Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2018 | May 11, 2018 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Borqs Technologies, Inc. | |
Entity Central Index Key | 1,650,575 | |
Trading Symbol | BRQS | |
Amendment Flag | false | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2018 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2,018 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 31,303,350 |
Unaudited Condensed Consolidate
Unaudited Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 3,026 | $ 13,060 |
Restricted cash | 21 | 3,459 |
Accounts receivable | 39,856 | 65,720 |
Receivable from Mobile Virtual Network Operator ("MVNO") franchisees | 3,646 | 3,514 |
Inventories | 20,784 | 17,031 |
Deferred cost of revenues | 751 | 507 |
Prepaid and other current assets | 22,846 | 16,240 |
Total current assets | 90,930 | 119,531 |
Non-current assets: | ||
Property and equipment, net | 1,316 | 1,362 |
Intangible assets, net | 20,588 | 20,004 |
Goodwill | 765 | 736 |
Long-term investment | 11,662 | |
Deferred tax assets | 1,566 | 1,463 |
Deferred cost of revenues | 3,666 | 2,642 |
Other non-current assets | 5,883 | 2,994 |
Total non-current assets | 45,446 | 29,201 |
Total assets | 136,376 | 148,732 |
Current liabilities: | ||
Accounts payable (including accounts payable of the Consolidated VIEs without recourse to the primary beneficiaries of US$4,143 and US$3,302 as of December 31, 2017 and March 31, 2018, respectively) | 16,671 | 49,690 |
Accrued expenses and other payables (including accrued expenses and other payables of the Consolidated VIEs without recourse to the primary beneficiaries of US$4,038 and US$4,339 as of December 31, 2017 and March 31, 2018, respectively) | 16,425 | 12,163 |
Advances from customers (including advances from customers of the Consolidated VIEs without recourse to the primary beneficiary of nil and nil as of December 31, 2017 and March 31, 2018, respectively) | 6,519 | 3,623 |
Deferred revenues (including deferred revenues of the Consolidated VIEs without recourse to the primary beneficiaries of US$5,904 and US$4,800 as of December 31, 2017 and March 31, 2018, respectively) | 7,307 | 7,960 |
Income tax payable (including income tax payable of the Consolidated VIEs without recourse to the primary beneficiary of nil and nil as of December 31, 2017 and March 31, 2018, respectively) | 1,860 | 1,232 |
Short-term bank borrowings (including short-term bank borrowings of the Consolidated VIEs without recourse to the primary beneficiaries of nil and US$40 as of December 31, 2017 and March 31, 2018, respectively) | 12,792 | 12,648 |
Long-term bank borrowings - current portion (including long-term bank borrowings - current portion of the Consolidated VIEs without recourse to the primary beneficiary of nil and nil as of December 31, 2017 and March 31, 2018, respectively) | 4,479 | 5,432 |
Total current liabilities | 66,053 | 92,748 |
Non-current liabilities: | ||
Unrecognized tax benefits (including unrecognized tax benefits of the Consolidated VIEs without recourse to the primary beneficiary of nil and nil as of December 31, 2017 and March 31, 2018, respectively) | 3,091 | 2,121 |
Deferred tax liabilities (including deferred tax liabilities of the Consolidated VIEs without recourse to the primary beneficiaries of US$1,550 and US$1,524 as of December 31, 2017 and March 31, 2018, respectively) | 3,796 | 3,555 |
Deferred revenues (including deferred revenues of the Consolidated VIEs without recourse to the primary beneficiary of nil and nil as of December 31, 2017 and March 31, 2018, respectively) | 2,693 | 1,346 |
Long-term bank payable (including long-term payable of the Consolidated VIEs without recourse to the primary beneficiary of nil and nil as of December 31, 2017 and March 31, 2018, respectively) | 5,531 | |
Deferred government grants (including deferred government grants of the Consolidated VIEs without recourse to the primary beneficiary of nil and nil as of December 31, 2017 and March 31, 2018, respectively) | 2,034 | 1,957 |
Total non-current liabilities | 17,145 | 8,979 |
Total liabilities | 83,198 | 101,727 |
Commitments and contingencies | ||
Shareholders' equity: | ||
Ordinary shares (no par value; unlimited shares authorized; 30,804,635 shares issued and outstanding as of December 31, 2017 and 31,307,522 shares issued and 31,303,350 shares outstanding as of March 31, 2018, respectively) | ||
Additional paid-in capital | 124,058 | 120,642 |
Statutory reserve | 2,074 | 1,898 |
Accumulated deficit | (73,230) | (74,231) |
Accumulated other comprehensive (loss) income | 825 | (507) |
Total Borqs Technologies, Inc. shareholder's equity | 53,727 | 47,802 |
Noncontrolling interest | (549) | (797) |
Total shareholders' equity | 53,178 | 47,005 |
Total liabilities and shareholders' equity | $ 136,376 | $ 148,732 |
Unaudited Condensed Consolidat3
Unaudited Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2018 | Dec. 31, 2017 | |
Accounts payable, consolidated VIEs without recourse to primary beneficiaries | $ 3,302 | $ 4,143 |
Accrued expenses and other payables, consolidated VIEs without recourse to primary beneficiaries | 4,339 | 4,038 |
Advances from customer ,including advances from customers of the Consolidated VIEs without recourse to the primary beneficiary | ||
Deferred revenue, consolidated VIEs without recourse to primary beneficiaries | 4,800 | 5,904 |
Short-term bank borrowings, consolidated VIEs without recourse to primary beneficiaries | 40 | 40 |
Deferred tax liabilities of the consolidated VIEs | $ 1,550 | $ 1,524 |
Common stock, par value | ||
Common stock, shares authorized | Unlimited | Unlimited |
Common stock, shares issued | 31,307,522 | 30,804,635 |
Common stock, shares outstanding | 31,303,350 | 30,804,635 |
Variable Interest Entity [Member] | ||
Accounts payable, consolidated VIEs without recourse to primary beneficiaries | $ 3,302 | $ 4,143 |
Accrued expenses and other payables, consolidated VIEs without recourse to primary beneficiaries | 4,339 | 4,038 |
Advances from customer ,including advances from customers of the Consolidated VIEs without recourse to the primary beneficiary | ||
Deferred revenue, consolidated VIEs without recourse to primary beneficiaries | 4,800 | 5,904 |
Short-term bank borrowings, consolidated VIEs without recourse to primary beneficiaries | 40 | |
Deferred tax liabilities of the consolidated VIEs | $ 1,524 | $ 1,550 |
Unaudited Condensed Consolidat4
Unaudited Condensed Consolidated Statement of Operations - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Net Revenues: | ||
Software | $ 2,256 | $ 3,084 |
Hardware | 48,118 | 21,679 |
MVNO | 7,509 | 5,932 |
Others | 373 | 515 |
Total net revenues | 58,256 | 31,210 |
Software | (769) | (2,330) |
Hardware | (43,399) | (19,238) |
MVNO | (5,061) | (5,287) |
Others | (171) | (200) |
Total cost of revenues | (49,400) | (27,055) |
Total gross profit | 8,856 | 4,155 |
Operating expenses: | ||
Sales and marketing expenses | (1,682) | (1,339) |
General and administrative expenses | (3,096) | (1,558) |
Research and development expenses | (889) | (292) |
Changes in the fair value of warrant liabilities | (161) | |
Total operating expenses | (5,667) | (3,350) |
Other operating income | 266 | |
Operating income | 3,189 | 1,071 |
Interest income | 6 | 2 |
Interest expense | (245) | (619) |
Other income | 39 | 303 |
Other expense | (45) | (118) |
Foreign exchange loss | (374) | (177) |
Profit before income taxes | 2,570 | 462 |
Income tax expenses | (1,183) | (444) |
Net Income | 1,387 | 18 |
Less: net (loss) income attributable to noncontrolling interests | 188 | (78) |
Net income attributable to Borqs Technologies, Inc. | 1,199 | 96 |
Add: accretion to redemption value of convertible redeemable preferred shares | (298) | |
Net ( loss) income attributable to ordinary shareholders | $ 1,199 | $ (202) |
(Loss) earnings per share: | ||
Basic | $ 0.05 | $ (0.05) |
Diluted | $ 0.04 | $ (0.05) |
Number of ordinary shares used in (loss) earnings per share computation: | ||
Basic | 26,384,152 | 4,224,725 |
Diluted | 27,471,885 | 4,224,725 |
Unaudited Consolidated Condense
Unaudited Consolidated Condensed Interim Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Statement of Comprehensive Income [Abstract] | ||
Net Income | $ 1,387 | $ 18 |
Other comprehensive income, net of tax of nil: | ||
Foreign currency translation adjustments, net of tax of nil | 1,392 | 312 |
Other comprehensive income, net of tax of nil | 1,392 | 312 |
Comprehensive Income | 2,779 | 330 |
Less: comprehensive (loss) income attributable to noncontrolling interest | 248 | (71) |
Comprehensive Income attributable to the Borqs Technologies, Inc. | $ 2,531 | $ 401 |
Unaudited Consolidated Condens6
Unaudited Consolidated Condensed Interim Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net cash generated from operating activities | $ 688 | $ 1,183 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchases of property and equipment | (115) | (76) |
Purchases of intangible assets | (1,617) | (1,889) |
Proceeds from disposal of property and equipment | 1 | |
Repayments of a loan to a third party | 1,469 | 121 |
Net cash used in investing activities | (262) | (1,844) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Prepayment for repurchase of ordinary shares | (10,070) | |
Proceeds from issuance of convertible redeemable preferred shares | 9,007 | |
Issuance costs | (312) | |
Proceeds from short-term bank borrowings | 40 | |
Proceeds from long-term bank borrowings | 2,000 | |
Repayments of long-term bank borrowings | (1,000) | (143) |
Net cash generated from (used in) financing activities | (11,030) | 10,552 |
Effect of foreign exchange rate changes on cash and cash equivalents | 570 | 53 |
Net increase (decrease) in cash and cash equivalents | (10,034) | 9,944 |
Cash and cash equivalents at beginning of period | 13,060 | 13,060 |
Cash and cash equivalents at end of period | $ 3,026 | $ 13,554 |
Organization
Organization | 3 Months Ended |
Mar. 31, 2018 | |
Organization [Abstract] | |
ORGANIZATION | 1. ORGANIZATION Borqs Technologies, Inc. (formerly known as “Pacific Special Acquisition Corp.”, the “Company” or “Borqs Technologies”) was incorporated in the British Virgin Islands on July 1, 2015. The Company was formed for the purpose of acquiring, engaging in a share exchange, share reconstruction and amalgamation, purchasing all or substantially all of the assets of, entering into contractual arrangements, or engaging in any other similar business combination with one or more businesses or entities. On August 18, 2017, the Company acquired 100% equity interest of BORQS International Holding Corp. (“Borqs International”) and its subsidiaries, variable interest entities (the “VIE”) and the VIE’s subsidiaries (collectively referred to as “Borqs Group” hereinafter) (the Company and Borqs Group collectively referred to as the “Group”) in an all-stock transaction (the “Merger”). Concurrent with the completion of the acquisition of Borqs International, the Company changed its name from Pacific Special Acquisition Corp.”, to Borqs Technologies, Inc. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2018 | |
Summary of Significant Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) Basis of presentation The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“US GAAP”) and applicable rules and regulations of the Securities and Exchange Commission, regarding financial reporting, and include all normal and recurring adjustments that management of the Group considers necessary for a fair presentation of its financial position and operation results. Certain information and footnote disclosures normally included in financial statements prepared in conformity with US GAAP have been condensed or omitted pursuant to such rules and regulations. Accordingly, these statements should be read in conjunction with the Group’s unaudited consolidated financial statements as of and for the three years in the periods ended December 31, 2017. (b) Liquidity As of March 31, 2018, the Group has accumulated deficit of US$73,230 and negative cash flow of US$10,034 for the three months then ended. These condition raises substantial doubt about the Group’s ability to continue as a going concern. When preparing the unaudited condensed consolidated financial statements as of March 31, 2018 and for the three months then ended, the Group’s management concluded that a going concern basis of preparation was appropriate after analyzing the forecasted cash flows for the next twelve months, which indicates that the Group will have sufficient liquidity. In preparing the forecasted cash flow analysis, management took into account of the expected net cash inflows to be funded by public offering of approximately US$20,000. As a result, management prepared the unaudited condensed consolidated financial statements assuming the Group will continue as a going concern. However, there is no assurance that the public offering can be completed in a timely manner or at all, and there is no assurance that any short term debt is available at acceptable terms. The unaudited condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. (c) Long-term investment The Group’s long-term investment represents a cost method investment purchased during the three months period ended March 31, 2018. In accordance with ASC 325-20 (“ASC 325-20”), Investments-Other: Cost Method Investments, for investments in investees over which the Group does not have significant influence, the Group carries the investments at cost and only adjusts for other-than-temporary declines in fair value and distributions of earnings. The Group’s management regularly evaluates the impairment of its cost method investments based on the performance and financial position of the investees as well as other evidence of estimated market values. Such evaluation includes, but is not limited to, reviewing the investees’ cash position, recent financing, projected and historical financial performance, cash flow forecasts and current and future financing needs. An impairment loss is recognized in the consolidated statements of comprehensive loss equal to the excess of the investment’s cost over its fair value at the balance sheet date of the reporting period for which the assessment is made. The fair value would then become the new cost basis of investment. (d) Recent accounting pronouncements The Group is an emerging growth company (“EGC’’) as defined by the Jumpstart Our Business Startups Act (“JOBS Act’’). The JOBS Act provides that an EGC can take advantage of an extended transition period for complying with new or revised accounting standards. This allows an EGC to delay adoption of certain accounting standards until those standards would otherwise apply to private companies. The Group elected to take advantage of the extended transition period. However, this election will not apply should the company cease to be classified as an EGC. In May 2014, the Financial Accounting Standards Board (“FASB’’) issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). ASU 2014-09 supersedes the revenue recognition requirements in ASC 605, and requires entities to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, which defers the effective date of ASU 2014-09 by one year. As a result, ASU 2014-09 is effective for the Group for annual reporting periods beginning January 1, 2019 and interim periods within annual periods beginning January 1, 2020. In March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers—Principal versus Agent Considerations, which clarifies the implementation guidance on principal versus agent considerations. In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers—Identifying Performance Obligations and Licensing, which clarify guidance related to identifying performance obligations and licensing implementation guidance contained in ASU 2014-09. In May 2016, the FASB issued ASU 2016-12, Revenue from Contracts with Customers— Narrow-Scope Improvements and Practical Expedients, which addresses narrow-scope improvements to the guidance on collectability, non-cash consideration, and completed contracts at transition and provides practical expedients for contract modifications at transition and an accounting policy election related to the presentation of sales taxes and other similar taxes collected from customers. The effective dates for these amendments are the same as the effective date of ASU No 2014-09. Early adoption is permitted, and the standard permits the use of either the retrospective or cumulative effect transition method. The Group does not plan to early adopt the standard and amendments and it is in the process of developing a plan for evaluating the impact of adoption of these guidance on its unaudited consolidated financial statements, including the selection of the adoption method, the identification of differences, if any, from the application of the guidance, and the impact of such differences, if any, on its consolidated unaudited financial statements. In January 2016, the FASB issued ASU 2016-01, Financial Instruments. ASU 2016-01 requires equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income. An entity may choose to measure equity investments that do not have readily determinable fair values at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. ASU 2016-01 also simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment. When a qualitative assessment indicates that impairment exists, an entity is required to measure the investment at fair value. ASU 2016-01 is effective for the Group beginning January 1, 2019 with interim periods within annual periods beginning January 1, 2020. Early adoption is permitted no earlier than the fiscal year beginning January 1, 2018 including interim periods within that year. The Group does not plan to early adopt ASU 2016-01 and it is currently evaluating the impact of adopting this standard on its unaudited consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases, which specifies the accounting for leases. For operating leases, ASU 2016-02 requires a lessee to recognize a right-of-use asset and a lease liability, initially measured at the present value of the lease payments, in its balance sheet. The standard also requires a lessee to recognize a single lease cost, calculated so that the cost of the lease is allocated over the lease term, on a generally straight-line basis. ASU 2016-02 is effective for the Group for annual reporting periods beginning January 1, 2020 and interim periods within annual periods beginning January 1, 2021. Early adoption is permitted. The Group does not plan to early adopt ASU 2016-02 and it is currently evaluating the impact of adopting the standard on its unaudited consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments — Credit Losses does not plan to early adopt ASU No. 2016-13 and it is evaluating the effect that this guidance will have on its unaudited consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, which addresses eight specific cash flow issues: Debt prepayment or debt extinguishment costs; settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing; contingent consideration payments made after a business combination; proceeds from the settlement of insurance claims; proceeds from the settlement of corporate-owned life insurance policies (COLIs) (including bank-owned life insurance policies (BOLIs)); distributions received from equity method investees; beneficial interests in securitization transactions; and separately identifiable cash flows and application of the predominance principle. In November 2016, the FASB issued ASU 2016-18, Statements of Cash Flow (Topic 230): Restricted Cash, which requires that a statement of cash flows explain the change during the period in the total cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amount shown on the statement of cash flows. ASU 2016-15 and ASU 2016-18 are effective for the Group for annual reporting periods beginning January 1, 2019 and interim periods within annual periods beginning January 1, 2020. Early adoption is permitted. The Group does not plan to early adopt ASU 2016-15 and ASU 2016-18 and it is evaluating the impacts that these standards will have on its unaudited consolidated financial statements. In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. ASU 2017-01 clarifies the framework for determining whether an integrated set of assets and activities meets the definition of a business. The revised framework establishes a screen for determining whether an integrated set of assets and activities is a business and narrows the definition of a business, which is expected to result in fewer transactions being accounted for as business combinations. Acquisitions of integrated sets of assets and activities that do not meet the definition of a business are accounted for as asset acquisitions. ASU 2017-01 is effective for the Group for annual reporting periods beginning January 1, 2020 and interim periods within annual periods beginning January 1, 2021, with early adoption permitted for transactions that have not been reported in previously issued (or available to be issued) financial statements. The Group does not plan to early adopt ASU 2017-01 and does not expect the impact that this standard will have a material impact on its unaudited consolidated financial statements. In January 2017, the FASB issued Accounting Standards Update No. 2017-04, Intangibles — Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 3 Months Ended |
Mar. 31, 2018 | |
Prepaid Expenses and Other Current Assets [Abstract] | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | 3. PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets consist of the following: As of December 31, As of March 31, 2017 2018 US$ US$ Staff advances 312 430 Prepayment for ordinary share repurchase (i) - 10,048 Prepayment for products 1,008 1,787 Advance to OEM 3,662 - Rental and other deposits 1,203 1,103 VAT recoverable 2,189 2,898 Loan to third parties 1,469 - Receivable from an agent 6,318 6,450 Others 79 130 16,240 22,846 (i) On January 10, 2018, the Company entered into a stock repurchase agreement (“Stock Repurchase Agreement”) with Zhengqi International Holding Limited (“Zhengqi”), pursuant to which the Company agreed to repurchase 966,136 ordinary shares that were originally issued and sold to Zhengqi on August 18, 2017, at an aggregate purchase price of $10 million. The $10 million share repurchases consideration was transferred to Zhengqi, and the Company is working with Zhengqi to complete certain procedures to close the transaction in 2018. |
Property and Equipment, Net
Property and Equipment, Net | 3 Months Ended |
Mar. 31, 2018 | |
Property and Equipment, Net [Abstract] | |
PROPERTY AND EQUIPMENT, NET | 4. PROPERTY AND EQUIPMENT, NET Property and equipment consist of the following: As of As of 2017 2018 US$ US$ At cost: Leasehold improvements 933 1,115 Computer and network equipment 6,458 6,595 Office equipment 918 987 Motor vehicles 233 234 8,542 8,931 Less: accumulated depreciation (7,180 ) (7,615 ) 1,362 1,316 Depreciation expense was US$283 and US$139 for the three months ended March 31, 2017 and 2018, respectively, were included in the following captions: Three Months Ended 2017 2018 US$ US$ Cost of revenues 41 48 Sales and marketing expenses 2 3 General and administrative expenses 72 18 Research and development expenses 168 70 283 139 |
Intangible Assets, Net
Intangible Assets, Net | 3 Months Ended |
Mar. 31, 2018 | |
Intangible Assets, Net/Goodwill [Abstract] | |
INTANGIBLE ASSETS, NET | 5. INTANGIBLE ASSETS, NET The following table presents the Group’s intangible assets as of the respective balance sheet dates: Software Capitalized software development costs License Total US$ US$ US$ US$ Balance as of January 1, 2017 2,294 6,874 6,330 15,498 Additions 31 1,858 - 1,889 Amortization expense (60 ) (670 ) (212 ) (942 ) Foreign currency translation difference 11 23 35 69 Balance as of March 31, 2017 2,276 8,085 6,153 16,514 Balance as of January 1, 2018 2,529 11,600 5,875 20,004 Additions 139 1,478 - 1,617 Amortization expense (29 ) (1,339 ) (236 ) (1,604 ) Foreign currency translation difference 98 243 230 571 Balance as of March 31, 2018 2,737 11,982 5,869 20,588 The intangible assets are amortized using the straight-line method, which is the Group’s best estimate of how these assets will be economically consumed over their respective estimated useful lives of 3-10 years. Amortization expense was US$942 and US$1,604 for the three months ended March 31, 2017 and 2018, respectively. |
Goodwill
Goodwill | 3 Months Ended |
Mar. 31, 2018 | |
Intangible Assets, Net/Goodwill [Abstract] | |
GOODWILL | 6. GOODWILL The changes in the carrying amount of goodwill were as follows: As of As of 2017 2018 US$ US$ Balance at beginning of the period 693 736 Foreign currency translation difference 43 29 Balance at end of the period 736 765 No impairment charge was recorded in any of the three months ended March 31, 2017 and 2018, respectively. |
Long-Term Investment
Long-Term Investment | 3 Months Ended |
Mar. 31, 2018 | |
Long-Term Investment/Bank and Other Borrowings [Abstract] | |
LONG-TERM INVESTMENT | 7. LONG-TERM INVESTMENT On January 18, 2018, the Company entered into an agreement with Colmei Technology International Ltd (“Colmei”) and its affiliate Shenzhen Crave Communication Co., Ltd (“Crave”), along with the shareholders of Crave and Colmei (“Selling Shareholders”), pursuant to which the Selling Shareholders sold to the Company 13.8% of the outstanding shares of Crave and 13.8% of the outstanding shares of Colmei. Under the agreement, the Company paid purchase consideration consisting of the Company’s 473,717 ordinary shares issued and cash in the amount of US$10,000 to be paid to the Selling Shareholders over a period of 36 months from the date of agreement. If approved by the Company’s board of directors, the Company will also issue additional shares to the Selling Shareholders if the aggregate value of the Company shares initially issued to the Selling Shareholders under this agreement is less than US$3,000 on August 18, 2018. This transaction was completed on March 22, 2018. The Company does not have significant influence over the investees and therefore the investment was accounted for under the cost method. Cost of the long-term investment consisted of the fair value of the share consideration on the date of issuance and the present value of the cash consideration, which was determined based on management’s estimate of the payment schedule. |
Bank and Other Borrowings
Bank and Other Borrowings | 3 Months Ended |
Mar. 31, 2018 | |
Long-Term Investment/Bank and Other Borrowings [Abstract] | |
BANK AND OTHER BORROWINGS | 8. BANK AND OTHER BORROWINGS Bank and other borrowings are as follows as of the respective balance sheet dates: As of As of 2017 2018 US$ US$ Short-term bank and other borrowings 12,648 12,792 Long-term bank borrowings, current portion 5,432 4,479 Total borrowings 18,080 17,271 The short-term bank borrowings outstanding as of December 31, 2017 and March 31, 2018 bore a weighted average interest rate of 6.73% and 6.44% per annum, respectively, and were denominated in RMB and US$. These borrowings were obtained from financial institutions and have term s of one year. The long-term bank borrowings, current portion outstanding as of March 31, 2018 bore a weighted average interest rate of 8%, and were denominated in US$. These borrowings were obtained from financial institutions located in the United States, and have terms of three years. On November 28, 2017, the Company entered into short-term loan agreement with HHMC Microelectronic Co., Limited for US$5,000,000 with an interest rate of 14.6% per annum and a maturity term of three months, for working capital. The loan has been extended to May 28, 2018. Bank borrowings as of March 31, 2018 were pledged by accounts receivable. As of March 31, 2018, the Company was in breach of two of the financial covenants under a long-term bank borrowing with an outstanding balance of US$479. The breach could result in acceleration of the repayment according to the contractual term. Therefore, the outstanding balance was reclassified as current liability as of March 31, 2018. |
Accrued Expenses and Other Paya
Accrued Expenses and Other Payables | 3 Months Ended |
Mar. 31, 2018 | |
Accrued Expenses and Other Payables [Abstract] | |
ACCRUED EXPENSES AND OTHER PAYABLES | 9. ACCRUED EXPENSES AND OTHER PAYABLES The components of accrued expenses and other payables are as follows: As of December 31, As of March 31, 2017 2018 US$ US$ Payroll and welfare payable 2,030 2,457 Payable for long-term investment (Note 7) - 3,131 VAT, and other taxes payable 2,473 2,827 Payables for office supply and utilities 711 958 Payables for purchase of property and equipment 52 54 Professional service fees 3,161 2,964 Deposits from agents 3,509 3,614 Others 227 420 12,163 16,425 |
Deferred Government Grants
Deferred Government Grants | 3 Months Ended |
Mar. 31, 2018 | |
Deferred Government Grants [Abstract] | |
DEFERRED GOVERNMENT GRANTS | 10. DEFERRED GOVERNMENT GRANTS The government grants received are required to be used in construction of property and equipment. These grants are initially deferred and subsequently recognized in the statement of operations over the life of the related assets as other operating income. Three Months Ended March 31, 2017 2018 US$ US$ Balance at beginning of the period 2,108 1,957 Recognized as other operating income (266 ) - Foreign currency translation difference 12 77 Balance at ending of the period 1,854 2,034 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 3 Months Ended |
Mar. 31, 2018 | |
Accumulated Other Comprehensive Income (Loss) [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | 11. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The changes in accumulated other comprehensive income (loss), net of tax of nil, are as follows: Foreign currency translation Total US$ US$ Balance as of December 31, 2016 (2,626 ) (2,626 ) Current year other comprehensive income 2,119 2,119 Balance as of December 31, 2017 (507 ) (507 ) Current year other comprehensive income 1,332 1,332 Balance as of March 31, 2018 825 825 |
Mainland China Employee Contrib
Mainland China Employee Contribution Plan | 3 Months Ended |
Mar. 31, 2018 | |
Mainland China Employee Contribution Plan [Abstract] | |
MAINLAND CHINA EMPLOYEE CONTRIBUTION PLAN | 12. MAINLAND CHINA EMPLOYEE CONTRIBUTION PLAN As stipulated by the regulations of the PRC, full-time employees of the Company in the PRC participate in a government-mandated multiemployer defined contribution plan organized by municipal and provincial governments. Under the plan, certain pension benefits, medical care, unemployment insurance, employee housing fund and other welfare benefits are provided to employees. The Company is required to make contributions to the plan based on certain percentages of employees’ salaries. The total expenses for the plan were US$558 and US$836 respectively, for the three months ended March 31, 2017 and 2018. |
Taxation
Taxation | 3 Months Ended |
Mar. 31, 2018 | |
Taxation [Abstract] | |
TAXATION | 13. TAXATION Profit before income taxes consists of: Three Months Ended 2017 2018 US$ US$ Non-PRC 1,903 590 PRC (1,441 ) 1,980 462 2,570 Income tax expenses comprise of: Three Months Ended 2017 2018 US$ US$ Current (473 ) (1,050 ) Deferred 29 (133 ) (444 ) (1,183 ) The reconciliation of tax computed by applying the statutory income tax rate of 25% for the three months ended March 31, 2017 and 2018 applicable to the PRC operations to income tax expenses is as follows: Three Months Ended 2017 2018 US$ US$ Profit before income taxes 462 2,570 Income tax expenses computed at the statutory income tax rate at 25% (116 ) (642 ) Non-deductible expenses (123 ) (105 ) Non-taxation income 67 - Preferential rate (99 ) 355 Current and deferred tax rate differences 6 (834 ) Foreign rate differences (132 ) (149 ) Change of valuation allowance (16 ) 545 Interest expenses (31 ) (353 ) Income tax expenses (444 ) (1,183 ) Deferred Taxes The significant components of deferred taxes are as follows: As of As of 2017 2018 US$ US$ Deferred tax assets Inventories provision 229 - AR provision - 238 Accrued salary and welfare payable 165 284 Property and equipment 14 15 Tax losses 14,769 14,198 Valuation allowance (13,714 ) (13,169 ) Total deferred tax assets 1,463 1,566 Deferred tax liabilities Intangible assets 2,004 1,964 Deferred cost of revenues 1,551 1,832 Total deferred tax liabilities 3,555 3,796 As of March 31, 2018, the Group had net tax operating losses from its PRC subsidiaries and its Consolidated VIEs, as per filed tax returns, of US$28,855, which will expire from 2018 to 2022. The Group has net tax operating loss from its HK subsidiary of US$14,949, which will not expire. As of March 31, 2018, the Group intends to permanently reinvest the undistributed earnings from its foreign subsidiaries and the Consolidated VIEs to fund future operations. The amount of unrecognized deferred tax liabilities for temporary differences related to investments in foreign subsidiaries and the Consolidated VIEs is not determined because such a determination is not practicable. Unrecognized Tax Benefits As of December 31, 2017 and March 31, 2018, the Group recorded an unrecognized tax benefits of US$4,047 and US$5,334, respectively, of which, US$2,764 and US$3,654, respectively, are presented on a net basis against the deferred tax assets related to tax loss carry forwards on the consolidated balance sheets. The unrecognized tax benefits and its related interests are primarily related to under-reported intercompany profit. The amount of unrecognized tax benefits will change in the next 12 months, pending clarification of current tax law or audit by the tax authorities, however, an estimate of the range of the possible change cannot be made at this time. As of December 31, 2017 and March 31, 2018, unrecognized tax benefits of US$2,043 and US$2,983, if ultimately recognized, will impact the effective tax rate. A roll-forward of unrecognized tax benefits is as follows: Three Months Ended 2017 2018 US$ US$ Balance at beginning of period 4,053 4,547 Additions based on tax positions related to the current year 67 609 Foreign currency translation difference (407 ) 178 Balance at end of period 3,713 5,334 In the three months ended March 31, 2017 and 2018, the Group recorded interest expenses accrued in relation to the unrecognized tax benefits of US$31 and US$353 in income tax expenses, respectively. Accumulated interest expenses recorded by the Group was US$119 and US$691 as of March 31, 2017 and 2018, respectively. As of March 31, 2018, the tax years ended December 31, 2013 through 2018 for the PRC subsidiaries and the VIE remain open for statutory examination by the PRC tax authorities. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2018 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | 14. RELATED PARTY TRANSACTIONS (a) Related parties Names of related parties Relationship with the Group Intel Capital Corporation (“Intel”) and its affiliates A substantial shareholder of the company, but exited from the mobile chipset activities. (b) Other than disclosed elsewhere, the Group had the following significant related party transactions for the three months ended March 31, 2017 and 2018: Three Months Ended March 31, 2017 2018 US$ US$ Software services provided to: Intel Corporation - - Intel (China) Co., Ltd. 9 - Intel Asia-Pacific Research and Development Ltd. 19 - Intel (China) Research Center Co., Ltd. 34 - |
(Loss) Earnings Per Share
(Loss) Earnings Per Share | 3 Months Ended |
Mar. 31, 2018 | |
(Loss) Earnings Per Share [Abstract] | |
(LOSS) EARNINGS PER SHARE | 15. (LOSS) EARNINGS PER SHARE Basic and diluted (loss) earnings per share for each of the three months presented are calculated as follows: Three Months Ended 2017 2018 US$ US$ Numerator: Net income 18 1,387 Less: net (loss) income attributable to noncontrolling interests (78 ) 188 Net income attributable to Borqs Technologies, Inc. 96 1,199 Accretion to redemption value of Convertible Redeemable Preferred Shares (298 ) - Net (loss) income attributable to Borqs Technologies, Inc.’s ordinary shareholders (202 ) 1,199 Denominator: Weighted-average number of ordinary shares outstanding—basic 4,224,725 26,384,152 Weighted-average number of ordinary shares outstanding—diluted 4,224,725 27,471,885 (Loss) earnings per share—Basic: (0.05 ) 0.05 (Loss) earnings per share—Diluted: (0.05 ) 0.04 For the three months ended March 31, 2017, convertible redeemable preferred shares and share options, replacement warrants to purchase ordinary shares were anti-dilutive and excluded from the calculation of diluted net loss per share |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2018 | |
Commitments and Contingencies [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 16. COMMITMENTS AND CONTINGENCIES Operating lease commitments The Group leases buildings in the PRC and India under non-cancelable operating leases expiring on different dates. For the three months ended March 2017 and 2018, total rental expenses for all operating leases amounted to US$354 and US$421, respectively. As of March 31, 2018, the Group has future minimum lease payments under non-cancelable operating leases with initial terms in excess of one year in relation to office buildings consisting of the following: US$ 2018 1,369 2019 2,070 2020 1,184 2021 526 2022 and thereafter 424 5,573 Payments under operating leases are expensed on a straight-line basis over the periods of their respective leases. Income Taxes As of March 31, 2018, the Group recognized an accrual of US$3,091 for unrecognized tax benefits and its interest (Note 1 3). The final outcome of the tax uncertainty is dependent upon various matters including tax examinations, interpretation of tax laws or expiration of statutes of limitation. However, due to the uncertainties associated with the status of examinations, including the protocols of finalizing audits by the relevant tax authorities, there is a high degree of uncertainty regarding the future cash outflows associated with these tax uncertainties. As of March 31, 2018, the Group classified the accrual for unrecognized tax benefits as a non-current liability. |
Segment Reporting
Segment Reporting | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | 17. SEGMENT REPORTING The operations of the Group are organized into two segments, consisting of Yuantel and Connected Solution. The CODM measures the performance of each segment based on metrics of revenue and earnings from operations and uses these results to evaluate the performance of, and to allocate resources to each of the segments. CODM does not evaluate operating segments using asset information. The CODM evaluates performance based on each reporting segment’s net revenue and operating profit (loss). The table below provides a summary of the Group’s operating segment results for the three months ended March 31, 2017 and 2018: Connected Total Three months ended March 31, 2018 Yuantel Solution Segments Eliminations Consolidated Net revenue -External customers 7,882 50,374 58,256 - 58,256 -Inter-segment - 304 304 (304 ) - Total net revenue 7,882 50,678 58,560 (304 ) 58,256 Operating income 684 2,505 3,189 - 3,189 Connected Total Three months ended March 31, 2017 Yuantel Solution segments Eliminations Consolidated Net revenue -External customers 6,447 24,763 31,210 - 31,210 -Inter-segment - 449 449 (449 ) - Total net revenue 6,447 25,212 31,659 (449 ) 31,210 Operating (loss) income (1,122 ) 2,193 1,071 - 1,071 Three Months Ended 2017 2018 US$ US$ PRC 12,759 11,179 Outside PRC: United States 1,553 4,196 India 2,088 42,074 Rest of the world 14,810 807 Total net revenue 31,210 58,256 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2018 | |
Subsequent Events Abstract] | |
SUBSEQUENT EVENTS | 18. SUBSEQUENT EVENTS Acquisition of KADI On January 8, 2018, the Company entered into a letter of intent to acquire a 60% equity interest in Shanghai KADI Machinery Technology Co., Ltd (“KADI”), a Chinese company that develops software and hardware solutions for electric vehicle control modules, for an aggregate consideration of $15 million consisting of $11.7 million in cash and an agreed-upon value of $3.3 million in the Company’s ordinary shares with the selling shareholders of KADI. KADI is not a customer or a supplier of Borqs. In accordance with the letter of intent, the Company have made three of four scheduled cash advances to KADI amounted to $450,000, which is recorded as other non-current assets. The remaining fourth payment of $150,000 will be paid in May 2018. These advances will be deducted from the cash consideration to KADI under the definitive agreement to be negotiated. If this transaction fails to be consummated within nine months after signing of the letter of intent, the advance payments will be exchanged into equity interest representing 5% of the outstanding capital stock of KADI on such date. There are no termination fees or penalties under the letter of intent. |
Summary of Significant Accoun25
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2018 | |
Summary of Significant Accounting Policies [Abstract] | |
Basis of presentation | (a) Basis of presentation The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“US GAAP”) and applicable rules and regulations of the Securities and Exchange Commission, regarding financial reporting, and include all normal and recurring adjustments that management of the Group considers necessary for a fair presentation of its financial position and operation results. Certain information and footnote disclosures normally included in financial statements prepared in conformity with US GAAP have been condensed or omitted pursuant to such rules and regulations. Accordingly, these statements should be read in conjunction with the Group’s unaudited consolidated financial statements as of and for the three years in the periods ended December 31, 2017. |
Liquidity | (b) Liquidity As of March 31, 2018, the Group has accumulated deficit of US$73,230 and negative cash flow of US$10,034 for the three months then ended. These condition raises substantial doubt about the Group’s ability to continue as a going concern. When preparing the unaudited condensed consolidated financial statements as of March 31, 2018 and for the three months then ended, the Group’s management concluded that a going concern basis of preparation was appropriate after analyzing the forecasted cash flows for the next twelve months, which indicates that the Group will have sufficient liquidity. In preparing the forecasted cash flow analysis, management took into account of the expected net cash inflows to be funded by public offering of approximately US$20,000. As a result, management prepared the unaudited condensed consolidated financial statements assuming the Group will continue as a going concern. However, there is no assurance that the public offering can be completed in a timely manner or at all, and there is no assurance that any short term debt is available at acceptable terms. The unaudited condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. |
Long-term investment | (c) Long-term investment The Group’s long-term investment represents a cost method investment purchased during the three months period ended March 31, 2018. In accordance with ASC 325-20 (“ASC 325-20”), Investments-Other: Cost Method Investments, for investments in investees over which the Group does not have significant influence, the Group carries the investments at cost and only adjusts for other-than-temporary declines in fair value and distributions of earnings. The Group’s management regularly evaluates the impairment of its cost method investments based on the performance and financial position of the investees as well as other evidence of estimated market values. Such evaluation includes, but is not limited to, reviewing the investees’ cash position, recent financing, projected and historical financial performance, cash flow forecasts and current and future financing needs. An impairment loss is recognized in the consolidated statements of comprehensive loss equal to the excess of the investment’s cost over its fair value at the balance sheet date of the reporting period for which the assessment is made. The fair value would then become the new cost basis of investment. |
Recent accounting pronouncements | (d) Recent accounting pronouncements The Group is an emerging growth company (“EGC’’) as defined by the Jumpstart Our Business Startups Act (“JOBS Act’’). The JOBS Act provides that an EGC can take advantage of an extended transition period for complying with new or revised accounting standards. This allows an EGC to delay adoption of certain accounting standards until those standards would otherwise apply to private companies. The Group elected to take advantage of the extended transition period. However, this election will not apply should the company cease to be classified as an EGC. In May 2014, the Financial Accounting Standards Board (“FASB’’) issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). ASU 2014-09 supersedes the revenue recognition requirements in ASC 605, and requires entities to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, which defers the effective date of ASU 2014-09 by one year. As a result, ASU 2014-09 is effective for the Group for annual reporting periods beginning January 1, 2019 and interim periods within annual periods beginning January 1, 2020. In March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers—Principal versus Agent Considerations, which clarifies the implementation guidance on principal versus agent considerations. In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers—Identifying Performance Obligations and Licensing, which clarify guidance related to identifying performance obligations and licensing implementation guidance contained in ASU 2014-09. In May 2016, the FASB issued ASU 2016-12, Revenue from Contracts with Customers— Narrow-Scope Improvements and Practical Expedients, which addresses narrow-scope improvements to the guidance on collectability, non-cash consideration, and completed contracts at transition and provides practical expedients for contract modifications at transition and an accounting policy election related to the presentation of sales taxes and other similar taxes collected from customers. The effective dates for these amendments are the same as the effective date of ASU No 2014-09. Early adoption is permitted, and the standard permits the use of either the retrospective or cumulative effect transition method. The Group does not plan to early adopt the standard and amendments and it is in the process of developing a plan for evaluating the impact of adoption of these guidance on its unaudited consolidated financial statements, including the selection of the adoption method, the identification of differences, if any, from the application of the guidance, and the impact of such differences, if any, on its consolidated unaudited financial statements. In January 2016, the FASB issued ASU 2016-01, Financial Instruments. ASU 2016-01 requires equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income. An entity may choose to measure equity investments that do not have readily determinable fair values at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. ASU 2016-01 also simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment. When a qualitative assessment indicates that impairment exists, an entity is required to measure the investment at fair value. ASU 2016-01 is effective for the Group beginning January 1, 2019 with interim periods within annual periods beginning January 1, 2020. Early adoption is permitted no earlier than the fiscal year beginning January 1, 2018 including interim periods within that year. The Group does not plan to early adopt ASU 2016-01 and it is currently evaluating the impact of adopting this standard on its unaudited consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases, which specifies the accounting for leases. For operating leases, ASU 2016-02 requires a lessee to recognize a right-of-use asset and a lease liability, initially measured at the present value of the lease payments, in its balance sheet. The standard also requires a lessee to recognize a single lease cost, calculated so that the cost of the lease is allocated over the lease term, on a generally straight-line basis. ASU 2016-02 is effective for the Group for annual reporting periods beginning January 1, 2020 and interim periods within annual periods beginning January 1, 2021. Early adoption is permitted. The Group does not plan to early adopt ASU 2016-02 and it is currently evaluating the impact of adopting the standard on its unaudited consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments — Credit Losses does not plan to early adopt ASU No. 2016-13 and it is evaluating the effect that this guidance will have on its unaudited consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, which addresses eight specific cash flow issues: Debt prepayment or debt extinguishment costs; settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing; contingent consideration payments made after a business combination; proceeds from the settlement of insurance claims; proceeds from the settlement of corporate-owned life insurance policies (COLIs) (including bank-owned life insurance policies (BOLIs)); distributions received from equity method investees; beneficial interests in securitization transactions; and separately identifiable cash flows and application of the predominance principle. In November 2016, the FASB issued ASU 2016-18, Statements of Cash Flow (Topic 230): Restricted Cash, which requires that a statement of cash flows explain the change during the period in the total cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amount shown on the statement of cash flows. ASU 2016-15 and ASU 2016-18 are effective for the Group for annual reporting periods beginning January 1, 2019 and interim periods within annual periods beginning January 1, 2020. Early adoption is permitted. The Group does not plan to early adopt ASU 2016-15 and ASU 2016-18 and it is evaluating the impacts that these standards will have on its unaudited consolidated financial statements. In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. ASU 2017-01 clarifies the framework for determining whether an integrated set of assets and activities meets the definition of a business. The revised framework establishes a screen for determining whether an integrated set of assets and activities is a business and narrows the definition of a business, which is expected to result in fewer transactions being accounted for as business combinations. Acquisitions of integrated sets of assets and activities that do not meet the definition of a business are accounted for as asset acquisitions. ASU 2017-01 is effective for the Group for annual reporting periods beginning January 1, 2020 and interim periods within annual periods beginning January 1, 2021, with early adoption permitted for transactions that have not been reported in previously issued (or available to be issued) financial statements. The Group does not plan to early adopt ASU 2017-01 and does not expect the impact that this standard will have a material impact on its unaudited consolidated financial statements. In January 2017, the FASB issued Accounting Standards Update No. 2017-04, Intangibles — Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. |
Prepaid Expenses and Other Cu26
Prepaid Expenses and Other Current Assets (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Prepaid Expenses and Other Current Assets [Abstract] | |
Schedule of prepaid expenses and other current assets | As of December 31, As of March 31, 2017 2018 US$ US$ Staff advances 312 430 Prepayment for ordinary share repurchase (i) - 10,048 Prepayment for products 1,008 1,787 Advance to OEM 3,662 - Rental and other deposits 1,203 1,103 VAT recoverable 2,189 2,898 Loan to third parties 1,469 - Receivable from an agent 6,318 6,450 Others 79 130 16,240 22,846 (i) On January 10, 2018, the Company entered into a stock repurchase agreement (“Stock Repurchase Agreement”) with Zhengqi International Holding Limited (“Zhengqi”), pursuant to which the Company agreed to repurchase 966,136 ordinary shares that were originally issued and sold to Zhengqi on August 18, 2017, at an aggregate purchase price of $10 million. The $10 million share repurchases consideration was transferred to Zhengqi, and the Company is working with Zhengqi to complete certain procedures to close the transaction in 2018. |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Property and Equipment, Net [Abstract] | |
Schedule of property and equipment | As of As of 2017 2018 US$ US$ At cost: Leasehold improvements 933 1,115 Computer and network equipment 6,458 6,595 Office equipment 918 987 Motor vehicles 233 234 8,542 8,931 Less: accumulated depreciation (7,180 ) (7,615 ) 1,362 1,316 |
Summary of depreciation expense on property and equipment | Three Months Ended 2017 2018 US$ US$ Cost of revenues 41 48 Sales and marketing expenses 2 3 General and administrative expenses 72 18 Research and development expenses 168 70 283 139 |
Intangible Assets, Net (Tables)
Intangible Assets, Net (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Intangible Assets, Net/Goodwill [Abstract] | |
Summry of presents the Group's intangible assets as of the respective balance sheet dates | Software Capitalized software development costs License Total US$ US$ US$ US$ Balance as of January 1, 2017 2,294 6,874 6,330 15,498 Additions 31 1,858 - 1,889 Amortization expense (60 ) (670 ) (212 ) (942 ) Foreign currency translation difference 11 23 35 69 Balance as of March 31, 2017 2,276 8,085 6,153 16,514 Balance as of January 1, 2018 2,529 11,600 5,875 20,004 Additions 139 1,478 - 1,617 Amortization expense (29 ) (1,339 ) (236 ) (1,604 ) Foreign currency translation difference 98 243 230 571 Balance as of March 31, 2018 2,737 11,982 5,869 20,588 |
Goodwill (Tables)
Goodwill (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Intangible Assets, Net/Goodwill [Abstract] | |
Schedule of changes in carrying amount of goodwill | As of As of 2017 2018 US$ US$ Balance at beginning of the period 693 736 Foreign currency translation difference 43 29 Balance at end of the period 736 765 |
Bank and Other Borrowings (Tabl
Bank and Other Borrowings (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Long-Term Investment/Bank and Other Borrowings [Abstract] | |
Schedule of bank borrowings of the balance sheet | As of As of 2017 2018 US$ US$ Short-term bank and other borrowings 12,648 12,792 Long-term bank borrowings, current portion 5,432 4,479 Total borrowings 18,080 17,271 |
Accrued Expenses and Other Pa31
Accrued Expenses and Other Payables (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Accrued Expenses and Other Payables [Abstract] | |
Schedule of accrued expenses and other payables | As of December 31, As of March 31, 2017 2018 US$ US$ Payroll and welfare payable 2,030 2,457 Payable for long-term investment (Note 7) - 3,131 VAT, and other taxes payable 2,473 2,827 Payables for office supply and utilities 711 958 Payables for purchase of property and equipment 52 54 Professional service fees 3,161 2,964 Deposits from agents 3,509 3,614 Others 227 420 12,163 16,425 |
Deferred Government Grants (Tab
Deferred Government Grants (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Deferred Government Grants [Abstract] | |
Summary of defferred government grants | Three Months Ended March 31, 2017 2018 US$ US$ Balance at beginning of the period 2,108 1,957 Recognized as other operating income (266 ) - Foreign currency translation difference 12 77 Balance at ending of the period 1,854 2,034 |
Accumulated Other Comprehensi33
Accumulated Other Comprehensive Income (Loss) (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Accumulated Other Comprehensive Income (Loss) [Abstract] | |
Schedule of accumulated other comprehensive loss, net of tax | Foreign currency translation Total US$ US$ Balance as of December 31, 2016 (2,626 ) (2,626 ) Current year other comprehensive income 2,119 2,119 Balance as of December 31, 2017 (507 ) (507 ) Current year other comprehensive income 1,332 1,332 Balance as of March 31, 2018 825 825 |
Taxation (Tables)
Taxation (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Taxation [Abstract] | |
Schedule of profit before income taxes | Three Months Ended 2017 2018 US$ US$ Non-PRC 1,903 590 PRC (1,441 ) 1,980 462 2,570 |
Schedule of income tax expense | Three Months Ended 2017 2018 US$ US$ Current (473 ) (1,050 ) Deferred 29 (133 ) (444 ) (1,183 ) |
Schedule of reconciliation of tax computed by applying the statutory income tax rate | Three Months Ended 2017 2018 US$ US$ Profit before income taxes 462 2,570 Income tax expenses computed at the statutory income tax rate at 25% (116 ) (642 ) Non-deductible expenses (123 ) (105 ) Non-taxation income 67 - Preferential rate (99 ) 355 Current and deferred tax rate differences 6 (834 ) Foreign rate differences (132 ) (149 ) Change of valuation allowance (16 ) 545 Interest expenses (31 ) (353 ) Income tax expenses (444 ) (1,183 ) |
Schedule of significant components of deferred taxes | As of As of 2017 2018 US$ US$ Deferred tax assets Inventories provision 229 - AR provision - 238 Accrued salary and welfare payable 165 284 Property and equipment 14 15 Tax losses 14,769 14,198 Valuation allowance (13,714 ) (13,169 ) Total deferred tax assets 1,463 1,566 Deferred tax liabilities Intangible assets 2,004 1,964 Deferred cost of revenues 1,551 1,832 Total deferred tax liabilities 3,555 3,796 |
Schedule of roll-forward of unrecognized tax benefits | Three Months Ended 2017 2018 US$ US$ Balance at beginning of period 4,053 4,547 Additions based on tax positions related to the current year 67 609 Foreign currency translation difference (407 ) 178 Balance at end of period 3,713 5,334 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Related Party Transactions [Abstract] | |
Schedule of names of related parties and relationship with group | Names of related parties Relationship with the Group Intel Capital Corporation (“Intel”) and its affiliates A substantial shareholder of the company, but exited from the mobile chipset activities. |
Schedule of significant related party transactions | Three Months Ended March 31, 2017 2018 US$ US$ Software services provided to: Intel Corporation - - Intel (China) Co., Ltd. 9 - Intel Asia-Pacific Research and Development Ltd. 19 - Intel (China) Research Center Co., Ltd. 34 - |
(Loss) Earnings Per Share (Tabl
(Loss) Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
(Loss) Earnings Per Share [Abstract] | |
Schedule of basic and diluted loss per share | Three Months Ended 2017 2018 US$ US$ Numerator: Net income 18 1,387 Less: net (loss) income attributable to noncontrolling interests (78 ) 188 Net income attributable to Borqs Technologies, Inc. 96 1,199 Accretion to redemption value of Convertible Redeemable Preferred Shares (298 ) - Net (loss) income attributable to Borqs Technologies, Inc.’s ordinary shareholders (202 ) 1,199 Denominator: Weighted-average number of ordinary shares outstanding—basic 4,224,725 26,384,152 Weighted-average number of ordinary shares outstanding—diluted 4,224,725 27,471,885 (Loss) earnings per share—Basic: (0.05 ) 0.05 (Loss) earnings per share—Diluted: (0.05 ) 0.04 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Commitments and Contingencies [Abstract] | |
Schedule of future minimum lease payments under non-cancelable operating leases | US$ 2018 1,369 2019 2,070 2020 1,184 2021 526 2022 and thereafter 424 5,573 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Schedule of group's operating segment | Connected Total Three months ended March 31, 2018 Yuantel Solution Segments Eliminations Consolidated Net revenue -External customers 7,882 50,374 58,256 - 58,256 -Inter-segment - 304 304 (304 ) - Total net revenue 7,882 50,678 58,560 (304 ) 58,256 Operating income 684 2,505 3,189 - 3,189 Connected Total Three months ended March 31, 2017 Yuantel Solution segments Eliminations Consolidated Net revenue -External customers 6,447 24,763 31,210 - 31,210 -Inter-segment - 449 449 (449 ) - Total net revenue 6,447 25,212 31,659 (449 ) 31,210 Operating (loss) income (1,122 ) 2,193 1,071 - 1,071 Three Months Ended 2017 2018 US$ US$ PRC 12,759 11,179 Outside PRC: United States 1,553 4,196 India 2,088 42,074 Rest of the world 14,810 807 Total net revenue 31,210 58,256 |
Organization (Details Textual)
Organization (Details Textual) | 8 Months Ended |
Aug. 18, 2017 | |
BORQS International Holding Corp. [Member] | |
Organization (Textual) | |
Equity interest, percentage | 100.00% |
Summary of Significant Accoun40
Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Dec. 31, 2017 | |
Summary of Significant Accounting Policies (Textual) | ||
Accumulated deficit | $ (73,230) | $ (74,231) |
Negative cash flow | 10,034 | |
Funded by public | $ 20,000 |
Prepaid Expenses and Other Cu41
Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 | |
Prepaid Expenses and Other Current Assets [Abstract] | |||
Staff advances | $ 430 | $ 312 | |
Prepayment for ordinary share repurchase | [1] | 10,048 | |
Prepayment for products | 1,787 | 1,008 | |
Advance to OEM | 3,662 | ||
Rental and other deposits | 1,103 | 1,203 | |
VAT recoverable | 2,898 | 2,189 | |
Loan to third parties | 1,469 | ||
Receivable from an agent | 6,450 | 6,318 | |
Others | 130 | 79 | |
Prepaid expenses and other current assets | $ 22,846 | $ 16,240 | |
[1] | On January 10, 2018, the Company entered into a stock repurchase agreement ("Stock Repurchase Agreement") with Zhengqi International Holding Limited ("Zhengqi"), pursuant to which the Company agreed to repurchase 966,136 ordinary shares that were originally issued and sold to Zhengqi on August 18, 2017, at an aggregate purchase price of $10 million. The $10 million share repurchases consideration was transferred to Zhengqi, and the Company is working with Zhengqi to complete certain procedures to close the transaction in 2018. |
Prepaid Expenses and Other Cu42
Prepaid Expenses and Other Current Assets (Details Textual) - Zhengqi International Holding Limited [Member] $ in Millions | 1 Months Ended |
Jan. 10, 2018USD ($)shares | |
Prepaid Expenses And Other Current Assets (Textual) | |
Agreed to repurchase of ordinary shares | shares | 966,136 |
Aggregate purchase price | $ | $ 10 |
Property and Equipment, Net (De
Property and Equipment, Net (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
At cost: | ||
Property and equipment, gross | $ 8,931 | $ 8,542 |
Less: accumulated depreciation | (7,615) | (7,180) |
Property and equipment, net | 1,316 | 1,362 |
Leasehold improvements [Member] | ||
At cost: | ||
Property and equipment, gross | 1,115 | 933 |
Computer and network equipment [Member] | ||
At cost: | ||
Property and equipment, gross | 6,595 | 6,458 |
Office equipment [Member] | ||
At cost: | ||
Property and equipment, gross | 987 | 918 |
Motor vehicles [Member] | ||
At cost: | ||
Property and equipment, gross | $ 234 | $ 233 |
Property and Equipment, Net (44
Property and Equipment, Net (Details 1) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Property, Plant and Equipment [Line Items] | ||
Depreciation expense, Total | $ 194 | $ 283 |
Cost of revenues [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Depreciation expense, Total | 48 | 41 |
Sales and marketing expenses [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Depreciation expense, Total | 3 | 2 |
General and administrative expenses [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Depreciation expense, Total | 18 | 72 |
Research and development expenses [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Depreciation expense, Total | $ 70 | $ 168 |
Property and Equipment, Net (45
Property and Equipment, Net (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Property and Equipment, Net (Textual) | ||
Depreciation expense | $ 194 | $ 283 |
Intangible Assets, Net (Details
Intangible Assets, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Finite-Lived Intangible Assets [Line Items] | ||
Beginning Balance | $ 20,004 | $ 15,498 |
Additions | 1,617 | 1,889 |
Amortization expense | (1,604) | (942) |
Foreign currency translation difference | 571 | 69 |
Ending Balance | 20,588 | 16,514 |
Software [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Beginning Balance | 2,529 | 2,294 |
Additions | 139 | 31 |
Amortization expense | (29) | (60) |
Foreign currency translation difference | 98 | 11 |
Ending Balance | 2,737 | 2,276 |
Capitalized software development costs [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Beginning Balance | 11,600 | 6,874 |
Additions | 1,478 | 1,858 |
Amortization expense | (1,339) | (670) |
Foreign currency translation difference | 243 | 23 |
Ending Balance | 11,982 | 8,085 |
License [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Beginning Balance | 5,875 | 6,330 |
Additions | ||
Amortization expense | (236) | (212) |
Foreign currency translation difference | 230 | 35 |
Ending Balance | $ 5,869 | $ 6,153 |
Intangible Assets, Net (Detai47
Intangible Assets, Net (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Finite-Lived Intangible Assets [Line Items] | |||
Amortization of intangible assets | $ 1,604 | $ 942 | |
Estimated useful lives | 5 years | ||
Maximum [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Estimated useful lives | 10 years | ||
Minimum [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Estimated useful lives | 3 years |
Goodwill (Details)
Goodwill (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2018 | Dec. 31, 2017 | |
Intangible Assets, Net/Goodwill [Abstract] | ||
Balance as of January 1 | $ 736 | |
Foreign currency translation difference | 29 | $ 43 |
Balance as of December 31 | $ 765 | $ 736 |
Long-Term Investment (Details)
Long-Term Investment (Details) $ in Thousands | 1 Months Ended |
Jan. 18, 2018USD ($)shares | |
Zhengqi International Holding Limited [Member] | |
Long-Term Investment (Textual) | |
Agreed to acquire equity percentage | 13.80% |
Ordinary shares issued to selling shareholders | shares | 473,717 |
Ordinary shares to selling shareholders value | $ | $ 10,000 |
Colmei Technology International Ltd [Member] | |
Long-Term Investment (Textual) | |
Agreed to acquire equity percentage | 13.80% |
Ordinary shares issued to selling shareholders | shares | 473,717 |
Ordinary shares to selling shareholders value | $ | $ 10,000 |
Bank and Other Borrowings (Deta
Bank and Other Borrowings (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Long-Term Investment/Bank and Other Borrowings [Abstract] | ||
Short-term bank and other borrowings | $ 12,792 | $ 12,648 |
Long-term bank borrowings, current portion | 4,479 | 5,432 |
Bank borrowings, current | $ 17,271 | $ 18,080 |
Bank and Other Borrowings (De51
Bank and Other Borrowings (Details Textual) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | ||
Nov. 28, 2017 | Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Bank Borrowings (Textual) | ||||
Weighted average interest rate | 6.44% | 6.73% | ||
Short term bank term | These borrowings were obtained from financial institutions and have terms of one year. | |||
Short term loan | $ 12,792 | $ 12,648 | ||
Long-term debt, description | These borrowings were obtained from financial institutions located in the United States, and have terms of three years. | |||
Long term loan | $ 18,080 | |||
Warrants re-measured at fair value | $ 161 | |||
Long-term bank borrowing | 479 | |||
HHMC Microelectronic Co., Limited [Member] | ||||
Bank Borrowings (Textual) | ||||
Short term bank term | Three months | |||
Short term loan | $ 5,000,000 | |||
Interest rate | 14.60% | |||
Warrants [Member] | ||||
Bank Borrowings (Textual) | ||||
Warrants re-measured at fair value | $ 479 |
Accrued Expenses and Other Pa52
Accrued Expenses and Other Payables (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Accrued Expenses and Other Payables [Abstract] | ||
Payroll and welfare payable | $ 2,457 | $ 2,030 |
Payable for long-term investment (Note 7) | 3,131 | |
VAT, and other taxes payable | 2,827 | 2,473 |
Payables for office supply and utilities | 958 | 711 |
Payables for purchase of property and equipment | 54 | 52 |
Professional service fees | 2,964 | 3,161 |
Deposits from agents | 3,614 | 3,509 |
Others | 420 | 227 |
Accrued expenses and other payabes | $ 16,425 | $ 12,163 |
Deferred Government Grants (Det
Deferred Government Grants (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Deferred Government Grants [Abstract] | ||||
Balance at beginning of the period | $ 1,957 | $ 2,108 | $ 4,014 | $ 7,316 |
Recognized as other operating income | (266) | (1,650) | (2,880) | |
Foreign currency translation difference | 77 | 12 | (256) | (422) |
Balance at ending of the period | $ 2,034 | $ 1,854 | $ 2,108 | $ 4,014 |
Accumulated Other Comprehensi54
Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2018 | Dec. 31, 2017 | |
Class of Stock [Line Items] | ||
Beginning balance | $ (507) | |
Current year other comprehensive income | 1,332 | $ 2,119 |
Ending balance | 825 | (507) |
Foreign currency translation [Member] | ||
Class of Stock [Line Items] | ||
Beginning balance | 507 | 2,626 |
Current year other comprehensive income | 1,332 | 2,119 |
Ending balance | $ 825 | $ 507 |
Mainland China Employee Contr55
Mainland China Employee Contribution Plan (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Mainland China Employee Contribution Plan (Textual) | ||
Total expenses for employee contribution plan | $ 836 | $ 836 |
Taxation (Details)
Taxation (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Components of profit before income taxes | ||
Non-PRC | $ 590 | $ 1,903 |
PRC | 1,980 | (1,441) |
Profit before income taxes | $ 2,570 | $ 462 |
Taxation (Details 1)
Taxation (Details 1) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Components of income tax expense | ||
Current | $ (1,050) | $ (473) |
Deferred | (133) | 29 |
Income tax expenses | $ (1,183) | $ (444) |
Taxation (Details 2)
Taxation (Details 2) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Taxation [Abstract] | ||
Profit before income taxes | $ 2,570 | $ 462 |
Income tax expenses computed at the statutory income tax rate at 25% | (642) | (116) |
Non-deductible expenses | (105) | (123) |
Non-taxation income | 67 | |
Preferential rate | 355 | (99) |
Current and deferred tax rate differences | (834) | 6 |
Foreign rate differences | (149) | (132) |
Change of valuation allowance | 545 | (16) |
Interest expenses | (353) | (31) |
Income tax expenses | $ (1,183) | $ (444) |
Taxation (Details 3)
Taxation (Details 3) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Deferred tax assets | ||
Inventories provision | $ 229 | |
AR provision | 238 | |
Accrued salary and welfare payable | 165 | 284 |
Property and equipment | 14 | 15 |
Tax losses | 14,769 | 14,198 |
Valuation allowance | (13,714) | (13,169) |
Total deferred tax assets | 1,463 | 1,566 |
Deferred tax liabilities | ||
Intangible assets | 2,004 | 1,964 |
Deferred cost of revenues | 1,551 | 1,832 |
Total deferred tax liabilities | $ 3,555 | $ 3,796 |
Taxation (Details 4)
Taxation (Details 4) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
A roll-forward of unrecognized tax benefits is as follows: | ||
Balance at beginning of year | $ 2,121 | |
Balance at end of year | 3,091 | |
Unrecognized tax benefits [Member] | ||
A roll-forward of unrecognized tax benefits is as follows: | ||
Balance at beginning of year | 4,547 | $ 4,053 |
Additions based on tax positions related to the current year | 609 | 67 |
Foreign currency translation difference | 178 | (407) |
Balance at end of year | $ 5,334 | $ 3,713 |
Taxation (Details Textual)
Taxation (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Taxation (Textual) | |||
Unrecognized tax benefits | $ 5,223 | $ 4,047 | |
Deferred tax assets related to tax loss carry forwards | 3,654 | $ 2,764 | |
Unrecognized tax benefits of ultimately recognized, will impact the effective tax rate | 2,983 | $ 2,043 | |
Interest expenses accrued in relation to the unrecognized tax benefit | 353 | 31 | |
Accumulated interest expenses | 691 | 119 | |
Current income tax expense | (1,050) | $ (473) | |
PRC [Member] | |||
Taxation (Textual) | |||
Net tax operating loss from subsidiaries | $ 28,855 | ||
Net tax operating loss expiration term | Expire from 2018 to 2022 | ||
Borqs HK [Member] | |||
Taxation (Textual) | |||
Net tax operating loss from subsidiaries | $ 14,949 | ||
Net tax operating loss expiration term | Will not expire. |
Related Party Transactions (Det
Related Party Transactions (Details) | 3 Months Ended |
Mar. 31, 2018 | |
Intel Capital Corporation (''Intel") and its affiliates [Member] | |
Related Party Transaction [Line Items] | |
Relationship with the Group | A substantial shareholder of the company, but exited from the mobile chipset activities. |
Related Party Transactions (D63
Related Party Transactions (Details 1) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Intel Corporation [Member] | ||
Related Party Transaction [Line Items] | ||
Software services provided to | ||
Intel (China) Co., Ltd. [Member] | ||
Related Party Transaction [Line Items] | ||
Software services provided to | 9 | |
Intel Asia-Pacific Research and Development Ltd [Member] | ||
Related Party Transaction [Line Items] | ||
Software services provided to | 19 | |
Intel (China) Research Center Co., Ltd [Member] | ||
Related Party Transaction [Line Items] | ||
Software services provided to | $ 34 |
Related Party Transactions (D64
Related Party Transactions (Details 2) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | |
Accounts receivable from related parties: | |||
Accounts receivable from related parties | |||
Intel Corporation [Member] | |||
Accounts receivable from related parties: | |||
Accounts receivable from related parties | [1] | $ 481 | |
Intel (China) Co., Ltd. [Member] | |||
Accounts receivable from related parties: | |||
Accounts receivable from related parties | [1] | 9 | |
Intel Asia-Pacific Research and Development Ltd [Member] | |||
Accounts receivable from related parties: | |||
Accounts receivable from related parties | [1] | ||
[1] | Upon the consummation of the Merger, both entities ceased to be the shareholders of the Group. |
(Loss) Earnings Per Share (Deta
(Loss) Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Numerator: | ||
Net income | $ 1,387 | $ 18 |
Less: net (loss) income attributable to noncontrolling interests | 188 | (78) |
Net income attributable to Borqs Technologies, Inc. | 1,199 | 96 |
Accretion to redemption value of Convertible Redeemable Preferred Shares | (298) | |
Net (loss) income attributable to Borqs Technologies, Inc.'s ordinary shareholders | $ 1,199 | $ (202) |
Denominator: | ||
Weighted-average number of ordinary shares outstanding-basic | 26,384,152 | 4,224,725 |
Weighted-average number of ordinary shares outstanding-diluted | 27,471,885 | 4,224,725 |
(Loss) earnings per share-Basic: | $ 0.04 | $ (0.05) |
(Loss) earnings per share-Diluted: | $ 0.05 | $ (0.05) |
Fair Value Measurements (Detail
Fair Value Measurements (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Liabilities | $ 1,344 |
Warrant liabilities | 1,344 |
Level 1 [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Liabilities | |
Warrant liabilities | |
Level 2 [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Liabilities | |
Warrant liabilities | |
Level 3 [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Liabilities | 1,344 |
Warrant liabilities | $ 1,344 |
Commitments and Contingencies67
Commitments and Contingencies (Details) $ in Thousands | Mar. 31, 2018USD ($) |
Commitments and Contingencies [Abstract] | |
2,018 | $ 1,369 |
2,019 | 2,070 |
2,020 | 1,184 |
2,021 | 526 |
2022 and thereafter | 424 |
Total | $ 5,573 |
Commitments and Contingencies68
Commitments and Contingencies (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Commitments and Contingencies (Textual) | ||
Total rental expenses for all operating leases | $ 354 | $ 354 |
Unrecognized tax benefits and interest | $ 3,091 |
Segment Reporting (Details)
Segment Reporting (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Schedule of group's operating segment | ||
Total net revenues | $ 58,256 | $ 31,210 |
Operating income | 3,189 | 1,071 |
PRC [Member] | ||
Schedule of group's operating segment | ||
Total net revenues | 11,179 | 12,759 |
United States [Member] | ||
Schedule of group's operating segment | ||
Total net revenues | 4,196 | 1,553 |
India [Member] | ||
Schedule of group's operating segment | ||
Total net revenues | 42,074 | 2,088 |
Rest of the world [Member] | ||
Schedule of group's operating segment | ||
Total net revenues | 807 | 14,810 |
Consolidated [Member] | ||
Schedule of group's operating segment | ||
Total net revenues | 58,256 | 31,210 |
Operating income | 2,982 | |
Consolidated [Member] | External customers [Member] | ||
Schedule of group's operating segment | ||
Total net revenues | 58,256 | 31,210 |
Consolidated [Member] | Inter-segment [Member] | ||
Schedule of group's operating segment | ||
Total net revenues | ||
Eliminations [Member] | ||
Schedule of group's operating segment | ||
Total net revenues | (304) | (449) |
Operating income | ||
Eliminations [Member] | External customers [Member] | ||
Schedule of group's operating segment | ||
Total net revenues | ||
Eliminations [Member] | Inter-segment [Member] | ||
Schedule of group's operating segment | ||
Total net revenues | (304) | (449) |
Total segments [Member] | ||
Schedule of group's operating segment | ||
Total net revenues | 58,560 | 31,659 |
Operating income | 3,189 | 1,071 |
Total segments [Member] | External customers [Member] | ||
Schedule of group's operating segment | ||
Total net revenues | 58,256 | 31,210 |
Total segments [Member] | Inter-segment [Member] | ||
Schedule of group's operating segment | ||
Total net revenues | 304 | 449 |
Yuantel [Member] | ||
Schedule of group's operating segment | ||
Total net revenues | 7,882 | 6,447 |
Operating income | 684 | (1,122) |
Yuantel [Member] | External customers [Member] | ||
Schedule of group's operating segment | ||
Total net revenues | 7,882 | 6,447 |
Yuantel [Member] | Inter-segment [Member] | ||
Schedule of group's operating segment | ||
Total net revenues | ||
Connected Solution [Member] | ||
Schedule of group's operating segment | ||
Total net revenues | 50,678 | 25,212 |
Operating income | 2,505 | 2,193 |
Connected Solution [Member] | External customers [Member] | ||
Schedule of group's operating segment | ||
Total net revenues | 50,374 | 24,763 |
Connected Solution [Member] | Inter-segment [Member] | ||
Schedule of group's operating segment | ||
Total net revenues | $ 304 | $ 449 |
Segment Reporting (Details Text
Segment Reporting (Details Textual) | 3 Months Ended |
Mar. 31, 2018Segments | |
Segment Reporting (Textual) | |
Number of segments reports | 2 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ in Millions | 1 Months Ended | |
Jan. 08, 2018 | Mar. 31, 2018 | |
Subsequent Events (Textual) | ||
Agreement to acquire equity interest | 79.00% | |
Shanghai KADI Machinery Technology Co., Ltd. [Member] | ||
Subsequent Events (Textual) | ||
Ordinary shares to selling shareholders value | $ 3.3 | |
Agreement to acquire equity interest | 60.00% | |
Aggregate of cash to paid | $ 15 | |
Cash | $ 11.7 | |
Cash advances payment, description | In accordance with the letter of intent, the Company have made three of four scheduled cash advances to KADI amounted to $450,000, which is recorded as other non-current assets. The remaining fourth payment of $150,000 will be paid in May 2018. | |
Advance payments converted into equity interest percentage | 5.00% |