Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2017 | Nov. 01, 2017 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | ELF | |
Entity Registrant Name | e.l.f. Beauty, Inc. | |
Entity Central Index Key | 1,600,033 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 46,259,817 |
Condensed consolidated balance
Condensed consolidated balance sheets (unaudited) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash | $ 5,677 | $ 15,295 |
Accounts receivable, net | 35,627 | 37,825 |
Inventories | 63,571 | 69,397 |
Prepaid expenses and other current assets | 8,302 | 2,387 |
Total current assets | 113,177 | 124,904 |
Property and equipment, net | 16,635 | 17,151 |
Intangible assets, net | 107,636 | 113,003 |
Goodwill | 157,264 | 157,264 |
Investments | 2,875 | |
Other assets | 9,433 | 2,407 |
Total assets | 407,020 | 414,729 |
Current liabilities: | ||
Current portion of long-term debt and capital lease obligations | 18,140 | 8,650 |
Accounts payable | 21,007 | 37,944 |
Accrued expenses and other current liabilities | 12,937 | 33,676 |
Total current liabilities | 52,084 | 80,270 |
Long-term debt and capital lease obligations | 149,690 | 156,177 |
Deferred tax liabilities | 34,408 | 34,212 |
Other long-term liabilities | 2,878 | 3,208 |
Total liabilities | 239,060 | 273,867 |
Commitments and contingencies (Note 7) | ||
Stockholders' equity: | ||
Common stock, par value of $0.01 per share; 250,000,000 shares authorized as of September 30, 2017 and December 31, 2016; 46,242,817 and 45,276,137 shares issued and outstanding as of September 30, 2017 and December 31, 2016, respectively | 459 | 438 |
Additional paid-in capital | 715,953 | 700,871 |
Accumulated deficit | (548,452) | (560,447) |
Total stockholders' equity | 167,960 | 140,862 |
Total liabilities and stockholders' equity | $ 407,020 | $ 414,729 |
Condensed consolidated balance3
Condensed consolidated balance sheets (unaudited) (Parenthetical) - $ / shares | Sep. 30, 2017 | Dec. 31, 2016 |
Statement Of Financial Position [Abstract] | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 250,000,000 | 250,000,000 |
Common stock, shares issued | 46,242,817 | 45,276,137 |
Common stock, shares outstanding | 46,242,817 | 45,276,137 |
Condensed consolidated statemen
Condensed consolidated statements of operations and comprehensive income (loss) (unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Statement [Abstract] | ||||
Net sales | $ 71,865 | $ 56,312 | $ 188,295 | $ 153,132 |
Cost of sales | 28,952 | 23,834 | 71,264 | 66,217 |
Gross profit | 42,913 | 32,478 | 117,031 | 86,915 |
Selling, general and administrative expenses | 33,133 | 31,002 | 98,843 | 78,807 |
Operating income | 9,780 | 1,476 | 18,188 | 8,108 |
Other income (expense), net | (379) | 288 | (1,422) | 2,253 |
Interest expense, net | (2,262) | (5,192) | (6,805) | (11,588) |
Income (loss) before provision for income taxes | 7,139 | (3,428) | 9,961 | (1,227) |
Income tax benefit (provision) | (1,274) | 1,051 | 2,034 | (61) |
Net income (loss) | 5,865 | (2,377) | 11,995 | (1,288) |
Comprehensive income (loss) | $ 5,865 | $ (2,377) | $ 11,995 | $ (1,288) |
Net income (loss) per share (Note 9): | ||||
Basic | $ 0.13 | $ (73.13) | $ 0.27 | $ (234.34) |
Diluted | $ 0.12 | $ (73.13) | $ 0.24 | $ (234.34) |
Weighted average shares outstanding (Note 9): | ||||
Basic | 45,813,801 | 5,109,016 | 45,132,567 | 2,151,324 |
Diluted | 49,283,247 | 5,109,016 | 49,462,166 | 2,151,324 |
Condensed consolidated stateme5
Condensed consolidated statements of cash flows (unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 11,995 | $ (1,288) |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Amortization of intangible and other non-current assets | 5,555 | 6,209 |
Depreciation of property and equipment | 5,121 | 3,369 |
Stock-based compensation expense | 9,720 | 5,589 |
Amortization of debt issuance costs and discount on debt | 605 | 1,504 |
Deferred income taxes | (1) | 193 |
Debt prepayment penalty | 400 | |
Loss on disposal of fixed assets | 241 | 235 |
Loss/(gain) on foreign currency forward contracts | (8,333) | |
Other, net | 194 | (93) |
Changes in operating assets and liabilities: | ||
Accounts receivable | 1,993 | (11,503) |
Inventories | 5,837 | (9,907) |
Prepaid expenses and other assets | (13,030) | (8,315) |
Accounts payable and accrued expenses | (34,067) | 23,592 |
Other liabilities | (330) | 897 |
Net cash provided by (used in) operating activities | (6,167) | 2,549 |
Cash flows from investing activities: | ||
Purchase of property and equipment | (4,371) | (5,553) |
Investment in equity securities | (2,875) | |
Proceeds from sale of property and equipment | 84 | |
Net cash used in investing activities | (7,246) | (5,469) |
Cash flows from financing activities: | ||
Proceeds from revolving line of credit | 24,100 | 5,500 |
Repayment of revolving line of credit | (14,600) | (13,200) |
Proceeds from long-term debt | 62,294 | |
Repayment of long-term debt | (6,188) | (42,369) |
Debt issuance costs paid | (519) | |
Cash received from issuance of common stock | 1,309 | 64,034 |
Proceeds from repayment of employee note receivable | 7,912 | |
Deferred offering costs paid | (5,574) | |
Dividend paid | (68,000) | |
Debt prepayment penalty | (400) | |
Other, net | (307) | (197) |
Net cash provided by financing activities | 3,795 | 10,000 |
Net increase (decrease) in cash | (9,618) | 7,080 |
Cash - beginning of period | 15,295 | 14,004 |
Cash - end of period | $ 5,677 | $ 21,084 |
Nature of Operations
Nature of Operations | 9 Months Ended |
Sep. 30, 2017 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Nature of operations | Note 1 ̶ Nature of operations e.l.f. Beauty, Inc. and subsidiaries (the “Company,” “we,” “us,” “its” and “our”) was formed as a Delaware corporation on December 20, 2013 under the name J.A. Cosmetics Holdings, Inc. In April 2016, the Company changed its name to e.l.f. Beauty, Inc. The Company and its subsidiaries conduct business under the name e.l.f. Cosmetics, and offer high-quality, prestige-inspired products for eyes, lips and face to consumers through its retail customers, e.l.f. stores and e-commerce channels. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Summary of significant accounting policies | Note 2 ̶ Summary of significant accounting policies Basis of presentation The accompanying unaudited condensed consolidated financial statements and related notes have been prepared in accordance with U.S. generally accepted accounting principles (“US GAAP”) for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). In the opinion of the Company, these interim financial statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of its financial position as of September 30, 2017, and its results of operations for the three and nine months ended September 30, 2017, and cash flows for the nine months ended September 30, 2017. The condensed consolidated balance sheet at December 31, 2016, was derived from audited annual financial statements, but does not contain all of the footnote disclosures from the annual financial statements. All intercompany balances and transactions have been eliminated in consolidation. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements as of and for the year ended December 31, 2016 and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016 (the “Annual Report”). Operating results for the interim periods are not necessarily indicative of the results that may be expected for the full year. Use of estimates The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Segment reporting Operating segments are components of an enterprise for which separate financial information is available that is evaluated by the chief operating decision maker in deciding how to allocate resources and in assessing performance. Utilizing these criteria, the Company manages its business on the basis of one operating segment and one reportable segment. Significant accounting policies The Company made no significant changes in the application of its significant accounting policies that were disclosed in Note 2, “Summary of significant accounting policies,” to the audited consolidated financial statements as of and for the year ended December 31, 2016 included in the Annual Report. The Company has prepared the accompanying unaudited condensed consolidated financial statements on the same basis as the audited consolidated financial statements included in the Annual Report. Recent accounting pronouncements The following table provides a brief description of recent accounting pronouncements that could have a material effect on the Company’s financial statements: Standard Description Date of expected adoption/adoption Effect on the financial statements or other significant matters Standards that are not yet adopted ASU 2014-09, Revenue from Contracts with Customers (Topic 606) The standard will replace existing revenue recognition standards and significantly expand the disclosure requirements for revenue arrangements. It may be adopted either retrospectively or on a modified retrospective basis to new contracts and existing contracts with remaining performance obligations as of the effective date. January 1, 2018 The Company expects the standard to impact the methods used to reserve for discounts, refunds and other customer incentives, which may impact the timing of revenue recognition. The Company expects to apply the modified retrospective method of adoption and is currently evaluating other possible impacts of the standard on its consolidated financial statements and related disclosures. ASU 2015-14 , Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date In August 2015, the FASB issued ASU 2015-14, which deferred the effective date from annual periods beginning on or after December 15, 2016 to annual periods beginning on or after December 15, 2017. ASU 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) ASU 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing ASU 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients In March, April and May 2016, the FASB issued ASU 2016-08, ASU 2016-10 and ASU 2016-12. These standards provide supplemental adoption guidance and clarification to ASU 2014-09, and must be adopted concurrently with the adoption of ASU 2014-09. ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities The standard makes targeted improvements to US GAAP, including significant revisions to an entity’s accounting related to the classification and measurement of investments in equity securities and the presentation of certain fair value changes for financial liabilities measured at fair value. January 1, 2018 The Company is currently evaluating the effect of the standard but does not expect it to have a material effect on its consolidated financial statements and related disclosures. ASU 2016-02, Leases (Topic 842) The standard will require lessees to recognize a right-of-use asset and a lease liability for virtually all of their leases (other than leases that meet the definition of a short-term lease). The liability will be equal to the present value of lease payments. The asset will be based on the liability, subject to adjustment, such as for initial direct costs. Lessor accounting is similar to the current model, but updated to align with certain changes to the lessee model (e.g., certain definitions, such as initial direct costs, have been updated) and the new revenue recognition standard. It requires a modified retrospective approach for all leases existing at, or entered into after, the date of initial application. January 1, 2019 The Company expects the standard to result in increased assets and liabilities related to operating leases currently not recorded on the balance sheet. The Company is currently evaluating other possible impacts of the adoption of this standard on its consolidated financial statements and related disclosures. |
Investment in Equity Securities
Investment in Equity Securities | 9 Months Ended |
Sep. 30, 2017 | |
Investments All Other Investments [Abstract] | |
Investment in equity securities | Note 3 ̶ Investment in equity securities On April 14, 2017, the Company entered into an agreement to make a minority equity investment in a social media analytics company (“Investee”). Pursuant to this agreement, the Company invested $2.9 million and received 4.7 million shares of preferred stock, or approximately 15.0% of the total outstanding voting securities of the Investee. The Company’s investment is carried at cost. It is not practicable to estimate the fair value of the shares of preferred stock of Investee, which is not publicly traded. There have been no identified events or changes in circumstances that may have a significant adverse effect on the fair value of the investment. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 9 Months Ended |
Sep. 30, 2017 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and intangible assets | Note 4 ̶ Goodwill and intangible assets Information regarding the Company’s goodwill and intangible assets as of September 30, 2017, is as follows (in thousands): Estimated useful life Gross carrying amount Accumulated amortization Net carrying amount Customer relationships – retailers 10 years $ 68,800 $ (25,227 ) $ 43,573 Customer relationships – e-commerce 3 years 3,900 (3,867 ) 33 Favorable leases, net Varies 580 (350 ) 230 Total finite-lived intangibles 73,280 (29,444 ) 43,836 Trademarks Indefinite 63,800 - 63,800 Goodwill 157,264 - 157,264 Total goodwill and other intangibles $ 294,344 $ (29,444 ) $ 264,900 Information regarding the Company’s goodwill and intangible assets as of December 31, 2016, is as follows (in thousands): Estimated useful life Gross carrying amount Accumulated amortization Net carrying amount Customer relationships – retailers 10 years $ 68,800 $ (20,067 ) $ 48,733 Customer relationships – e-commerce 3 years 3,900 (3,736 ) 164 Favorable leases, net Varies 580 (274 ) 306 Total finite-lived intangibles 73,280 (24,077 ) 49,203 Trademarks Indefinite 63,800 - 63,800 Goodwill 157,264 - 157,264 Total goodwill and other intangibles $ 294,344 $ (24,077 ) $ 270,267 Amortization expense related to intangible assets was $1.7 million and $5.4 million in the three and nine months ended September 30, 2017, respectively, and $2.1 million and $6.2 million in the three and nine months ended September 30, 2016, respectively. Trademark assets have been classified as indefinite-lived intangible assets and accordingly, are not subject to amortization. Future amortization expense for intangible assets as of September 30, 2017 is as follows (in thousands): Remainder of 2017 $ 1,754 2018 7,007 2019 6,982 2020 6,880 2021 6,880 Thereafter 14,333 Total $ 43,836 No impairments of goodwill or intangible assets were recorded in the nine months ended September 30, 2017 and 2016. |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 9 Months Ended |
Sep. 30, 2017 | |
Payables And Accruals [Abstract] | |
Accrued expenses and other current liabilities | Note 5 ̶ Accrued expenses and other current liabilities Accrued expenses and other current liabilities as of September 30, 2017 and December 31, 2016 consisted of the following (in thousands): September 30, 2017 December 31, 2016 Accrued expenses $ 4,320 $ 9,537 Other current liabilities 1,871 9,249 Accrued compensation 6,746 7,111 Early exercised option deposit liability - 4,074 Income taxes payable - 3,705 Accrued expenses and other current liabilities $ 12,937 $ 33,676 |
Debt
Debt | 9 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
Debt | Note 6 ̶ Debt The Company’s outstanding debt as of September 30, 2017 and December 31, 2016 consisted of the following (in thousands): September 30, 2017 December 31, 2016 Revolving credit facility (1) $ 9,500 $ - Term loan (1) 156,332 162,627 Capital lease obligations 2,469 2,766 Total debt (2) 168,301 165,393 Less: debt issuance costs (471 ) (566 ) Total debt, net of issuance costs 167,830 164,827 Less: current portion (18,140 ) (8,650 ) Long-term portion of debt $ 149,690 $ 156,177 (1) (2) August 2017 Credit Agreement Amendment On August 25, 2017, the Company entered into a First Amendment to Credit Agreement (the “Amendment”), amending that certain Senior Secured Credit Agreement, dated as of December 23, 2016 (the “Credit Agreement”). Pursuant to the Amendment, borrowings under both the term loan facility (the “Term Loan Facility”) and the revolving credit facility (“Revolving Credit Facility”) under the Credit Agreement bear interest, at the Company’s option, at either (i) a rate per annum equal to an adjusted LIBOR rate determined by reference to the cost of funds for U.S. dollar deposits for the applicable interest period (subject to a minimum floor of 0%) plus an applicable margin ranging from 1.50% to 2.75% (amended from 2.00% to 3.50% as previously set forth in the Credit Agreement) based on the Company’s consolidated total net leverage ratio or (ii) a floating base rate plus an applicable margin ranging from 0.50% to 1.75% (amended from 1.00% to 2.50% as previously set forth in the Credit Agreement) based on the Company’s consolidated total net leverage ratio. The interest rate for both the Revolving Credit Facility and the Term Loan was approximately 4.00% as of September 30, 2017. The Amendment amended the Credit Agreement to increase the amount of the Revolving Credit Facility from $35.0 million to $50.0 million. The amount of the $165.0 million Term Loan Facility remains unchanged. The Amendment also amended the Credit Agreement to extend the maturity date for both the Revolving Credit Facility and the Term Loan Facility to August 25, 2022. The unused balance of the Revolving Credit Facility as of September 30, 2017 was $40.0 million. The Company paid approximately $0.5 million in fees related to the Amendment. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2017 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and contingencies | Note 7 ̶ Commitments and contingencies Operating leases The Company leases office, retail and warehouse space in New York, New Jersey, California and China from third parties under non-cancelable operating leases that provide for minimum base rental payments (excluding taxes and other charges). The leases expire between 2018 and 2027. Total rent expense was $1.3 million and $3.8 million for the three and nine months ended September 30, 2017, respectively, and $1.0 million and $2.9 million for the three and nine months ended September 30, 2016, respectively. Future minimum lease payments under the operating leases are as follows (in thousands): Remainder of 2017 $ 1,264 2018 5,108 2019 4,976 2020 4,483 2021 3,582 Thereafter 11,485 Total $ 30,898 Legal contingencies From time to time, the Company may become involved in legal proceedings, claims and litigation arising in the ordinary course of business. The Company is not currently a party to any matters that management expects will have a material adverse effect on the Company’s consolidated financial position, results of operations or cash flows. |
Stock-based Compensation
Stock-based Compensation | 9 Months Ended |
Sep. 30, 2017 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock-based compensation | Note 8 ̶ Stock-based compensation Early exercise of stock options Stock options granted pursuant to the Company’s 2014 Equity Incentive Plan permit certain management-level option holders and directors to elect to exercise unvested options prior to vesting (“early exercise”). In the event of termination of the option holder’s employment or directorship, all unvested shares issued upon the early exercise, so long as they remain unvested, are subject to repurchase by the Company at the lower of the original exercise price or the fair market value of a share of common stock on the date of termination. Consistent with authoritative guidance, early exercises are not considered substantive exercises for accounting purposes. Cash received for the exercise of unvested options is recorded as a liability, which is released to additional paid-in capital at each reporting date as the shares vest. A total of 1,522,826 shares subject to early exercised options vested during the nine months ended September 30, 2017 and the associated deposit liability of $4.1 million was reclassified to additional paid-in capital. As of September 30, 2017, no early exercised options remain unvested. Stock options Service-based vesting options The following table summarizes the activity for options that vest solely based upon the satisfaction of a service condition for the nine months ended September 30, 2017: Options outstanding Weighted-average exercise price Weighted-average remaining contractual life (in years) Aggregate intrinsic values (in thousands) Balance as of December 31, 2016 3,168,967 $ 8.55 Granted 205,300 26.53 Exercised (379,214 ) 1.94 Forfeited (141,331 ) 17.58 Balance as of September 30, 2017 2,853,722 $ 10.28 8.13 $ 35,748 Exercisable, September 30, 2017 1,098,328 $ 4.67 6.94 $ 19,637 The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the fair market value of a share of common stock of $22.55 on September 30, 2017. Stock-based compensation cost related to service-based vesting options was $0.7 million and $1.8 million in the three and nine months ended September 30, 2017, respectively, and $2.6 million and $3.7 million in the three and nine months ended September 30, 2016, respectively. As of September 30, 2017, there was $8.3 million in unrecognized stock-based compensation cost related to unvested service-based stock options, which is expected to be recognized over a weighted-average period of 3.2 years. All stock-based compensation expense is recorded in selling, general and administrative expenses. Performance-based and market-based vesting options The following table summarizes the activity for options that vest based upon the satisfaction of performance or market conditions for the nine months ended September 30, 2017: Options outstanding Weighted-average exercise price Weighted-average remaining contractual life (in years) Aggregate intrinsic values (in thousands) Balance as of December 31, 2016 3,836,107 $ 2.46 Granted 463,200 27.02 Exercised (1,711,381 ) 2.71 Forfeited (43,350 ) 27.29 Balance as of September 30, 2017 2,544,576 $ 6.33 7.56 $ 43,083 The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the fair market value of a share of common stock of $22.55 on September 30, 2017. Prior to the initial public offering, the Company granted options that vested based upon the achievement of both a performance and market condition. The performance condition was based on the occurrence of a liquidity event, and was satisfied in connection with the initial public offering in September 2016. The market condition was based upon the achievement of a minimum rate of return from the liquidity event, and was satisfied in March 2017. Accordingly, all such outstanding options vested in March 2017. In February 2017, the Company granted options that vest based upon the achievement of specified stock prices. The fair values and derived service periods were determined using a Monte Carlo simulation model. If the awards vest prior to the end of the derived service period, the remaining unamortized compensation cost will be recognized in the period of vesting. Stock-based compensation cost related to performance-based and market-based vesting options was $1.1 million and $2.9 million in the three and nine months ended September 30, 2017, respectively, and $1.5 million in both the three and nine months ended September 30, 2016. As of September 30, 2017, there was $1.8 million in unrecognized stock-based compensation cost related to unvested performance-based and market-based stock options, which is expected to be recognized over a weighted-average period of 0.6 years. Restricted stock The following table summarizes the activities for restricted stock awards (“RSAs”) and restricted stock units (“RSUs”) for the nine months ended September 30, 2017: Shares of restricted stock outstanding Weighted-average grant date fair value Balance as of December 31, 2016 586,224 $ 17.00 Granted 884,081 26.60 Vested (96,711 ) 17.00 Forfeited (126,523 ) 23.27 Balance as of September 30, 2017 1,247,071 $ 23.17 As of September 30, 2017, there were 302,200 unvested shares subject to RSAs outstanding. The Company recognized stock-based compensation cost related to RSAs and RSUs of $2.0 million and $5.0 million in the three and nine months ended September 30, 2017, respectively, and $0.1 million in both the three and nine months ended September 30, 2016. As of September 30, 2017, there was $24.9 million in unrecognized stock-based compensation cost related to unvested RSAs and RSUs, which is expected to be recognized over a weighted-average period of 3.2 years. |
Net Income (Loss) Per Share
Net Income (Loss) Per Share | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Net income (loss) per share | Note 9 ̶ Net income (loss) per share The Company computes basic earnings per share using the weighted average number of common shares outstanding. As the Company incurred a net loss attributable to common stockholders during the three and nine months ended September 30, 2016, basic and diluted weighted average shares outstanding are the same in those periods. A portion of the net loss attributable to common stockholders in prior periods reflects the accretion of preferred stock to the maximum redemption value. All outstanding shares of convertible preferred stock converted to common stock and the accreted value was reclassified into common stock and additional paid-in capital in the three months ended September 30, 2016. The following is a reconciliation of the numerator and denominator in the basic and diluted net income (loss) per common share computations (in thousands, except share and per share data): Three months ended September 30, Nine months ended September 30, 2017 2016 2017 2016 Numerator: Net income (loss) $ 5,865 $ (2,377 ) $ 11,995 $ (1,288 ) Adjustments to numerator: Dividend paid to preferred stockholders - - - (66,531 ) Accretion of convertible preferred stock to maximum redemption value - (371,228 ) - (436,317 ) Net income (loss) attributable to common stockholders $ 5,865 $ (373,605 ) $ 11,995 $ (504,136 ) Denominator: Weighted average common shares outstanding - basic 45,813,801 5,109,016 45,132,567 2,151,324 Diluted common equivalents from stock options 3,241,620 - 4,064,723 - Diluted common equivalents from restricted stock units 227,826 - 256,394 - Diluted common equivalents from restricted stock awards - - 8,482 - Weighted average common shares outstanding - diluted 49,283,247 5,109,016 49,462,166 2,151,324 Net income (loss) per share: Basic $ 0.13 $ (73.13 ) $ 0.27 $ (234.34 ) Diluted $ 0.12 $ (73.13 ) $ 0.24 $ (234.34 ) Anti-dilutive securities excluded from diluted EPS: Stock options 601,749 7,083,483 503,516 7,083,483 Restricted stock units 444,274 596,217 13,688 596,217 Restricted stock awards 302,200 - - - Total 1,348,223 7,679,700 517,204 7,679,700 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 10–Income taxes We estimate our annual effective income tax rate at the end of each quarterly period. This estimate takes into account the mix of expected income or loss before income taxes by tax jurisdiction and enacted changes in tax laws. Our quarterly tax provision and quarterly estimate of the annual effective income tax rate is subject to significant volatility due to several factors, including having to forecast income or loss before income taxes by jurisdiction prior to the completion of the full year, changes in non-deductible expenses or discrete items, as well as the actual amount of income or loss before income taxes. For example, the impact of discrete items on our effective tax rate is greater when income or loss before income taxes is lower. The effective tax rate for the three and nine months ended September 30, 2017, was 17.7% and (20.3%), respectively, compared to 30.7% and (5.0%) for the three and nine months ended September 30, 2016, respectively. The change in the Company's effective tax rate for the three months ended September 30, 2017 compared to the same period in 2016 was primarily due to the impact of discrete items, such as stock option exercises, which generated a tax benefit of $0.5 million, and changes in uncertain tax positions, which generated a tax benefit of $0.5 million. The change in the Company's effective tax rate for the nine months ended September 30, 2017 compared to the same period in 2016 was primarily due to the impact of discrete items, such as stock option exercises, which generated a tax benefit of $4.9 million. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 11 ̶ Related party transactions On October 11, 2016, the Company entered into a sublease agreement with Fit for Life, LLC pursuant to which the Company subleased certain office and showroom space in New York, New York. Joseph A. Shamah, a former member of the Company’s Board of Directors and a director and stockholder of J.A. Cosmetics Corp., the holder of approximately 10.0% of the Company’s outstanding common stock, is the Chief Executive Officer of Fit for Life, LLC. The annual base rent for the sublease is approximately $0.3 million per year and the sublease has a term of 39 months. The Company recognized $0.1 million and $0.2 million in sublease income from Fit for Life, LLC during the three and nine months ended September 30, 2017, respectively, and the estimated future sublease income as of September 30, 2017 is $0.7 million. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2017 | |
Subsequent Events [Abstract] | |
Subsequent events | Note 12 — The Company entered into a new e.l.f. store lease agreement with a minimum future lease commitment amount of $1.4 million. This lease also provides for the payment of contingent rent based on a percentage of sales. |
Summary of Significant Accoun18
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation The accompanying unaudited condensed consolidated financial statements and related notes have been prepared in accordance with U.S. generally accepted accounting principles (“US GAAP”) for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). In the opinion of the Company, these interim financial statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of its financial position as of September 30, 2017, and its results of operations for the three and nine months ended September 30, 2017, and cash flows for the nine months ended September 30, 2017. The condensed consolidated balance sheet at December 31, 2016, was derived from audited annual financial statements, but does not contain all of the footnote disclosures from the annual financial statements. All intercompany balances and transactions have been eliminated in consolidation. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements as of and for the year ended December 31, 2016 and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016 (the “Annual Report”). Operating results for the interim periods are not necessarily indicative of the results that may be expected for the full year. |
Use of estimates | Use of estimates The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Segment reporting | Segment reporting Operating segments are components of an enterprise for which separate financial information is available that is evaluated by the chief operating decision maker in deciding how to allocate resources and in assessing performance. Utilizing these criteria, the Company manages its business on the basis of one operating segment and one reportable segment. |
Recent accounting pronouncements | Recent accounting pronouncements The following table provides a brief description of recent accounting pronouncements that could have a material effect on the Company’s financial statements: Standard Description Date of expected adoption/adoption Effect on the financial statements or other significant matters Standards that are not yet adopted ASU 2014-09, Revenue from Contracts with Customers (Topic 606) The standard will replace existing revenue recognition standards and significantly expand the disclosure requirements for revenue arrangements. It may be adopted either retrospectively or on a modified retrospective basis to new contracts and existing contracts with remaining performance obligations as of the effective date. January 1, 2018 The Company expects the standard to impact the methods used to reserve for discounts, refunds and other customer incentives, which may impact the timing of revenue recognition. The Company expects to apply the modified retrospective method of adoption and is currently evaluating other possible impacts of the standard on its consolidated financial statements and related disclosures. ASU 2015-14 , Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date In August 2015, the FASB issued ASU 2015-14, which deferred the effective date from annual periods beginning on or after December 15, 2016 to annual periods beginning on or after December 15, 2017. ASU 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) ASU 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing ASU 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients In March, April and May 2016, the FASB issued ASU 2016-08, ASU 2016-10 and ASU 2016-12. These standards provide supplemental adoption guidance and clarification to ASU 2014-09, and must be adopted concurrently with the adoption of ASU 2014-09. ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities The standard makes targeted improvements to US GAAP, including significant revisions to an entity’s accounting related to the classification and measurement of investments in equity securities and the presentation of certain fair value changes for financial liabilities measured at fair value. January 1, 2018 The Company is currently evaluating the effect of the standard but does not expect it to have a material effect on its consolidated financial statements and related disclosures. ASU 2016-02, Leases (Topic 842) The standard will require lessees to recognize a right-of-use asset and a lease liability for virtually all of their leases (other than leases that meet the definition of a short-term lease). The liability will be equal to the present value of lease payments. The asset will be based on the liability, subject to adjustment, such as for initial direct costs. Lessor accounting is similar to the current model, but updated to align with certain changes to the lessee model (e.g., certain definitions, such as initial direct costs, have been updated) and the new revenue recognition standard. It requires a modified retrospective approach for all leases existing at, or entered into after, the date of initial application. January 1, 2019 The Company expects the standard to result in increased assets and liabilities related to operating leases currently not recorded on the balance sheet. The Company is currently evaluating other possible impacts of the adoption of this standard on its consolidated financial statements and related disclosures. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Information Regarding Company's Goodwill and Intangible Assets | Information regarding the Company’s goodwill and intangible assets as of September 30, 2017, is as follows (in thousands): Estimated useful life Gross carrying amount Accumulated amortization Net carrying amount Customer relationships – retailers 10 years $ 68,800 $ (25,227 ) $ 43,573 Customer relationships – e-commerce 3 years 3,900 (3,867 ) 33 Favorable leases, net Varies 580 (350 ) 230 Total finite-lived intangibles 73,280 (29,444 ) 43,836 Trademarks Indefinite 63,800 - 63,800 Goodwill 157,264 - 157,264 Total goodwill and other intangibles $ 294,344 $ (29,444 ) $ 264,900 Information regarding the Company’s goodwill and intangible assets as of December 31, 2016, is as follows (in thousands): Estimated useful life Gross carrying amount Accumulated amortization Net carrying amount Customer relationships – retailers 10 years $ 68,800 $ (20,067 ) $ 48,733 Customer relationships – e-commerce 3 years 3,900 (3,736 ) 164 Favorable leases, net Varies 580 (274 ) 306 Total finite-lived intangibles 73,280 (24,077 ) 49,203 Trademarks Indefinite 63,800 - 63,800 Goodwill 157,264 - 157,264 Total goodwill and other intangibles $ 294,344 $ (24,077 ) $ 270,267 |
Future Amortization Expense for Intangible Assets | Future amortization expense for intangible assets as of September 30, 2017 is as follows (in thousands): Remainder of 2017 $ 1,754 2018 7,007 2019 6,982 2020 6,880 2021 6,880 Thereafter 14,333 Total $ 43,836 |
Accrued Expenses and Other Cu20
Accrued Expenses and Other Current Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Payables And Accruals [Abstract] | |
Summary of Accrued Expenses and Other Current Liabilities | Accrued expenses and other current liabilities as of September 30, 2017 and December 31, 2016 consisted of the following (in thousands): September 30, 2017 December 31, 2016 Accrued expenses $ 4,320 $ 9,537 Other current liabilities 1,871 9,249 Accrued compensation 6,746 7,111 Early exercised option deposit liability - 4,074 Income taxes payable - 3,705 Accrued expenses and other current liabilities $ 12,937 $ 33,676 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Outstanding Debt | The Company’s outstanding debt as of September 30, 2017 and December 31, 2016 consisted of the following (in thousands): September 30, 2017 December 31, 2016 Revolving credit facility (1) $ 9,500 $ - Term loan (1) 156,332 162,627 Capital lease obligations 2,469 2,766 Total debt (2) 168,301 165,393 Less: debt issuance costs (471 ) (566 ) Total debt, net of issuance costs 167,830 164,827 Less: current portion (18,140 ) (8,650 ) Long-term portion of debt $ 149,690 $ 156,177 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Commitments And Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Lease Payments under Operating Leases | Future minimum lease payments under the operating leases are as follows (in thousands): Remainder of 2017 $ 1,264 2018 5,108 2019 4,976 2020 4,483 2021 3,582 Thereafter 11,485 Total $ 30,898 |
Stock-based Compensation (Table
Stock-based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Summary of Activities for Restricted Stock Awards ("RSAs") and Restricted Stock Units ("RSUs") | The following table summarizes the activities for restricted stock awards (“RSAs”) and restricted stock units (“RSUs”) for the nine months ended September 30, 2017: Shares of restricted stock outstanding Weighted-average grant date fair value Balance as of December 31, 2016 586,224 $ 17.00 Granted 884,081 26.60 Vested (96,711 ) 17.00 Forfeited (126,523 ) 23.27 Balance as of September 30, 2017 1,247,071 $ 23.17 |
Service-based Vesting Options | |
Summary of Stock Option Activity and Related Information | The following table summarizes the activity for options that vest solely based upon the satisfaction of a service condition for the nine months ended September 30, 2017: Options outstanding Weighted-average exercise price Weighted-average remaining contractual life (in years) Aggregate intrinsic values (in thousands) Balance as of December 31, 2016 3,168,967 $ 8.55 Granted 205,300 26.53 Exercised (379,214 ) 1.94 Forfeited (141,331 ) 17.58 Balance as of September 30, 2017 2,853,722 $ 10.28 8.13 $ 35,748 Exercisable, September 30, 2017 1,098,328 $ 4.67 6.94 $ 19,637 |
Performance-based and Market-based Vesting Options | |
Summary of Stock Option Activity and Related Information | The following table summarizes the activity for options that vest based upon the satisfaction of performance or market conditions for the nine months ended September 30, 2017: Options outstanding Weighted-average exercise price Weighted-average remaining contractual life (in years) Aggregate intrinsic values (in thousands) Balance as of December 31, 2016 3,836,107 $ 2.46 Granted 463,200 27.02 Exercised (1,711,381 ) 2.71 Forfeited (43,350 ) 27.29 Balance as of September 30, 2017 2,544,576 $ 6.33 7.56 $ 43,083 |
Net Income (Loss) Per Share (Ta
Net Income (Loss) Per Share (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Reconciliation of Numerator and Denominator in Basic and Diluted Net Income (Loss) Per Common Share Computations | The following is a reconciliation of the numerator and denominator in the basic and diluted net income (loss) per common share computations (in thousands, except share and per share data): Three months ended September 30, Nine months ended September 30, 2017 2016 2017 2016 Numerator: Net income (loss) $ 5,865 $ (2,377 ) $ 11,995 $ (1,288 ) Adjustments to numerator: Dividend paid to preferred stockholders - - - (66,531 ) Accretion of convertible preferred stock to maximum redemption value - (371,228 ) - (436,317 ) Net income (loss) attributable to common stockholders $ 5,865 $ (373,605 ) $ 11,995 $ (504,136 ) Denominator: Weighted average common shares outstanding - basic 45,813,801 5,109,016 45,132,567 2,151,324 Diluted common equivalents from stock options 3,241,620 - 4,064,723 - Diluted common equivalents from restricted stock units 227,826 - 256,394 - Diluted common equivalents from restricted stock awards - - 8,482 - Weighted average common shares outstanding - diluted 49,283,247 5,109,016 49,462,166 2,151,324 Net income (loss) per share: Basic $ 0.13 $ (73.13 ) $ 0.27 $ (234.34 ) Diluted $ 0.12 $ (73.13 ) $ 0.24 $ (234.34 ) Anti-dilutive securities excluded from diluted EPS: Stock options 601,749 7,083,483 503,516 7,083,483 Restricted stock units 444,274 596,217 13,688 596,217 Restricted stock awards 302,200 - - - Total 1,348,223 7,679,700 517,204 7,679,700 |
Summary of Significant Accoun25
Summary of Significant Accounting Policies - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2017Segment | |
Accounting Policies [Abstract] | |
Number of operating segment | 1 |
Number of reportable segment | 1 |
Investment in Equity Securiti26
Investment in Equity Securities - Additional Information (Details) - Investee - USD ($) shares in Millions, $ in Millions | 9 Months Ended | |
Sep. 30, 2017 | Apr. 14, 2017 | |
Schedule Of Cost Method Investments [Line Items] | ||
Amount invested in minority equity investment | $ 2.9 | |
Preferred stock received in minority equity investment, shares | 4.7 | |
Percentage of outstanding voting securities on a fully diluted basis | 15.00% | |
Investment in equity securities, additional information | There have been no identified events or changes in circumstances that may have a significant adverse effect on the fair value of the investment. |
Goodwill and Intangible Asset27
Goodwill and Intangible Assets - Information Regarding Company's Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2017 | Dec. 31, 2016 | |
Schedule Of Intangible Assets And Goodwill [Line Items] | ||
Total finite-lived intangibles, Gross carrying amount | $ 73,280 | $ 73,280 |
Total finite-lived intangibles, Accumulated amortization | (29,444) | (24,077) |
Total finite-lived intangibles, Net carrying amount | 43,836 | 49,203 |
Goodwill, Gross carrying amount | 157,264 | 157,264 |
Goodwill, Net carrying amount | 157,264 | 157,264 |
Total goodwill and other intangibles, Gross carrying amount | 294,344 | 294,344 |
Total goodwill and other intangibles, Accumulated amortization | (29,444) | (24,077) |
Total goodwill and other intangibles, Net carrying amount | 264,900 | 270,267 |
Trademark | ||
Schedule Of Intangible Assets And Goodwill [Line Items] | ||
Indefinite lived intangibles, Net carrying amount | $ 63,800 | 63,800 |
Indefinite-lived intangibles, Estimated useful life | Indefinite | |
Customer Relationships, Retailers | ||
Schedule Of Intangible Assets And Goodwill [Line Items] | ||
Total finite-lived intangibles, Gross carrying amount | $ 68,800 | 68,800 |
Total finite-lived intangibles, Accumulated amortization | (25,227) | (20,067) |
Total finite-lived intangibles, Net carrying amount | $ 43,573 | $ 48,733 |
Amortization of intangible assets with finite useful lives | 10 years | 10 years |
Customer Relationships, E-Commerce | ||
Schedule Of Intangible Assets And Goodwill [Line Items] | ||
Total finite-lived intangibles, Gross carrying amount | $ 3,900 | $ 3,900 |
Total finite-lived intangibles, Accumulated amortization | (3,867) | (3,736) |
Total finite-lived intangibles, Net carrying amount | $ 33 | $ 164 |
Amortization of intangible assets with finite useful lives | 3 years | 3 years |
Favorable Leases, Net | ||
Schedule Of Intangible Assets And Goodwill [Line Items] | ||
Total finite-lived intangibles, Gross carrying amount | $ 580 | $ 580 |
Total finite-lived intangibles, Accumulated amortization | (350) | (274) |
Total finite-lived intangibles, Net carrying amount | $ 230 | $ 306 |
Finite-lived intangibles, Estimated useful life | Varies |
Goodwill and Intangible Asset28
Goodwill and Intangible Assets - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Goodwill And Intangible Assets Disclosure [Abstract] | ||||
Amortization expense related to intangible assets | $ 1,700,000 | $ 2,100,000 | $ 5,400,000 | $ 6,200,000 |
Impairments of goodwill or intangible assets | $ 0 | $ 0 |
Goodwill and Intangible Asset29
Goodwill and Intangible Assets - Future Amortization Expense for Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Goodwill And Intangible Assets Disclosure [Abstract] | ||
Remainder of 2017 | $ 1,754 | |
2,018 | 7,007 | |
2,019 | 6,982 | |
2,020 | 6,880 | |
2,021 | 6,880 | |
Thereafter | 14,333 | |
Total finite-lived intangibles, Net carrying amount | $ 43,836 | $ 49,203 |
Accrued Expenses and Other Cu30
Accrued Expenses and Other Current Liabilities - Summary of Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Payables And Accruals [Abstract] | ||
Accrued expenses | $ 4,320 | $ 9,537 |
Other current liabilities | 1,871 | 9,249 |
Accrued compensation | 6,746 | 7,111 |
Early exercised option deposit liability | 4,074 | |
Income taxes payable | 3,705 | |
Accrued expenses and other current liabilities | $ 12,937 | $ 33,676 |
Debt - Schedule of Outstanding
Debt - Schedule of Outstanding Debt (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | ||
Total debt | $ 168,301 | $ 165,393 |
Less: debt issuance costs | (471) | (566) |
Total debt, net of issuance costs | 167,830 | 164,827 |
Less: current portion | (18,140) | (8,650) |
Long-term portion of debt | 149,690 | 156,177 |
Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Total debt | 9,500 | |
Term Loan | ||
Debt Instrument [Line Items] | ||
Total debt | 156,332 | 162,627 |
Capital Lease Obligations | ||
Debt Instrument [Line Items] | ||
Total debt | $ 2,469 | $ 2,766 |
Debt - Additional Information (
Debt - Additional Information (Details) - USD ($) | Aug. 25, 2017 | Aug. 24, 2017 | Sep. 30, 2017 |
Minimum | LIBOR | |||
Debt Instrument [Line Items] | |||
Debt instrument, basis spread on interest rate | 2.00% | ||
Minimum | Base Rate | |||
Debt Instrument [Line Items] | |||
Debt instrument, basis spread on interest rate | 1.00% | ||
Maximum | LIBOR | |||
Debt Instrument [Line Items] | |||
Debt instrument, basis spread on interest rate | 3.50% | ||
Maximum | Base Rate | |||
Debt Instrument [Line Items] | |||
Debt instrument, basis spread on interest rate | 2.50% | ||
Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Senior secured credit facility, aggregate commitments | $ 35,000,000 | ||
Amended Senior Secured Credit Agreement | |||
Debt Instrument [Line Items] | |||
Debt instrument, interest rate, description | Pursuant to the Amendment, borrowings under both the term loan facility (the “Term Loan Facility”) and the revolving credit facility (“Revolving Credit Facility”) under the Credit Agreement bear interest, at the Company’s option, at either (i) a rate per annum equal to an adjusted LIBOR rate determined by reference to the cost of funds for U.S. dollar deposits for the applicable interest period (subject to a minimum floor of 0%) plus an applicable margin ranging from 1.50% to 2.75% (amended from 2.00% to 3.50% as previously set forth in the Credit Agreement) based on the Company’s consolidated total net leverage ratio or (ii) a floating base rate plus an applicable margin ranging from 0.50% to 1.75% (amended from 1.00% to 2.50% as previously set forth in the Credit Agreement) based on the Company’s consolidated total net leverage ratio. | ||
Amendment fees paid | $ 500,000 | ||
Amended Senior Secured Credit Agreement | Minimum | LIBOR | |||
Debt Instrument [Line Items] | |||
Debt instrument,variable rate floor | 0.00% | ||
Debt instrument, basis spread on interest rate | 1.50% | ||
Amended Senior Secured Credit Agreement | Minimum | Base Rate | |||
Debt Instrument [Line Items] | |||
Debt instrument, basis spread on interest rate | 0.50% | ||
Amended Senior Secured Credit Agreement | Maximum | LIBOR | |||
Debt Instrument [Line Items] | |||
Debt instrument, basis spread on interest rate | 2.75% | ||
Amended Senior Secured Credit Agreement | Maximum | Base Rate | |||
Debt Instrument [Line Items] | |||
Debt instrument, basis spread on interest rate | 1.75% | ||
Amended Senior Secured Credit Agreement | Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Credit facility, interest rate | 4.00% | ||
Senior secured credit facility, aggregate commitments | $ 50,000,000 | ||
Maturity date | Aug. 25, 2022 | ||
Revolving credit facility, unused amount | $ 40,000,000 | ||
Amended Senior Secured Credit Agreement | Term Loan | |||
Debt Instrument [Line Items] | |||
Credit facility, interest rate | 4.00% | ||
Senior secured credit facility, aggregate commitments | $ 165,000,000 | ||
Maturity date | Aug. 25, 2022 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Loss Contingencies [Line Items] | ||||
Total rent expense | $ 1.3 | $ 1 | $ 3.8 | $ 2.9 |
Minimum | ||||
Loss Contingencies [Line Items] | ||||
Lease expiration year | 2,018 | |||
Maximum | ||||
Loss Contingencies [Line Items] | ||||
Lease expiration year | 2,027 |
Commitments and Contingencies34
Commitments and Contingencies - Schedule of Future Minimum Lease Payments under Operating Leases (Details) $ in Thousands | Sep. 30, 2017USD ($) |
Commitments And Contingencies Disclosure [Abstract] | |
Remainder of 2017 | $ 1,264 |
2,018 | 5,108 |
2,019 | 4,976 |
2,020 | 4,483 |
2,021 | 3,582 |
Thereafter | 11,485 |
Total | $ 30,898 |
Stock-based Compensation - Addi
Stock-based Compensation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Early Exercise Of Stock Options | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Number of options, vested | 1,522,826 | ||||
Liability reclassified to additional paid-in-capital | $ 4.1 | $ 4.1 | |||
Number of options, Unvested | 0 | 0 | |||
Service-based Vesting Options | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Fair market value of common stock, per share | $ 22.55 | $ 22.55 | |||
Unrecognized stock-based compensation cost | $ 8.3 | $ 8.3 | |||
Unrecognized stock-based compensation cost, expected weighted-average period of recognition | 3 years 2 months 13 days | ||||
Service-based Vesting Options | Selling, General and Administrative Expenses | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Stock-based compensation cost | $ 0.7 | $ 2.6 | $ 1.8 | $ 3.7 | |
Performance-based and Market-based Vesting Options | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Fair market value of common stock, per share | $ 22.55 | $ 22.55 | |||
Stock-based compensation cost | $ 1.1 | 1.5 | $ 2.9 | 1.5 | |
Unrecognized stock-based compensation cost | $ 1.8 | $ 1.8 | |||
Unrecognized stock-based compensation cost, expected weighted-average period of recognition | 7 months 7 days | ||||
Restricted Stock Awards ("RSAs") | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Unvested RSAs outstanding | 302,200 | 302,200 | |||
Restricted Stock | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Stock-based compensation cost | $ 2 | $ 0.1 | $ 5 | $ 0.1 | |
Unrecognized stock-based compensation cost, expected weighted-average period of recognition | 3 years 2 months 13 days | ||||
Unvested RSAs outstanding | 1,247,071 | 1,247,071 | 586,224 | ||
Unrecognized stock-based compensation cost | $ 24.9 | $ 24.9 |
Stock-based Compensation - Summ
Stock-based Compensation - Summary of Activity for Options Vest Solely Based upon Satisfaction of Service Condition (Details) - Service-based Vesting Options $ / shares in Units, $ in Thousands | 9 Months Ended |
Sep. 30, 2017USD ($)$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Options outstanding, Beginning balance | shares | 3,168,967 |
Options outstanding, Granted | shares | 205,300 |
Options outstanding, Exercised | shares | (379,214) |
Options outstanding, Forfeited | shares | (141,331) |
Options outstanding, Ending balance | shares | 2,853,722 |
Options outstanding, Exercisable | shares | 1,098,328 |
Weighted-average exercise price, Beginning balance | $ / shares | $ 8.55 |
Weighted-average exercise price, Granted | $ / shares | 26.53 |
Weighted-average exercise price, Exercised | $ / shares | 1.94 |
Weighted-average exercise price, Forfeited | $ / shares | 17.58 |
Weighted-average exercise price, Ending balance | $ / shares | 10.28 |
Weighted-average exercise price, Exercisable | $ / shares | $ 4.67 |
Weighted-average remaining contractual life (in years), Outstanding | 8 years 1 month 17 days |
Weighted-average remaining contractual life(in years), Exercisable | 6 years 11 months 9 days |
Aggregate intrinsic values, Outstanding | $ | $ 35,748 |
Aggregate intrinsic values, Exercisable | $ | $ 19,637 |
Stock-based Compensation - Su37
Stock-based Compensation - Summary of Activity for Options Vest Based upon Performance or Market Conditions (Details) - Performance-based and Market-based Vesting Options $ / shares in Units, $ in Thousands | 9 Months Ended |
Sep. 30, 2017USD ($)$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Options outstanding, Beginning balance | shares | 3,836,107 |
Options outstanding, Granted | shares | 463,200 |
Options outstanding, Exercised | shares | (1,711,381) |
Options outstanding, Forfeited | shares | (43,350) |
Options outstanding, Ending balance | shares | 2,544,576 |
Weighted-average exercise price, Beginning balance | $ / shares | $ 2.46 |
Weighted-average exercise price, Granted | $ / shares | 27.02 |
Weighted-average exercise price, Exercised | $ / shares | 2.71 |
Weighted-average exercise price, Forfeited | $ / shares | 27.29 |
Weighted-average exercise price, Ending balance | $ / shares | $ 6.33 |
Weighted-average remaining contractual life (in years), Outstanding | 7 years 6 months 22 days |
Aggregate intrinsic values, Outstanding | $ | $ 43,083 |
Stock-based Compensation - Su38
Stock-based Compensation - Summary of Activities for Restricted Stock Awards ("RSAs") and Restricted Stock Units ("RSUs") (Details) - Restricted Stock | 9 Months Ended |
Sep. 30, 2017$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Shares of restricted stock outstanding, Beginning balance | shares | 586,224 |
Shares of restricted stock outstanding, Granted | shares | 884,081 |
Shares of restricted stock outstanding, Vested | shares | (96,711) |
Shares of restricted stock outstanding, Forfeited | shares | (126,523) |
Shares of restricted stock outstanding, Ending balance | shares | 1,247,071 |
Weighted-average exercise price, Beginning balance | $ / shares | $ 17 |
Weighted-average exercise price, Granted | $ / shares | 26.60 |
Weighted-average exercise price, Vested | $ / shares | 17 |
Weighted-average exercise price, Forfeited | $ / shares | 23.27 |
Weighted-average exercise price, Ending balance | $ / shares | $ 23.17 |
Net Income (Loss) Per Share - R
Net Income (Loss) Per Share - Reconciliation of Numerator and Denominator in Basic and Diluted Net Income (Loss) Per Common Share Computations (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Numerator: | ||||
Net income (loss) | $ 5,865 | $ (2,377) | $ 11,995 | $ (1,288) |
Adjustments to numerator: | ||||
Dividend paid to preferred stockholders | (66,531) | |||
Accretion of convertible preferred stock to maximum redemption value | (371,228) | (436,317) | ||
Net income (loss) attributable to common stockholders | $ 5,865 | $ (373,605) | $ 11,995 | $ (504,136) |
Denominator: | ||||
Weighted average common shares outstanding - basic | 45,813,801 | 5,109,016 | 45,132,567 | 2,151,324 |
Weighted average common shares outstanding - diluted | 49,283,247 | 5,109,016 | 49,462,166 | 2,151,324 |
Net income (loss) per share: | ||||
Basic | $ 0.13 | $ (73.13) | $ 0.27 | $ (234.34) |
Diluted | $ 0.12 | $ (73.13) | $ 0.24 | $ (234.34) |
Anti-dilutive securities excluded from diluted EPS: | ||||
Anti-dilutive securities excluded from diluted EPS, Total | 1,348,223 | 7,679,700 | 517,204 | 7,679,700 |
Stock Options | ||||
Denominator: | ||||
Diluted common equivalents | 3,241,620 | 4,064,723 | ||
Anti-dilutive securities excluded from diluted EPS: | ||||
Anti-dilutive securities excluded from diluted EPS, Total | 601,749 | 7,083,483 | 503,516 | 7,083,483 |
Restricted Stock Units | ||||
Denominator: | ||||
Diluted common equivalents | 227,826 | 256,394 | ||
Anti-dilutive securities excluded from diluted EPS: | ||||
Anti-dilutive securities excluded from diluted EPS, Total | 444,274 | 596,217 | 13,688 | 596,217 |
Restricted Stock Awards | ||||
Denominator: | ||||
Diluted common equivalents | 8,482 | |||
Anti-dilutive securities excluded from diluted EPS: | ||||
Anti-dilutive securities excluded from diluted EPS, Total | 302,200 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate, percent | 17.70% | 30.70% | 20.30% | 5.00% |
Tax benefit due to exercise of stock option | $ 0.5 | $ 4.9 | ||
Tax benefit due to uncertain tax positions | $ 0.5 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - Fit for Life, LLC - USD ($) $ in Millions | Oct. 11, 2016 | Sep. 30, 2017 | Sep. 30, 2017 |
Related Party Transaction [Line Items] | |||
Annual base rent for sublease | $ 0.3 | ||
Sublease contractual term | 39 months | ||
Recognized sublease income | $ 0.1 | $ 0.2 | |
Estimated future sublease income | $ 0.7 | $ 0.7 | |
Chief Executive Officer | |||
Related Party Transaction [Line Items] | |||
Percentage of outstanding common stock | 10.00% |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) - USD ($) $ in Thousands | Nov. 09, 2017 | Sep. 30, 2017 |
Subsequent Event [Line Items] | ||
Minimum future lease commitment | $ 30,898 | |
Subsequent Event | ||
Subsequent Event [Line Items] | ||
Minimum future lease commitment | $ 1,400 |