the joint venture on December 27, 2017, the Company initially purchased shares of HAPSMobile representing a 5% ownership interest in exchange for an investment of 210,000,000 yen ($1,860,000). The Company subsequently purchased additional shares of HAPSMobile in order to maintain a 5% ownership stake in the joint venture. The first such purchase occurred on April 17, 2018, at which time the Company invested 150,000,000 yen ($1,407,000) for the purchase of additional shares of HAPSMobile. On January 29, 2019, the Company invested an additional 209,500,000 yen ($1,926,000) to maintain its 5% ownership stake. On February 9, 2019, the Company elected to purchase 632,800,000 yen ($5,671,000) of additional shares of HAPSMobile to increase the Company’s ownership in the joint venture from 5% to 10%, and on May 10, 2019, the Company purchased 500,000,000 yen ($4,569,000) of additional shares of HAPSMobile to maintain its 10% ownership stake. The Company’s ownership percentage was subsequently diluted from 10% to approximately 5%. On December 4, 2019, the Company purchased 540,050,000 yen ($4,982,000) of additional shares of HAPSMobile to increase its ownership stake to approximately 7%. As the Company has the ability to exercise significant influence over the operating and financial policies of HAPSMobile pursuant to the applicable Joint Venture Agreement and related organizational documents, the Company’s investment is accounted for as an equity method investment. For the three and nine months ended January 25, 2020, the Company recorded its ownership percentage of the net loss of HAPSMobile, or $1,200,000 and $3,410,000, respectively, in equity method investment loss, net of tax in the unaudited consolidated statement of operations. For the three and nine months ended January 26, 2019, the Company recorded its ownership percentage of the net loss of HAPSMobile, or $717,000 and $2,071,000, respectively, in equity method investment loss, net of tax in the unaudited consolidated statement of operations. At January 25, 2020 and April 30, 2019, the carrying value of the investment in HAPSMobile of $11,819,000 and $5,612,000, respectively, was recorded in other assets. |
Warranty Reserves
Warranty Reserves | 9 Months Ended |
Jan. 25, 2020 | |
Warranty Reserves | |
Warranty Reserves | 7. Warranty Reserves The Company accrues an estimate of its exposure to warranty claims based upon both current and historical product sales data and warranty costs incurred. The warranty reserve is included in other current liabilities. The related expense is included in cost of sales. Warranty reserve activity is summarized as follows for the three and nine months ended January 25, 2020 and January 26, 2019, respectively (in thousands): Three Months Ended Nine Months Ended January 25, January 26, January 25, January 26, 2020 2019 2020 2019 Beginning balance $ 1,875 $ 2,431 $ 1,704 $ 2,090 Warranty expense 250 53 1,469 414 Changes in estimates related to pre-existing warranties — — (189) 519 Warranty costs settled (289) (354) (1,148) (893) Ending balance $ 1,836 $ 2,130 $ 1,836 $ 2,130 |
Intangibles
Intangibles | 9 Months Ended |
Jan. 25, 2020 | |
Intangibles | |
Intangibles | 8. Intangibles The components of intangibles are as follows (in thousands): January 25, April 30, 2020 2019 Technology $ 14,950 $ - Licenses 1,006 1,006 Customer relationships 873 733 In-process research and development 550 - Non-compete agreements 320 - Trademarks and tradenames 68 28 Other 3 3 Intangibles, gross 17,770 1,770 Less accumulated amortization (3,413) (1,311) Intangibles, net $ 14,357 $ 459 The weighted average amortization period at January 25, 2020 and April 30, 2019 was five years and one year, respectively. Amortization expense for the three and nine months ended January 25, 2020 was $775,000 and $2,102,000, respectively. Amortization expense for the three and nine months ended January 26, 2019 was $104,000 and $253,000, respectively. Technology, in-process research and development, customer relationships, trademarks and tradenames, and non-compete agreements were recognized in conjunction with the Company’s acquisition of Pulse on June 10, 2019. Refer to Note 18—Business Acquisitions for further details. Estimated amortization expense for the next five years is as follows (in thousands): Year ending April 30, 2020 $ 720 2021 2,792 2022 2,829 2023 2,688 2024 2,629 $ 11,658 |
Goodwill
Goodwill | 9 Months Ended |
Jan. 25, 2020 | |
Goodwill. | |
Goodwill | 9. Goodwill The following table presents the changes in the Company’s goodwill balance (in thousands): Balance at April 30, 2019 $ - Additions to goodwill 6,340 Impairment of goodwill - Balance at January 25, 2020 $ 6,340 The increase of goodwill is attributable to the acquisition of Pulse. Refer to Note 18—Business Acquisitions for further details. |
Leases
Leases | 9 Months Ended |
Jan. 25, 2020 | |
Leases | |
Leases | 10. Leases The Company leases certain buildings, land and equipment. Under the New Lease Standard, at contract inception the Company determines whether the contract is, or contains, a lease and whether the lease should be classified as an operating or a financing lease. Operating leases are recorded in operating lease right-of-use assets, current operating lease liabilities and non-current operating lease liabilities. The Company recognizes operating lease right-of-use assets and operating lease liabilities based on the present value of the future minimum lease payments over the lease term at commencement date. The Company uses its incremental borrowing rate based on the information available at commencement date to determine the present value of future payments and the appropriate lease classification. The Company defines the initial lease term to include renewal options determined to be reasonably certain. The Company’s leases have remaining lease terms of less than one year to six years, some of which may include options to extend options to terminate Many of the Company’s real estate lease agreements contain incentives for tenant improvements, rent holidays, or rent escalation clauses. For tenant improvement incentives, if the incentive is determined to be a leasehold improvement owned by the lessee, the Company generally records incentive as a reduction to fixed lease payments thereby reducing rent expense. For rent holidays and rent escalation clauses during the lease term, the Company records rental expense on a straight-line basis over the term of the lease. For these lease incentives, the Company uses the date of initial possession as the commencement date, which is generally when the Company is given the right of access to the space and begins to make improvements in preparation for intended use. The Company does not have any finance leases. The Company does not have any material restrictions or covenants in its lease agreements, sale-leaseback transactions, land easements or residual value guarantees. In determining the inputs to the incremental borrowing rate calculation, the Company makes judgments about the value of the leased asset, its credit rating and the lease term including the probability of its exercising options to extend or terminate the underlying lease. Additionally, the Company makes judgments around contractual asset substitution rights in determining whether a contract contains a lease. The components of lease costs recorded in cost of sales for product sales and contract services and selling, general and administrative (“SG&A”) expense were as follows (in thousands): Nine Months Ended January 25, 2020 Operating lease cost $ 3,453 Short term lease cost 489 Variable lease cost 609 Sublease income (230) Total lease costs, net $ 4,321 Supplemental lease information were as follows: Nine Months Ended January 25, 2020 (In thousands) Cash paid for amounts included in the measurement of operating lease liabilities $ 4,029 Right-of-use assets obtained in exchange for new lease liabilities $ 12,634 Weighted average remaining lease term 35 months Weighted average discount rate 3.6% Maturities of operating lease liabilities as of January 25, 2020 were as follows (in thousands): 2020 $ (1,309) 2021 4,496 2022 3,749 2023 2,171 2024 1,055 Thereafter 62 Total lease payments 10,224 Less: imputed interest (585) Total present value of operating lease liabilities $ 9,639 Maturities of operating lease liabilities as of April 30, 2019 were as follows: 2020 $ 5,298 2021 3,527 2022 2,723 2023 1,554 2024 953 Thereafter — Total lease payments $ 14,055 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income and Reclassifications Adjustments | 9 Months Ended |
Jan. 25, 2020 | |
Accumulated Other Comprehensive Income and Reclassifications Adjustments | |
Accumulated Other Comprehensive Income and Reclassifications Adjustments | 11. Accumulated Other Comprehensive Income and Reclassifications Adjustments The components of accumulated other comprehensive income and adjustments are as follows (in thousands): Accumulated Other Income Balance, net of $0 deferred taxes, as of April 30, 2019 $ 2 Reclassifications out of accumulated other comprehensive income, net of taxes — Change in foreign currency translation adjustments, net of $0 taxes 67 Balance, net of $0 deferred taxes, as of January 25, 2020 $ 69 |
Customer-Funded Research & Deve
Customer-Funded Research & Development | 9 Months Ended |
Jan. 25, 2020 | |
Customer-Funded Research & Development | |
Customer-Funded Research & Development | 12. Customer-Funded Research & Development Customer-funded R&D costs are incurred pursuant to contracts (revenue arrangements) to perform R&D activities according to customer specifications. These costs are direct contract costs and are expensed to cost of sales as costs are incurred. Revenue from customer-funded R&D contracts are recognized in accordance with Topic 606 over time as costs are incurred. Revenue from customer-funded R&D was approximately $17,939,000 and $50,565,000 for the three and nine months ended January 25, 2020, respectively. Revenue from customer-funded R&D was approximately $19,437,000 and $55,344,000 for the three and nine months ended January 26, 2019, respectively. |
Long-Term Incentive Awards
Long-Term Incentive Awards | 9 Months Ended |
Jan. 25, 2020 | |
Long-Term Incentive Awards. | |
Long-Term Incentive Awards | 13. Long-Term Incentive Awards During the three months ended July 27, 2019, the Company granted awards under its amended and restated 2006 Equity Incentive Plan (the “Restated 2006 Plan”) to key employees (“Fiscal 2020 LTIP”). Awards under the Fiscal 2020 LTIP consist of: (i) time-based restricted stock awards, which vest in equal tranches in July 2020, July 2021 and July 2022, and (ii) performance-based restricted stock units (“PRSUs”), which vest based on the Company’s achievement of revenue and operating income targets for the three-year period ending April 30, 2022. At the award date, target achievement levels for each of the financial performance metrics were established for the PRSUs, at which levels the PRSUs would vest at 100% for each such metric. Threshold achievement levels for which the PRSUs would vest at 50% for each such metric and maximum achievement levels for which such awards would vest at 200% for each such metric were also established. The actual payout for the PRSUs at the end of the performance period will be calculated based upon the Company’s achievement of the established revenue and operating income targets for the performance period. Settlement of the PRSUs will be made in fully-vested shares of common stock. For the three and nine months ended January 25, 2020, the Company recorded $215,000 and $512,000 of compensation expense related to the Fiscal 2020 LTIP. At January 25, 2020, the maximum compensation expense that may be recorded for the performance-based portion of the Fiscal 2020 LTIP is $4,263,000. During the three months ended July 28, 2018, the Company also granted awards under the Restated 2006 Plan to key employees (“Fiscal 2019 LTIP”). Awards under the Fiscal 2019 LTIP consist of: (i) time-based restricted stock awards, which vest in equal tranches in July 2019, July 2020 and July 2021, and (ii) PRSUs, which vest based on the Company’s achievement of revenue and operating income targets for the three-year period ending April 30, 2021. At the award date, target achievement levels for each of the financial performance metrics were established for the PRSUs, at which levels the PRSUs would vest at 100% for each such metric. Threshold achievement levels for which the PRSUs would vest at 50% for each such metric and maximum achievement levels for which such awards would vest at 200% for each such metric were also established. The actual payout for the PRSUs at the end of the performance period will be calculated based upon the Company’s achievement of the established revenue and operating income targets for the performance period. Settlement of the PRSUs will be made in fully-vested shares of common stock. For the three and nine months ended January 25, 2020, the Company recorded $246,000 and $294,000 of compensation expense related to the Fiscal 2019 LTIP, respectively. For the three and nine months ended January 26, 2019, the Company recorded $226,000 and $482,000 of compensation expense related to the Fiscal 2019 LTIP, respectively. At January 25, 2020, the maximum compensation expense that may be recorded for the performance-based portion of the Fiscal 2019 LTIP is $2,478,000. During the three months ended July 29, 2017, the Company also granted awards under the Restated 2006 Plan to key employees (“Fiscal 2018 LTIP”). Awards under the Fiscal 2018 LTIP consist of: (i) time-based restricted stock awards, which vest in equal tranches in July 2018, July 2019 and July 2020, and (ii) PRSUs, which vest based on the Company’s achievement of revenue and operating income targets for the three-year period ending April 30, 2020. At the award date, target achievement levels for each of the financial performance metrics were established for the PRSUs, at which levels the PRSUs would vest at 100% for each such metric. Threshold achievement levels for which the PRSUs would vest at 50% for each such metric and maximum achievement levels for which such awards would vest at 200% for each such metric were also established. The actual payout for the PRSUs at the end of the performance period will be calculated based upon the Company’s achievement of the established revenue and operating income targets for the performance period. Settlement of the PRSUs will be made in fully-vested shares of common stock. For the three and nine months ended January 25, 2020, the Company recorded $201,000 and $162,000 of compensation expense related to the Fiscal 2018 LTIP, respectively. For the three and nine months ended January 26, 2019, the Company recorded $317,000 and $653,000 of compensation expense related to the Fiscal 2018 LTIP, respectively. At January 25, 2020, the maximum compensation expense that may be recorded for the performance-based portion of the Fiscal 2018 LTIP is $1,850,000. During the three months ended July 29, 2017, the Company also granted awards under the Restated 2006 Plan to key employees (“Fiscal 2017 LTIP”). Awards under the Fiscal 2017 LTIP consist of: (i) time-based restricted stock awards, which vested in equal tranches in July 2017, July 2018 and July 2019, and (ii) PRSUs, which vested based on the Company’s achievement of revenue and operating income targets for the three-year period ending April 30, 2019. During the three months ended July 27, 2019, the Company issued a total of 14,814 fully-vested shares of common stock to settle the PRSUs in the Fiscal 2017 LTIP. No compensation expense was recorded during the three and nine months ended January 25, 2020 for the Fiscal 2017 LTIP. At January 25, 2020 and April 30, 2019, the Company recorded cumulative stock-based compensation expense from the Fiscal 2020 LTIP, Fiscal 2019 LTIP and Fiscal 2018 LTIP of $2,397,000 and $1,429,000, respectively. At each reporting period, the Company reassesses the probability of achieving the performance targets for the PRSUs. The estimation of whether the performance targets will be achieved requires judgment, and to the extent actual results or updated estimates differ from the Company’s current estimates, the cumulative effect on current and prior periods of those changes will be recorded in the period estimates are revised. No compensation cost is ultimately recognized for awards for which employees do not render the requisite service and are forfeited. |
Income Taxes
Income Taxes | 9 Months Ended |
Jan. 25, 2020 | |
Income Taxes | |
Income Taxes | 14. Income Taxes For the three and nine months ended January 25, 2020, the Company recorded a (benefit from) provision for income taxes of $(38,000) and $3,203,000, respectively, yielding an effective tax rate of (28.4)% and 10.6%, respectively. For the three and nine months ended January 26, 2019, the Company recorded a provision for income taxes of $946,000 and $4,724,000, respectively, yielding effective tax rates of 9.4% and 11.1%, respectively. The variance from statutory rates for the three and nine months ended January 25, 2020 was primarily due to federal R&D credits, foreign derived intangible income deductions and the recording of discrete excess tax benefits resulting from the vesting of restricted stock awards and exercises of stock options. The variance from statutory rates for the three and nine months ended January 26, 2019 was primarily due to federal R&D credits and the recording of discrete excess tax benefits resulting from the vesting of restricted stock awards and exercises of stock options. |
Share Repurchase
Share Repurchase | 9 Months Ended |
Jan. 25, 2020 | |
Share Repurchase | |
Share Repurchase | 15. Share Repurchase In September 2015, the Company’s Board of Directors authorized a program to repurchase up to $25,000,000 of the Company’s common stock with no specified termination date for the program. No shares were repurchased under the program during the three and nine months ended January 25, 2020 or January 26, 2019. As of January 25, 2020 and April 30, 2019, approximately $21,200,000 remained authorized for future repurchases under this program. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Jan. 25, 2020 | |
Related Party Transactions | |
Related Party Transactions | 16. Related Party Transactions Related party transactions are defined as transactions between the Company and entities either controlled by the Company or that the Company can significantly influence. Although SoftBank has a controlling interest in HAPSMobile, the Company determined that it has the ability to exercise significant influence over HAPSMobile. As such, HAPSMobile and SoftBank are considered related parties of the Company. Concurrent with the formation of HAPSMobile, the Company executed a Design and Development Agreement (the “DDA”) with HAPSMobile. Under the DDA and related efforts, the Company will use its best efforts, up to a maximum net value of $148,576,000, to design and build prototype solar powered high altitude aircraft and ground control stations for HAPSMobile and conduct low altitude and high altitude flight tests of the prototype aircraft. The Company recorded revenue under the DDA and preliminary design agreements between the Company and SoftBank of $11,762,000 and $37,491,000 for the three and nine months ended January 25, 2020, respectively. The Company recorded revenue under the DDA and preliminary design agreements between the Company and SoftBank of $13,586,000 and $37,981,000 for the three and nine months ended January 26, 2019, respectively. At January 25, 2020 and April 30, 2019, the Company had unbilled related party receivables from HAPSMobile of $28,849,000 and $9,028,000 recorded in unbilled receivables and retentions on the consolidated balance sheets, respectively. During the year ended April 30, 2019, the Company owned a 10% stake in accordance with the Joint Venture Agreement which was diluted to approximately 5% during the first three months ended July 27, 2019. On December 4, 2019, the Company purchased 540,050,000 yen ($4,982,000) of additional shares of HAPSMobile to increase its ownership stake to approximately 7%. Refer to Note 6—Equity Method Investments for further details. |
Legal Settlements
Legal Settlements | 9 Months Ended |
Jan. 25, 2020 | |
Legal Settlements | |
Legal Settlements | 17. Legal Settlements In May 2018, the Company entered into a settlement agreement to dismiss its claims against MicaSense Inc. and former AeroVironment employees, Gabriel Torres, Justin McAllister, and Jeff McBride. The terms and amount of the settlement agreement are confidential. The proceeds of the settlement were received during the three months ended July 28, 2018 and have been recorded in other income, net on the consolidated statements of operations. |
Business Acquisitions
Business Acquisitions | 9 Months Ended |
Jan. 25, 2020 | |
Business Acquisitions | |
Business Acquisitions | 18. Business Acquisitions On June 10, 2019, the Company purchased 100% of the issued and outstanding member units of Pulse pursuant to the terms of the Pulse Purchase Agreement. The Company’s acquisition of Pulse’s helicopter UAS product family strengthens AeroVironment’s leading family of fixed-wing small unmanned aircraft systems and increases the mission capabilities of AeroVironment’s family of systems. Pursuant to the Pulse Purchase Agreement, at closing, the Company paid $20,650,000 in cash, less closing indebtedness and transaction costs as defined in the Pulse Purchase Agreement, less a $250,000 retention to cover any post-closing indemnification claims, and less a $1,250,000 holdback amount, with the retention and holdback to be released to the member unit holders of Pulse, less any amounts paid or reserved, 18 months after the closing of the transactions in accordance with the terms of the Pulse Purchase Agreement. The closing cash consideration included the payoff of the outstanding indebtedness of Pulse as of the closing date. The Company financed the acquisition entirely from available cash on hand. In addition to the consideration paid at closing, the acquisition of Pulse includes contingent consideration arrangements that require additional consideration to be paid by the Company to the sellers of Pulse if two specified research and development milestones are achieved by December 10, 2021 and the continued employment of specified employees. Amounts are payable upon the achievement of the milestones. The range of the undiscounted amounts the Company could pay under each of the contingent consideration agreements is zero or $2,500,000 ($5,000,000 in total if both milestones are achieved and specific key employees continued employment). The fair value of the contingent consideration recognized on the acquisition date of $1,703,000 was estimated by applying the income approach. That measure is based on significant Level 3 inputs not observable in the market. Key assumptions include (1) a discount rate of 4.5% and (2) the probability that each of the milestones will be achieved. As of January 25, 2020, the fair value of the contingent consideration was $2,500,000 recorded in other current liabilities on the consolidated balance sheet. During the three months ended January 25, 2020, one of the research and development milestones was achieved, and the requirements for the payout of remaining contingent consideration were concluded to not have been met. As a result, the Company recorded a gain of $832,000 which was recorded in selling, general, and administrative expense in the consolidated statements of operations. On February 26, 2020, $2,500,000 of contingent consideration was paid to the sellers for the achieved milestone, and the remaining $2,500,000 is no longer restricted. The following table summarizes the provisional allocation of the purchase price over the estimated fair value of the assets and liabilities assumed in the acquisition of Pulse (in thousands): June 10, 2019 Technology $ 14,950 Goodwill 6,340 In-process R&D 550 Inventory 334 Non-compete agreements 320 Other assets, net of liabilities assumed (614) Total net identified assets acquired $ 21,880 Fair value of consideration: Cash $ 18,677 Holdback 1,250 Retention 250 Contingent consideration 1,703 Total $ 21,880 Determining the fair value of the intangible assets acquired requires significant judgment, including the amount and timing of expected future cash flows, long-term growth rates and discount rates. The fair value of the intangibles assets was determined using a discounted cash flow analysis, which were based on the Company’s best estimate of future sales, earnings and cash flows after considering such factors as general market conditions, anticipated customer demand, changes in working capital, long term business plans and recent operating performance. Use of different estimates and judgments could yield materially different results. The goodwill is attributable to the synergies the Company expects to achieve through leveraging the acquired technology to its existing customers, the workforce of Pulse and expected future customers in the helicopter UAS market. For tax purposes the acquisition was treated as an asset purchase and the goodwill is deductible ratably over a period of fifteen years. Supplemental Pro Forma Information (unaudited) Pulse revenue for the three and nine months ended January 25, 2020 since acquisition on June 10, 2019 were $2,229,000 and $2,901,000, respectively. Other than the aforementioned revenue and intangible asset amortization expense of $671,000 and $1,790,000 for the three and nine months ended January 25, 2020 since acquisition on June 10, 2019, the Pulse financial results were not significant. The following unaudited pro forma summary presents consolidated information of the Company as if the business acquisition had occurred on May 1, 2018 (in thousands): Three Months Ended Nine Months Ended January 25, January 26, January 25, January 26, 2020 2019 2020 2019 Revenue $ 61,891 $ 75,922 $ 232,300 $ 228,533 Net (loss) income attributable to AeroVironment $ (726) $ 7,244 $ 24,227 $ 38,471 The Company did not have any material, nonrecurring pro forma adjustments directly attributable to the business acquisition included in the reported pro forma revenue and earnings. These pro forma amounts have been calculated by applying the Company’s accounting policies, assuming transaction costs had been incurred during the three months ended July 28, 2018, reflecting the additional amortization that would have been charged assuming the fair value adjustments to intangible assets had been applied from May 1, 2018 with the consequential tax effects, and including the results of Pulse prior to acquisition. The Company incurred approximately $344,000 and $1,036,000 of acquisition-related expenses for the three and nine months ended January 25, 2020. These expenses are included in selling, general and administrative, research and development, and product cost of sales on the Company’s consolidated income statement. The unaudited pro forma supplemental information is based on estimates and assumptions, which the Company believes are reasonable and are not necessarily indicative of the results that have been realized had the acquisitions been consolidated in the tables above as of May 1, 2018, nor are they indicative of results of operations that may occur in the future. |
Organization and Significant _2
Organization and Significant Accounting Policies (Policies) | 9 Months Ended |
Jan. 25, 2020 | |
Organization and Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information and with the instructions of Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments, consisting only of normal recurring adjustments necessary for a fair presentation with respect to the interim financial statements have been included. The results of operations for the three and nine months ended January 25, 2020 are not necessarily indicative of the results for the full year ending April 30, 2020. For further information, refer to the consolidated financial statements and footnotes thereto for the year ended April 30, 2019, included in the Company’s Annual Report on Form 10-K. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions, including estimates of anticipated contract costs and revenue utilized in the revenue recognition process, that affect the reported amounts in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. The Company’s consolidated financial statements include the assets, liabilities and operating results of wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated. In December 2017, the Company and SoftBank Corp. (“SoftBank”) formed a joint venture, HAPSMobile, Inc. (“HAPSMobile”). As the Company has the ability to exercise significant influence over the operating and financial policies of HAPSMobile, the Company’s investment has been accounted for as an equity method investment. The Company has presented its proportion of HAPSMobile’s net loss in equity method investment activity, net of tax in the consolidated statements of operations. The carrying value of the investment in HAPSMobile was recorded in other assets. Refer to Note 6—Equity Method Investments for further details. On June 29, 2018, the Company completed the sale of substantially all of the assets and related liabilities of its Efficient Energy Systems business segment (the “EES Business”) to Webasto Charging Systems, Inc. (“Webasto”) pursuant to an Asset Purchase Agreement (the “Purchase Agreement”) between Webasto and the Company. The Company determined that the EES Business met the criteria for classification as an asset held for sale at April 30, 2018 and represents a strategic shift in the Company’s operations. Therefore, the assets and liabilities and the results of operations of the EES Business are reported as discontinued operations for all periods presented. Refer to Note 2—Discontinued Operations for further details. On June 10, 2019, the Company purchased 100% of the issued and outstanding member units of Pulse Aerospace, LLC (“Pulse”) pursuant to the terms of a Unit Purchase Agreement (the “Pulse Purchase Agreement”). The assets, liabilities and operating results of Pulse have been included in the Company’s consolidated financial statements. Refer to Note 18—Business Acquisitions for further details. During the three months ended October 27, 2019, the Company dissolved its wholly-owned subsidiary, Skytower, Inc., the results of which were not material to the consolidated financial statements. |
Recently Adopted Accounting Standards | Recently Adopted Accounting Standards Effective May 1, 2019, the Company adopted Accounting Standards Update (“ASU”) 2016-02, Leases In July 2018, the FASB issued ASU 2018-09, “Codification Improvements” (“ASU 2018-09”). ASU 2018-09 provides technical corrections, clarifications and other improvements across a variety of accounting topics. Among the clarifications, ASU 2018-09 clarifies that an entity should recognize excess tax benefits in the period in which the amount of the deduction is determined. This includes deductions that are taken on the entity’s return in a different period from when the event that gives rise to the tax deduction occurs and the uncertainty about whether the entity will receive a tax deduction and the amount of the tax deduction is resolved. Certain amendments were applicable immediately while others provide transition guidance and are effective in the Company’s first quarter of fiscal year 2020. The Company adopted ASU 2018-09 on May 1, 2019 using the modified retrospective method. The adoption of ASU 2018-09 resulted in a cumulative adjustment to increase retained earnings by $665,000 at May 1, 2019. |
Reclassifications | Reclassifications Certain prior year amounts have been reclassified to conform to the current year presentation. Specifically, the Company’s existing intangible assets have been reclassified from other assets to intangibles, net on the consolidated balance sheet for all periods presented. |
Restricted Cash | Restricted Cash The Company classifies cash accounts which are not available for general use as restricted cash. Pursuant to the terms of the Pulse Purchase Agreement, the Company maintains an escrow account to satisfy the payment of contingent consideration due to the sellers if certain objectives are met. The restricted funds in the escrow account are recorded in other assets on the consolidated balance sheet. As of January 25, 2020 restricted cash was $5,000,000. During the three months ended January 25, 2020, one of the research and development milestones was achieved, and the requirements for the remaining contingent consideration were concluded to not have been met. On February 26, 2020, $2,500,000 of contingent consideration was paid to the sellers for the achieved milestone, and the remaining $2,500,000 is no longer restricted. The Company had no restricted cash as of April 30, 2019. |
Revenue Recognition | Revenue Recognition The Company’s revenue is generated pursuant to written contractual arrangements to design, develop, manufacture and/or modify complex products and to provide related engineering, technical and other services according to the specifications of the customers. These contracts may be firm fixed price (“FFP”), cost plus fixed fee (“CPFF”), or time and materials (“T&M”). The Company considers all such contracts to be within the scope of ASC Topic 606. Performance Obligations A performance obligation is a promise in a contract to transfer distinct goods or services to a customer, and it is the unit of account in ASC Topic 606. A contract’s transaction price is allocated to each distinct performance obligation and revenue is recognized when each performance obligation under the terms of a contract is satisfied. Revenue is measured at the amount of consideration the Company expects to receive in exchange for transferring goods or providing services. For contracts with multiple performance obligations, the Company allocates the contract’s transaction price to each performance obligation using its observable standalone selling price for products and services. When the standalone selling price is not directly observable, the Company uses its best estimate of the standalone selling price of each distinct good or service in the contract using the cost plus margin approach. This approach estimates the Company’s expected costs of satisfying the performance obligation and then adds an appropriate margin for that distinct good or service. Contract modifications are routine in the performance of the Company’s contracts. In most instances, contract modifications are for additional goods and/or services that are distinct and, therefore, accounted for as new contracts. The Company’s performance obligations are satisfied over time or at a point in time. Performance obligations are satisfied over time if the customer receives the benefits as the Company performs, if the customer controls the asset as it is being developed or produced, or if the product being produced for the customer has no alternative use and the Company has a contractual right to payment for the Company’s costs incurred to date plus a reasonable margin. The contractual right to payment is generally supported by termination for convenience clauses that allow the customer to unilaterally terminate the contract for convenience, pay the Company for costs incurred plus a reasonable profit, and take control of any work in process. Revenue for tactical missile systems (“TMS”) product deliveries and Customer-Funded Research and Development contracts is recognized over time as costs are incurred. Contract services revenue is composed of revenue recognized on contracts for the provision of services, including repairs and maintenance, training, engineering design, development and prototyping activities, and technical support services. Contract services revenue is recognized over time as services are rendered. Typically, revenue is recognized over time using an input measure (e.g., costs incurred to date relative to total estimated costs at completion) to measure progress. Training services are recognized over time using an output method based on days of training completed. For performance obligations satisfied over time, revenue is generally recognized using costs incurred to date relative to total estimated costs at completion to measure progress. Incurred costs represent work performed, which correspond with, and thereby best depict, transfer of control to the customer. Contract costs include labor, materials, subcontractors’ costs, other direct costs, and indirect costs applicable on government and commercial contracts. For performance obligations which are not satisfied over time per the aforementioned criteria above, revenue is recognized at the point in time in which each performance obligation is fully satisfied. The Company’s small UAS product sales revenue is composed of revenue recognized on contracts for the delivery of small UAS systems and spare parts. Revenue is recognized at the point in time when control transfers to the customer, which generally occurs when title and risk of loss have passed to the customer. On January 25, 2020, the Company had approximately $125,958,000 of remaining performance obligations under fully funded contracts with its customers, which the Company also refers to as funded backlog. The Company currently expects to recognize approximately 75% of the remaining performance obligations as revenue in fiscal 2020 , an additional 24% in fiscal 2021, and the balance thereafter. The Company collects sales, value added, and other taxes concurrent with revenue producing activities, which are excluded from revenue when they are both imposed on a specific transaction and collected from a customer. Contract Estimates Accounting for contracts and programs primarily with a duration of less than six months involves the use of various techniques to estimate total contract revenue and costs. For long-term contracts, the Company estimates the total expected costs to complete the contract and recognizes revenue based on the percentage of costs incurred at period end. Typically, revenue is recognized over time using costs incurred to date relative to total estimated costs at completion to measure progress toward satisfying the Company’s performance obligations. Incurred costs represent work performed, which corresponds with, and thereby best depicts, the transfer of control to the customer. Contract costs include labor, materials, subcontractors’ costs, other direct costs, and indirect costs applicable on government and commercial contracts. Contract estimates are based on various assumptions to project the outcome of future events that may span several years. These assumptions include labor productivity and availability, the complexity of the work to be performed, the cost and availability of materials, the performance of subcontractors, and the availability and timing of funding from the customer. The nature of the Company’s contracts gives rise to several types of variable consideration, including penalty fees and incentive awards generally for late delivery and early delivery, respectively. The Company generally estimates such variable consideration as the most likely amount. In addition, the Company includes the estimated variable consideration to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the related uncertainty is resolved. These estimates are based on historical award experience, anticipated performance and the Company’s best judgment at the time. Because of the certainty in estimating these amounts, they are included in the transaction price of the Company’s contracts and the associated remaining performance obligations. As a significant change in one or more of these estimates could affect the profitability of the Company’s contracts, the Company regularly reviews and updates its contract-related estimates. Changes in cumulative revenue estimates, due to changes in the estimated transaction price or cost estimates, are recorded using a cumulative catch-up adjustment in the period identified for contracts with performance obligations recognized over time. If at any time the estimate of contract profitability indicates an anticipated loss on the contract, the Company recognizes the total loss in the quarter it is identified, and it is recorded in other current liabilities. The impact of adjustments in contract estimates on the Company’s operating earnings can be reflected in either operating costs and expenses or revenue. The aggregate net favorable impact of adjustments in contract estimates on revenue related to performance obligations satisfied or partially satisfied in previous periods was approximately $1,152,000 and $1,169,000 for the three and nine month periods ended January 25, 2020, respectively. No adjustment on any one contract was material to the Company’s unaudited consolidated financial statements for the three month period ended January 25, 2020. During the nine month period ended January 25, 2020, the Company revised its estimates of the total expected costs to complete a contract associated with a design and development agreement. The impact of the revised estimate on this contract on revenue related to performance obligations satisfied or partially satisfied in previous periods was an increase of approximately $1,036,000. The aggregate net unfavorable impact of adjustments in contract estimates on revenue related to performance obligations satisfied or partially satisfied in previous periods was approximately $1,705,000 for the three months ended January 26, 2019. For the three months ended January 26, 2019, the Company revised its estimates of the total expected costs to complete a TMS contract due to ongoing test and evaluation resulting from some systems not passing the customer’s final lot acceptance tests which the Company anticipates to be resolved in a future period. The impact of the revised estimate on this contract on revenue related to performance obligations satisfied or partially satisfied in previous periods was a reduction of approximately $1,519,000. The aggregate impact of adjustments in contract estimates on revenue related to performance obligations satisfied or partially satisfied in previous periods was not significant for the nine month period ended January 26, 2019. No adjustment on any one contract was material to the Company’s unaudited consolidated financial statements for the nine month period ended January 26, 2019. Revenue by Category The following tables present the Company’s revenue disaggregated by major product line, contract type, customer category and geographic location (in thousands): Three Months Ended Nine Months Ended January 25, January 26, January 25, January 26, Revenue by major product line/program 2020 2019 2020 2019 Small UAS $ 36,965 $ 47,704 $ 162,868 $ 131,119 TMS 7,908 11,270 21,419 49,055 HAPS 11,762 13,586 37,490 37,981 Other 5,256 2,762 10,296 8,189 Total revenue $ 61,891 $ 75,322 $ 232,073 $ 226,344 Three Months Ended Nine Months Ended January 25, January 26, January 25, January 26, Revenue by contract type 2020 2019 2020 2019 FFP $ 40,145 $ 52,833 $ 168,607 $ 160,890 CPFF 20,863 22,370 60,384 65,223 T&M 883 119 3,082 231 Total revenue $ 61,891 $ 75,322 $ 232,073 $ 226,344 Each of these contract types presents advantages and disadvantages. Typically, the Company assumes more risk with FFP contracts. However, these types of contracts generally offer additional profits when the Company completes the work for less than originally estimated. CPFF contracts generally subject the Company to lower risk. Accordingly, the associated base fees are usually lower than fees on FFP contracts. Under T&M contracts, the Company’s profit may vary if actual labor hour rates vary significantly from the negotiated rates. Three Months Ended Nine Months Ended January 25, January 26, January 25, January 26, Revenue by customer category 2020 2019 2020 2019 U.S. government: $ 25,535 $ 52,383 $ 124,971 $ 135,232 Non-U.S. government 36,356 22,939 107,102 91,112 Total revenue $ 61,891 $ 75,322 $ 232,073 $ 226,344 Three Months Ended Nine Months Ended January 25, January 26, January 25, January 26, Revenue by geographic location 2020 2019 2020 2019 Domestic $ 27,626 $ 34,436 $ 116,399 $ 116,514 International 34,265 40,886 115,674 109,830 Total revenue $ 61,891 $ 75,322 $ 232,073 $ 226,344 Contract Balances The timing of revenue recognition, billings, and cash collections results in billed accounts receivable, unbilled receivables, and customer advances and deposits on the consolidated balance sheet. In the Company’s services contracts, amounts are billed as work progresses in accordance with agreed-upon contractual terms, either at periodic intervals, which is generally monthly, or upon the achievement of contractual milestones. Generally, billing occurs subsequent to revenue recognition, resulting in contract assets recorded in unbilled receivables and retentions on the consolidated balance sheet. However, the Company sometimes receives advances or deposits from its customers before revenue is recognized, resulting in contract liabilities recorded in customer advances on the consolidated balance sheet. Contract liabilities are not a significant financing component as they are generally utilized to pay for contract costs within a one-year period or are used to ensure the customer meets contractual requirements. These assets and liabilities are reported on the consolidated balance sheet on a contract-by-contract basis at the end of each reporting period. For the Company’s product revenue, the Company generally receives cash payments subsequent to satisfying the performance obligation via delivery of the product, resulting in billed accounts receivable. Changes in the contract asset and liability balances during the nine month period ended January 25, 2020 were not materially impacted by any other factors. For the Company’s contracts, there are no significant gaps between the receipt of payment and the transfer of the associated goods and services to the customer for material amounts of consideration. Revenue recognized for the three and nine month periods ended January 25, 2020 that was included in contract liability balances at April 30, 2019 were $12,000 and $1,670,000, respectively; and revenue recognized for the three and nine month periods ended January 26, 2019 that was included in contract liability balances at April 30, 2018 were $10,000 and $1,587,000, respectively. |
Segments | 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 (“CODM”) in deciding how to allocate resources and in assessing performance. The Company’s CODM, who is the Chief Executive Officer, makes operating decisions, assesses performance and makes resource allocation decisions, including the focus of research and development (“R&D”), on a consolidated basis for the Company’s continuing operations. Accordingly, the Company operates its business as a single reportable segment. |
Investments | Investments The Company’s investments are accounted for as held-to-maturity reported at amortized cost, available-for-sale reported at cost less impairment, and available-for-sale reported at fair value, which approximates book value. The Company has elected to measure available-for-sale investments that do not have readily determinable fair values at cost minus impairment, if any, adjusted for changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. |
Fair Values of Financial Instruments | Fair Values of Financial Instruments Fair values of cash and cash equivalents, accounts receivable, unbilled receivables and retentions, and accounts payable approximate cost due to the short period of time to maturity. |
Government Contracts | Government Contracts Payments to the Company on government CPFF or T&M contracts are based on provisional, or estimated indirect rates, which are subject to an annual audit by the Defense Contract Audit Agency (“DCAA”). The cost audits result in the negotiation and determination of the final indirect cost rates that the Company may use for the period(s) audited. The final rates, if different from the provisional rates, may create an additional receivable or liability for the Company. For example, during the course of its audits, the DCAA may question the Company’s incurred costs, and if the DCAA believes the Company has accounted for such costs in a manner inconsistent with the requirements under Federal Acquisition Regulations, the DCAA auditor may recommend to the Company’s administrative contracting officer to disallow such costs. Historically, the Company has not experienced material disallowed costs as a result of government audits. However, the Company can provide no assurance that the DCAA or other government audits will not result in material disallowances for incurred costs in the future. The Company’s revenue recognition policy calls for revenue recognized on all CPFF or T&M government contracts to be recorded at actual rates to the extent it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur. During the fiscal year ended April 30, 2019, the Company settled rates for its incurred cost claims with the DCAA for fiscal years 2016 and 2017 without payment of any consideration. At January 25, 2020 and April 30, 2019, the Company had $275,000 and $93,000 reserved for incurred cost claim audits, respectively. |
Intangible Assets-Acquired in Business Combinations | Intangibles Assets — Acquired in Business Combinations The Company performs valuations of assets acquired and liabilities assumed on each acquisition accounted for as a business combination and allocates the purchase price of the acquired business to the respective net tangible and intangible assets. Acquired intangible assets include technology, in-process research and development, customer relationships, trademarks and tradenames, and non-compete agreements. The Company determines the appropriate useful life by performing an analysis of expected cash flows based on historical experience of the acquired businesses and the Company’s comparable businesses. Intangible assets are amortized over their estimated useful lives using the straight-line method which approximates the pattern in which the economic benefits are consumed. |
Goodwill | Goodwill Goodwill represents the excess of the cost of an acquired entity over the fair value of the acquired net assets. Goodwill is tested for impairment annually during the fourth quarter of the Company’s fiscal year or when events or circumstances change in a manner that indicates goodwill might be impaired. Events or circumstances that could trigger an impairment review include, but are not limited to, a significant adverse change in legal factors or in the business or political climate, an adverse action or assessment by a regulator, unanticipated competition, a loss of key personnel, significant changes in the manner of the Company’s use of the acquired assets or the strategy for the Company’s overall business, significant negative industry or economic trends or significant underperformance relative to projected future results of operations. |
(Loss) Earnings Per Share | (Loss) Earnings Per Share Basic (loss) earnings per share is computed using the weighted-average number of common shares outstanding, excluding shares of unvested restricted stock. The reconciliation of basic to diluted shares is as follows (in thousands except share data): Three Months Ended Nine Months Ended (Loss) income from January 25, 2020 January 26, 2019 January 25, 2020 January 26, 2019 Continuing operations attributable to AeroVironment $ (1,008) $ 8,431 $ 23,603 $ 35,815 Discontinued operations, net of tax — (62) — 5,941 Net (loss) income attributable to AeroVironment $ (1,008) $ 8,369 $ 23,603 $ 41,756 Denominator for basic (loss) earnings per share: Weighted average common shares 23,821,145 23,687,672 23,790,788 23,643,866 Dilutive effect of employee stock options, restricted stock and restricted stock units — 394,147 285,407 420,142 Denominator for diluted (loss) earnings per share 23,821,145 24,081,819 24,076,195 24,064,008 Due to the net loss for the three months ended January 25, 2020, no shares reserved for issuance upon exercise of stock options or shares of unvested restricted stock were included in the computation of diluted loss per share as their inclusion would have been anti-dilutive. Potentially dilutive shares not included in the computation of diluted weighted-average common shares because their effect would have been anti-dilutive were 287,408 and 3,076 for the three and nine months ended January 25, 2020, respectively. Potentially dilutive shares not included in the computation of diluted weighted-average common shares because their effect would have been anti-dilutive were 1,705 and 5,519 for the three and nine months ended January 26, 2019, respectively. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments In August 2018, the FASB issued ASU 2018-13, Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement . In August 2018, the FASB issued ASU 2018-15, Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract . In December 2019, the FASB issued ASU 2019-12, Simplifying the Accounting for Income Taxes . In January 2020, the FASB issued ASU 2020-01, Clarifying the Interactions between Topic 321, Topic 323, and Topic 815 . |
Organization and Significant _3
Organization and Significant Accounting Policies (Tables) | 9 Months Ended |
Jan. 25, 2020 | |
Organization and Significant Accounting Policies | |
Schedule of revenue by category | The following tables present the Company’s revenue disaggregated by major product line, contract type, customer category and geographic location (in thousands): Three Months Ended Nine Months Ended January 25, January 26, January 25, January 26, Revenue by major product line/program 2020 2019 2020 2019 Small UAS $ 36,965 $ 47,704 $ 162,868 $ 131,119 TMS 7,908 11,270 21,419 49,055 HAPS 11,762 13,586 37,490 37,981 Other 5,256 2,762 10,296 8,189 Total revenue $ 61,891 $ 75,322 $ 232,073 $ 226,344 Three Months Ended Nine Months Ended January 25, January 26, January 25, January 26, Revenue by contract type 2020 2019 2020 2019 FFP $ 40,145 $ 52,833 $ 168,607 $ 160,890 CPFF 20,863 22,370 60,384 65,223 T&M 883 119 3,082 231 Total revenue $ 61,891 $ 75,322 $ 232,073 $ 226,344 Three Months Ended Nine Months Ended January 25, January 26, January 25, January 26, Revenue by customer category 2020 2019 2020 2019 U.S. government: $ 25,535 $ 52,383 $ 124,971 $ 135,232 Non-U.S. government 36,356 22,939 107,102 91,112 Total revenue $ 61,891 $ 75,322 $ 232,073 $ 226,344 Three Months Ended Nine Months Ended January 25, January 26, January 25, January 26, Revenue by geographic location 2020 2019 2020 2019 Domestic $ 27,626 $ 34,436 $ 116,399 $ 116,514 International 34,265 40,886 115,674 109,830 Total revenue $ 61,891 $ 75,322 $ 232,073 $ 226,344 |
Schedule of reconciliation of basic to diluted shares | The reconciliation of basic to diluted shares is as follows (in thousands except share data): Three Months Ended Nine Months Ended (Loss) income from January 25, 2020 January 26, 2019 January 25, 2020 January 26, 2019 Continuing operations attributable to AeroVironment $ (1,008) $ 8,431 $ 23,603 $ 35,815 Discontinued operations, net of tax — (62) — 5,941 Net (loss) income attributable to AeroVironment $ (1,008) $ 8,369 $ 23,603 $ 41,756 Denominator for basic (loss) earnings per share: Weighted average common shares 23,821,145 23,687,672 23,790,788 23,643,866 Dilutive effect of employee stock options, restricted stock and restricted stock units — 394,147 285,407 420,142 Denominator for diluted (loss) earnings per share 23,821,145 24,081,819 24,076,195 24,064,008 |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 9 Months Ended |
Jan. 25, 2020 | |
Discontinued Operations. | |
Schedule of statements of operations data for the EES Business | Three Months Ended Nine Months Ended January 26, January 26, 2019 2019 Net sales $ — $ 4,256 Cost of sales 54 5,080 Gross margin (54) (824) Selling, general and administrative 14 1,517 Research and development 34 1,075 Other income, net — 1 Loss from discontinued operations before income taxes (102) (3,415) Benefit for income taxes (41) (904) Net loss from discontinued operations $ (61) $ (2,511) Gain on sale of business, net of tax expense of $2,463 (1) 8,452 Net (loss) income from discontinued operations $ (62) $ 5,941 |
Investments (Tables)
Investments (Tables) | 9 Months Ended |
Jan. 25, 2020 | |
Investments | |
Schedule of investments | Investments consist of the following (in thousands): January 25, April 30, 2020 2019 Short-term investments: Held-to-maturity securities: Municipal securities $ 7,565 $ 5,332 U.S. government securities 45,439 63,205 Corporate bonds 82,298 81,950 Total held-to-maturity investments 135,302 150,487 Available-for-sale securities: Variable rate demand notes 13,200 — Total available-for-sale investments 13,200 — Total short-term investments $ 148,502 $ 150,487 Long-term investments: Held-to-maturity securities: Municipal securities 15,887 — U.S. government securities — 7,404 Corporate bonds 4,558 1,982 Certificates of deposit 1,017 — Total held-to-maturity investments 21,462 9,386 Available-for-sale securities: Investment in limited partnership fund 4,947 — Total available-for-sale investments 4,947 — Total long-term investments $ 26,409 $ 9,386 |
schedule of amortized cost and fair value of the available-for-sale debt securities by contractual maturity | The amortized cost and fair value of the available-for-sale debt securities by contractual maturity at January 25, 2020 were as follows (in thousands): Cost Fair Value Due after 20 years $ 13,200 $ 13,200 Total $ 13,200 $ 13,200 |
Schedule of activity related to available-for-sale investments recorded in short-term and long-term investments | The following table is a summary of the activity related to the available-for-sale investments recorded in short-term and long-term investments (in thousands): April 30, 2019 Changes in January 25, 2020 Carrying Fair Value Sales or Carrying Value Reflected in Net Income Purchases Value Variable rate demand notes $ — $ — $ 13,200 $ 13,200 Investment in limited partnership — — 4,947 4,947 Total available-for-sale investments $ — $ — $ 18,147 $ 18,147 |
Held to maturity securities | |
Investments | |
Schedule of amortized cost, gross unrealized gains, gross unrealized losses, and estimated fair value of held-to-maturity investments | The amortized cost, gross unrealized gains, gross unrealized losses, and estimated fair value of the held-to-maturity investments as of January 25, 2020 were as follows (in thousands): January 25, 2020 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value Municipal securities $ 23,452 $ 12 $ (4) $ 23,460 U.S. government securities 45,439 63 — 45,502 Corporate bonds 86,856 57 — 86,913 Certificates of deposit 1,017 4 — 1,021 Total held-to-maturity investments $ 156,764 $ 136 $ (4) $ 156,896 The amortized cost, gross unrealized gains, gross unrealized losses, and estimated fair value of the held-to-maturity investments as of April 30, 2019 were as follows (in thousands): April 30, 2019 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value Municipal securities $ 5,332 $ 2 $ (1) $ 5,333 U.S. government securities 70,609 78 (52) 70,635 Corporate bonds 83,932 20 (5) 83,947 Total held-to-maturity investments $ 159,873 $ 100 $ (58) $ 159,915 |
Schedule of amortized cost and fair value by contractual maturity | The amortized cost and fair value of the held-to-maturity securities by contractual maturity at January 25, 2020 were as follows (in thousands): Cost Fair Value Due within one year $ 135,302 $ 135,418 Due after one year through five years 21,462 21,478 Total $ 156,764 $ 156,896 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Jan. 25, 2020 | |
Fair Value Measurements | |
Schedule of financial liabilities measured at fair value on recurring basis | The Company’s financial liabilities measured at fair value on a recurring basis at January 25, 2020, were as follows (in thousands): Fair Value Measurement Using Significant Quoted prices in other Significant active markets for observable unobservable identical assets inputs inputs Description (Level 1) (Level 2) (Level 3) Total Variable rate demand notes $ — $ 13,200 $ — $ 13,200 Contingent consideration — — 2,500 2,500 Total $ — $ 13,200 $ 2,500 $ 15,700 |
Schedule of financial assets measured at fair value on a recurring basis | Fair Value Measurements Using Significant Unobservable Inputs Description (Level 3) Balance at May 1, 2019 $ — Business acquisition 1,703 Transfers to Level 3 — Total (gains) losses (realized or unrealized) Included in inventories 380 Included in product cost of sales 767 Included in selling, general and administrative (703) Included in research and development 353 Included in other comprehensive income — Settlements — Balance at January 25, 2020 $ 2,500 The amount of total (gains) or losses for the period included in earnings attributable to the change in unrealized gains or losses relating to assets or liabilities still held at January 25, 2020 $ — |
Inventories, net (Tables)
Inventories, net (Tables) | 9 Months Ended |
Jan. 25, 2020 | |
Inventories, net | |
Schedule of inventories | Inventories consist of the following (in thousands): January 25, April 30, 2020 2019 Raw materials $ 19,119 $ 16,792 Work in process 33,005 19,162 Finished goods 23,169 25,926 Inventories, gross 75,293 61,880 Reserve for inventory excess and obsolescence (10,137) (7,824) Inventories, net $ 65,156 $ 54,056 |
Warranty Reserves (Tables)
Warranty Reserves (Tables) | 9 Months Ended |
Jan. 25, 2020 | |
Warranty Reserves | |
Summary of warranty reserve activity | Three Months Ended Nine Months Ended January 25, January 26, January 25, January 26, 2020 2019 2020 2019 Beginning balance $ 1,875 $ 2,431 $ 1,704 $ 2,090 Warranty expense 250 53 1,469 414 Changes in estimates related to pre-existing warranties — — (189) 519 Warranty costs settled (289) (354) (1,148) (893) Ending balance $ 1,836 $ 2,130 $ 1,836 $ 2,130 |
Intangibles (Tables)
Intangibles (Tables) | 9 Months Ended |
Jan. 25, 2020 | |
Intangibles | |
Schedule of components of intangibles | The components of intangibles are as follows (in thousands): January 25, April 30, 2020 2019 Technology $ 14,950 $ - Licenses 1,006 1,006 Customer relationships 873 733 In-process research and development 550 - Non-compete agreements 320 - Trademarks and tradenames 68 28 Other 3 3 Intangibles, gross 17,770 1,770 Less accumulated amortization (3,413) (1,311) Intangibles, net $ 14,357 $ 459 |
Schedule of estimated amortization expense for the next five years | Estimated amortization expense for the next five years is as follows (in thousands): Year ending April 30, 2020 $ 720 2021 2,792 2022 2,829 2023 2,688 2024 2,629 $ 11,658 |
Goodwill (Tables)
Goodwill (Tables) | 9 Months Ended |
Jan. 25, 2020 | |
Goodwill. | |
Schedule of the changes in goodwill balances | The following table presents the changes in the Company’s goodwill balance (in thousands): Balance at April 30, 2019 $ - Additions to goodwill 6,340 Impairment of goodwill - Balance at January 25, 2020 $ 6,340 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Jan. 25, 2020 | |
Leases | |
Schedule of components of lease costs | The components of lease costs recorded in cost of sales for product sales and contract services and selling, general and administrative (“SG&A”) expense were as follows (in thousands): Nine Months Ended January 25, 2020 Operating lease cost $ 3,453 Short term lease cost 489 Variable lease cost 609 Sublease income (230) Total lease costs, net $ 4,321 |
Schedule of supplemental lease information | Nine Months Ended January 25, 2020 (In thousands) Cash paid for amounts included in the measurement of operating lease liabilities $ 4,029 Right-of-use assets obtained in exchange for new lease liabilities $ 12,634 Weighted average remaining lease term 35 months Weighted average discount rate 3.6% |
Schedule of maturities of operating lease liabilities - ASC 842 | Maturities of operating lease liabilities as of January 25, 2020 were as follows (in thousands): 2020 $ (1,309) 2021 4,496 2022 3,749 2023 2,171 2024 1,055 Thereafter 62 Total lease payments 10,224 Less: imputed interest (585) Total present value of operating lease liabilities $ 9,639 |
Schedule of maturities of operating lease liabilities - ASC 840 | 2020 $ 5,298 2021 3,527 2022 2,723 2023 1,554 2024 953 Thereafter — Total lease payments $ 14,055 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income and Reclassifications Adjustments (Tables) | 9 Months Ended |
Jan. 25, 2020 | |
Accumulated Other Comprehensive Income and Reclassifications Adjustments | |
Schedule of components of accumulated other comprehensive loss | The components of accumulated other comprehensive income and adjustments are as follows (in thousands): Accumulated Other Income Balance, net of $0 deferred taxes, as of April 30, 2019 $ 2 Reclassifications out of accumulated other comprehensive income, net of taxes — Change in foreign currency translation adjustments, net of $0 taxes 67 Balance, net of $0 deferred taxes, as of January 25, 2020 $ 69 |
Business Acquisitions (Tables)
Business Acquisitions (Tables) | 9 Months Ended |
Jan. 25, 2020 | |
Business Acquisitions | |
Schedule of the fair value of the assets acquired and liabilities assumed at the acquisition date | The following table summarizes the provisional allocation of the purchase price over the estimated fair value of the assets and liabilities assumed in the acquisition of Pulse (in thousands): June 10, 2019 Technology $ 14,950 Goodwill 6,340 In-process R&D 550 Inventory 334 Non-compete agreements 320 Other assets, net of liabilities assumed (614) Total net identified assets acquired $ 21,880 Fair value of consideration: Cash $ 18,677 Holdback 1,250 Retention 250 Contingent consideration 1,703 Total $ 21,880 |
Schedule of unaudited pro forma summary presents consolidated information of the Company as if the business combination had occurred | Three Months Ended Nine Months Ended January 25, January 26, January 25, January 26, 2020 2019 2020 2019 Revenue $ 61,891 $ 75,922 $ 232,300 $ 228,533 Net (loss) income attributable to AeroVironment $ (726) $ 7,244 $ 24,227 $ 38,471 |
Organization and Significant _4
Organization and Significant Accounting Policies - Pulse Aerospace, LLC (Details) | Jun. 10, 2019 |
Organization and Significant Accounting Policies | |
Ownership interest acquired | 100.00% |
Organization and Significant _5
Organization and Significant Accounting Policies - Recently Adopted Accounting Standards (Details) | May 01, 2019USD ($) |
ASU 2018-09 | Effect of the Adoption of ASC Topic 606 | |
Revenue recognition | |
Retained earnings, continuing operations | $ 665,000 |
Organization and Significant _6
Organization and Significant Accounting Policies - Restricted Cash (Details) - USD ($) | Feb. 26, 2020 | Feb. 20, 2020 | Jun. 10, 2019 | Jan. 25, 2020 | Apr. 30, 2019 |
Restricted Cash [Abstract] | |||||
Restricted Cash | $ 5,000,000 | $ 0 | |||
Pulse Aerospace, LLC | |||||
Restricted Cash [Abstract] | |||||
Each milestone achievement | $ 2,500,000 | $ 2,500,000 | |||
Cash | $ 2,500,000 | $ 2,500,000 | $ 18,677,000 |
Organization and Significant _7
Organization and Significant Accounting Policies - Performance Obligations (Details) | Jan. 25, 2020USD ($) |
Organization and Significant Accounting Policies | |
Remaining performance obligations | $ 125,958,000 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-04-30 | |
Organization and Significant Accounting Policies | |
Remaining performance obligations (as a percentage) | 75.00% |
Performance Obligations | |
Year of performance obligations | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-04-30 | |
Organization and Significant Accounting Policies | |
Remaining performance obligations (as a percentage) | 24.00% |
Performance Obligations | |
Year of performance obligations | 2 years |
Organization and Significant _8
Organization and Significant Accounting Policies - Contract Estimates (Details) | 3 Months Ended | 9 Months Ended | ||
Jan. 25, 2020USD ($)contract | Jan. 26, 2019USD ($)contract | Jan. 25, 2020USD ($)contract | Jan. 26, 2019USD ($)contract | |
Material adjustment to any one contract | $ 0 | $ 0 | ||
Number of active contracts | contract | 1 | 1 | 1 | 1 |
Design and development agreement | ||||
Amount of aggregate impact of adjustments in contract estimates on revenue related to performance obligations satisfied or partially satisfied in previous periods | $ 1,152,000 | $ 1,169,000 | ||
TMS contract | ||||
Amount of aggregate impact of adjustments in contract estimates on revenue related to performance obligations satisfied or partially satisfied in previous periods | $ 1,705,000 | |||
Revision of estimate of total costs required to complete the contracts | Cumulative catch-up adjustment | Design and development agreement | ||||
Amount of revised aggregate impact of adjustments in contract estimates on revenue related to performance obligations satisfied or partially satisfied in previous periods | 1,036,000 | 1,036,000 | ||
Revision of estimate of total costs required to complete the contracts | Cumulative catch-up adjustment | TMS contract | ||||
Amount of revised aggregate impact of adjustments in contract estimates on revenue related to performance obligations satisfied or partially satisfied in previous periods | $ 1,519,000 | $ 1,519,000 |
Organization and Significant _9
Organization and Significant Accounting Policies - Revenue by Category (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Disaggregation of revenue | ||||
Revenue | $ 61,891,000 | $ 75,322,000 | $ 232,073,000 | $ 226,344,000 |
Contract Liability | ||||
Disaggregation of revenue | ||||
Revenue | 12,000 | 10,000 | 1,670,000 | 1,587,000 |
Domestic | ||||
Disaggregation of revenue | ||||
Revenue | 27,626,000 | 34,436,000 | 116,399,000 | 116,514,000 |
International | ||||
Disaggregation of revenue | ||||
Revenue | 34,265,000 | 40,886,000 | 115,674,000 | 109,830,000 |
U.S. government | ||||
Disaggregation of revenue | ||||
Revenue | 25,535,000 | 52,383,000 | 124,971,000 | 135,232,000 |
Non-U.S. government | ||||
Disaggregation of revenue | ||||
Revenue | 36,356,000 | 22,939,000 | 107,102,000 | 91,112,000 |
FFP | ||||
Disaggregation of revenue | ||||
Revenue | 40,145,000 | 52,833,000 | 168,607,000 | 160,890,000 |
CPFF | ||||
Disaggregation of revenue | ||||
Revenue | 20,863,000 | 22,370,000 | 60,384,000 | 65,223,000 |
T&M | ||||
Disaggregation of revenue | ||||
Revenue | 883,000 | 119,000 | 3,082,000 | 231,000 |
Small UAS | ||||
Disaggregation of revenue | ||||
Revenue | 36,965,000 | 47,704,000 | 162,868,000 | 131,119,000 |
TMS | ||||
Disaggregation of revenue | ||||
Revenue | 7,908,000 | 11,270,000 | 21,419,000 | 49,055,000 |
HAPS | ||||
Disaggregation of revenue | ||||
Revenue | 11,762,000 | 13,586,000 | 37,490,000 | 37,981,000 |
Other | ||||
Disaggregation of revenue | ||||
Revenue | $ 5,256,000 | $ 2,762,000 | $ 10,296,000 | $ 8,189,000 |
Organization and Significant_10
Organization and Significant Accounting Policies - Government Contracts (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | Apr. 30, 2019 | |
Government Contracts | |||||
Reserves for incurred cost claim audits | $ 275,000 | $ 275,000 | $ 93,000 | ||
Numerator for basic earnings per share: | |||||
Continuing operations attributable to AeroVironment | (1,008,000) | $ 8,431,000 | 23,603,000 | $ 35,815,000 | |
Discontinued operations, net of tax | (62,000) | 5,941,000 | |||
Net (loss) income attributable to AeroVironment | $ (1,008,000) | $ 8,369,000 | $ 23,603,000 | $ 41,756,000 | |
Denominator for basic (loss) earnings per share: | |||||
Weighted average common shares | 23,821,145 | 23,687,672 | 23,790,788 | 23,643,866 | |
Dilutive effect of employee stock options, restricted stock and restricted stock units | 394,147 | 285,407 | 420,142 | ||
Denominator for diluted (loss) earnings per share | 23,821,145 | 24,081,819 | 24,076,195 | 24,064,008 | |
Number of shares reserved for issuance | 0 | 0 | |||
Number of anti-dilutive shares | 287,408 | 1,705 | 3,076 | 5,519 |
Discontinued Operations (Detail
Discontinued Operations (Details) | Oct. 29, 2019USD ($) | Feb. 22, 2019USD ($) | Jun. 29, 2018USD ($) | Jan. 25, 2020USD ($)contract | Jan. 26, 2019USD ($) | Jan. 25, 2020USD ($)contract | Jan. 26, 2019USD ($) |
Discontinued operations | |||||||
Amount of alleged damages | $ 1,700,000 | $ 6,500,000 | |||||
Statement of operations | |||||||
Net loss from discontinued operations | $ (62,000) | $ (2,511,000) | |||||
Gain on sale of business, net of tax expense of $2,463 | 8,452,000 | ||||||
Tax expense | 2,463,000 | ||||||
Net (loss) income from discontinued operations | (62,000) | 5,941,000 | |||||
EES Business | Disposed of by sale | |||||||
Discontinued operations | |||||||
Cash consideration received | $ 31,994,000 | ||||||
Gain on sale of business | 11,420,000 | ||||||
Amount of reduction to gain resulting from a working capital adjustment | 505,000 | ||||||
Working capital dispute | 922,000 | ||||||
Amounts recorded in the consolidated financial statements | 0 | ||||||
Statement of operations | |||||||
Net Sales | 4,256,000 | ||||||
Cost of sales | 54,000 | 5,080,000 | |||||
Gross margin | (54,000) | (824,000) | |||||
Selling, general and administrative | 14,000 | 1,517,000 | |||||
Research and development | 34,000 | 1,075,000 | |||||
Other income, net | 1,000 | ||||||
Loss from discontinued operations before income taxes | (102,000) | (3,415,000) | |||||
Benefit for income taxes | (41,000) | (904,000) | |||||
Net loss from discontinued operations | (61,000) | (2,511,000) | |||||
Gain on sale of business, net of tax expense of $2,463 | (1,000) | 8,452,000 | |||||
Tax expense | 2,463,000 | ||||||
Net (loss) income from discontinued operations | (62,000) | 5,941,000 | |||||
EES Business | Disposed of by sale | Other income (expense) | |||||||
Statement of operations | |||||||
Net Sales | $ 57,000 | $ 657,000 | $ 545,000 | $ 2,013,000 | |||
Holdback | Disposed of by sale | |||||||
Discontinued operations | |||||||
Cash consideration received | $ 6,500,000 | ||||||
Number of remaining contracts | contract | 2 | 2 |
Investments (Details)
Investments (Details) - USD ($) $ in Thousands | Jan. 25, 2020 | Apr. 30, 2019 |
Short-term investments: | ||
Total held-to-maturity and short-term investments | $ 148,502 | $ 150,487 |
Long-term investments: | ||
Total long-term investments | 26,409 | 9,386 |
Held to maturity securities | ||
Short-term investments: | ||
Total held-to-maturity and short-term investments | 135,302 | 150,487 |
Long-term investments: | ||
Total long-term investments | 21,462 | 9,386 |
Held to maturity securities | Municipal securities | ||
Short-term investments: | ||
Total held-to-maturity and short-term investments | 7,565 | 5,332 |
Long-term investments: | ||
Total long-term investments | 15,887 | |
Held to maturity securities | U.S. government securities | ||
Short-term investments: | ||
Total held-to-maturity and short-term investments | 45,439 | 63,205 |
Long-term investments: | ||
Total long-term investments | 7,404 | |
Held to maturity securities | Corporate bonds | ||
Short-term investments: | ||
Total held-to-maturity and short-term investments | 82,298 | 81,950 |
Long-term investments: | ||
Total long-term investments | 4,558 | $ 1,982 |
Held to maturity securities | Certificates of deposit | ||
Long-term investments: | ||
Total long-term investments | 1,017 | |
Available-for-sale securities | ||
Short-term investments: | ||
Total held-to-maturity and short-term investments | 13,200 | |
Long-term investments: | ||
Total long-term investments | 4,947 | |
Available-for-sale securities | Investment in limited partnership fund | ||
Long-term investments: | ||
Total long-term investments | 4,947 | |
Available-for-sale securities | Variable rate demand notes | ||
Short-term investments: | ||
Total held-to-maturity and short-term investments | $ 13,200 |
Investments - Held-To-Maturity
Investments - Held-To-Maturity Securities (Details) - USD ($) $ in Thousands | Jan. 25, 2020 | Apr. 30, 2019 |
Held To Maturity Securities | ||
Amortized Cost | $ 156,764 | $ 159,873 |
Gross Unrealized Gains | 136 | 100 |
Gross Unrealized Losses | (4) | (58) |
Total | 156,896 | 159,915 |
Municipal securities | ||
Held To Maturity Securities | ||
Amortized Cost | 23,452 | 5,332 |
Gross Unrealized Gains | 12 | 2 |
Gross Unrealized Losses | (4) | (1) |
Total | 23,460 | 5,333 |
U.S. government securities | ||
Held To Maturity Securities | ||
Amortized Cost | 45,439 | 70,609 |
Gross Unrealized Gains | 63 | 78 |
Gross Unrealized Losses | (52) | |
Total | 45,502 | 70,635 |
Corporate bonds | ||
Held To Maturity Securities | ||
Amortized Cost | 86,856 | 83,932 |
Gross Unrealized Gains | 57 | 20 |
Gross Unrealized Losses | (5) | |
Total | 86,913 | $ 83,947 |
Certificates of deposit | ||
Held To Maturity Securities | ||
Amortized Cost | 1,017 | |
Gross Unrealized Gains | 4 | |
Total | $ 1,021 |
Investments - Amortized Cost an
Investments - Amortized Cost and Fair Value of the Held-to-Maturity Securities by Contractual Maturity (Details) - USD ($) $ in Thousands | Jan. 25, 2020 | Apr. 30, 2019 |
Amortized cost of held-to-maturity securities by contractual maturity | ||
Due within one year | $ 135,302 | |
Due after one year through five years | 21,462 | |
Total | 156,764 | $ 159,873 |
Fair value of held-to-maturity securities by contractual maturity | ||
Due within one year | 135,418 | |
Due after one year through five years | 21,478 | |
Total | $ 156,896 | $ 159,915 |
Investments - Available for sal
Investments - Available for sale securities (Details) - Available-for-sale securities $ in Thousands | 9 Months Ended |
Jan. 25, 2020USD ($) | |
Investments | |
Sales or Purchases | $ 18,147 |
Carrying Value | 18,147 |
Amortized cost of available-for-sale securities by contractual maturity | |
Due after 20 years | 13,200 |
Total | 13,200 |
Fair value of available-for-sale securities by contractual maturity | |
Due after 20 years | 13,200 |
Total | $ 13,200 |
Minimum | |
Fair value of available-for-sale securities by contractual maturity | |
Variable rate demand notes long maturities | 20 years |
Maximum | |
Fair value of available-for-sale securities by contractual maturity | |
Variable rate demand notes long maturities | 30 years |
Investment in limited partnership fund | |
Investments | |
Sales or Purchases | $ 4,947 |
Carrying Value | 4,947 |
Variable rate demand notes | |
Investments | |
Sales or Purchases | 13,200 |
Carrying Value | $ 13,200 |
Put option | Minimum | |
Fair value of available-for-sale securities by contractual maturity | |
Variable rate demand notes long maturities | 1 day |
Put option | Maximum | |
Fair value of available-for-sale securities by contractual maturity | |
Variable rate demand notes long maturities | 7 days |
Investments - Auction rate secu
Investments - Auction rate securities (Details) - Auction rate securities | Apr. 30, 2018item |
Investments | |
Number of available-for-sale securities | 2 |
Minimum | |
Available For Sale Securities | |
Maturity period of available-for-sale securities | 1 year |
Maximum | |
Available For Sale Securities | |
Maturity period of available-for-sale securities | 16 years |
Fair Value Measurements - (Deta
Fair Value Measurements - (Details) $ in Thousands | Jan. 25, 2020USD ($) |
Fair Value Measurement | |
Financial liabilities | $ 15,700 |
Variable rate demand notes | |
Fair Value Measurement | |
Financial liabilities | 13,200 |
Contingent consideration | |
Fair Value Measurement | |
Financial liabilities | 2,500 |
Recurring basis | Significant other observable inputs (Level 2) | |
Fair Value Measurement | |
Financial liabilities | 13,200 |
Recurring basis | Significant other observable inputs (Level 2) | Variable rate demand notes | |
Fair Value Measurement | |
Financial liabilities | 13,200 |
Recurring basis | Significant unobservable inputs (Level 3) | |
Fair Value Measurement | |
Financial liabilities | 2,500 |
Recurring basis | Significant unobservable inputs (Level 3) | Contingent consideration | |
Fair Value Measurement | |
Financial liabilities | $ 2,500 |
Fair Value Measurements - Recon
Fair Value Measurements - Reconciliation (Details) - Significant unobservable inputs (Level 3) $ in Thousands | 9 Months Ended |
Jan. 25, 2020USD ($) | |
Reconciliation between beginning and ending balances of items measured at fair value on recurring basis | |
Business acquisition | $ 1,703 |
Included in inventories | 380 |
Balance at the end of the period | 2,500 |
Cost of sales | |
Reconciliation between beginning and ending balances of items measured at fair value on recurring basis | |
Included in earnings | 767 |
SG&A | |
Reconciliation between beginning and ending balances of items measured at fair value on recurring basis | |
Included in earnings | (703) |
Reseach and development | |
Reconciliation between beginning and ending balances of items measured at fair value on recurring basis | |
Included in earnings | $ 353 |
Fair Value Measurements - Pulse
Fair Value Measurements - Pulse purchase agreement (Details) - Pulse Aerospace, LLC | Feb. 26, 2020USD ($) | Feb. 20, 2020USD ($) | Jun. 10, 2019USD ($)item | Jan. 25, 2020item | Jan. 25, 2020USD ($) |
Fair Value Measurement | |||||
Total cash consideration | $ 2,500,000 | $ 2,500,000 | $ 18,677,000 | ||
Each milestone achievement | $ 2,500,000 | $ 2,500,000 | |||
Number of research and development milestones | item | 2 | 1 | |||
Business acquisitions gain | $ 832,000 | ||||
Maximum | |||||
Fair Value Measurement | |||||
Total cash consideration | $ 5,000,000 | ||||
Each milestone achievement | $ 2,500,000 |
Inventories, net (Details)
Inventories, net (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | Apr. 30, 2019 | |
Inventories, net | |||||
Raw materials | $ 19,119,000 | $ 19,119,000 | $ 16,792,000 | ||
Work in process | 33,005,000 | 33,005,000 | 19,162,000 | ||
Finished goods | 23,169,000 | 23,169,000 | 25,926,000 | ||
Inventories, gross | 75,293,000 | 75,293,000 | 61,880,000 | ||
Reserve for inventory excess and obsolescence | (10,137,000) | (10,137,000) | (7,824,000) | ||
Inventories, net | 65,156,000 | 65,156,000 | $ 54,056,000 | ||
Inventory reserve charge | $ 617,000 | 3,807,000 | |||
Impairment of long-lived assets | $ 1,889,000 | $ 3,079,000 | |||
UAS Quantix Solution | |||||
Inventories, net | |||||
Inventory reserve charge | $ 2,600,000 |
Equity Method Investments (Deta
Equity Method Investments (Details) ¥ in Thousands | 3 Months Ended | 9 Months Ended | |||||||||||||||||
Jan. 25, 2020USD ($) | Jan. 26, 2019USD ($) | Jan. 25, 2020USD ($) | Jan. 26, 2019USD ($) | Dec. 04, 2019USD ($) | Dec. 04, 2019JPY (¥) | Jul. 27, 2019 | May 10, 2019USD ($) | May 10, 2019JPY (¥) | Apr. 30, 2019USD ($) | Feb. 09, 2019USD ($) | Feb. 09, 2019JPY (¥) | Feb. 08, 2019 | Jan. 29, 2019USD ($) | Jan. 29, 2019JPY (¥) | Apr. 17, 2018USD ($) | Apr. 17, 2018JPY (¥) | Dec. 27, 2017USD ($) | Dec. 27, 2017JPY (¥) | |
Equity Method Investments | |||||||||||||||||||
Equity method investment loss, net of tax | $ (1,200,000) | $ (717,000) | $ (3,410,000) | $ (2,071,000) | |||||||||||||||
HAPSMobile | |||||||||||||||||||
Equity Method Investments | |||||||||||||||||||
Ownership percentage | 7.00% | 7.00% | 5.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 5.00% | 5.00% | 5.00% | 5.00% | 5.00% | ||||||
Payments for purchase of interest | $ 4,982,000 | ¥ 540,050 | $ 4,569,000 | ¥ 500,000 | $ 5,671,000 | ¥ 632,800 | $ 1,926,000 | ¥ 209,500 | $ 1,407,000 | ¥ 150,000 | $ 1,860,000 | ¥ 210,000 | |||||||
HAPSMobile | Equity method investment loss, net of tax | |||||||||||||||||||
Equity Method Investments | |||||||||||||||||||
Equity method investment loss, net of tax | $ 717,000 | $ 2,071,000 | |||||||||||||||||
HAPSMobile | Equity method investment activity, net of tax | |||||||||||||||||||
Equity Method Investments | |||||||||||||||||||
Equity method investment loss, net of tax | (1,200,000) | (3,410,000) | |||||||||||||||||
HAPSMobile | Other assets, long term | |||||||||||||||||||
Equity Method Investments | |||||||||||||||||||
Carrying value of investment | $ 11,819,000 | $ 11,819,000 | $ 5,612,000 | ||||||||||||||||
HAPSMobile | SoftBank | |||||||||||||||||||
Equity Method Investments | |||||||||||||||||||
Ownership percentage | 93.00% | 93.00% | |||||||||||||||||
AeroVironment | HAPSMobile | |||||||||||||||||||
Equity Method Investments | |||||||||||||||||||
Ownership percentage | 7.00% | 7.00% |
Warranty Reserves (Details)
Warranty Reserves (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Warranty Reserves | ||||
Beginning balance | $ 1,875 | $ 2,431 | $ 1,704 | $ 2,090 |
Warranty expense | 250 | 53 | 1,469 | 414 |
Changes in estimates related to pre-existing warranties | (189) | 519 | ||
Warranty costs settled | (289) | (354) | (1,148) | (893) |
Ending balance | $ 1,836 | $ 2,130 | $ 1,836 | $ 2,130 |
Intangibles (Details)
Intangibles (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | Apr. 30, 2019 | |
Intangibles | |||||
Intangibles, gross | $ 17,770,000 | $ 17,770,000 | $ 1,770,000 | ||
Less accumulated amortization | (3,413,000) | (3,413,000) | (1,311,000) | ||
Intangibles, net | 14,357,000 | $ 14,357,000 | $ 459,000 | ||
Weighted average amortization period | 5 years | 1 year | |||
Amortization expense | 775,000 | $ 104,000 | $ 2,102,000 | $ 253,000 | |
Technology | |||||
Intangibles | |||||
Intangibles, gross | 14,950,000 | 14,950,000 | |||
Licenses | |||||
Intangibles | |||||
Intangibles, gross | 1,006,000 | 1,006,000 | $ 1,006,000 | ||
Customer relationships | |||||
Intangibles | |||||
Intangibles, gross | 873,000 | 873,000 | 733,000 | ||
In process research and development | |||||
Intangibles | |||||
Intangibles, gross | 550,000 | 550,000 | |||
Non-compete agreements | |||||
Intangibles | |||||
Intangibles, gross | 320,000 | 320,000 | |||
Trademarks and tradenames | |||||
Intangibles | |||||
Intangibles, gross | 68,000 | 68,000 | 28,000 | ||
Other | |||||
Intangibles | |||||
Intangibles, gross | $ 3,000 | $ 3,000 | $ 3,000 |
Intangibles - Estimated amortiz
Intangibles - Estimated amortization expense (Details) $ in Thousands | Apr. 30, 2019USD ($) |
Estimated amortization expense for the next five years | |
2020 | $ 720 |
2021 | 2,792 |
2022 | 2,829 |
2023 | 2,688 |
2024 | 2,629 |
Total | $ 11,658 |
Goodwill (Details)
Goodwill (Details) $ in Thousands | 9 Months Ended |
Jan. 25, 2020USD ($) | |
Goodwill. | |
Additions to goodwill | $ 6,340 |
Goodwill, Ending Balance | $ 6,340 |
Leases (Details)
Leases (Details) | 9 Months Ended |
Jan. 25, 2020 | |
Leases | |
Option to extend | true |
Option to terminate | true |
Option to terminate period (in years) | 2 years |
Minimum | |
Leases | |
Remaining lease terms (in years) | 1 year |
Maximum | |
Leases | |
Remaining lease terms (in years) | 6 years |
Option to extend period (in years) | 10 years |
Leases - Components of lease co
Leases - Components of lease costs (Details) $ in Thousands | 9 Months Ended |
Jan. 25, 2020USD ($) | |
Components of lease costs | |
Operating lease cost | $ 3,453 |
Short term lease cost | 489 |
Variable lease cost | 609 |
Sublease income | (230) |
Total lease costs, net | $ 4,321 |
Leases - Supplemental lease inf
Leases - Supplemental lease information (Details) $ in Thousands | 9 Months Ended |
Jan. 25, 2020USD ($) | |
Leases | |
Cash paid for amounts included in the measurement of operating lease liabilities | $ 4,029 |
Right-of-use assets obtained in exchange for new lease liabilities | $ 12,634 |
Weighted average remaining lease term | 35 months |
Weighted average discount rate | 3.60% |
Leases - Maturities - ASC 842 (
Leases - Maturities - ASC 842 (Details) $ in Thousands | Jan. 25, 2020USD ($) |
Maturities of operating lease liabilities: | |
2020 | $ (1,309) |
2021 | 4,496 |
2022 | 3,749 |
2023 | 2,171 |
2024 | 1,055 |
Thereafter | 62 |
Total lease payments | 10,224 |
Less: imputed interest | (585) |
Total present value of operating lease liabilities | $ 9,639 |
Leases - Maturities - ASC 840 (
Leases - Maturities - ASC 840 (Details) $ in Thousands | Apr. 30, 2019USD ($) |
Maturities of operating lease liabilities: | |
2020 | $ 5,298 |
2021 | 3,527 |
2022 | 2,723 |
2023 | 1,554 |
2024 | 953 |
Total lease payments | $ 14,055 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income and Reclassifications Adjustments (Details) - USD ($) $ in Thousands | Apr. 30, 2019 | Jan. 25, 2020 |
Accumulated other comprehensive loss | ||
Balance, net of $0 deferred taxes, as of April 30, 2019 | $ 2 | |
Balance, net of $0 deferred taxes, as of January 25, 2020 | $ 2 | 69 |
Accumulated Other Comprehensive Loss | ||
Accumulated other comprehensive loss | ||
Balance, net of $0 deferred taxes, as of April 30, 2019 | 2 | |
Change in foreign currency translation adjustments, net of $0 taxes | 67 | |
Balance, net of $0 deferred taxes, as of January 25, 2020 | 2 | 69 |
Other comprehensive income, tax | $ 0 | 0 |
Foreign Currency Translation Adjustments | ||
Accumulated other comprehensive loss | ||
Other comprehensive income, tax | $ 0 |
Customer-Funded Research & De_2
Customer-Funded Research & Development (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Customer-Funded Research & Development | ||||
Revenue from customer funded research and development | $ 17,939,000 | $ 19,437,000 | $ 50,565,000 | $ 55,344,000 |
Long-Term Incentive Awards (Det
Long-Term Incentive Awards (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||
Jan. 25, 2020 | Jul. 27, 2019 | Jan. 26, 2019 | Jul. 28, 2018 | Jul. 29, 2017 | Jan. 25, 2020 | Jan. 26, 2019 | Apr. 30, 2019 | |
Stock Based Compensation | ||||||||
Stock based compensation expense | $ 0 | $ 0 | ||||||
Fiscal 2020 LTIP | Performance based restricted stock units | ||||||||
Stock Based Compensation | ||||||||
Stock based compensation expense | $ 215,000 | 512,000 | ||||||
Exercisable period from grant date | 3 years | |||||||
Fiscal 2020 LTIP | Performance based restricted stock units | 100% Vested | ||||||||
Stock Based Compensation | ||||||||
Vesting (as a percentage) | 100.00% | |||||||
Fiscal 2020 LTIP | Performance based restricted stock units | 50% Vested | ||||||||
Stock Based Compensation | ||||||||
Vesting (as a percentage) | 50.00% | |||||||
Fiscal 2020 LTIP | Performance based restricted stock units | 200% Vested | ||||||||
Stock Based Compensation | ||||||||
Vesting (as a percentage) | 200.00% | |||||||
Fiscal 2020 LTIP | Performance based restricted stock units | Maximum | ||||||||
Stock Based Compensation | ||||||||
Stock based compensation expense | 4,263,000 | |||||||
Fiscal 2019 LTIP | Performance based restricted stock units | ||||||||
Stock Based Compensation | ||||||||
Stock based compensation expense | 246,000 | $ 226,000 | 294,000 | $ 482,000 | ||||
Exercisable period from grant date | 3 years | |||||||
Fiscal 2019 LTIP | Performance based restricted stock units | 100% Vested | ||||||||
Stock Based Compensation | ||||||||
Vesting (as a percentage) | 100.00% | |||||||
Fiscal 2019 LTIP | Performance based restricted stock units | 50% Vested | ||||||||
Stock Based Compensation | ||||||||
Vesting (as a percentage) | 50.00% | |||||||
Fiscal 2019 LTIP | Performance based restricted stock units | 200% Vested | ||||||||
Stock Based Compensation | ||||||||
Vesting (as a percentage) | 200.00% | |||||||
Fiscal 2019 LTIP | Performance based restricted stock units | Maximum | ||||||||
Stock Based Compensation | ||||||||
Stock based compensation expense | 2,478,000 | |||||||
Fiscal 2018 LTIP | Performance based restricted stock units | ||||||||
Stock Based Compensation | ||||||||
Stock based compensation expense | 201,000 | $ 317,000 | 162,000 | $ 653,000 | ||||
Exercisable period from grant date | 3 years | |||||||
Fiscal 2018 LTIP | Performance based restricted stock units | 100% Vested | ||||||||
Stock Based Compensation | ||||||||
Vesting (as a percentage) | 100.00% | |||||||
Fiscal 2018 LTIP | Performance based restricted stock units | 50% Vested | ||||||||
Stock Based Compensation | ||||||||
Vesting (as a percentage) | 50.00% | |||||||
Fiscal 2018 LTIP | Performance based restricted stock units | 200% Vested | ||||||||
Stock Based Compensation | ||||||||
Vesting (as a percentage) | 200.00% | |||||||
Fiscal 2018 LTIP | Performance based restricted stock units | Maximum | ||||||||
Stock Based Compensation | ||||||||
Stock based compensation expense | 1,850,000 | |||||||
Fiscal 2017 LTIP | Performance based restricted stock units | ||||||||
Stock Based Compensation | ||||||||
Stock based compensation expense | $ 0 | 0 | ||||||
Exercisable period from grant date | 3 years | |||||||
Issue of fully-vested shares of common stock to settle | 14,814 | |||||||
Fiscal 2020 LTIP, Fiscal 2019 LTIP and Fiscal 2018 LTIP | ||||||||
Stock Based Compensation | ||||||||
Stock based compensation expense | $ 2,397,000 | $ 1,429,000 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | |
Income taxes | ||||
(Benefit from) provision for income taxes | $ (38) | $ 946 | $ 3,203 | $ 4,724 |
Effective tax benefit rate (as a percent) | (28.40%) | 9.40% | 10.60% | 11.10% |
Share Repurchase (Details)
Share Repurchase (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Jan. 25, 2020 | Jan. 26, 2019 | Jan. 25, 2020 | Jan. 26, 2019 | Apr. 30, 2019 | Sep. 30, 2015 | |
Share Repurchase | ||||||
Stock Repurchase Program, Authorized Amount | $ 25,000,000 | |||||
Shares repurchased and retired | 0 | 0 | 0 | 0 | ||
Share authorized for future repurchases | $ 21,200,000 | $ 21,200,000 | $ 21,200,000 |
Related Party Transactions (Det
Related Party Transactions (Details) ¥ in Thousands | 3 Months Ended | 9 Months Ended | |||||||||||||||||
Jan. 25, 2020USD ($) | Jan. 26, 2019USD ($) | Jan. 25, 2020USD ($) | Jan. 26, 2019USD ($) | Dec. 04, 2019USD ($) | Dec. 04, 2019JPY (¥) | Jul. 27, 2019 | May 10, 2019USD ($) | May 10, 2019JPY (¥) | Apr. 30, 2019USD ($) | Feb. 09, 2019USD ($) | Feb. 09, 2019JPY (¥) | Feb. 08, 2019 | Jan. 29, 2019USD ($) | Jan. 29, 2019JPY (¥) | Apr. 17, 2018USD ($) | Apr. 17, 2018JPY (¥) | Dec. 27, 2017USD ($) | Dec. 27, 2017JPY (¥) | |
Long-Term Incentive Awards | |||||||||||||||||||
Revenue | $ 11,762,000 | $ 13,586,000 | $ 37,491,000 | $ 37,981,000 | |||||||||||||||
Unbilled related party receivables | 28,849,000 | 28,849,000 | $ 9,028,000 | ||||||||||||||||
Design and Development Agreement | |||||||||||||||||||
Long-Term Incentive Awards | |||||||||||||||||||
Maximum net value | 148,576,000 | 148,576,000 | |||||||||||||||||
HAPSMobile | Design and Development Agreement | |||||||||||||||||||
Long-Term Incentive Awards | |||||||||||||||||||
Revenue | 11,762,000 | $ 13,586,000 | 37,491,000 | $ 37,981,000 | |||||||||||||||
Unbilled related party receivables | $ 28,849,000 | $ 28,849,000 | $ 9,028,000 | ||||||||||||||||
HAPSMobile | |||||||||||||||||||
Long-Term Incentive Awards | |||||||||||||||||||
Payments for purchase of interest | $ 4,982,000 | ¥ 540,050 | $ 4,569,000 | ¥ 500,000 | $ 5,671,000 | ¥ 632,800 | $ 1,926,000 | ¥ 209,500 | $ 1,407,000 | ¥ 150,000 | $ 1,860,000 | ¥ 210,000 | |||||||
Ownership percentage | 7.00% | 7.00% | 5.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 5.00% | 5.00% | 5.00% | 5.00% | 5.00% |
Business Acquisitions (Details)
Business Acquisitions (Details) | Feb. 26, 2020USD ($) | Feb. 20, 2020USD ($) | Jun. 10, 2019USD ($)item | Jan. 25, 2020USD ($)item | Jan. 26, 2019USD ($) | Jan. 25, 2020USD ($) | Jan. 26, 2019USD ($) |
Business Acquisitions | |||||||
Ownership interest acquired | 100.00% | ||||||
Business Combinations, Assets Acquired and Liabilities Assumed at Acquisition Date | |||||||
Goodwill | $ 6,340,000 | $ 6,340,000 | |||||
Fair value of consideration transferred: | |||||||
Period of goodwill deduction | 15 years | ||||||
Supplemental Pro forma Information | |||||||
Revenue | 2,229,000 | $ 2,901,000 | |||||
Amortization of Intangible Assets | 775,000 | $ 104,000 | 2,102,000 | $ 253,000 | |||
SG&A | |||||||
Supplemental Pro forma Information | |||||||
Acquisition-related costs | $ 344,000 | 1,036,000 | |||||
Pulse Aerospace, LLC | |||||||
Business Acquisitions | |||||||
Ownership interest acquired | 100.00% | ||||||
Amount of cash less closing indebtedness and transaction costs | $ 20,650,000 | ||||||
Amount of retention to cover post closing indemnification claims | 250,000 | ||||||
Amount of holdback | $ 1,250,000 | ||||||
Number of months after closing holdback will be paid | 18 months | ||||||
Number of research and development milestones | item | 2 | 1 | |||||
Each milestone achievement | $ 2,500,000 | $ 2,500,000 | |||||
Total milestone achievement | $ 5,000,000 | ||||||
Business acquisitions gain | 832,000 | ||||||
Fair value of contingent consideration | $ 2,500,000 | 2,500,000 | |||||
Business Combinations, Assets Acquired and Liabilities Assumed at Acquisition Date | |||||||
Inventory | 334,000 | ||||||
Goodwill | 6,340,000 | ||||||
Other assets and liabilities assumed | (614,000) | ||||||
Total net identified assets acquired | 21,880,000 | ||||||
Fair value of consideration transferred: | |||||||
Cash | $ 2,500,000 | $ 2,500,000 | 18,677,000 | ||||
Holdback | 1,250,000 | ||||||
Retention | 250,000 | ||||||
Contingent consideration | $ 1,703,000 | ||||||
Supplemental Pro forma Information | |||||||
Revenue | 61,891,000 | 75,922,000 | 232,300,000 | 228,533,000 | |||
Net income attributable to AeroVironment | (726,000) | $ 7,244,000 | 24,227,000 | $ 38,471,000 | |||
Amortization of Intangible Assets | $ (671,000) | (1,790,000) | |||||
Pulse Aerospace, LLC | Discount rate | |||||||
Business Acquisitions | |||||||
Measurement input | 4.5 | ||||||
Pulse Aerospace, LLC | Minimum | |||||||
Business Acquisitions | |||||||
Each milestone achievement | $ 0 | ||||||
Pulse Aerospace, LLC | Maximum | |||||||
Business Acquisitions | |||||||
Each milestone achievement | 2,500,000 | ||||||
Fair value of consideration transferred: | |||||||
Cash | $ 5,000,000 | ||||||
Pulse Aerospace, LLC | Technology | |||||||
Business Combinations, Assets Acquired and Liabilities Assumed at Acquisition Date | |||||||
Intangible assets | 14,950,000 | ||||||
Pulse Aerospace, LLC | In process research and development | |||||||
Business Combinations, Assets Acquired and Liabilities Assumed at Acquisition Date | |||||||
Intangible assets | 550,000 | ||||||
Pulse Aerospace, LLC | Non-compete agreements | |||||||
Business Combinations, Assets Acquired and Liabilities Assumed at Acquisition Date | |||||||
Intangible assets | $ 320,000 |