Blackhawk Network 10-Q 26 Jul 17 2017 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 17, 2017	Jul. 19, 2017
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 17, 2017
Document Fiscal Year Focus	2,017
Document Fiscal Period Focus	Q2
Entity Registrant Name	BLACKHAWK NETWORK HOLDINGS, INC
Entity Central Index Key	1,411,488
Current Fiscal Year End Date	--12-30
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		56,655,000

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 17, 2017	Dec. 31, 2016	Jun. 18, 2016
Current assets:
Cash and cash equivalents	$ 295,071	$ 1,008,125	$ 263,988
Restricted cash	67,322	10,793	2,500
Settlement receivables, net	401,758	641,691	340,925
Accounts receivable, net	262,616	262,672	226,929
Other current assets	180,925	131,375	103,061
Total current assets	1,207,692	2,054,656	937,403
Property, equipment and technology, net	174,314	172,381	165,246
Intangible assets, net	327,763	350,185	302,435
Goodwill	572,855	570,398	511,808
Deferred income taxes	361,584	362,302	349,286
Other assets	82,223	85,856	67,597
TOTAL ASSETS	2,726,431	3,595,778	2,333,775
Current liabilities:
Settlement payables	622,653	1,626,827	607,463
Consumer and customer deposits	226,727	173,344	132,662
Accounts payable and accrued operating expenses	146,893	153,885	97,717
Deferred revenue	151,037	150,582	111,941
Note payable, current portion	9,890	9,856	156,091
Notes payable to Safeway	4,201	3,163	3,753
Bank line of credit	0	0	100,000
Other current liabilities	91,101	51,176	48,259
Total current liabilities	1,252,502	2,168,833	1,257,886
Deferred income taxes	28,877	27,887	20,168
Note payable	177,924	137,984	268,571
Convertible notes payable	434,855	429,026	0
Other liabilities	27,672	39,653	24,196
Total liabilities	1,921,830	2,803,383	1,570,821
Commitments and contingencies (see Note 9)
Stockholders’ equity:
Preferred stock: $0.001 par value; 10,000 shares authorized; no shares outstanding	0	0	0
Common stock: $0.001 par value; 210,000 shares authorized; 56,623, 55,667 and 56,289 shares outstanding, respectively	56	56	56
Additional paid-in capital	626,693	608,568	581,712
Accumulated other comprehensive loss	(34,893)	(48,877)	(32,065)
Retained earnings	208,513	228,451	208,895
Total Blackhawk Network Holdings, Inc. equity	800,369	788,198	758,598
Non-controlling interests	4,232	4,197	4,356
Total stockholders’ equity	804,601	792,395	762,954
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$ 2,726,431	$ 3,595,778	$ 2,333,775

Condensed Consolidated Balance3

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 17, 2017	Dec. 31, 2016	Jun. 18, 2016
Statement of Financial Position [Abstract]
Preferred stock, par value (in usd per share)	$ 0.001	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000,000	10,000,000	10,000,000
Preferred stock, shares outstanding	0	0	0
Common stock, par value (in usd per share)	$ 0.001	$ 0.001	$ 0.001
Common stock, shares authorized	210,000,000	210,000,000	210,000,000
Common stock, shares outstanding	56,623,000	55,667,000	56,289,000

Condensed Consolidated Statemen

Condensed Consolidated Statements of Income (Loss) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 17, 2017	Jun. 18, 2016	Jun. 17, 2017	Jun. 18, 2016
OPERATING REVENUES:
Commissions and fees	$ 282,633	$ 262,931	$ 537,839	$ 502,555
Program and other fees	107,914	67,419	208,824	142,861
Marketing	24,825	20,696	39,106	34,155
Product sales	47,774	40,160	84,613	78,097
Total operating revenues	463,146	391,206	870,382	757,668
OPERATING EXPENSES:
Partner distribution expense	201,525	191,231	381,001	363,386
Processing and services	107,680	76,875	209,952	150,816
Sales and marketing	77,722	60,511	140,507	113,849
Costs of products sold	44,541	38,309	80,734	74,041
General and administrative	25,563	22,557	54,588	46,054
Transition and acquisition	905	641	1,356	1,586
Amortization of acquisition intangibles	13,648	15,259	26,673	25,157
Change in fair value of contingent consideration	(4,037)	800	(2,997)	800
Total operating expenses	467,547	406,183	891,814	775,689
OPERATING INCOME (LOSS)	(4,401)	(14,977)	(21,432)	(18,021)
OTHER INCOME (EXPENSE):
Interest income and other income (expense), net	667	486	1,503	898
Interest expense	(7,051)	(4,118)	(13,994)	(8,184)
INCOME (LOSS) BEFORE INCOME TAX EXPENSE (BENEFIT)	(10,785)	(18,609)	(33,923)	(25,307)
INCOME TAX EXPENSE (BENEFIT)	(4,591)	(7,290)	(14,366)	(10,527)
NET INCOME (LOSS) BEFORE ALLOCATION TO NON-CONTROLLING INTERESTS	(6,194)	(11,319)	(19,557)	(14,780)
Loss (income) attributable to non-controlling interests, net of tax	(157)	(18)	(280)	(110)
NET INCOME (LOSS) ATTRIBUTABLE TO BLACKHAWK NETWORK HOLDINGS, INC.	$ (6,351)	$ (11,337)	$ (19,837)	$ (14,890)
EARNINGS (LOSS) PER SHARE:
Basic (in usd per share)	$ (0.11)	$ (0.20)	$ (0.35)	$ (0.27)
Diluted (in usd per share)	$ (0.11)	$ (0.20)	$ (0.35)	$ (0.27)
Weighted average shares outstanding—basic (in shares)	56,448	56,134	56,176	55,944
Weighted average shares outstanding—diluted (in shares)	56,448	56,134	56,176	55,944

Condensed Consolidated Stateme5

Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 17, 2017	Jun. 18, 2016	Jun. 17, 2017	Jun. 18, 2016
Statement of Comprehensive Income [Abstract]
NET INCOME (LOSS) BEFORE ALLOCATION TO NON-CONTROLLING INTERESTS	$ (6,194)	$ (11,319)	$ (19,557)	$ (14,780)
Other comprehensive income (loss):
Currency translation adjustments	7,764	2,985	13,739	8,051
COMPREHENSIVE INCOME (LOSS) BEFORE ALLOCATION TO NON-CONTROLLING INTERESTS	1,570	(8,334)	(5,818)	(6,729)
Comprehensive loss (income) attributable to non-controlling interests, net of tax	47	71	(35)	(31)
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO BLACKHAWK NETWORK HOLDINGS, INC.	$ 1,617	$ (8,263)	$ (5,853)	$ (6,760)

Condensed Consolidated Stateme6

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 17, 2017	Jun. 18, 2016
OPERATING ACTIVITIES:
Net income (loss) before allocation to non-controlling interests	$ (19,557)	$ (14,780)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation and amortization of property, equipment and technology	25,020	21,684
Amortization of intangibles	29,160	27,459
Amortization of deferred program and contract costs	14,044	12,544
Amortization of deferred financing costs and debt discount	6,344	880
Loss on property, equipment and technology disposal/write-down	606	3,094
Employee stock-based compensation expense	16,451	16,572
Change in fair value of contingent consideration	(2,997)	800
Other	(68)	(3,011)
Changes in operating assets and liabilities:
Settlement receivables	252,160	293,441
Settlement payables	(1,010,431)	(1,005,723)
Accounts receivable, current and long-term	(10,664)	16,964
Other current assets	3,579	16,914
Other assets	(5,357)	(2,544)
Consumer and customer deposits	764	31,974
Accounts payable and accrued operating expenses	2,098	(33,574)
Deferred revenue	4,356	493
Other current and long-term liabilities	14,670	(21,742)
Income taxes, net	(14,467)	(4,722)
Net cash (used in) provided by operating activities	(694,289)	(643,277)
INVESTING ACTIVITIES:
Expenditures for property, equipment and technology	(30,178)	(20,281)
Business acquisitions, net of cash acquired	(10,260)	(144,477)
Investment in unconsolidated entities	(5,601)	0
Change in restricted cash	(10,580)	689
Other	(4,487)	(2,500)
Net cash (used in) provided by investing activities	(61,106)	(166,569)
FINANCING ACTIVITIES:
Payments for acquisition liability	(5,503)	0
Repayment of debt assumed in business acquisitions	(300)	(8,964)
Proceeds from issuance of note payable	50,000	100,000
Repayment of note payable	(10,000)	(37,500)
Payments of financing costs	(619)	0
Borrowings under revolving bank line of credit	1,198,597	1,502,675
Repayments on revolving bank line of credit	(1,198,597)	(1,402,675)
Repayment on notes payable to Safeway	(254)	(376)
Proceeds from issuance of common stock from exercise of employee stock options and employee stock purchase plans	10,371	3,452
Other stock-based compensation related	(9,705)	(2,002)
Net cash (used in) provided by financing activities	33,990	154,610
Effect of exchange rate changes on cash and cash equivalents	8,351	4,648
Decrease in cash and cash equivalents	(713,054)	(650,588)
Cash and cash equivalents—beginning of period	1,008,125	914,576
Cash and cash equivalents—end of period	295,071	263,988
NONCASH FINANCING AND INVESTING ACTIVITIES:
Financing of business acquisition with contingent consideration	$ 1,640	$ 20,100

The Company and Significant Acc

The Company and Significant Accounting Policies	6 Months Ended
	Jun. 17, 2017
Accounting Policies [Abstract]
The Company and Significant Accounting Policies	The Company and Significant Accounting Policies The Company Blackhawk Network Holdings, Inc., together with its subsidiaries (“we”, “us”, “our”, the “Company”), is a leading prepaid payment network utilizing proprietary technology to offer consumers and businesses a broad selection of prepaid cards in physical and electronic forms, as well as complementary prepaid products, payment services and incentives solutions. We currently offer our products and/or solutions directly or through commercial relationships in the United States and 25 other countries and can deliver solutions in over 100 countries. Our product offerings include single-use gift cards; loyalty, incentive and reward products and services; prepaid telecom products and prepaid financial services products, including general purpose reloadable (“GPR”) cards, and our reload network (collectively, “prepaid products”). We offer gift cards from leading consumer brands (known as “closed loop”) as well as branded gift and incentive cards from leading payment network card associations such as American Express, Discover, MasterCard and Visa (known as “open loop”) and prepaid telecom products offered by prepaid wireless telecom carriers. We also distribute GPR cards and operate a proprietary reload network named Reloadit, which allows consumers to reload funds onto their previously purchased GPR cards. We distribute these prepaid products across multiple high-traffic channels such as grocery, convenience, specialty and online retailers (referred to as “retail distribution partners”) in the Americas, Europe, Africa, Australia and Asia and provide these prepaid products and related services to business clients for their loyalty, incentive and reward programs. Basis of Presentation The accompanying condensed consolidated financial statements of Blackhawk Network Holdings, Inc. are unaudited. We have prepared our unaudited interim condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. We have condensed or omitted certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP pursuant to such rules and regulations. Accordingly, our interim condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements and related notes included in our Annual Report on Form 10-K, filed with the SEC on February 27, 2017 (the “Annual Report”). We have prepared our condensed consolidated financial statements on the same basis as our annual audited consolidated financial statements and, in the opinion of management, have reflected all adjustments, which include only normal recurring adjustments, necessary to present fairly our financial position and results of operations for the interim periods presented. Our results for the interim periods are not necessarily reflective of the results to be expected for the year ending December 30, 2017 or for any other interim period or other future year. Our condensed consolidated balance sheet as of December 31, 2016 , included herein was derived from our audited consolidated financial statements as of that date but does not include all disclosures required by GAAP for annual financial statements, including notes to the financial statements. Seasonality For our retail business, a significant portion of gift card sales occurs in late December each year during the holiday selling season. As a result, we earn a significant portion of our revenues, net income and cash flows during the fourth quarter of each year and remit the majority of the cash, less commissions, to our content providers in January of the following year. The timing of our fiscal year-end, December holiday sales and the related January cash settlement with content providers significantly increases our Cash and cash equivalents, Settlement receivables and Settlement payables balances at the end of each fiscal year relative to normal daily balances. The cash settlement with our content providers in January accounts for the majority of the use of cash from operating activities in our condensed consolidated statements of cash flows during our first three fiscal quarters. We also experience an increase in revenues, net income and cash flows during the second quarter of each year, which we primarily attribute to the Mother’s Day, Father’s Day and graduation gifting season and the Easter holiday. Depending on when the Easter holiday occurs, the associated increase is in either the first or second quarter. As a result, quarterly financial results are not necessarily reflective of the results to be expected for the year or any other interim or future period. Seasonality also impacts our incentives businesses, but such impact is smaller in comparison to our retail business. Recently Issued or Adopted Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09 Revenue from Contracts with Customers (Topic 606), which along with amendments issued in 2015 and 2016, will replace nearly all current U.S. GAAP guidance on this topic with a comprehensive revenue measurement and recognition standard and expanded disclosure requirements. Under the new standard, revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. This new guidance is to be applied retrospectively either to each reporting period presented (full retrospective method) or with the cumulative effect of initially applying the guidance at the date of initial application for reporting periods beginning after December 15, 2017. Early adoption is not permitted. We will adopt this standard using the full retrospective method in the first quarter of fiscal 2018, and we are currently evaluating the impact of this guidance on our condensed financial statements. In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment , which simplifies the existing two-step guidance for goodwill impairment testing by eliminating the second step resulting in a write-down to goodwill equal to the initial amount of impairment determined in step one. The ASU is to be applied prospectively for reporting periods beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed after January 1, 2017. We have early-adopted this standard in the first quarter of 2017, however, it has no impact on our financial statements unless we determine in the future that goodwill is impaired at one of our reporting units. Significant Accounting Policies Except for goodwill as stated above, there have been no material changes to our significant accounting policies, as compared to the significant accounting policies described in the audited consolidated financial statements and related notes included in the Annual Report.

Business Acquisitions

Business Acquisitions	6 Months Ended
	Jun. 17, 2017
Business Combinations [Abstract]
Business Acquisitions	Business Acquisitions 2017 Acquisition During the first quarter of 2017, we completed an acquisition of a rebates and incentives business for total consideration of approximately $18.0 million , which includes $16.4 million cash on hand and approximately $1.6 million related to contingent consideration, which is a cash payment of up to $2.0 million based on the performance of the acquired business through December 31, 2017. In aggregate, $6.1 million cash was acquired, and based on our initial estimate of the purchase price allocation, $7.8 million was attributed to intangible assets, $9.9 million was attributed to goodwill, and $5.8 million was attributed to net tangible liabilities acquired. For the intangible assets acquired, customer relationships have an average useful life of 7 years. We expect to deduct goodwill and identifiable technology and intangible assets for tax purposes, a portion of which will commence upon settlement of contingent consideration and contingent liabilities. We have not presented separate results of operations since closing or combined pro forma financial information of us and the acquisition since the beginning of fiscal 2016, as results of operations for the acquisition are immaterial. 2016 Acquisitions During the second quarter of 2017, we recorded a measurement period adjustment for The Grass Roots Group Holdings Limited and its subsidiaries (collectively, “Grass Roots”), which increased the purchase price by $0.8 million , increased accounts receivables by $0.4 million , decreased consumer and customer deposits by $1.8 million and decreased goodwill by $1.4 million . We also recorded a measurement period adjustment for Spafinder Wellness, Inc. and its subsidiaries (collectively, “Spafinder”), which increased goodwill by $0.3 million and decreased inventory by $0.3 million . The measurement periods for IMShopping, Inc. and its subsidiary (collectively, “NimbleCommerce”) and 888extramoney.com LLC (“Extrameasures”) were closed in the first and second quarter of 2017, respectively. The measurement period for our acquisitions of Grass Roots, Spafinder and Samba Days Experience Group Ltd. and certain of its subsidiaries remains open with respect to intangibles and deferred taxes.

Financing

Financing	6 Months Ended
	Jun. 17, 2017
Debt Disclosure [Abstract]
Financing	Financing Credit Agreement In March 2017, we repaid $10.0 million of the term loan outstanding under our Credit Agreement, as amended and restated (the “Restated Credit Agreement”). On April 20, 2017, we borrowed an additional $50.0 million of term loan under the Restated Credit Agreement. The terms of the new term loan are substantially similar to the outstanding term loan. On April 25, 2017, we entered into an amendment to the Restated Credit Agreement to extend the term loan commitments provided by the lenders under our Restated Credit Agreement to January 12, 2018 and made certain modifications to the financial and other covenants to add operating flexibility, including modification of the leverage covenant and increasing the dollar limitation on dividends, stock repurchases and other restricted payments under certain conditions. The following table presents the amounts due by maturity date of our term loan and convertible notes as of June 17, 2017 (in thousands): June 17, 2017 2018 $ 10,000 2019 10,000 2020 20,000 2021 150,000 2022 500,000 Total long-term debt $ 690,000 As a result of the covenants in our Restated Credit Agreement which require us to maintain certain leverage ratios of total debt to adjusted EBITDA (as defined in the Restated Credit Agreement), and depending on our levels of adjusted EBITDA, we are limited in our ability to incur additional indebtedness either under the Restated Credit Agreement or through other debt facilities. These limitations also affect the amount of capital we can allocate to acquisitions, internal capital developments and capital returned to stockholders.

Fair Value Measurements

Fair Value Measurements	6 Months Ended
	Jun. 17, 2017
Fair Value Disclosures [Abstract]
Fair Value Measurements	Fair Value Measurements We measure certain assets and liabilities at fair value on a recurring basis. The table below summarizes the fair values of these assets and liabilities as of June 17, 2017 , December 31, 2016 and June 18, 2016 (in thousands): June 17, 2017 Level 1 Level 2 Level 3 Total Assets Cash and cash equivalents Money market mutual funds $ 4,092 $ — $ — $ 4,092 Liabilities Contingent consideration $ — $ — $ 16,892 $ 16,892 December 31, 2016 Level 1 Level 2 Level 3 Total Assets Cash and cash equivalents Money market mutual funds $ 300,015 $ — $ — $ 300,015 Liabilities Contingent consideration $ — $ — $ 23,752 $ 23,752 June 18, 2016 Level 1 Level 2 Level 3 Total Assets Cash and cash equivalents Money market mutual funds $ 11,100 $ — $ — $ 11,100 Liabilities Contingent consideration $ — $ — $ 20,900 $ 20,900 Level 1 — Unadjusted quoted prices in active markets for identical assets or liabilities. Level 1 investments include money market mutual funds. Level 2 — Inputs other than quoted prices included in Level 1 that are either directly or indirectly observable. During the 24 weeks ended June 17, 2017 , there were no transfers between levels. Level 3 — Unobservable inputs in which little or no market activity exists, therefore requiring an entity to develop its own assumptions about the inputs that market participants would use in pricing. Level 3 includes the estimated fair value of our contingent consideration liabilities. Term loan —As of June 17, 2017 , using Level 2 inputs, we estimate the fair value of our term loan (classified as Note payable on the balance sheet) to be approximately $190.0 million . Convertible notes payable —As of June 17, 2017 , using Level 2 inputs, we estimate the fair value of our convertible notes payable to be approximately $541.9 million . Contingent consideration —We estimate the fair value of the contingent consideration based on our estimates of the probability of achieving the relevant targets and discount rates reflecting the risk of meeting these targets. The changes in fair value of contingent consideration for the 24 weeks ended June 17, 2017 and June 18, 2016 are as follows (in thousands): 24 weeks ended June 17, 2017 June 18, 2016 Balance, beginning of period $ 23,752 $ — Addition from acquisition (see Note 2—Business Acquisitions ) 1,640 20,100 Change in fair value of contingent consideration (2,997 ) 800 Settlement (5,503 ) — Balance, end of period $ 16,892 $ 20,900 We present the change in the fair value of contingent consideration in Change in fair value of contingent consideration and as a noncash adjustment to net income in our condensed consolidated statements of cash flows. A significant increase (decrease) in our estimates of the amounts payable for and probability of achieving the relevant targets or a significant decrease (increase) in the discount rate could materially increase (decrease) the estimated fair value of contingent consideration. The issuance and increase in fair value of contingent consideration during 2016 was related to our acquisition of Extrameasures. During the 24 weeks ended June 17, 2017 , we paid out $5.5 million for achieving relevant targets during the first earn-out year, and we estimated the fair value of the remaining contingent consideration based on our estimates of the amounts payable for and probability of achieving the relevant targets and a discount rate of 17% .

Consolidated Financial Statemen

Consolidated Financial Statement Details	6 Months Ended
	Jun. 17, 2017
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Consolidated Financial Statement Details	Consolidated Financial Statement Details The following tables represent the components of Other current assets , Other assets , Other current liabilities and Other liabilities as of June 17, 2017 , December 31, 2016 and June 18, 2016 consisted of the following (in thousands): June 17, 2017 December 31, 2016 June 18, 2016 Other current assets: Inventory $ 42,616 $ 43,950 $ 34,154 Deferred expenses 18,931 22,148 12,656 Income tax receivables 30,134 13,599 25,639 Other 48,874 51,678 30,612 Assets held for sale 40,370 — — Total other current assets $ 180,925 $ 131,375 $ 103,061 Other assets: Deferred program and contract costs $ 39,097 $ 48,066 $ 43,527 Other receivables 1,622 2,713 2,810 Income taxes receivable 2,270 2,358 — Deferred financing costs 2,756 2,688 1,675 Other 36,478 30,031 19,585 Total other assets $ 82,223 $ 85,856 $ 67,597 Other current liabilities: Payroll and related liabilities $ 28,309 $ 24,944 $ 24,336 Income taxes payable 5,000 4,199 2,333 Acquisition liability 7,352 6,672 10,850 Other payables and accrued liabilities 11,582 15,361 10,740 Liabilities held for sale 38,858 — — Total other current liabilities $ 91,101 $ 51,176 $ 48,259 Other liabilities: Acquisition liability $ 9,540 $ 17,080 $ 10,050 Income taxes payable 7,130 6,957 6,186 Deferred income and other liabilities 11,002 15,616 7,960 Total other liabilities $ 27,672 $ 39,653 $ 24,196 Assets held for sale During the first quarter of 2017, management approved a plan to sell all assets and liabilities related to Grass Roots’ Meetings & Events (“M&E”) business. It is probable that such sale will occur within one year. As a result, beginning from the time the plan was approved, each of the relevant asset and liability balances will be accounted for as held for sale and measured at the lower of its carrying value or fair value less cost to sell. Based on the purchase price allocation performed in the fourth quarter of 2016, we believe that the carrying value of all the relevant assets and liabilities does not exceed fair value less cost to sell. The following table presents the aggregate carrying amounts of the major classes of assets and liabilities related to the M&E business as of June 17, 2017 (in thousands): June 17, 2017 Accounts receivable, net $ 16,174 Other current assets 4,657 Property, equipment and technology, net 927 Intangible assets, net 5,607 Goodwill 11,924 Deferred income taxes 1,081 Total assets held for sale $ 40,370 Settlement payables $ 7,838 Consumer and customer deposits 1,754 Accounts payable and accrued operating expenses 8,454 Deferred revenue 4,695 Other current liabilities 16,004 Deferred income taxes 113 Total liabilities held for sale $ 38,858 During the first two quarters of 2017, the M&E business recorded pre-tax income of $0.6 million during the period it was accounted for as an asset held for sale.

Goodwill

Goodwill	6 Months Ended
	Jun. 17, 2017
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill	Goodwill We have assigned goodwill to our U.S. Retail, Incentives & Rewards and International segments. To date, we have not recorded any impairment charges against or disposed of any reporting units with goodwill. During the first quarter of 2017, as a result of changes in reporting financial results to our Chief Operating Decision Maker (“CODM”), we concluded that we would report the international incentives businesses within the International reportable segment. Accordingly, we re-allocated a portion of the goodwill from the historical Incentives & Rewards segment to the International segment based on their relative fair values. As we continue to develop our e-commerce strategy, we also re-allocated a portion of the e-commerce goodwill from U.S. Retail to Incentives & Rewards to align with the way our business is managed. A summary of changes in goodwill during the 24 weeks ended June 17, 2017 is as follows (in thousands): June 17, 2017 U.S. Retail Incentives & Rewards International Total Balance, beginning of period $ 99,685 $ 366,508 $ 104,205 $ 570,398 Re-allocation of goodwill to International — (7,152 ) 7,152 — Re-allocation of e-commerce goodwill (10,505 ) 10,505 — — Acquisition (see Note 2—Business Acquisitions ) — 9,919 — 9,919 Measurement period of adjustments for 2016 acquisitions 338 — (1,384 ) (1,046 ) Asset held for sale (see Note 5—Consolidated Financial Statement Details ) — — (11,924 ) (11,924 ) Foreign currency translation adjustments — 386 5,122 5,508 Balance, end of period $ 89,518 $ 380,166 $ 103,171 $ 572,855

Stock-Based Compensation

Stock-Based Compensation	6 Months Ended
	Jun. 17, 2017
Equity [Abstract]
Stock-Based Compensation	Stock-Based Compensation During the 24 weeks ended June 17, 2017 , our Board of Directors granted 992,669 restricted stock units and 200,700 performance stock units. The following table presents total stock-based compensation expense according to the income statement line in our condensed consolidated statements of income (loss) for the 24 weeks ended June 17, 2017 and June 18, 2016 (in thousands): 12 weeks ended 24 weeks ended June 17, 2017 June 18, 2016 June 17, 2017 June 18, 2016 Processing and services $ 1,798 $ 1,522 $ 3,500 $ 2,964 Sales and marketing 2,884 3,027 5,696 5,841 Cost of products sold 4 42 21 58 General and administrative 3,364 3,981 7,234 7,709 Total stock-based compensation expense $ 8,050 $ 8,572 $ 16,451 $ 16,572

Income Taxes

Income Taxes	6 Months Ended
	Jun. 17, 2017
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes Our effective tax rates were 42.6% and 39.2% for the 12 weeks ended June 17, 2017 and June 18, 2016 , respectively, and 42.3% and 41.6% for the 24 weeks ended June 17, 2017 and June 18, 2016 , respectively. The effective rate for the 12 weeks and 24 weeks ended June 17, 2017 was higher primarily due to excess tax benefits of employee stock-based compensation.

Commitments and Contingencies

Commitments and Contingencies	6 Months Ended
	Jun. 17, 2017
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Contingencies From time to time, we enter into contracts containing provisions that require us to indemnify various parties against certain potential claims from third parties. Under contracts with certain issuing banks, we are responsible to the banks for any unrecovered overdrafts on cardholders’ accounts. Under contracts with certain content providers, retail distribution partners and issuing banks, we are responsible for potential losses resulting from certain claims from third parties. Because the indemnity amounts associated with these agreements are not explicitly stated, the maximum amount of the obligation cannot be reasonably estimated. Historically, we have paid immaterial amounts pursuant to these indemnification provisions. We are subject to audits related to various indirect taxes, including, but not limited to, sales and use taxes, value-added tax, and goods and services tax, in various foreign and state jurisdictions. We evaluate our exposure related to these audits and potential audits and do not believe that it is probable that any audit would hold us liable for any material amounts due. Legal Matters There are various claims and lawsuits arising in the normal course of business pending against us, including the matters described below, some of which seek damages and other relief which, if granted, may require future cash expenditures. Management does not believe that it is probable that the resolution of these matters would result in any liability that would materially affect our results of operations or financial condition. On March 30, 2015, Greg Haney in his capacity as Seller Representative for CardLab, Inc. filed a lawsuit against us in the Delaware Chancery Court (CardLab, Inc. v. Blackhawk Network Holdings, Inc., Case No. 10851). The complaint generally alleges that we failed to disclose material information relating to a potential earn-out payment in connection with our acquisition of CardLab, Inc. in 2014. We believe that the suit is without merit, and are vigorously defending ourselves against these claims. On June 8, 2015, we filed a motion to dismiss the complaint. On June 22, 2015, the plaintiff filed an amended complaint. On July 7, 2015, we filed a motion to dismiss the case in its entirety. On February 26, 2016, the Court granted the motion to dismiss in part, dismissing two claims of the amended complaint. On March 25, 2016 we filed our answer denying the remaining claims and a counterclaim for attorneys’ fees pursuant to the merger agreement between the parties. On June 22, 2016, the plaintiff filed a motion to dismiss our counterclaim for indemnification. On July 22, 2016, we filed an amended counterclaim in response. On August 5, 2016, the plaintiff filed a reply. On May 11, 2017, the parties updated the Court regarding the status of the case. We believe the likelihood of loss is remote. In addition, we transact business in non-U.S. markets and may, from time to time, be subject to disputes and tax audits by foreign tax authorities related to indirect taxes typically on commissions or fees we receive from non-resident content providers. After the application of third party indemnities, our present exposure is approximately $4.9 million , primarily in a single jurisdiction. If we were to be assessed for this exposure, we believe it is probable that we will prevail.

Segment Reporting

Segment Reporting	6 Months Ended
	Jun. 17, 2017
Segment Reporting [Abstract]
Segment Reporting	Segment Reporting Our three reportable segments are U.S. Retail, Incentives & Rewards and International. During the first quarter of 2017, as a result of changes in reporting financial results to our CODM, we concluded that we would report the international incentives businesses within the International reportable segment. We also determined that it would be appropriate to allocate all costs that have been previously reported within Corporate and Unallocated: i) account management and marketing personnel, ii) the substantial majority of our technology personnel and related depreciation and amortization of technology and related hardware, iii) accounting, finance, legal, human resources and other administrative functions and iv) noncash charges including amortization of acquisition intangibles, stock-based compensation and change in fair value of contingent consideration, to the respective reportable segments. We do not assess performance based on assets and do not provide information on the assets of our reportable segments to our CODM. The key metrics used by our CODM to assess segment performance include Operating revenues , Operating revenues, net of Partner distribution expense and segment profit. The following tables present the key metrics used by our CODM for the evaluation of segment performance, including certain significant noncash charges (consisting of certain depreciation and amortization of property, equipment and technology and distribution partner stock-based compensation expense) which have been deducted from the segment profit amounts shown below, and reconciliations of these amounts to our condensed consolidated financial statements (in thousands): 12 weeks ended June 17, 2017 U.S. Retail Incentives & Rewards International Consolidated Total operating revenues $ 237,705 $ 80,702 $ 144,739 $ 463,146 Partner distribution expense 124,763 6,650 70,112 201,525 Operating revenues, net of Partner distribution expense 112,942 74,052 74,627 261,621 Other operating expenses 111,697 76,325 78,000 266,022 Segment profit (loss) / Operating income (loss) $ 1,245 $ (2,273 ) $ (3,373 ) $ (4,401 ) Other income (expense) (6,384 ) Income (loss) before income tax expense $ (10,785 ) Noncash charges $ 13,660 $ 11,869 $ 8,696 12 weeks ended June 18, 2016 U.S. Retail Incentives & Rewards International Consolidated Total operating revenues $ 237,608 $ 61,119 $ 92,479 $ 391,206 Partner distribution expense 120,795 5,218 65,218 191,231 Operating revenues, net of Partner distribution expense 116,813 55,901 27,261 199,975 Other operating expenses 112,701 68,678 33,573 214,952 Segment profit (loss) / Operating income (loss) $ 4,112 $ (12,777 ) $ (6,312 ) $ (14,977 ) Other income (expense) (3,632 ) Income (loss) before income tax expense $ (18,609 ) Noncash charges $ 13,727 $ 22,041 $ 5,595 24 weeks ended June 17, 2017 U.S. Retail Incentives & Rewards International Consolidated Total operating revenues $ 445,343 $ 143,927 $ 281,112 $ 870,382 Partner distribution expense 226,476 10,736 143,789 381,001 Operating revenues, net of Partner distribution expense 218,867 133,191 137,323 489,381 Other operating expenses 220,610 142,748 147,455 510,813 Segment profit (loss) / Operating income (loss) $ (1,743 ) $ (9,557 ) $ (10,132 ) $ (21,432 ) Other income (expense) (12,491 ) Income (loss) before income tax expense $ (33,923 ) Noncash charges $ 27,277 $ 27,699 $ 16,524 24 weeks ended June 18, 2016 U.S. Retail Incentives & Rewards International Consolidated Total operating revenues $ 453,104 $ 120,773 $ 183,791 $ 757,668 Partner distribution expense 226,354 8,049 128,983 363,386 Operating revenues, net of Partner distribution expense 226,750 112,724 54,808 394,282 Other operating expenses 214,444 130,141 67,718 412,303 Segment profit (loss) / Operating income (loss) $ 12,306 $ (17,417 ) $ (12,910 ) $ (18,021 ) Other income (expense) (7,286 ) Income (loss) before income tax expense $ (25,307 ) Noncash charges $ 25,243 $ 38,301 $ 9,865

Earnings Per Share

Earnings Per Share	6 Months Ended
	Jun. 17, 2017
Earnings Per Share [Abstract]
Earnings Per Share	Earnings Per Share The following table provides reconciliations of net income (loss) and shares used in calculating basic earnings (loss) per share (“EPS”) to those used in calculating diluted EPS (in thousands, except per share amounts): 12 weeks ended June 17, 2017 June 18, 2016 Basic Diluted Basic Diluted Net income (loss) attributable to Blackhawk Network Holdings, Inc. $ (6,351 ) $ (6,351 ) $ (11,337 ) $ (11,337 ) Distributed and undistributed earnings allocated to participating securities — — — — Net income (loss) attributable to common stockholders $ (6,351 ) $ (6,351 ) $ (11,337 ) $ (11,337 ) Weighted-average common shares outstanding 56,448 56,448 56,134 56,134 Common share equivalents — — Weighted-average shares outstanding 56,448 56,134 Earnings (loss) per share $ (0.11 ) $ (0.11 ) $ (0.20 ) $ (0.20 ) 24 weeks ended June 17, 2017 June 18, 2016 Basic Diluted Basic Diluted Net income (loss) attributable to Blackhawk Network Holdings, Inc. $ (19,837 ) $ (19,837 ) $ (14,890 ) $ (14,890 ) Distributed and undistributed earnings allocated to participating securities — — (15 ) (15 ) Net income (loss) attributable to common stockholders $ (19,837 ) $ (19,837 ) $ (14,905 ) $ (14,905 ) Weighted-average common shares outstanding 56,176 56,176 55,944 55,944 Common share equivalents — — Weighted-average shares outstanding 56,176 55,944 Earnings (loss) per share $ (0.35 ) $ (0.35 ) $ (0.27 ) $ (0.27 ) The weighted-average common shares outstanding for diluted EPS for the 12 weeks ended June 17, 2017 and June 18, 2016 , excluded approximately 5,046,000 and 5,694,000 , respectively, and for the 24 weeks ended June 17, 2017 and June 18, 2016 , excluded approximately 5,177,000 and 5,407,000 , respectively, of total potential common stock outstanding because the effect would have been anti-dilutive.

The Company and Significant A18

The Company and Significant Accounting Policies (Policies)	6 Months Ended
	Jun. 17, 2017
Accounting Policies [Abstract]
The Company	The Company Blackhawk Network Holdings, Inc., together with its subsidiaries (“we”, “us”, “our”, the “Company”), is a leading prepaid payment network utilizing proprietary technology to offer consumers and businesses a broad selection of prepaid cards in physical and electronic forms, as well as complementary prepaid products, payment services and incentives solutions. We currently offer our products and/or solutions directly or through commercial relationships in the United States and 25 other countries and can deliver solutions in over 100 countries. Our product offerings include single-use gift cards; loyalty, incentive and reward products and services; prepaid telecom products and prepaid financial services products, including general purpose reloadable (“GPR”) cards, and our reload network (collectively, “prepaid products”). We offer gift cards from leading consumer brands (known as “closed loop”) as well as branded gift and incentive cards from leading payment network card associations such as American Express, Discover, MasterCard and Visa (known as “open loop”) and prepaid telecom products offered by prepaid wireless telecom carriers. We also distribute GPR cards and operate a proprietary reload network named Reloadit, which allows consumers to reload funds onto their previously purchased GPR cards. We distribute these prepaid products across multiple high-traffic channels such as grocery, convenience, specialty and online retailers (referred to as “retail distribution partners”) in the Americas, Europe, Africa, Australia and Asia and provide these prepaid products and related services to business clients for their loyalty, incentive and reward programs.
Basis of Presentation	Basis of Presentation The accompanying condensed consolidated financial statements of Blackhawk Network Holdings, Inc. are unaudited. We have prepared our unaudited interim condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. We have condensed or omitted certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP pursuant to such rules and regulations. Accordingly, our interim condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements and related notes included in our Annual Report on Form 10-K, filed with the SEC on February 27, 2017 (the “Annual Report”). We have prepared our condensed consolidated financial statements on the same basis as our annual audited consolidated financial statements and, in the opinion of management, have reflected all adjustments, which include only normal recurring adjustments, necessary to present fairly our financial position and results of operations for the interim periods presented. Our results for the interim periods are not necessarily reflective of the results to be expected for the year ending December 30, 2017 or for any other interim period or other future year. Our condensed consolidated balance sheet as of December 31, 2016 , included herein was derived from our audited consolidated financial statements as of that date but does not include all disclosures required by GAAP for annual financial statements, including notes to the financial statements.
Seasonality	Seasonality For our retail business, a significant portion of gift card sales occurs in late December each year during the holiday selling season. As a result, we earn a significant portion of our revenues, net income and cash flows during the fourth quarter of each year and remit the majority of the cash, less commissions, to our content providers in January of the following year. The timing of our fiscal year-end, December holiday sales and the related January cash settlement with content providers significantly increases our Cash and cash equivalents, Settlement receivables and Settlement payables balances at the end of each fiscal year relative to normal daily balances. The cash settlement with our content providers in January accounts for the majority of the use of cash from operating activities in our condensed consolidated statements of cash flows during our first three fiscal quarters. We also experience an increase in revenues, net income and cash flows during the second quarter of each year, which we primarily attribute to the Mother’s Day, Father’s Day and graduation gifting season and the Easter holiday. Depending on when the Easter holiday occurs, the associated increase is in either the first or second quarter. As a result, quarterly financial results are not necessarily reflective of the results to be expected for the year or any other interim or future period. Seasonality also impacts our incentives businesses, but such impact is smaller in comparison to our retail business.
Recently Issued or Adopted Accounting Pronouncements	Recently Issued or Adopted Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09 Revenue from Contracts with Customers (Topic 606), which along with amendments issued in 2015 and 2016, will replace nearly all current U.S. GAAP guidance on this topic with a comprehensive revenue measurement and recognition standard and expanded disclosure requirements. Under the new standard, revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. This new guidance is to be applied retrospectively either to each reporting period presented (full retrospective method) or with the cumulative effect of initially applying the guidance at the date of initial application for reporting periods beginning after December 15, 2017. Early adoption is not permitted. We will adopt this standard using the full retrospective method in the first quarter of fiscal 2018, and we are currently evaluating the impact of this guidance on our condensed financial statements. In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment , which simplifies the existing two-step guidance for goodwill impairment testing by eliminating the second step resulting in a write-down to goodwill equal to the initial amount of impairment determined in step one. The ASU is to be applied prospectively for reporting periods beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed after January 1, 2017. We have early-adopted this standard in the first quarter of 2017, however, it has no impact on our financial statements unless we determine in the future that goodwill is impaired at one of our reporting units.

Financing (Tables)

Financing (Tables)	6 Months Ended
	Jun. 17, 2017
Debt Disclosure [Abstract]
Schedule of Maturities of Long-term Debt	The following table presents the amounts due by maturity date of our term loan and convertible notes as of June 17, 2017 (in thousands): June 17, 2017 2018 $ 10,000 2019 10,000 2020 20,000 2021 150,000 2022 500,000 Total long-term debt $ 690,000

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	6 Months Ended
	Jun. 17, 2017
Fair Value Disclosures [Abstract]
Summary of Fair Value of Assets, Liabilities and Equity Instruments on Recurring Basis	The table below summarizes the fair values of these assets and liabilities as of June 17, 2017 , December 31, 2016 and June 18, 2016 (in thousands): June 17, 2017 Level 1 Level 2 Level 3 Total Assets Cash and cash equivalents Money market mutual funds $ 4,092 $ — $ — $ 4,092 Liabilities Contingent consideration $ — $ — $ 16,892 $ 16,892 December 31, 2016 Level 1 Level 2 Level 3 Total Assets Cash and cash equivalents Money market mutual funds $ 300,015 $ — $ — $ 300,015 Liabilities Contingent consideration $ — $ — $ 23,752 $ 23,752 June 18, 2016 Level 1 Level 2 Level 3 Total Assets Cash and cash equivalents Money market mutual funds $ 11,100 $ — $ — $ 11,100 Liabilities Contingent consideration $ — $ — $ 20,900 $ 20,900
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation	The changes in fair value of contingent consideration for the 24 weeks ended June 17, 2017 and June 18, 2016 are as follows (in thousands): 24 weeks ended June 17, 2017 June 18, 2016 Balance, beginning of period $ 23,752 $ — Addition from acquisition (see Note 2—Business Acquisitions ) 1,640 20,100 Change in fair value of contingent consideration (2,997 ) 800 Settlement (5,503 ) — Balance, end of period $ 16,892 $ 20,900

Consolidated Financial Statem21

Consolidated Financial Statement Details (Tables)	6 Months Ended
	Jun. 17, 2017
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Schedule of Other Current Assets	The following tables represent the components of Other current assets , Other assets , Other current liabilities and Other liabilities as of June 17, 2017 , December 31, 2016 and June 18, 2016 consisted of the following (in thousands): June 17, 2017 December 31, 2016 June 18, 2016 Other current assets: Inventory $ 42,616 $ 43,950 $ 34,154 Deferred expenses 18,931 22,148 12,656 Income tax receivables 30,134 13,599 25,639 Other 48,874 51,678 30,612 Assets held for sale 40,370 — — Total other current assets $ 180,925 $ 131,375 $ 103,061 Other assets: Deferred program and contract costs $ 39,097 $ 48,066 $ 43,527 Other receivables 1,622 2,713 2,810 Income taxes receivable 2,270 2,358 — Deferred financing costs 2,756 2,688 1,675 Other 36,478 30,031 19,585 Total other assets $ 82,223 $ 85,856 $ 67,597 Other current liabilities: Payroll and related liabilities $ 28,309 $ 24,944 $ 24,336 Income taxes payable 5,000 4,199 2,333 Acquisition liability 7,352 6,672 10,850 Other payables and accrued liabilities 11,582 15,361 10,740 Liabilities held for sale 38,858 — — Total other current liabilities $ 91,101 $ 51,176 $ 48,259 Other liabilities: Acquisition liability $ 9,540 $ 17,080 $ 10,050 Income taxes payable 7,130 6,957 6,186 Deferred income and other liabilities 11,002 15,616 7,960 Total other liabilities $ 27,672 $ 39,653 $ 24,196
Schedule of Other Assets	The following tables represent the components of Other current assets , Other assets , Other current liabilities and Other liabilities as of June 17, 2017 , December 31, 2016 and June 18, 2016 consisted of the following (in thousands): June 17, 2017 December 31, 2016 June 18, 2016 Other current assets: Inventory $ 42,616 $ 43,950 $ 34,154 Deferred expenses 18,931 22,148 12,656 Income tax receivables 30,134 13,599 25,639 Other 48,874 51,678 30,612 Assets held for sale 40,370 — — Total other current assets $ 180,925 $ 131,375 $ 103,061 Other assets: Deferred program and contract costs $ 39,097 $ 48,066 $ 43,527 Other receivables 1,622 2,713 2,810 Income taxes receivable 2,270 2,358 — Deferred financing costs 2,756 2,688 1,675 Other 36,478 30,031 19,585 Total other assets $ 82,223 $ 85,856 $ 67,597 Other current liabilities: Payroll and related liabilities $ 28,309 $ 24,944 $ 24,336 Income taxes payable 5,000 4,199 2,333 Acquisition liability 7,352 6,672 10,850 Other payables and accrued liabilities 11,582 15,361 10,740 Liabilities held for sale 38,858 — — Total other current liabilities $ 91,101 $ 51,176 $ 48,259 Other liabilities: Acquisition liability $ 9,540 $ 17,080 $ 10,050 Income taxes payable 7,130 6,957 6,186 Deferred income and other liabilities 11,002 15,616 7,960 Total other liabilities $ 27,672 $ 39,653 $ 24,196
Schedule of Other Current Liabilities	The following tables represent the components of Other current assets , Other assets , Other current liabilities and Other liabilities as of June 17, 2017 , December 31, 2016 and June 18, 2016 consisted of the following (in thousands): June 17, 2017 December 31, 2016 June 18, 2016 Other current assets: Inventory $ 42,616 $ 43,950 $ 34,154 Deferred expenses 18,931 22,148 12,656 Income tax receivables 30,134 13,599 25,639 Other 48,874 51,678 30,612 Assets held for sale 40,370 — — Total other current assets $ 180,925 $ 131,375 $ 103,061 Other assets: Deferred program and contract costs $ 39,097 $ 48,066 $ 43,527 Other receivables 1,622 2,713 2,810 Income taxes receivable 2,270 2,358 — Deferred financing costs 2,756 2,688 1,675 Other 36,478 30,031 19,585 Total other assets $ 82,223 $ 85,856 $ 67,597 Other current liabilities: Payroll and related liabilities $ 28,309 $ 24,944 $ 24,336 Income taxes payable 5,000 4,199 2,333 Acquisition liability 7,352 6,672 10,850 Other payables and accrued liabilities 11,582 15,361 10,740 Liabilities held for sale 38,858 — — Total other current liabilities $ 91,101 $ 51,176 $ 48,259 Other liabilities: Acquisition liability $ 9,540 $ 17,080 $ 10,050 Income taxes payable 7,130 6,957 6,186 Deferred income and other liabilities 11,002 15,616 7,960 Total other liabilities $ 27,672 $ 39,653 $ 24,196
Schedule of Other Liabilities	The following tables represent the components of Other current assets , Other assets , Other current liabilities and Other liabilities as of June 17, 2017 , December 31, 2016 and June 18, 2016 consisted of the following (in thousands): June 17, 2017 December 31, 2016 June 18, 2016 Other current assets: Inventory $ 42,616 $ 43,950 $ 34,154 Deferred expenses 18,931 22,148 12,656 Income tax receivables 30,134 13,599 25,639 Other 48,874 51,678 30,612 Assets held for sale 40,370 — — Total other current assets $ 180,925 $ 131,375 $ 103,061 Other assets: Deferred program and contract costs $ 39,097 $ 48,066 $ 43,527 Other receivables 1,622 2,713 2,810 Income taxes receivable 2,270 2,358 — Deferred financing costs 2,756 2,688 1,675 Other 36,478 30,031 19,585 Total other assets $ 82,223 $ 85,856 $ 67,597 Other current liabilities: Payroll and related liabilities $ 28,309 $ 24,944 $ 24,336 Income taxes payable 5,000 4,199 2,333 Acquisition liability 7,352 6,672 10,850 Other payables and accrued liabilities 11,582 15,361 10,740 Liabilities held for sale 38,858 — — Total other current liabilities $ 91,101 $ 51,176 $ 48,259 Other liabilities: Acquisition liability $ 9,540 $ 17,080 $ 10,050 Income taxes payable 7,130 6,957 6,186 Deferred income and other liabilities 11,002 15,616 7,960 Total other liabilities $ 27,672 $ 39,653 $ 24,196
Schedule of Assets Held-for-sale	The following table presents the aggregate carrying amounts of the major classes of assets and liabilities related to the M&E business as of June 17, 2017 (in thousands): June 17, 2017 Accounts receivable, net $ 16,174 Other current assets 4,657 Property, equipment and technology, net 927 Intangible assets, net 5,607 Goodwill 11,924 Deferred income taxes 1,081 Total assets held for sale $ 40,370 Settlement payables $ 7,838 Consumer and customer deposits 1,754 Accounts payable and accrued operating expenses 8,454 Deferred revenue 4,695 Other current liabilities 16,004 Deferred income taxes 113 Total liabilities held for sale $ 38,858

Goodwill (Tables)

Goodwill (Tables)	6 Months Ended
	Jun. 17, 2017
Goodwill and Intangible Assets Disclosure [Abstract]
Summary of Changes in Goodwill	A summary of changes in goodwill during the 24 weeks ended June 17, 2017 is as follows (in thousands): June 17, 2017 U.S. Retail Incentives & Rewards International Total Balance, beginning of period $ 99,685 $ 366,508 $ 104,205 $ 570,398 Re-allocation of goodwill to International — (7,152 ) 7,152 — Re-allocation of e-commerce goodwill (10,505 ) 10,505 — — Acquisition (see Note 2—Business Acquisitions ) — 9,919 — 9,919 Measurement period of adjustments for 2016 acquisitions 338 — (1,384 ) (1,046 ) Asset held for sale (see Note 5—Consolidated Financial Statement Details ) — — (11,924 ) (11,924 ) Foreign currency translation adjustments — 386 5,122 5,508 Balance, end of period $ 89,518 $ 380,166 $ 103,171 $ 572,855

Stock-Based Compensation (Table

Stock-Based Compensation (Tables)	6 Months Ended
	Jun. 17, 2017
Equity [Abstract]
Schedule of Stock-Based Compensation Expense	The following table presents total stock-based compensation expense according to the income statement line in our condensed consolidated statements of income (loss) for the 24 weeks ended June 17, 2017 and June 18, 2016 (in thousands): 12 weeks ended 24 weeks ended June 17, 2017 June 18, 2016 June 17, 2017 June 18, 2016 Processing and services $ 1,798 $ 1,522 $ 3,500 $ 2,964 Sales and marketing 2,884 3,027 5,696 5,841 Cost of products sold 4 42 21 58 General and administrative 3,364 3,981 7,234 7,709 Total stock-based compensation expense $ 8,050 $ 8,572 $ 16,451 $ 16,572

Segment Reporting (Tables)

Segment Reporting (Tables)	6 Months Ended
	Jun. 17, 2017
Segment Reporting [Abstract]
Schedule of Segment Reporting Information	The following tables present the key metrics used by our CODM for the evaluation of segment performance, including certain significant noncash charges (consisting of certain depreciation and amortization of property, equipment and technology and distribution partner stock-based compensation expense) which have been deducted from the segment profit amounts shown below, and reconciliations of these amounts to our condensed consolidated financial statements (in thousands): 12 weeks ended June 17, 2017 U.S. Retail Incentives & Rewards International Consolidated Total operating revenues $ 237,705 $ 80,702 $ 144,739 $ 463,146 Partner distribution expense 124,763 6,650 70,112 201,525 Operating revenues, net of Partner distribution expense 112,942 74,052 74,627 261,621 Other operating expenses 111,697 76,325 78,000 266,022 Segment profit (loss) / Operating income (loss) $ 1,245 $ (2,273 ) $ (3,373 ) $ (4,401 ) Other income (expense) (6,384 ) Income (loss) before income tax expense $ (10,785 ) Noncash charges $ 13,660 $ 11,869 $ 8,696 12 weeks ended June 18, 2016 U.S. Retail Incentives & Rewards International Consolidated Total operating revenues $ 237,608 $ 61,119 $ 92,479 $ 391,206 Partner distribution expense 120,795 5,218 65,218 191,231 Operating revenues, net of Partner distribution expense 116,813 55,901 27,261 199,975 Other operating expenses 112,701 68,678 33,573 214,952 Segment profit (loss) / Operating income (loss) $ 4,112 $ (12,777 ) $ (6,312 ) $ (14,977 ) Other income (expense) (3,632 ) Income (loss) before income tax expense $ (18,609 ) Noncash charges $ 13,727 $ 22,041 $ 5,595 24 weeks ended June 17, 2017 U.S. Retail Incentives & Rewards International Consolidated Total operating revenues $ 445,343 $ 143,927 $ 281,112 $ 870,382 Partner distribution expense 226,476 10,736 143,789 381,001 Operating revenues, net of Partner distribution expense 218,867 133,191 137,323 489,381 Other operating expenses 220,610 142,748 147,455 510,813 Segment profit (loss) / Operating income (loss) $ (1,743 ) $ (9,557 ) $ (10,132 ) $ (21,432 ) Other income (expense) (12,491 ) Income (loss) before income tax expense $ (33,923 ) Noncash charges $ 27,277 $ 27,699 $ 16,524 24 weeks ended June 18, 2016 U.S. Retail Incentives & Rewards International Consolidated Total operating revenues $ 453,104 $ 120,773 $ 183,791 $ 757,668 Partner distribution expense 226,354 8,049 128,983 363,386 Operating revenues, net of Partner distribution expense 226,750 112,724 54,808 394,282 Other operating expenses 214,444 130,141 67,718 412,303 Segment profit (loss) / Operating income (loss) $ 12,306 $ (17,417 ) $ (12,910 ) $ (18,021 ) Other income (expense) (7,286 ) Income (loss) before income tax expense $ (25,307 ) Noncash charges $ 25,243 $ 38,301 $ 9,865

Earnings Per Share (Tables)

Earnings Per Share (Tables)	6 Months Ended
	Jun. 17, 2017
Earnings Per Share [Abstract]
Reconciliations of Net Income and Shares Used in Calculating Basic and Diluted EPS	The following table provides reconciliations of net income (loss) and shares used in calculating basic earnings (loss) per share (“EPS”) to those used in calculating diluted EPS (in thousands, except per share amounts): 12 weeks ended June 17, 2017 June 18, 2016 Basic Diluted Basic Diluted Net income (loss) attributable to Blackhawk Network Holdings, Inc. $ (6,351 ) $ (6,351 ) $ (11,337 ) $ (11,337 ) Distributed and undistributed earnings allocated to participating securities — — — — Net income (loss) attributable to common stockholders $ (6,351 ) $ (6,351 ) $ (11,337 ) $ (11,337 ) Weighted-average common shares outstanding 56,448 56,448 56,134 56,134 Common share equivalents — — Weighted-average shares outstanding 56,448 56,134 Earnings (loss) per share $ (0.11 ) $ (0.11 ) $ (0.20 ) $ (0.20 ) 24 weeks ended June 17, 2017 June 18, 2016 Basic Diluted Basic Diluted Net income (loss) attributable to Blackhawk Network Holdings, Inc. $ (19,837 ) $ (19,837 ) $ (14,890 ) $ (14,890 ) Distributed and undistributed earnings allocated to participating securities — — (15 ) (15 ) Net income (loss) attributable to common stockholders $ (19,837 ) $ (19,837 ) $ (14,905 ) $ (14,905 ) Weighted-average common shares outstanding 56,176 56,176 55,944 55,944 Common share equivalents — — Weighted-average shares outstanding 56,176 55,944 Earnings (loss) per share $ (0.35 ) $ (0.35 ) $ (0.27 ) $ (0.27 )

The Company and Significant A26

The Company and Significant Accounting Policies (Detail)	Jun. 17, 2017country
United States
Description of Business [Line Items]
Number of countries in which entity operates	1
Foreign Countries
Description of Business [Line Items]
Number of countries in which entity operates	25

Business Acquisitions (Details)

Business Acquisitions (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 17, 2017	Mar. 25, 2017	Jun. 17, 2017
Business Acquisition
Total consideration transferred		$ 18,000
Purchase consideration		16,400
Contingent consideration transferred		1,600
Potential contingent consideration payment		$ 2,000
Cash acquired	$ 6,100		$ 6,100
Intangible assets acquired	7,800		7,800
Goodwill acquired during period			9,919
Net tangible liabilities acquired	(5,800)		$ (5,800)
Customer Relationships
Business Acquisition
Weighted average useful lives of acquired intangible assets			7 years
Grass Roots
Business Acquisition
Increase in purchase price	800
Increase in accounts receivable	400
Decrease in customer deposits	1,800
Increase (decrease) in goodwill	1,400
Spafinder
Business Acquisition
Increase (decrease) in goodwill	300
(Decrease) in inventory	$ 300

Financing - Credit Agreement (D

Financing - Credit Agreement (Details) - USD ($) $ in Thousands	Apr. 20, 2017	Mar. 31, 2017	Jun. 17, 2017	Jun. 18, 2016
Debt Instrument [Line Items]
Term loan, repayments			$ 10,000	$ 37,500
Term Loan | Restated Credit Agreement
Debt Instrument [Line Items]
Term loan, repayments		$ 10,000
Term loan borrowings	$ 50,000

Financing - Maturities of Conve

Financing - Maturities of Convertible Notes (Details) $ in Thousands	Jun. 17, 2017USD ($)
Debt Disclosure [Abstract]
2,018	$ 10,000
2,019	10,000
2,020	20,000
2,021	150,000
2,022	500,000
Total long-term debt	$ 690,000

Fair Value Measurements - Summa

Fair Value Measurements - Summary of Fair Value of Assets, Liabilities and Equity Instruments on Recurring Basis (Detail) - Fair Value Measurements, Recurring - USD ($) $ in Thousands	Jun. 17, 2017	Dec. 31, 2016	Jun. 18, 2016
Liabilities
Contingent consideration	$ 16,892	$ 23,752	$ 20,900
Money Market Mutual Funds
Assets
Cash and cash equivalents	4,092	300,015	11,100
Level 1
Liabilities
Contingent consideration	0	0	0
Level 1 | Money Market Mutual Funds
Assets
Cash and cash equivalents	4,092	300,015	11,100
Level 2
Liabilities
Contingent consideration	0	0	0
Level 2 | Money Market Mutual Funds
Assets
Cash and cash equivalents	0	0	0
Level 3
Liabilities
Contingent consideration	16,892	23,752	20,900
Level 3 | Money Market Mutual Funds
Assets
Cash and cash equivalents	$ 0	$ 0	$ 0

Fair Value Measurements - Sum31

Fair Value Measurements - Summary of Changes in Fair Value of Contingent Consideration Classified as Level 3 (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 17, 2017	Jun. 18, 2016
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation
Balance - beginning of period	$ 23,752	$ 0
Addition from acquisition (see Note 2—Business Acquisitions)	1,640	20,100
Change in fair value of contingent consideration	(2,997)	800
Settlement	(5,503)	0
Balance - end of period	$ 16,892	$ 20,900

Fair Value Measurements - Narra

Fair Value Measurements - Narrative (Detail) - USD ($) $ in Thousands	6 Months Ended
	Jun. 17, 2017	Jun. 18, 2016
Business Acquisition
Settlement	$ (5,503)	$ 0
Fair value inputs, discount rate percentage	17.00%
Level 2 | Term Loan
Business Acquisition
Fair value of debt instrument	$ 190,000
Level 2 | Convertible Notes Payable
Business Acquisition
Fair value of debt instrument	$ 541,900

Consolidated Financial Statem33

Consolidated Financial Statement Details - Components of Other Current Assets, Other Assets, Other Current Liabilities, and Other Liabilities (Detail) - USD ($) $ in Thousands	Jun. 17, 2017	Dec. 31, 2016	Jun. 18, 2016
Other current assets:
Inventory	$ 42,616	$ 43,950	$ 34,154
Deferred expenses	18,931	22,148	12,656
Income tax receivables	30,134	13,599	25,639
Other	48,874	51,678	30,612
Assets held for sale	40,370	0	0
Total other current assets	180,925	131,375	103,061
Other assets:
Deferred program and contract costs	39,097	48,066	43,527
Other receivables	1,622	2,713	2,810
Income taxes receivable	2,270	2,358	0
Deferred financing costs	2,756	2,688	1,675
Other	36,478	30,031	19,585
Total other assets	82,223	85,856	67,597
Other current liabilities:
Payroll and related liabilities	28,309	24,944	24,336
Income taxes payable	5,000	4,199	2,333
Acquisition liability	7,352	6,672	10,850
Other payables and accrued liabilities	11,582	15,361	10,740
Liabilities held for sale	38,858	0	0
Total other current liabilities	91,101	51,176	48,259
Other liabilities:
Acquisition liability	9,540	17,080	10,050
Income taxes payable	7,130	6,957	6,186
Deferred income and other liabilities	11,002	15,616	7,960
Total other liabilities	$ 27,672	$ 39,653	$ 24,196

Consolidated Financial Statem34

Consolidated Financial Statement Details - Assets Held for Sale (Details) - USD ($) $ in Thousands	Jun. 17, 2017	Dec. 31, 2016	Jun. 18, 2016
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Total assets held for sale	$ 40,370	$ 0	$ 0
Total liabilities held for sale	38,858	$ 0	$ 0
Grass Roots, Inc. | Assets Held-for-sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Accounts receivable, net	16,174
Other current assets	4,657
Property, equipment and technology, net	927
Intangible assets, net	5,607
Goodwill	11,924
Deferred income taxes	1,081
Total assets held for sale	40,370
Settlement payables	7,838
Consumer and customer deposits	1,754
Accounts payable and accrued operating expenses	8,454
Deferred revenue	4,695
Other current liabilities	16,004
Deferred income taxes	113
Total liabilities held for sale	$ 38,858

Consolidated Financial Statem35

Consolidated Financial Statement Details - Narrative (Details) $ in Millions	6 Months Ended
	Jun. 17, 2017USD ($)
Grass Roots, Inc. | Assets Held-for-sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Pre-tax income during period	$ 0.6

Goodwill - Summary of Changes i

Goodwill - Summary of Changes in Goodwill (Detail) $ in Thousands	6 Months Ended
	Jun. 17, 2017USD ($)
Goodwill
Balance, beginning of period	$ 570,398
Transfers of goodwill	0
Acquisition (see Note 2—Business Acquisitions)	9,919
Measurement period of adjustments for 2016 acquisitions	(1,046)
Foreign currency translation adjustments	5,508
Balance, end of period	572,855
U.S. Retail
Goodwill
Balance, beginning of period	99,685
Transfers of goodwill	0
Acquisition (see Note 2—Business Acquisitions)	0
Measurement period of adjustments for 2016 acquisitions	338
Foreign currency translation adjustments	0
Balance, end of period	89,518
Incentives & Rewards
Goodwill
Balance, beginning of period	366,508
Transfers of goodwill	(7,152)
Acquisition (see Note 2—Business Acquisitions)	9,919
Measurement period of adjustments for 2016 acquisitions	0
Foreign currency translation adjustments	386
Balance, end of period	380,166
International
Goodwill
Balance, beginning of period	104,205
Transfers of goodwill	7,152
Acquisition (see Note 2—Business Acquisitions)	0
Measurement period of adjustments for 2016 acquisitions	(1,384)
Foreign currency translation adjustments	5,122
Balance, end of period	103,171
Assets Held-for-sale
Goodwill
Transfers of goodwill	(11,924)
Assets Held-for-sale | U.S. Retail
Goodwill
Transfers of goodwill	0
Assets Held-for-sale | Incentives & Rewards
Goodwill
Transfers of goodwill	0
Assets Held-for-sale | International
Goodwill
Transfers of goodwill	(11,924)
E-Commerce
Goodwill
Transfers of goodwill	0
E-Commerce | U.S. Retail
Goodwill
Transfers of goodwill	(10,505)
E-Commerce | Incentives & Rewards
Goodwill
Transfers of goodwill	10,505
E-Commerce | International
Goodwill
Transfers of goodwill	$ 0

Stock-Based Compensation - Narr

Stock-Based Compensation - Narrative (Detail)	6 Months Ended
	Jun. 17, 2017shares
Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award
Stock awards and stock units granted during period (in shares)	992,669
Performance Stock Units
Share-based Compensation Arrangement by Share-based Payment Award
Stock awards and stock units granted during period (in shares)	200,700

Stock-Based Compensation - Sche

Stock-Based Compensation - Schedule of Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 17, 2017	Jun. 18, 2016	Jun. 17, 2017	Jun. 18, 2016
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost
Stock-based compensation expense	$ 8,050	$ 8,572	$ 16,451	$ 16,572
Processing and services
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost
Stock-based compensation expense	1,798	1,522	3,500	2,964
Sales and marketing
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost
Stock-based compensation expense	2,884	3,027	5,696	5,841
Cost of products sold
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost
Stock-based compensation expense	4	42	21	58
General and administrative
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost
Stock-based compensation expense	$ 3,364	$ 3,981	$ 7,234	$ 7,709

Income Taxes (Detail)

Income Taxes (Detail)	3 Months Ended		6 Months Ended
	Jun. 17, 2017	Jun. 18, 2016	Jun. 17, 2017	Jun. 18, 2016
Income Tax Disclosure [Abstract]
Effective income tax rate (percentage)	42.60%	39.20%	42.30%	41.60%

Commitments and Contingencies (

Commitments and Contingencies (Details) $ in Millions	Feb. 26, 2016claim	Jun. 17, 2017USD ($)
Foreign Tax Jurisdiction
Loss Contingencies [Line Items]
Estimate of possible loss, tax liability | $		$ 4.9
Pending Litigation | CardLab, Inc. v. Blackhawk Network Holdings, Inc., Case No. 10851
Loss Contingencies [Line Items]
Number of claims dismissed | claim	2

Segment Reporting - Schedule of

Segment Reporting - Schedule of Segment Reporting Information (Detail) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 17, 2017USD ($)	Jun. 18, 2016USD ($)	Jun. 17, 2017USD ($)segment	Jun. 18, 2016USD ($)
Segment Reporting Information
Number of reportable segments | segment			3
Total operating revenues	$ 463,146	$ 391,206	$ 870,382	$ 757,668
Partner distribution expense	201,525	191,231	381,001	363,386
Operating revenues, net of Partner distribution expense	261,621	199,975	489,381	394,282
Other operating expenses	266,022	214,952	510,813	412,303
OPERATING INCOME (LOSS)	(4,401)	(14,977)	(21,432)	(18,021)
Other income (expense)	(6,384)	(3,632)	(12,491)	(7,286)
INCOME (LOSS) BEFORE INCOME TAX EXPENSE (BENEFIT)	(10,785)	(18,609)	(33,923)	(25,307)
U.S. Retail
Segment Reporting Information
Total operating revenues	237,705	237,608	445,343	453,104
Partner distribution expense	124,763	120,795	226,476	226,354
Operating revenues, net of Partner distribution expense	112,942	116,813	218,867	226,750
Other operating expenses	111,697	112,701	220,610	214,444
OPERATING INCOME (LOSS)	1,245	4,112	(1,743)	12,306
Noncash charges	13,660	13,727	27,277	25,243
Incentives & Rewards
Segment Reporting Information
Total operating revenues	80,702	61,119	143,927	120,773
Partner distribution expense	6,650	5,218	10,736	8,049
Operating revenues, net of Partner distribution expense	74,052	55,901	133,191	112,724
Other operating expenses	76,325	68,678	142,748	130,141
OPERATING INCOME (LOSS)	(2,273)	(12,777)	(9,557)	(17,417)
Noncash charges	11,869	22,041	27,699	38,301
International
Segment Reporting Information
Total operating revenues	144,739	92,479	281,112	183,791
Partner distribution expense	70,112	65,218	143,789	128,983
Operating revenues, net of Partner distribution expense	74,627	27,261	137,323	54,808
Other operating expenses	78,000	33,573	147,455	67,718
OPERATING INCOME (LOSS)	(3,373)	(6,312)	(10,132)	(12,910)
Noncash charges	$ 8,696	$ 5,595	$ 16,524	$ 9,865

Earnings Per Share - Reconcilia

Earnings Per Share - Reconciliations of Net Income and Shares Used in Calculating Basic and Diluted EPS (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 17, 2017	Jun. 18, 2016	Jun. 17, 2017	Jun. 18, 2016
Earnings Per Share [Abstract]
Net income (loss) attributable to Blackhawk Network Holdings, Inc.	$ (6,351)	$ (11,337)	$ (19,837)	$ (14,890)
Distributed and undistributed earnings allocated to participating securities, Basic	0	0	0	(15)
Distributed and undistributed earnings allocated to participating securities, Diluted	0	0	0	(15)
Net income (loss) attributable to common stockholders, basic	(6,351)	(11,337)	(19,837)	(14,905)
Net income (loss) attributable to common stockholders, diluted	$ (6,351)	$ (11,337)	$ (19,837)	$ (14,905)
Weighted-average common shares outstanding-basic (in shares)	56,448	56,134	56,176	55,944
Basic earnings (loss) per share (in usd per share)	$ (0.11)	$ (0.20)	$ (0.35)	$ (0.27)
Common share equivalents (in shares)	0	0	0	0
Weighted-average common shares outstanding-diluted (in shares)	56,448	56,134	56,176	55,944
Diluted earnings (loss) per share (in usd per share)	$ (0.11)	$ (0.20)	$ (0.35)	$ (0.27)

Earnings Per Share - Narrative

Earnings Per Share - Narrative (Detail) - shares	3 Months Ended		6 Months Ended
	Jun. 17, 2017	Jun. 18, 2016	Jun. 17, 2017	Jun. 18, 2016
Earnings Per Share [Abstract]
Antidilutive securities excluded from computation of earnings per share (in shares)	5,046,000	5,694,000	5,177,000	5,407,000