COVER PAGE
COVER PAGE - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Mar. 23, 2020 | Jun. 28, 2019 | |
Entity Information [Line Items] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Transition Report | false | ||
Entity File Number | 001-37862 | ||
Entity Registrant Name | PHUNWARE, INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 26-4413774 | ||
Entity Address, Address Line One | 7800 Shoal Creek Blvd | ||
Entity Address, Address Line Two | Suite 230-S | ||
Entity Address, City or Town | Austin | ||
Entity Address, State or Province | TX | ||
Entity Address, Postal Zip Code | 78757 | ||
City Area Code | 512 | ||
Local Phone Number | 693-4199 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 69,119,694 | ||
Entity Common Stock, Shares Outstanding | 40,368,825 | ||
Documents Incorporated by Reference | Portions of the information called for by Part III of this Annual Report on Form 10-K is hereby incorporated by reference from the definitive proxy statement for the registrant's annual meeting of stockholders to be filed with the Securities and Exchange Commission within 120 days after the registrant's fiscal year ended December 31, 2019. | ||
Entity Central Index Key | 0001665300 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2019 | ||
Common Stock | |||
Entity Information [Line Items] | |||
Title of 12(b) Security | Common Stock, par value $0.0001 per share | ||
Trading Symbol | PHUN | ||
Security Exchange Name | NASDAQ | ||
Warrant | |||
Entity Information [Line Items] | |||
Title of 12(b) Security | Warrants to purchase one share of Common Stock | ||
Trading Symbol | PHUNW | ||
Security Exchange Name | NASDAQ |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash | $ 276 | $ 844 |
Accounts receivable, net | 1,671 | 3,606 |
Prepaid expenses and other current assets | 368 | 272 |
Total current assets | 2,315 | 4,722 |
Property and equipment, net | 24 | 66 |
Goodwill | 25,857 | 25,821 |
Intangible assets, net | 253 | 521 |
Deferred tax asset – long term | 241 | 64 |
Restricted cash | 86 | 5,500 |
Other assets | 276 | 187 |
Total assets | 29,052 | 36,881 |
Current liabilities: | ||
Accounts payable | 10,159 | 9,890 |
Accrued expenses and other | 4,035 | 3,028 |
Deferred revenue | 3,360 | 2,629 |
PhunCoin deposits | 1,202 | 0 |
Factored receivables payable | 1,077 | 2,434 |
Short term notes payable – related party | 0 | 1,993 |
Total current liabilities | 19,833 | 19,974 |
Debt (see Note 8) | 1,105 | 0 |
Deferred tax liability | 241 | 64 |
Deferred revenue | 3,764 | 5,622 |
Deferred rent | 83 | 17 |
Total liabilities | 25,026 | 25,677 |
Commitments and contingencies (see Note 9) | ||
Redeemable convertible preferred stock, $0.0001 par value (see Note 11) | 0 | 5,377 |
Stockholders’ equity | ||
Common stock, $0.0001 par value (see Note 12) | 4 | 3 |
Additional paid-in capital | 128,008 | 118,062 |
Accumulated other comprehensive loss | (382) | (418) |
Accumulated deficit | (123,604) | (111,820) |
Total stockholders’ equity | 4,026 | 5,827 |
Total liabilities, redeemable convertible preferred stock, and stockholders’ equity | $ 29,052 | $ 36,881 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Redeemable convertible preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Loss - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Income Statement [Abstract] | ||
Net revenues | $ 19,150 | $ 30,883 |
Cost of revenues | 9,020 | 11,802 |
Gross profit | 10,130 | 19,081 |
Operating expenses: | ||
Sales and marketing | 2,706 | 5,417 |
General and administrative | 15,403 | 13,562 |
Research and development | 4,333 | 6,965 |
Total operating expenses | 22,442 | 25,944 |
Operating loss | (12,312) | (6,863) |
Other income (expense): | ||
Interest expense | (581) | (724) |
Fair value adjustment for warrant liabilities | 0 | (54) |
Impairment of digital currencies | 0 | (334) |
Other income (expense) | 27 | (2,202) |
Total other expense | (554) | (3,314) |
Loss before taxes | (12,866) | (10,177) |
Income tax (provision) benefit | (5) | 374 |
Net loss | (12,871) | (9,803) |
Cumulative translation adjustment | 36 | (71) |
Comprehensive loss | $ (12,835) | $ (9,874) |
Loss per share, basic and diluted (in dollars per share) | $ (0.35) | $ (0.38) |
Weighted-average common shares used to compute net loss per share, basic and diluted (in shares) | 36,879 | 25,556 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Redeemable Convertible Preferred Stock and Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Other Comprehensive Loss |
Beginning balance at Dec. 31, 2017 | $ 0 | ||||
Beginning balance (in shares) at Dec. 31, 2017 | 0 | ||||
Increase (Decrease) in Temporary Equity [Roll Forward] | |||||
Issuance of Series A convertible preferred stock, net of issuance costs & fair value of warrants | $ 5,377 | ||||
Issuance of Series A convertible preferred stock, net of issuance costs & fair value of warrants (in shares) | 6 | ||||
Ending balance at Dec. 31, 2018 | $ 5,377 | ||||
Ending balance (in shares) at Dec. 31, 2018 | 6 | ||||
Beginning balance at Dec. 31, 2017 | $ 7,904 | $ 3 | $ 110,265 | $ (102,017) | $ (347) |
Beginning balance (in shares) at Dec. 31, 2017 | 24,559 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Exercise of stock options, net of vesting of restricted shares | 152 | 152 | |||
Exercise of stock options, net of vesting of restricted shares (in shares) | 276 | ||||
Issuance of common stock, net of issuance costs | 9,565 | 9,565 | |||
Issuance of common stock, net of issuance costs (in shares) | 1,085 | ||||
Recapitalization related to Reverse Merger | (2,370) | (2,370) | |||
Recapitalization related to Business Combination (in shares) | 1,333 | ||||
Stock-based compensation expense | 450 | 450 | |||
Cumulative translation adjustment | (71) | (71) | |||
Issuance of common stock for payment of bonus and legal fees | 0 | ||||
Net loss | (9,803) | (9,803) | |||
Ending balance at Dec. 31, 2018 | 5,827 | $ 3 | 118,062 | (111,820) | (418) |
Ending balance (in shares) at Dec. 31, 2018 | 27,253 | ||||
Increase (Decrease) in Temporary Equity [Roll Forward] | |||||
Series A convertible preferred stock redeemed for cash | $ (5,377) | ||||
Series A convertible preferred stock redeemed for cash (in shares) | (6) | ||||
Ending balance at Dec. 31, 2019 | $ 0 | ||||
Ending balance (in shares) at Dec. 31, 2019 | 0 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Exercise of stock options, net of vesting of restricted shares | $ 287 | 287 | |||
Exercise of stock options, net of vesting of restricted shares (in shares) | 506 | ||||
Exercise of common stock warrants for cash | 6,184 | 6,184 | |||
Exercise of common stock warrants for cash (in shares) | 617 | ||||
Exercise of common stock warrants pursuant to cashless provisions | 0 | $ 1 | (1) | ||
Exercise of common stock warrants pursuant to cashless provisions (in shares) | 10,913 | ||||
Series A convertible preferred stock redeemed for cash | (863) | (863) | |||
Waiver of sponsor promissory note originally issued in conjunction with Reverse Merger and Recapitalization | 1,993 | 1,993 | |||
Stock-based compensation expense | 1,784 | 1,784 | |||
Cumulative translation adjustment | 36 | 36 | |||
Vesting of restricted stock units (in shares) | 45 | ||||
Issuance of common stock for payment of bonus and legal fees | 562 | 562 | |||
Issuance of common stock for payment of bonus and legal fees (in shares) | 477 | ||||
Net loss | (12,871) | (12,871) | |||
Ending balance at Dec. 31, 2019 | $ 4,026 | $ 4 | $ 128,008 | $ (123,604) | $ (382) |
Ending balance (in shares) at Dec. 31, 2019 | 39,811 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Operating activities | ||
Net loss | $ (12,871) | $ (9,803) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation | 59 | 62 |
Loss on sale of digital currencies | 4 | 21 |
Bad debt expense | 114 | 167 |
Amortization of acquired intangibles | 268 | 372 |
Change in fair value of warrants | 0 | 1,329 |
Impairment of digital currencies | 0 | 334 |
Stock-based compensation | 1,784 | 450 |
Deferred income taxes | 0 | (387) |
Changes in operating assets and liabilities: | ||
Accounts receivable | 1,817 | 2,439 |
Prepaid expenses and other assets | 184 | 15 |
Accounts payable | 740 | 4,156 |
Accrued expenses | 1,133 | (5,789) |
Deferred revenue | 581 | 42 |
Net cash used by operating activities | (6,187) | (6,592) |
Investing activities | ||
Proceeds received from sale of digital currencies | 88 | 913 |
Payments for note receivable | 0 | (536) |
Capital expenditures | (18) | 0 |
Net cash provided by investing activities | 70 | 377 |
Financing activities | ||
Proceeds from convertible notes | 1,105 | 0 |
Proceeds from PhunCoin deposits | 212 | 0 |
Net (repayments) proceeds from factoring agreement | (1,357) | 618 |
Proceeds from common stock subscriptions, net of issuance costs | 0 | 5,448 |
Proceeds from warrant exercises | 6,092 | 0 |
Proceeds from exercise of options to purchase common stock | 287 | 152 |
(Redemptions, dividend payments) and issuances of Series A convertible preferred stock | (6,240) | 6,000 |
Proceeds from Business Combination | 0 | 98 |
Net cash provided for financing activities | 99 | 12,316 |
Effect of exchange rate on cash and restricted cash | 36 | (65) |
Net (decrease) increase in cash and restricted cash | (5,982) | 6,036 |
Cash and restricted cash at the beginning of the period | 6,344 | 308 |
Cash and restricted cash at the end of the period | 362 | 6,344 |
Supplemental disclosure of cash flow information | ||
Interest paid | 603 | 712 |
Supplemental disclosure of non-cash information | ||
Common stock issuances from subscription payable | 0 | 3,243 |
Warrants issued in conjunction with Reverse Merger and Recapitalization | 0 | 1,106 |
Issuance of common stock for payment of bonus and legal fees | 562 | 0 |
Waiver of sponsor promissory note originally issued in conjunction with Reverse Merger and Recapitalization | $ 1,993 | $ 0 |
The Company and Basis of Presen
The Company and Basis of Presentation | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
The Company and Basis of Presentation | The Company and Basis of Presentation The Company Phunware, Inc. (the “Company”) offers a fully integrated software platform that equips companies with the products, solutions and services necessary to engage, manage and monetize their mobile application portfolios globally at scale. Phunware’s Multiscreen as a Service ("MaaS") platform provides the entire mobile lifecycle of applications, media and data in one login through one procurement relationship. The Company’s MaaS technology is available in software development kit form for organizations developing their own application, via customized development services and prepackaged solutions. Through its integrated mobile advertising platform of publishers and advertisers, the Company provides in-app application transactions for mobile audience building, user acquisition, application discovery, audience engagement and audience monetization. Founded in 2009, the Company is a Delaware corporation headquartered in Austin, Texas. Reverse Merger On February 27, 2018, Phunware entered into an Agreement and Plan of Merger, as amended (collectively, the “Merger Agreement”) with Stellar Acquisition III, Inc. (“Stellar”). On December 26, 2018, the Company consummated the transaction contemplated by the Merger Agreement (the “Reverse Merger and Recapitalization”). In connection with the closing of the Reverse Merger and Recapitalization, the registrant changed its name from Stellar Acquisition III, Inc. to Phunware, Inc. (“Successor”). Furthermore, the holders of Phunware’s preferred stock converted all of their issued and outstanding shares of preferred stock into shares of Phunware common stock at a conversion ratio of one share of common stock for each share of preferred stock (the “Preferred Stock Exchange”). Subject to the terms and conditions set forth in the Merger Agreement, at the effective time of the Reverse Merger and Recapitalization (the “Effective Time”): (i) all shares of Phunware common stock and preferred stock (the “Phunware Stock”) issued and outstanding immediately prior to the Effective Time (after giving effect to the Preferred Stock Exchange) converted into the right to receive the Stockholder Merger Consideration (as defined below); (ii) each outstanding warrant to acquire shares of Phunware Stock was canceled, retired and terminated in exchange for the right to receive from the Successor a new warrant for shares of Successor common stock with its price and number of shares equitably adjusted based on the conversion of the shares of Phunware Stock into the Stockholder Merger Consideration, but with terms otherwise the same as the Phunware warrant (each, a “Replacement Warrant”); and (iii) each outstanding option to acquire Phunware Stock (whether vested or unvested) was assumed by the Successor and automatically converted into an option to acquire shares of Successor common stock, with its price and number of shares equitably adjusted based on the conversion of the shares of Phunware Stock into the Stockholder Merger Consideration (each, an “Assumed Option”). The shares of Successor common stock and the Transferred Sponsor Warrants to be transferred to Phunware stockholders are collectively referred to as “Stockholder Merger Consideration”. The per share Merger Consideration paid to Phunware Stockholders was 0.459 shares of Successor stock for each share of Phunware Stock. Unless otherwise noted, the financial statements, footnotes, and basic and dilutive net loss per share presented give retroactive effect of the Reverse Merger and Recapitalization. Basis of Presentation The consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”), and include the Company’s accounts and those of its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Going Concern Accounting Standards Codification (“ASC”) Topic 205-40, Presentation of Financial Statements - Going Concern ("ASC 205-40") requires management to assess the Company’s ability to continue as a going concern for one year after the date the financial statements are issued. Under ASC 205-40, management has the responsibility to evaluate whether conditions and/or events raise substantial doubt about the Company’s ability to meet future financial obligations as they become due within one year after the date that the financial statements are issued. As required by this standard, management’s evaluation shall initially not take into consideration the potential mitigating effects of management’s plans that have not been fully implemented as of the date the financial statements are issued. The Company’s assessment included the preparation of a detailed cash forecast that included all projected cash inflows and outflows. The Company continues to focus on growing its revenues. Accordingly, operating expenditures may exceed the revenue it expects to receive for the foreseeable future. Additionally, the Company has a history of operating losses and negative operating cash flows and expects these trends to continue into the foreseeable future. Future plans may include obtaining new debt financings and credit lines, utilizing existing or expanding existing credit lines, issuing equity securities, including the exercise of warrants, and reducing overhead expenses. Despite a history of successfully implementing similar plans to alleviate the adverse financial conditions, these sources of working capital are not currently assured, and consequently do not sufficiently mitigate the risks and uncertainties disclosed above. There can be no assurance that the Company will be able to obtain additional funding on satisfactory terms or at all. In addition, no assurance can be given that any such financing, if obtained, will be adequate to meet the Company’s capital needs and support its growth. If additional funding cannot be obtained on a timely basis and on satisfactory terms, its operations would be materially negatively impacted. The Company has therefore concluded there is substantial doubt about its ability to continue as a going concern through one year from the issuance of these financial statements. The accompanying consolidated financial statements have been prepared on a going-concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The accompanying consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from uncertainty related to the Company’s ability to continue as a going concern. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make certain 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 revenue and expenses during the reporting period. Items subject to the use of estimates include, but are not limited to, the standalone selling price for our products and services, stock-based compensation, useful lives of long-lived assets including intangibles, fair value of intangible assets and the recoverability or impairment of tangible and intangible assets, including goodwill, reserves and certain accrued liabilities, the benefit period of deferred commissions and provision for (benefit from) income taxes. Actual results could differ from those estimates and such differences could be material to the consolidated financial statements. Changes in Accounting Policies On January 1, 2019, we adopted Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers , as amended (“ASU 2014-09” or "ASC 606"), and have revised certain related accounting policies in connection with revenue recognition and deferred costs as more fully described below. Other recently adopted accounting policies can found under the subheading " Recently Adopted Accounting Standards " below. Revenue Recognition Revenue is recognized upon transfer of control of promised products or services in an amount that reflects the consideration we expect to receive in exchange for those products or services. The Company enters into contracts that can include various combinations of products and services, which are generally capable of being distinct, distinct within the context of the contract, and accounted for as separate performance obligations. Contract Balances The timing of revenue recognition may differ from the timing of invoicing for contracts with customers. When the timing of revenue recognition differs from the timing of invoicing, the Company uses judgment to determine whether the contract includes a significant financing component requiring adjustment to the transaction price. Various factors are considered in this determination including the duration of the contract, payment terms, and other circumstances. Generally, the Company determined that contracts do not include a significant financing component. The Company applies the practical expedient for instances where, at contract inception, the expected timing difference between when promised goods or services are transferred and associated payment will be one year or less. Payment terms vary by contract type; however, contracts typically stipulate a requirement for the customer to pay within 30 days. Transaction price may be allocated to performance obligations that are unsatisfied or are partially unsatisfied. Amounts relating to remaining performance obligations on non-cancelable contracts include both the deferred revenue balance and amounts that will be invoiced and recognized as revenue in future periods. As of December 31, 2019, approximately $12,989 of revenue is expected to be recognized from remaining performance obligations, a majority of which is related to multi-year subscription and support and maintenance arrangements. The Company expects to recognize revenue on approximately 72% of these remaining performance obligations within the next 24 months and the remainder thereafter. Significant Judgments Our contracts with customers often include promises to transfer multiple products and services to a customer. Determining whether products and services are considered distinct performance obligations that should be accounted for separately versus together may require significant judgment. For contracts with multiple performance obligations, the contract price is allocated to separate performance obligations on a relative standalone basis for which significant judgment is required. Judgment is required to determine whether a software license is considered distinct and accounted for separately, or not distinct and accounted for together with the software support and services and recognized over time. Platform Subscriptions and Services Revenue The Company derives subscription revenue from software license fees, which comprise subscription fees from customers licensing the Company’s Software Development Kits (SDKs), which includes accessing the MaaS platform and/or MaaS platform data; application development service revenue from the development of customer applications, or apps, which are built and delivered to customers; and support fees. The Company’s contract terms generally range from one three Subscription revenue from SDK licenses gives the customer the right to access the Company’s MaaS platform. In accordance with ASC 606, a ‘right to access’ license is recognized over the license period. Application development revenue is derived from development services around designing and building new applications or enhancing existing applications. The Company recognizes application development revenue upon the transfer of control of the completed application or application development services. The Company typically bills for application development revenue in advance at contract signing, but may at times, bill one-half in advance at contract execution and one-half upon completion. Support and maintenance revenue is comprised of support fees for customer applications, software updates, and technical support for application development services for a support term. Support revenue is recognized ratably over the support term. Support and maintenance is typically billed annually in advance. When a customer contract consists of licensing, application development and support and maintenance, the Company considers these separate performance obligations, which would require an allocation of consideration. From time to time, the Company also provides professional services by outsourcing employees to customers on a time and materials basis. Revenues from these arrangements are recognized as the services are performed. The Company typically bills professional service customers in the month in which the services are performed. Application Transaction Revenue The Company also generates revenue by charging advertisers to deliver advertisements (ads) to users of mobile connected devices. Depending on the specific terms of each advertising contract, the Company generally recognizes revenue based on the activity of mobile users viewing these ads. Fees from advertisers are commonly based on the number of ads delivered or views, clicks, or actions by users on mobile advertisements delivered, and the Company recognizes revenue at the time the user views, clicks, or otherwise acts on the ad. The Company sells ads through several offerings: cost per thousand impressions, on which advertisers are charged for each ad delivered to 1,000 consumers; cost per click, on which advertisers are charged for each ad clicked or touched on by a user; and cost per action, on which advertisers are charged each time a consumer takes a specified action, such as downloading an app. In addition, the Company generates application transaction revenue thru in-app purchases from an application on our platform. In the normal course of business, the Company acts as an intermediary in executing transactions with third parties. The determination of whether revenue should be reported on a gross or net basis is based on an assessment of whether the Company is acting as the principal or an agent in its transactions with advertisers. Control is a determining factor in assessing principal versus agent relation. The determination of whether the Company is acting as a principal or an agent in a transaction involves judgment and is based on an evaluation of the terms of each arrangement. ASC 606 provides indicators of when an entity controls specified goods or services and is therefore acting as a principal. Based on the indicators of control, the Company has determined that it is the principal in all advertising arrangements because it is responsible for fulfilling the promise to provide the specified advertisements to advertising agencies or companies; establishing the selling prices of the advertisements sold; and credit risk with its advertising traffic providers. Accordingly, the Company acts as the principal in all advertising arrangements and therefore reports revenue earned and costs incurred related to these transactions on a gross basis. Deferred Commissions The Company defers commission costs and amortizes them in a manner consistent with how we recognize revenue. Key judgments that impact our commission expense include estimating our customer life and the determination of the impairment of commission assets we deem to be unrecoverable. The Company applies a practical expedient and expenses these costs as incurred if the amortization period is one year or less. Changes in deferred commissions were as follows (in thousands): Year Ended December 31, Balance, beginning of the period $ 369 Deferral of commissions earned 171 Recognition of commission expense (231) Balance, end of the period $ 309 Concentrations of Credit Risk The Company’s financial instruments that are exposed to concentrations of credit risk consist primarily of cash and trade accounts receivable. Although the Company limits its exposure to credit loss by depositing its cash with established financial institutions that management believes have good credit ratings and represent minimal risk of loss of principal, its deposits, at times, may exceed federally insured limits. Collateral is not required for accounts receivable, and the Company believes the carrying value approximates fair value. Revenue from Fox Networks Group (“Fox”) was 50% and 42% of total net revenues for the years ended December 31, 2019 and 2018, respectively. Revenue from Fetch Media Ltd. was 21% of total revenue for 2018. The following table sets forth the Company's concentration of accounts receivable, net of specific allowances for doubtful accounts. December 31, 2019 December 31, 2018 Fox Networks Group —% 66% HID Global 23% —% American Made Media Consultants, LLC 15% —% Presidio Networked Solutions LLC 11% —% MD Anderson 10% —% The Company completed its contractual obligations under its statement of work with Fox as of September 30, 2019. While the underlying master services agreement with Fox (setting forth general terms and conditions) remains in place, the Company does not have any active statements of work with Fox. Cash, Cash Equivalents, and Restricted Cash The Company considers all investments with a maturity of three months or less from the date of acquisition to be cash equivalents. The Company had no cash equivalents at December 31, 2019 or 2018. As a result of the issuance of the Notes (defined and discussed further below), the Company had $86 in restricted cash as of December 31, 2019. As a result of the Series A Financing (defined and discussed further below), the Company had $5,500 in restricted cash as of December 31, 2018. Accounts Receivable and Reserves Accounts receivable are presented net of allowances. The Company considers receivables past due based on the contractual payment terms. The Company makes judgments as to its ability to collect outstanding receivables and records a bad debt allowance for receivables when collection becomes doubtful. The allowances are based upon historical loss patterns, current and prior trends in its aged receivables, credit memo activity, and specific circumstances of individual receivable balances. Accounts receivable consisted of the following: December 31, December 31, Accounts receivable $ 4,850 $ 6,882 Less allowances for doubtful accounts (3,179) (3,276) Accounts receivable, net $ 1,671 $ 3,606 Changes in the allowance for doubtful accounts are as follows: December 31, December 31, Balance as at beginning of period $ 3,276 $ 3,089 Allowances for bad debt 114 167 Issuance of credit memos (211) 20 Balance at end of period $ 3,179 $ 3,276 Property and Equipment Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets, generally ranging from three to seven years. Leasehold improvements are amortized over the shorter of their useful lives or the remaining terms of the related leases. Goodwill and Intangible Assets Goodwill arises from purchase business combinations and is measured as the excess of the cost of the business acquired over the sum of the acquisition-date fair values of tangible and identifiable intangible assets acquired, less any liabilities assumed. In accordance with ASC 350, Intangibles — Goodwill and Other , the Company does not amortize goodwill or intangible assets with indefinite lives but rather assesses their carrying value for indications of impairment annually, or more frequently if events or changes in circumstances indicate that the carrying amount may be impaired. The goodwill impairment test required by ASC 350 is a two-step process. The first step of the goodwill impairment test, used to identify potential impairment, compares the fair value of a reporting unit with its carrying amount, or the net book value of the company or reporting unit, including goodwill. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired; thus, the second step of the impairment test is unnecessary. If the carrying amount of a reporting unit exceeds its fair value, the second step of the goodwill impairment test shall be performed to measure the amount of impairment loss, if any. The Company attributes goodwill to its sole reporting unit for impairment testing. The fair value used by the Company was derived from the market capitalization approach, whereby the Company utilizes the historical market price of its stock traded on the Nasdaq to estimate the fair value of its reporting unit. The determination of whether goodwill has become impaired involves a significant level of judgment in the assumptions underlying the approach used to determine the value of the reporting unit. Changes in the Company’s strategy and/or market conditions could significantly impact these judgments and require adjustments to recorded amounts of goodwill. Identifiable intangible assets consist of acquired trade names, customer lists, technology, in-process research and development, and order backlog associated with the acquired businesses. Amortization of finite-lived intangible assets is calculated using either the straight-line or accelerated amortization model based on the Company’s best estimate of the distribution of the economic value of the identifiable intangible assets. The Company did not recognize any goodwill or intangible impairment losses in the years ended December 31, 2019 or 2018. Long-Lived Assets Long-lived asset with definite lives are reviewed for impairment whenever events or changes in circumstances indicate that an asset’s carrying value may not be recoverable. In accordance with authoritative guidance, the Company evaluates the recoverability of each of our long-lived assets, including property and equipment, by comparing its carrying amount to the undiscounted future cash flows expected to be generated. If the total of undiscounted future cash flows is less than the carrying amount of an asset, an impairment would be recognized for the amount by which the carrying amount of the asset exceeds its fair value. The Company did not recognize any impairment losses during the years ended December 31, 2019 or 2018. Deferred Revenue The Company’s deferred revenue balance consisted of the following: December 31, December 31, Current deferred revenue Platform subscriptions and services revenue $ 3,278 $ 1,506 Application transaction revenue 82 133 PhunCoin deposits — 990 Total current deferred revenue $ 3,360 $ 2,629 Non-current deferred revenue Platform subscriptions and services revenue $ 3,764 $ 5,622 Total non-current deferred revenue $ 3,764 $ 5,622 Total deferred revenue $ 7,124 $ 8,251 Deferred revenue consists of customer billings or payments received in advance of the recognition of revenue under the arrangements with customers. The Company recognizes deferred revenue as revenue only when revenue recognition criteria are met. During the year ended December 31, 2019, the Company recognized revenue of $3,585 that was included in its deferred revenue balance as of balance as of December 31, 2018. During the second quarter of 2019, Phunware announced the launch of a separate token, Phun, in addition to its current token, PhunCoin. As a result of this expanded dual token structure, the Company believes the economic substance and business characteristics of all previously issued PhunCoin Rights changed such that PhunCoin would be the investment vehicle in the Company's blockchain-enabled data exchange. As a result, the Company has reclassified all PhunCoin deposits from deferred revenue to a separate line item, "PhunCoin deposits," on its consolidated balance sheet as of December 31, 2019. Leases Leases are reviewed and classified as capital or operating at their inception. For leases that contain rent escalations or periods during the lease term where rent is not required, the Company recognizes rent expense based on allocating the total rent payable on a straight-line basis over the term of the lease excluding lease extension periods. The difference between rent payments and straight-line rent expense is recorded as deferred rent. Deferred rent that will be recognized during the succeeding 12-month period is recorded as the current portion of deferred rent and is included in accrued expenses and other and the remainder is recorded in deferred rent on the consolidated balance sheets. Advertising Costs Advertising costs are expensed as incurred. Total advertising costs were $0 and $225 for the years ended December 31, 2019 and 2018, respectively, and were included in sales and marketing expenses on the consolidated statements of operations and comprehensive loss. Stock-Based Compensation Compensation expense related to stock-based transactions, including employee and non-employee director awards, is measured and recognized in the financial statements based on fair value on the grant date of the award. The Company recognized stock-based compensation expense for awards with only service conditions on a straight-line basis over the requisite service period of the related award. The Company has not granted any awards with market or performance conditions. Forfeitures of all stock-based awards are accounted for when they occur. Retirement Plan At December 31, 2019, the Company administered one employee retirement plan that qualified as a deferred salary arrangement under Section 401(k) of the Internal Revenue Code (the "IRC"). Under the retirement plan, participating employees may contribute a portion of their pretax earnings, up to the Internal Revenue Service annual contribution limit. No employer matching contributions were made to the retirement plan during the years ended December 31, 2019 or 2018. Income Taxes The Company accounts for income taxes in accordance with ASC 740, Income Taxes ("ASC 740"). Under ASC 740, deferred tax assets and liabilities reflect the future tax consequences of the differences between the financial reporting and tax bases of assets and liabilities using current enacted tax rates. Valuation allowances are recorded when the realizability of such deferred tax assets does not meet the more-likely-than-not threshold under ASC 740. Significant judgment is required in determining any valuation allowance recorded against deferred tax assets. In assessing the need for a valuation allowance, the Company considers all available evidence, including past operating results, estimates of future taxable income and the feasibility of tax planning strategies. In the event of a change in the determination as to the amount of deferred tax assets that can be realized, an adjustment of the valuation allowance with a corresponding impact to the provision for income taxes will be made in the period in which such determination was made. The guidance on accounting for uncertainty in income taxes prescribes a recognition threshold and measurement attribute criterion for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company has not recognized interest or penalties on the consolidated balance sheets or statements of operations and comprehensive loss. Redeemable Convertible Preferred Stock In 2018, the Company issued 6,000 shares for aggregate cash proceeds of $6,000 from the Series A 8% convertible preferred stock financing (“Series A Financing”) in conjunction with the Reverse Merger and Recapitalization. In accordance with ASC 480, redemption provisions not solely within the control of the Company require the security to be classified outside of permanent equity. Comprehensive Loss The Company utilizes the guidance in ASC 220, Comprehensive Income , for the reporting and display of comprehensive loss and its components in the consolidated financial statements. Comprehensive loss comprises net loss and cumulative foreign currency translation adjustments. The accumulated comprehensive loss at December 31, 2019 and 2018 was due to foreign currency translation adjustments. Loss per Common Share Basic loss per common share is computed by dividing net loss applicable to common stockholders by the weighted average number of shares of common stock outstanding during the period. Restricted shares subject to repurchase provisions relating to early exercises under the Company's 2009 Equity Incentive Plan were excluded from basic shares outstanding. Diluted loss per common share is computed by giving effect to all potential shares of common stock, including those related to the Company's outstanding warrants and stock equity plans, to the extent dilutive. For all periods presented, these shares were excluded from the calculation of diluted loss per share of common stock because their inclusion would have been anti-dilutive. As a result, diluted loss per common share is the same as basic loss per common share for all periods presented. As of December 31, 2019 and 2018, 6,219 and 40,707 shares were restricted, respectively, relating to early exercises of the Company’s 2009 Stock Option Plan and are excluded from basic shares outstanding for the years then ended. Fair Value of Financial Instruments Authoritative guidance on fair value measurements defines fair value, establishes a consistent framework for measuring fair value, and expands disclosures for each major asset and liability category measured at fair value on either a recurring or non-recurring basis. Fair value is an exit price representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the authoritative guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows Level 1 — Observable inputs such as quoted prices in active markets. Level 2 — Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly. Level 3 — Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The carrying value of accounts receivable, prepaid expenses, other current assets, accounts payable, and accrued expenses are considered to be representative of their respective fair values because of the short-term nature of those instruments. Loss Contingencies We are subject to the possibility of various loss contingencies arising in the ordinary course of business. We accrue for loss contingencies when it is probable that an asset has been impaired or a liability has been incurred and the amount of loss can be reasonably estimated. If we determine that a loss is possible and the range of the loss can be reasonably determined, then we disclose the range of the possible loss. We regularly evaluate current information available to us to determine whether an accrual is required, an accrual should be adjusted or a range of possible loss should be disclosed. From time to time, we are involved in disputes, litigation, and other legal actions. However, there are many uncertainties associated with any litigation, and these actions or other third-party claims against us may cause us to incur substantial settlement charges, which are inherently difficult to estimate and could adversely affect our results of operations. The actual liability in any such matters may be materially different from our estimates, which could result in the need to adjust our liability and record additional expenses. Subsequent Events In accordance with U.S. GAAP, we have evaluated events that have occurred after the date of the financial statements through the date the financial statements are issued to determine if events or transactions occurring after the date of the financial statements require potential adjustment to or disclosure in the financial statements. See Note 17 for additional discussion on the Company’s subsequent events. Emerging Growth Company Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such an election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, will adopt the new or revised standard at the time private companies adopt the new or revised standard. Recently Adopted Accounting Standards In May 2014, the FASB and the International Accounting Standards Board jointly issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers , which is a comprehensive new revenue recognition standard that will supersede nearly all existing revenue recognition guidance under U.S. GAAP and International Financial Reporting Standards. The standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In doing so, companies will need to use more judgment and make more estimates than under previous authoritative guidance. These may include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price, and allocating the transaction price to each separate performance obligation. The Company elected to take advantage of the extended transition period provided in Securities Act Section 7(a)(2)(B) for complying with new or revised accounting standards. As a result, we adopted the ASU and related guidance as of January 1, 2019 using the modified retrospective method. The most significant impact of the standard relates to the elimination of the requirement to have vendor specific objective evidence, or VSOE, of fair value to separate and recognize revenue for products and services in a contract. The elimination of the VSOE requirement causes a significant change to the timing of revenue recognition for multiple-element arrangements with our MaaS subscriptions, application development services and related support and maintenance on the development services that lacked VSOE of fair value. Under ASC 606, we recognize the application development services at the time of delivery to our customer and recognize the license subscription and support services ratably over the term of the subscription agreements. Under the previous standards, we recognized all revenue from those arrangements ratably over the term of the subscription or support agreements. Due to the complexity of our revenue contracts, the actual revenue recognition treatment required under the new standard depends on contract-specific terms and in some instances may vary from recognition at the time of delivery. The timing of revenue recognized from professional services, support and maintenance and hardware remains substantially unchanged. In addition, Accounting Standards Codification Subtopic 340-40, Other Assets and Deferred Costs - Contracts with Customers , or ASC 340, requires us to recognize an asset for the incremental costs of obtaining a contract with a customer if our sales incentive programs meet the requirements for capitalization. Previously we recorded these incremental costs of obtaining a contract as commission expense when we booked a sales transaction; whereas under ASC 340, we record an asset for the incremental cost to obtain a contract and recognize the cost over the period commensurate with revenue recognition. When implementing ASC 606, the Company applied the practical expedient to reflect the aggregate effect of all contracts that were not completed as of January 1, 2019 when identifying satisfied and unsatisfied performance obligations, determining the transaction price, and allocating the transaction price to the satisfied and unsatisfied performance obligations. The following table sets forth the cumulative impact of the adoption of the new revenue standard for select condensed consolidated balance sheet line items: Balance at December 31, 2018 Adjustments due Balance at Assets: Prepaid expenses and other current assets $ 272 $ 369 $ 641 Liabilities: Deferred revenue short-term $ 2,629 $ (465) $ 2,164 Deferred revenue long-term $ 5,622 $ (253) $ 5,369 Stockholders’ deficit: Accumulated deficit $ (111,820) $ 1,087 $ (110,733) The following tables summarize the significant impacts of adopting ASC 606 on our financial statements as of and for the year ended December 31, 2019: Consolidated Balance Sheet December 31, 2019 As reported Impact of Adoption Balances Without Adoption of ASC 606 Assets: Prepaid expenses and other current assets $ 368 $ (309) $ 59 Liabilities: Deferred revenue short-term $ 3,360 $ 205 $ 3,565 Deferred revenue long-term $ 3,764 $ 113 $ 3,877 Stockholders’ deficit: Accumulated deficit $ (123,604) $ (627) $ (124,231) Consolidated Statement of Operations Year Ended December 31, 2019 As reported Impact of Adoption Amounts Without Adoption of ASC 606 Net revenue $ 19,150 $ 401 $ 19,551 Sales and marketing $ 2,706 $ (60) $ 2,646 Net loss $ (12,871) $ 461 $ (12,410) Net loss per share, basic and diluted $ (0.35) $ 0.01 $ (0.34) In connection with our adoption of ASC 606 on January 1, 2019, there was an increase to the Company’s deferred income tax liabilities and an offsetting reduction in the valuation allowance recorded against deferred tax assets. No income tax impact was recorded to retained earnings upon adoption as a result of the full valuation allowance on United States deferred tax assets. During the year ended December 31, 2019, there is no income tax expense or benefit recorded as a result of the adoption of the ASC 606. In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash (“ASU 2016-18"), which provides amendments to current guidance to address the classification and presentation of changes in restricted cash |
Reverse Merger
Reverse Merger | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
Reverse Merger | Reverse Merger As more fully described above, on February 27, 2018, Phunware entered into the Merger Agreement with Stellar, and.on December 26, 2018, the Company consummated the Reverse Merger and Recapitalization. The aggregate merger consideration paid to Phunware stockholders amounted to approximately $301,000 plus adjustments for cash on-hand as of the date of Closing. The merger consideration paid to Phunware stockholders was paid in the form of number shares of Successor common stock at a rate of 0.459 shares of Successor stock for each share of Phunware Stock. In addition, each holder of Phunware common and convertible preferred stock was entitled to elect to receive such holder’s pro rata share of up to an aggregate of 3,985,244 warrants (the “Transfer Sponsor Warrants”) to purchase shares of Successor common stock that are currently held by certain shareholders of Stellar. As consideration for the Transfer Sponsor Warrants transferred to Phunware stockholders, a promissory note was issued to the Sponsors (the “Transfer Sponsor Warrant Note”). The amount of the note was approximately $1,993, which represented $0.50 per warrant transferred to former stockholders of Phunware. The Transfer Sponsor Warrant Note bore no interest and was to mature on December 26, 2019. Stockholders of Phunware forfeited 187,188 shares to receive 3,985,244 Transfer Sponsor Warrants. On January 15, 2019, the Transfer Sponsor Warrant Note was waived and forgiven by the noteholders. The Company issued 2,211,572 Private Placement Warrants to the Sponsors as repayment in full for certain promissory notes (not the Transfer Sponsor Warrant Note) at the closing of the Reverse Merger and Recapitalization. In connection with the consummation of the Reverse Merger and Recapitalization, certain holders of shares of Stellar common stock sold in its initial public offering (“Public Shares”) exercised their right to redeem their Public Shares for cash. As a result of these redemptions, the cash proceeds to the Company as a result of the Reverse Merger and Recapitalization was $400 before transaction costs. In addition, 6,000 shares for aggregate cash proceeds of $6,000 from the Series A 8% convertible preferred stock financing (“Series A Financing”) were issued in conjunction with the Business Combination. In connection with the Series A Financing, certain Stellar shareholders transferred an aggregate of 250,000 shares of Stellar common stock and 250,000 warrants to purchase shares of Stellar common stock to the Series A Financing investor, and 181,391 shares to certain service providers. See Note 11 for additional discussion on the Series A Financing. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Goodwill Changes in the Company’s goodwill balance for the years ended December 31, 2019 and 2018, are summarized in the table below: 2019 2018 Balance as at beginning of period $ 25,821 $ 25,886 Foreign currency translation 36 (65) Balance at end of period $ 25,857 $ 25,821 Intangible Assets The Company’s intangible assets, excluding goodwill, consist of intangible assets acquired in business combinations and were recorded at their estimated fair values on the date of acquisition. The finite-lived intangible assets that are being amortized are summarized in the table below: Weighted Average Useful Life (years) December 31, 2019 December 31, 2018 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Trade name 4.6 $ 649 $ (649) $ — $ 648 $ (648) $ — Acquired technology 5.1 4,828 (4,798) 30 4,828 (4,763) 65 In-process research and development 5.0 94 (94) — 94 (94) — Customer relationships 5.7 4,604 (4,381) 223 4,576 (4,120) 456 Order backlog 1.5 329 (329) — 329 (329) — $ 10,504 $ (10,251) $ 253 $ 10,475 $ (9,954) $ 521 Amortization expense for the years ended December 31, 2019 and 2018, was approximately $268 and $372 respectively. Expected future annual amortization expense for finite-lived intangible assets as of December 31, 2019, is as follows: Year Amortization 2020 $ 142 2021 90 2022 21 2023 — Total $ 253 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and EquipmentProperty and equipment are stated at cost, net of accumulated depreciation and amortization. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets, generally ranging from three seven Life (years) December 31, December 31, Equipment 3-5 $ 907 $ 907 Furniture and fixtures 7 32 32 Leasehold improvements 5 or remaining lease term 258 241 Total property and equipment $ 1,197 $ 1,180 Accumulated depreciation (1,173) (1,114) Total property and equipment, net $ 24 $ 66 Total depreciation expense was $59 and $62 for the years ended December 31, 2019 and 2018, respectively. |
Accrued Expenses
Accrued Expenses | 12 Months Ended |
Dec. 31, 2019 | |
Payables and Accruals [Abstract] | |
Accrued Expenses | Accrued Expenses Accrued expenses consist of the following: December 31, December 31, Partner revenue share $ 155 $ 201 Payroll related expenses 3,202 2,496 Taxes 323 123 Other 355 208 Total accrued expenses $ 4,035 $ 3,028 |
Factoring Agreement
Factoring Agreement | 12 Months Ended |
Dec. 31, 2019 | |
Factoring Agreement [Abstract] | |
Factoring Agreement | Factoring Agreement On June 15, 2016, the Company entered into a factoring agreement with CSNK Working Capital Finance Corp. (d/b/a Bay View Funding) (“Bay View”) whereby it sells select accounts receivable with recourse. Under the terms of the agreement, Bay View may make advances to the Company of amounts representing up to 80% of the net amount of eligible accounts receivable. The factor facility was collateralized by a general security agreement over all the Company’s personal property and interests. Fees paid to Bay View for factored receivables are 1.80% for the first 30 days and is 0.65% for every ten days thereafter, to a maximum of 90 days total outstanding. The Company bears the risk of credit loss on the receivables. These receivables are accounted for as a secured borrowing arrangement and not as a sale of financial assets Factor expense of $555 and $718 for the years ended December 31, 2019 and 2018, respectively, was recorded as interest expense in other income (expense) on the consolidated statements operations and comprehensive loss. The amount of the factored receivables outstanding was $1,077 and $2,434 as of December 31, 2019 and 2018, respectively. There was $1,923 and $566 available for future advances as of December 31, 2019 and 2018 respectively. |
Debt
Debt | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Debt | Debt Convertible Notes During the second quarter of 2019, the Company’s board of directors authorized the issuance of $20,000 of convertible promissory notes (the “Convertible Notes”), which may be paid by investors in the form of cash or, in the Company’s sole discretion, cryptocurrency, such as Bitcoin or Ethereum. The Convertible Notes will be sold in reliance on an exemption from registration. The Company may not issue Convertible Notes under the Purchase Agreement in excess of $20,000, in the aggregate, unless otherwise agreed by the holders of a majority in interest of the principal outstanding under the Convertible Notes. The Convertible Notes bear ordinary interest at a rate of 7% per annum. Interest under the Convertible Notes is payable quarterly beginning on September 30, 2019, and interest and principal under the Convertible Notes is payable monthly beginning on June 30, 2021. However, at the holder’s election, interest payments may be deferred until the earlier of (i) repayment in full of all remaining unpaid principal, and (ii) conversion. The Convertible Notes mature on June 3, 2024. The Convertible Notes are convertible into shares of the Company’s common stock at a price of $11.50 per share. Each Convertible Note will convert voluntarily upon a holder’s election, or automatically upon the closing sale price of the Company’s common stock equals or exceeds $17.25 per share for 20 out of 30 consecutive trading days, if a registration statement is then in effect covering the disposition of the converted shares. The Company has one Convertible Note with a balance outstanding of $250 as of December 31, 2019. Transaction costs related to the issuance of the Convertible Note was immaterial. Interest expense related to the Convertible Note for the year ended December 31, 2019, and interest payable as of December 31, 2019 was immaterial. Promissory Notes During the fourth quarter of 2019, the Company’s board of directors authorized the issuance of $20,000 of promissory notes (the “Notes”), which may be paid by investors in the form of cash or, in the Company’s sole discretion, cryptocurrency, such as Bitcoin or Ethereum. The Notes will be sold in reliance on an exemption from registration provided by Section 4(a)(2) of the Securities Act, and Rule 506 of Regulation D promulgated thereunder. The Company may prepay the Notes at any time without penalty. The Company may not issue Notes under the Purchase Agreement in excess of $20,000, in the aggregate, unless otherwise agreed by the holders of a majority in interest of the principal outstanding under the Notes. The Notes bear ordinary interest at a rate of 10% per annum. Interest under the Notes is payable monthly beginning on November 30, 2019. During the term of the Notes, the Company will maintain a restricted bank account with a minimum balance of one year of interest payments on the aggregate principal balance of all Notes, which will be available for use exclusively to satisfy any payments owed by the Company under the Notes. The principal and unpaid accrued interest on the Notes will be due and payable on demand by the majority Note holders on or after the date that is 60 months following November 15, 2019. If an event of default occurs under the Notes, the majority Note holders may cause all principal and unpaid interest under the Notes to become immediately due and payable. In such event, the Notes will thereafter accrue interest at a rate of 12% per annum. Upon agreement between the Company and any senior creditor, the Notes will be subject to subordination in the right of payment to all current and future indebtedness or obligations of the Company for borrowed money to banks, commercial finance lenders, and other institutions regularly engaged in the business of lending money, or for factoring arrangements to parties providing such factoring. The Notes has a balance outstanding of $855 as of December 31, 2019. Transaction costs related to the issuance of the Notes was immaterial. Interest expense related to the Notes for the year ended December 31, 2019, and interest payable under the Notes as of December 31, 2019 was immaterial. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Leases The Company has operating office space leases in Austin, Texas; Irvine, California; San Diego, California; and Miami, Florida. Rent expense under operating leases totaled $727 and $643 for the years ended December 31, 2019 and 2018, respectively. On July 16, 2019, the Company entered into a lease agreement with BRE CA Office Owner, LLC for new office space in Irvine, California, for the lease of approximately 8,687 rentable square feet located at 16845 Von Karman Avenue (the “Lease”). The Lease commences on November 1, 2019, and terminates on March 31, 2025, subject to one five-year renewal option. Under the Lease, the Company will pay monthly rent of approximately $354 per year for the first year, with such rent increasing by a specified amount every year thereafter. The Lease also obligates the Company to pay its proportionate share of certain cost increases incurred by the landlord. The Company may receive certain abatements subject to the terms and conditions of the Lease. The Company was also obligated to pay a security deposit of approximately $118. On August 20, 2019, the Company entered into a lease amendment with Seamless Shoal Creek, LLC to extend its current lease in Austin, Texas (the "Amendment"). The Amendment commences on April 1, 2020, and terminates on March 31, 2022, with no renewal options. Under the Amendment, the Company will pay monthly rent of approximately $223 and $231 per year for the first year and second year, respectively. The Amendment also obligates the Company to pay its proportionate share of certain cost increases incurred by the landlord. Future minimum annual lease payments under the Company’s operating leases are as follows: Future minimum lease obligations years ending December 31, Lease Obligations 2020 $ 791 2021 836 2022 725 2023 622 2024 609 Thereafter 209 Total $ 3,792 Litigation On September 26, 2017, the Company filed a breach of contract complaint against Uber Technologies, Inc. ("Uber") seeking approximately $3,000 (plus interest) for unpaid invoices for advertising campaign services provided for Uber in the first quarter of 2017. The case, captioned Phunware, Inc. v. Uber Technologies, Inc., Case No. CGC-17-561546 was filed in the Superior Court of the State of California County of San Francisco. On November 13, 2017, Uber generally denied the allegations in the Company's complaint and also filed a cross-complaint against Phunware and Fetch Media, Ltd. ("Fetch") - the advertising agency Uber retained to run its mobile advertising campaign for the period 2014 through the first quarter of 2017 (the “Fetch Campaign”), asserting numerous fraud and contract-based claims. All the claims stem from Uber’s allegation that Fetch and/or the Company (and/or other-as-yet-unidentified ad networks and publishers) are liable for the Fetch Campaign, under which Uber allegedly overpaid Fetch and mobile advertising providers due to allegedly fraudulent attribution for installments of the Uber application. Uber did not allege any specific dollar amount that it is seeking in damages against either of the named cross-defendants (Fetch and Phunware). Phunware filed a motion to dismiss the cross-complaint, which was heard on February 7, 2018. The motion was granted in part and denied in part by the Court. On April 16, 2018, the action was designated complex, and the matter was assigned for all purposes to Judge Wiss of the Superior Court of California, San Francisco County (Department 305). In March 2019, Uber and Fetch settled Uber’s claims against Fetch on terms that have not been disclosed to Phunware at this time. On May 7, 2019, the Company retained new counsel. In June 2019, the Court set a new trial date of April 20, 2020. On June 26, 2019, the case was reassigned for all purposes to Judge Jackson of the Superior Court of California, San Francisco County (Department 613). On July 12, 2019, Uber filed its First Amended Cross-Complaint, naming new individual cross-defendants (Phunware Chief Executive Officer Alan S. Knitowski, and former Phunware employees D. Stasiuk, M. Borotsik, and A. Cook) accused of civil RICO violations and civil conspiracy to violate RICO, in addition to fraud, negligence, and unfair competition-based claims, and adding a fraud-based claim against Phunware. Uber’s First Amended Cross-Complaint alleges that cross-defendants fraudulently obtained approximately $17,000 from Uber, and claims treble damages, general and punitive damages, and attorneys’ fees and costs. On October 1, 2019, Alan S. Knitowski (“Knitowski”) filed his Motion to Quash Service of Summons, which was denied on October 29, 2019. On October 7, 2019, D. Stasiuk, M. Borotsik, and A. Cook filed their Motion to Quash Service of Summons, which was denied on December 17, 2019. On December 2, 2019, the case was reassigned for all purposes to Judge Cheng of the Superior Court of California, San Francisco County (Department 613). On January 22, 2020, the Court assigned the case to Judge Wiss of the Superior Court of California, San Francisco County (Department 305) for purposes of trial. On March 13, 2020, the Court ordered Phunware to pay $78 in monetary sanctions based on a discovery motion brought by Uber. Discovery is continuing. On March 13, 2020, the Court announced that jury trials will be continued for 90 days from the date they have been scheduled in response to the COVID-19 pandemic. The Company maintains that its claims against Uber are meritorious and that Uber’s claims against the Company are not. However, Phunware makes no predictions on the likelihood of success of prevailing on its contract action against Uber or on the likelihood of defeating Uber’s claims against the Company. On December 17, 2019, certain stockholders (the "Plaintiffs") filed a lawsuit against the Company. The case, captioned Wild Basin Investments, LLC, et al. v. Phunware, Inc., et al.; Cause No. D-1-GN-19- 008846 was filed in the 126th Judicial District Court of Travis County, Texas (the "Lawsuit"). The Plaintiffs invested in various early rounds of financing while the Company was private and claim the Company should not have subjected their shares to a 180-day "lock up" period. According to the Plaintiffs, the price of Phunware stock dropped significantly during the lock up period. The Plaintiffs seek unspecified damages in excess of one million dollars. The Company maintains the Plaintiffs' claims are without merit and intends to contest vigorously the claims asserted in the Lawsuit. All defendants have answered. No discovery has been issued, and no trial setting or scheduling order is in place. On March 9, 2020, Ellenoff Grossman & Schole LLP (the "Plaintiffs" or “EGS”) filed a complaint against the Company. The complaint, captioned Ellenoff Grossman & Schole LLP versus Stellar Acquisition III, Corp a/k/a Stellar Acquisition III, Inc. n/k/a Phunware, Inc., was filed in the Supreme Court of the State of New York, New York County (Case No. 152585/2020). The Plaintiffs are seeking monetary damages in the amount of $690 for alleged unpaid invoices related to legal services rendered in conjunction with the Reverse Merger and Recapitalization for Stellar, plus legal and court costs. The Company has 30 days to respond to the complaint. The Company has $690 in accounts payable and accrued expenses in the consolidated balance sheet as of December 31, 2019 and 2018 related to the alleged unpaid invoices. From time to time, the Company is and may become involved in various legal proceedings in the ordinary course of business. The outcomes of our legal proceedings are inherently unpredictable, subject to significant uncertainties, and could be material to our operating results and cash flows for a particular reporting period. In addition, for the matters disclosed above that do not include an estimate of the amount of loss or range of losses, such an estimate is not possible, and we may be unable to estimate the possible loss or range of losses that could potentially result from the application of non-monetary remedies. |
PhunCoin & PhunToken
PhunCoin & PhunToken | 12 Months Ended |
Dec. 31, 2019 | |
PhunCoin [Abstract] | |
PhunCoin & PhunToken | PhunCoin & PhunToken PhunCoin In June 2018, PhunCoin, Inc., the Company’s wholly-owned subsidiary, launched an offering pursuant to Rule 506(c) of Regulation D as promulgated under the Securities Act of rights (the “Rights”) to acquire PhunCoin (the “Token”). PhunCoin, Inc. accepts payment in the form of cash and digital currencies for purchases of the Rights. The amount of PhunCoin to be issued to the purchaser is equal to the dollar amount paid by the purchaser divided by the price of the PhunCoin at the time of issuance of the PhunCoin during the Token Generation Event (as defined below) before taking into consideration an applicable discount rate, which is based on the time of the purchase. Through December 31, 2019, the Company received cash proceeds from its Rights offering of $1,207, pursuant to which the holders of the Rights will receive an aggregate of approximately 577.9 million PhunCoin if the Token Generation Event occurs. Proceeds from the Rights are recorded as PhunCoin deposits in the Company's consolidated balance sheet as of December 31, 2019. The Company currently does not plan to raise additional proceeds from its PhunCoin Rights offering. The rights, privileges, and obligations of Rights holders are set forth as follows: Issuance of PhunCoin Tokens The PhunCoin is expected to be issued to Rights holders the earlier of (i) the launch of PhunCoin’s, Inc.’s blockchain technology enabled rewards marketplace and data exchange (“Token Generation Event”), (ii) one (1) year after the issuance of the Rights to the purchaser, or (iii) the date PhunCoin, Inc. determines that it has the ability to enforce resale restrictions with respect to PhunCoin pursuant to applicable federal securities laws. Proceeds from the Rights offering are generally not refundable if the Token Generation Event is not consummated; however, the Company believes PhunCoin, Inc. has a contractual obligation to use good faith efforts to issue a Token to Rights holders under the Token Rights Agreement. The Company currently anticipates that PhunCoin will be issued to the holders of the Rights in 2020. Holders of the Rights may be issued PhunCoin even if the Token Ecosystem is not yet operational. PhunCoin will have no usefulness until the Token Ecosystem is operational because PhunCoin is expected to only be useable on the Token Ecosystem. There can be no assurance as to when (or if) the Company will be able to successfully launch the Token Ecosystem. The Company is currently developing multiple aspects of the Token Ecosystem and expects that a review (beta) period will likely conclude in in the first half of 2020. The final software readiness date of the Token Ecosystem may be adjusted based on user feedback provided in the review (beta) period and thus a specific launch date is difficult to determine at this time, as it is based on many external factors outside of our control. Termination of the Token Rights Agreement Termination of the Token Rights Agreement occurs on the earlier of (i) PhunCoin being issued to the Rights holder pursuant to the provisions noted above, (ii) the payment, or setting aside of payment with respect to a dissolution event (as described below), or (iii) twelve months from the date of the Token Rights Agreement with the Rights holder, which PhunCoin, Inc. may extend at its sole discretion if a Token Generation Event has not occurred. Upon termination of the Token Rights Agreement, PhunCoin, Inc. has no further obligation to the Rights holder. PhunCoin, Inc. has extended the termination date of the Token Rights Agreement. Dissolution Event A dissolution event occurs if there has been (i) a voluntary termination of PhunCoin, Inc.’s operations, (ii) a general assignment for the benefit of PhunCoin, Inc.’s creditors, (iii) a change of U.S. laws that make the use or issuance of PhunCoin or the Token Generation Event impractical or unfeasible, or (iv) any other liquidation, dissolution or winding up of PhunCoin, Inc. In the event a dissolution event occurs prior to the termination of the Token Rights Agreement, if there are any remaining proceeds from the Rights offering that have not been utilized by PhunCoin, Inc.in its operations or for the development of the PhunCoin Ecosystem, such remaining proceeds would be distributed pro rata to purchasers in the Rights offering following any distributions to holders of PhunCoin, Inc.’s capital stock or debt, if any. No Voting Rights or Profit Share Rights holders (and eventual PhunCoin holders) have no voting rights and are not entitled to share in the profits or residual interest of Phunware, PhunCoin, Inc. or any subsidiaries of the Company. However, PhunCoin holders will be provided fractional interests in the Token Ecosystem, including ongoing monthly PhunCoin dividends to PhunCoin holders, based on their respective pro rata ownership percentage of PhunCoin, totaling 2.5% of the monthly credits purchased by Phunware customers. PhunCoin Warrant In 2018, the Company issued warrants to receive an aggregate of approximately 27,400,000 PhunCoins to sixty-eight (68) stockholders. Should the Company complete a Token Generation Event, the stockholders would receive their requisite amount of PhunCoin. The Company believes there is no traditional “exercise period” or ‘term” as with other typical embedded features, and the PhunCoin warrants were originally issued in conjunction with the Company’s Series F Preferred Stock financing. The PhunCoin warrants lack characteristics of financial instruments and derivatives. In addition, the PhunCoin warrants do not obligate the Company to achieve the Token Generation Event or launch and distribute the PhunCoins to the warrantholders. Currently, there is no market for PhunCoin, and they do not exist. Accordingly, at the time of the issuance, the Company has determined there is no value assigned to the warrants of PhunCoin issued to the stockholders. PhunToken ("Phun") During the second quarter of 2019, Phunware announced the launch of a separate token, Phun, which is meant to act as a medium of exchange within the Token Ecosystem. Phun will be issued through a separate, wholly-owned subsidiary, Phun Token International, available initially only to persons outside of the United States and Canada. Consumers may receive Phun for actively engaging in marketing campaigns; developers and publishers may receive Phun for utilizing Phunware’s loyalty software development kit in order to better engage, manage and monetize their consumers; and brands will gain access to more relevant, verifiable data by accessing Phunware’s data exchange and using Phun for their own loyalty programs. As of December 31, 2019, the Company had not sold any Phun. |
Series A Convertible Preferred
Series A Convertible Preferred Stock | 12 Months Ended |
Dec. 31, 2019 | |
Series A Convertible Preferred Stock [Abstract] | |
Series A Convertible Preferred Stock | Series A Convertible Preferred Stock In connection to the consummation of the Reverse Merger and Recapitalization, Phunware issued 6,000 shares to a single investor for aggregate cash proceeds of $6,000 from the Series A 8% convertible preferred stock financing (“Series A Financing”) with stated value of $1,000 per share. The Company deposited $5,500 of the $6,000 proceeds into a restricted escrow account in accordance with the securities purchase agreement entered into with the investor. The shares are mandatorily redeemable in cash at the following schedule; (i) 104% of the aggregate value of three thousand (3,000) shares on the 30 day anniversary of the issuance; (ii) 104% of the aggregate value of two thousand five hundred (2,500) shares on the 60th anniversary of the original issue; and (iii) 104% of the aggregate value of five hundred (500) shares of the 90th anniversary of the original issue. On the 30-day, 60-day, and 90-day anniversaries of the issuance, the holder redeemed an aggregate of 6,000 shares of the Series A convertible preferred stock for total proceeds of $6,240, representing $6,000 original issue price and $240 of dividends. Of the proceeds paid to the holder, $5,500 was paid from the restricted cash account, and $740 from the Company’s operating account. The Preferred Stock was also convertible into shares of the Company’s common stock at the option of the holder at a price of $11.50 per share, subject to adjustments for stock dividends, stock splits and other recapitalization type events and antidilutive events which would include subsequent issuances of equity or equity linked securities at prices more favorable than the conversion price of these preferred shares. Generally, the Preferred Stock did not have voting rights. The holder did not convert any of the Series A convertible preferred stock prior to the redemption dates. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Common Stock Total common stock authorized to be issued as of December 31, 2019 was 1,000,000,000 shares with a par value of $0.0001 per share. At December 31, 2019 and 2018, there were 39,817,917 and 27,253,457 shares outstanding, inclusive of 6,219 and 40,707 restricted shares subject to repurchase for unvested shares related to early option exercises under the Company’s stock equity plans, respectively. During 2019, the Company issued an aggregate of 11,530,442 shares of common stock related to various cash and cashless (net) exercises of warrants for common stock. Cash exercises for warrants for 617,296 shares of common stock resulted in aggregate gross proceeds of approximately $6,184, of which $6,092 was received in cash and $92 was received in digital currencies. Furthermore, there were 13,975,359 warrants exercised under cashless (net) provisions resulting in the issuance of 10,913,146 shares of common stock. See further discussion regarding details of the Company’s various warrants below. In 2018, the Company completed several closings of stock financing. During 2018, the Company issued 1,085,096 shares for cash proceeds of $9,565, net of issuance costs, respectively. Dividends Dividends are paid on a when-and-if-declared basis. The Company did not declare any dividends during 2019 or 2018. Warrants A summary of the Company’s warrant activity by warrant type is as follows: Warrant Type Cash Exercise Price per share Warrants/UPO's Outstanding 12/31/2018 Warrants issued for UPO exercises Warrants/UPO’s Exercised Warrants Outstanding 12/31/2019 Cash Cashless Common stock warrant (Series D-1) $ 5.54 14,866 — — — 14,866 Common stock warrants (Series F) $ 9.22 1,085,059 — (400,740) (306,917) 377,402 Public Warrants (PHUNW) $ 11.50 6,900,610 — — (5,139,319) 1,761,291 Private Placement Warrants $ 11.50 10,182,060 — (216,556) (8,307,123) 1,658,381 Unit Purchase Options (UPOs) $ 11.50 130,000 — — (130,000) — Unit Purchase Option Warrants $ 11.50 — 116,172 — (92,000) 24,172 Total 18,312,595 116,172 (617,296) (13,975,359) 3,836,112 In 2012, the Company issued a warrant to purchase an aggregate of 14,866 shares of the Company’s common stock with an exercise price of $5.54 per share to a banking institution with which the Company previously had a revolving line of credit. The term of the warrant is the earlier of (i) the tenth anniversary of the date of issuance, (ii) the closing of the initial registered public offering of the Company’s common stock, or (iii) the closing of an acquisition (as defined in the warrant) where the consideration consisting of cash or publicly traded securities payable in connection with the acquisition for each share is at least three (3) times the exercise price. The Reverse Merger and Recapitalization did not trigger an expiration of the warrant pursuant to term (ii) or (iii) above. The warrant is fully vested. In 2018, but prior to the Reverse Merger and Recapitalization, the Company issued warrants to purchase an aggregate of 1,085,059 shares of the Company’s common stock with an exercise price of $9.22 per share. The term of the warrants is the earlier of (i) the fifth anniversary of the date of issuance, (ii) an acquisition, merger, or consolidation of the Company or a sale, lease or other disposition of all or substantially all of the assets of Phunware and its subsidiaries, except (a) any sale of stock for capital raising purposes, (b) purpose of changing the Company’s state of incorporation, and (c) where the shareholders of Phunware immediately before such transaction retain at least a majority of the voting power immediately following such transaction; or (iii) immediately prior to an initial public offering. The Reverse Merger and Recapitalization did not trigger an expiration of the warrant pursuant to term (ii) or (iii) above. These warrants are fully vested. The Company has common stock warrants trading under the Nasdaq ticker symbol PHUNW (the “Public Warrants”). Each Public Warrant entitles the holder to purchase one share of common stock at an exercise price of $11.50 per share. No fractional shares will be issued upon exercise of the Public Warrants. The Public Warrants became exercisable for cash 30 days after the completion of the Reverse Merger and Recapitalization. In addition, if a registration statement covering the shares of common stock issuable upon exercise of the Public Warrants was not filed with the SEC and declared effective within 90 days from the consummation the Reverse Merger and Recapitalization, holders were entitled to exercise warrants on a cashless basis pursuant to an available exemption from registration under the Securities Act. The Company was unable to have the registration statement declared effective by the 90-day deadline, although it was declared effective on May 14, 2019. As of December 31, 2019, 5,139,319 Public Warrants have been exercised on a cashless basis that resulted in the issuance of 2,951,741 shares. The Company may redeem the outstanding Public Warrants in whole and not in part at a price of $0.01 per Public Warrant upon a minimum of 30 days’ prior written notice of redemption, only in the event that the last sale price of the Company’s shares of common stock equals or exceeds $21.00 per share for any 20 trading days within the 30-trading day period ending on the third trading day before the Company sends the notice of redemption to the Public Warrant holders. The Public Warrants will expire five years after the completion of the Reverse Merger and Recapitalization or earlier upon redemption or liquidation. The Company also has Private Placement Warrants outstanding (the “Private Placement Warrants”). Each Private Placement Warrant entitles the holder to purchase one share of common stock at an exercise price of $11.50 per share. The Private Placement Warrants became exercisable 30 days after the completion of the Reverse Merger and Recapitalization. The Private Placement Warrants are exercisable for cash (even if a registration statement covering the common stock issuable upon exercise of such warrants is not effective) or on a cashless basis, at the holder’s option and will not be redeemable in each case so long as they are still held by the initial purchasers or their affiliates. Unit Purchase Option ("UPOs") The Company sold to the underwriters for its initial public offering in 2016 an option to purchase up to a total of 130,000 units, at an exercise price of $11.50 per unit. The units are comprised of one share of common stock and one warrant to purchase common stock. The unit purchase option may be exercised for cash or on a cashless basis, at the holder’s option, at any time during the period commencing on the closing of the Reverse Merger and Recapitalization and terminating on the fifth anniversary of the Reverse Merger and Recapitalization. The units issuable upon exercise of this option are identical to those offered in the Company’s initial public offering in 2016. The unit purchase option may be exercised for cash or on a cashless basis, at the holder’s option, such that the holder may use the appreciated value of the unit purchase option (the difference between the exercise prices of the unit purchase option and the underlying Warrants and the market price of the UPO and underlying ordinary shares) to exercise the unit purchase option without the payment of cash. The warrants issued pursuant to UPO exercises have the same terms as the Private Placement Warrants described above. As of December 31, 2019, all UPOs had been exercised, and 24,172 warrants related to the UPO exercise remained outstanding. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation 2018 Equity Incentive Plan In connection with the consummation of the Reverse Merger and Recapitalization, our board of directors adopted, and our stockholders approved, the 2018 Equity Incentive Plan (the “2018 Plan”). The purposes of the 2018 Plan are to attract and retain the best available personnel for positions of substantial responsibility, to provide additional incentives to employees, directors and consultants who perform services to the Successor or any parent or subsidiary, and to promote the success of our business. These incentives are provided through the grant of stock options, stock appreciation rights, restricted stock, restricted stock units, performance units and performance shares. The number of shares of common stock available for issuance under the 2018 Plan will also include an annual increase on the first day of each fiscal year, equal to the lesser of: (i) 10% of the post-closing outstanding shares of common stock; (ii) 5% of the outstanding shares of common stock on the last day of the immediately preceding fiscal year; or (iii) such other amount as our board of directors may determine. In addition, the shares of common stock reserved for issuance under the 2018 Plan also will include any shares of common stock subject to stock options, restricted stock units or similar awards granted under the 2009 Equity Incentive Plan (the “2009 Plan”), that, on or after the Reverse Merger and Recapitalization, are assumed in connection with the Reverse Merger and Recapitalization, expire or otherwise terminate without having been exercised in full and shares of common stock issued pursuant to awards granted under the 2009 Plan that, on or after the Reverse Merger and Recapitalization, are forfeited to or repurchased by us, with the maximum number of shares of common stock that may be added to the 2018 Plan pursuant to the foregoing equal to 1,471,669 as of December 31, 2019. For the year ended December 31, 2019, the restricted stock units were the only stock-based incentives granted under the 2018 Plan. A summary of the Company’s restricted stock unit activity under the 2018 Plan is set forth below: Shares Weighted Average Grant Date Fair Value Outstanding as of December 31, 2018 — $ — Granted 3,245,922 2.93 Released (521,979) 1.79 Forfeited (286,975) 3.10 Outstanding as of December 31, 2019 2,436,968 $ 3.15 Not including the maximum number of shares from the 2009 Plan that may be added to the 2018 Plan noted above, the 2018 Plan had 205,206 and 2,729,416 shares of common stock reserved for future issuances as of December 31, 2019 and 2018, respectively. During the second quarter of 2019, we granted 620,363 restricted stock units to employees and 45,000 restricted stock units to non-employee directors, each with a grant date fair value of $7.34 per share. The awards granted to team members vest over eighteen months in three equal installments on May 18, 2020, August 18, 2020, and November 18, 2020, respectively, and are subject to service conditions. The awards granted to non-employee directors vest in two equal installments on July 1, 2019 and December 26, 2019, respectively, and are subject to service conditions. During the third quarter of 2019, we granted 1,603,000 restricted stock units to team members with an average grant date fair value of $2.11 per share. The awards granted to team members vest over an average of 4 years with various installment and vesting dates, and are subject to service conditions. During the fourth quarter of 2019, we granted 240,964 restricted stock units to team members, 336,595 restricted stock units to non-employees directors and 400,000 restricted stock units to a non-employee service provider with an average grant date fair value of $1.26 per share. The restricted stock units awarded to team members in lieu of cash compensation for bonuses earned in 2018. The awards granted to team members and non-employee directors have various installment and vesting dates, and were subject to service conditions. The restricted stock units granted to the non-employee service provider were for satisfaction of legal fees owed. The awards granted to the legal service provider vested immediately. 2018 Employee Stock Purchase Plan Also, in connection with the consummation of the Reverse Merger and Recapitalization, our board of directors adopted, and our stockholders approved, the 2018 Employee Stock Purchase Plan (the “2018 ESPP”). The 2018 ESPP will be administered by our board of directors or a committee appointed by the board (the “administrator”). The purpose of the 2018 ESPP is to provide eligible employees with an opportunity to purchase shares of our common stock through accumulated contributions. The 2018 ESPP permits participants to purchase shares of common stock through contributions (generally in the form of payroll deductions) of up to an amount of their eligible compensation determined by the administrator. Subject to certain other limitations or unless otherwise determined by the administrator, a participant may purchase a maximum of 2,000 shares of common stock during a purchase period. The offering periods under the 2018 ESPP will begin on such date as determined by the administrator and expire on the earliest to occur of (a) the completion of the purchase of shares on the last exercise date occurring within 27 months of the applicable enrollment date of the offering period on which the purchase right was granted, or (b) a shorter period established by the administrator prior to an enrollment date for all options to be granted on such enrollment date. Amounts deducted and accumulated by the participant are used to purchase shares of common stock on each exercise date. The purchase price of the shares will be determined by the administrator but in no event will be less than 85% of the lower of the fair market value of common stock on the enrollment date or on the exercise date. Participants may end their participation at any time during an offering period and will be paid their accrued contributions that have not yet been used to purchase shares of common stock. Participation ends automatically upon termination of employment with the Company. The number of shares of common stock that may be made available for sale under the 2018 ESPP also includes an annual increase on the first day of each fiscal year beginning for the fiscal year following the fiscal year in which the first enrollment date (if any) occurs equal to the lesser of (i) 3% of the expected post-closing outstanding shares of common stock; (ii)1.5% of the outstanding shares of common stock on the last day of the immediately preceding fiscal year; or such other amount as the administrator may determine. As of December 31, 2019, the Company had not consummated an enrollment or offering period related to the 2018 ESPP. The 2018 ESPP had 272,942 shares of common stock available for sale and reserved for issuance as of December 31, 2019 and 2018. 2009 Equity Incentive Plan In 2009, the Company adopted its 2009 Equity Incentive Plan (the “2009 Plan”), which allowed for the granting of incentive and non-statutory stock options, as defined by the Internal Revenue Code, to employees, directors, and consultants. Prior to the Reverse Merger and Recapitalizatoin, the exercise price of the options granted is generally equal to the value of the Company’s common stock on the date of grant, as determined by the Company’s Board of Directors. The awards are exercisable and vest, generally over four years, in accordance with each option agreement. The term of each option is no more than ten years from the date of the grant. The 2009 Plan allows for options to be immediately exercisable, subject to the Company’s right of repurchase for unvested shares at the original exercise price. The total amount received in exchange for these shares has been included in accrued expenses on the accompanying consolidated balance sheets and is reclassified to equity as the shares vest. As of December 31, 2019 and 2018, 6,219 and 40,707 shares were unvested amounting to $3 and $34 in accrued expenses, respectively. Effective with the Reverse Merger and Recapitalization, no additional grants will be made under the 2009 Plan. A summary of the Company’s stock option activity under the 2009 Plan and related information is set forth below: Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value 12/31/2017 Outstanding 1,417,373 $ 0.54 7.18 $ 53 Granted 1,770,225 1.11 Exercised (293,778) 0.58 Cancelled/Expired (528,997) 0.78 12/31/2018 Outstanding 2,364,823 $ 0.90 8.12 $ 71,332 Granted — — Exercised (488,090) 0.57 Cancelled/Expired (411,283) 1.68 12/31/2019 Outstanding 1,465,450 $ 0.80 6.86 $ 771 Options exercisable 1,016,089 $ 0.73 6.33 $ 560 The aggregate intrinsic value is based on the Company’s stock price trading price on the NASDAQ Capital Market. The aggregate intrinsic value of options exercised was $7,619 and $483 for the years ended December 31, 2019 and 2018, respectively, and is calculated based on the difference between the estimated fair value of the Company’s common stock at the date of exercise and the exercise price. The weighted average grant-date fair value of stock options granted during the year ended December 31, 2018 was $0.15. The total fair value for options vested during the years ended December 31, 2019 and 2018, was $348 and $343, respectively. Stock-Based Compensation Compensation cost that has been included on the Company’s consolidated statements of operations for all stock-based compensation arrangements is set forth below: Year Ended Stock-based compensation December 31, December 31, Cost of revenues $ 146 $ 45 Sales and marketing 12 42 General and administrative 1,417 313 Research and development 209 50 Total stock-based compensation $ 1,784 $ 450 As of December 31, 2019, there was approximately $6,328 of total unrecognized compensation cost related to unvested restricted stock units under the 2018 Plan. This unrecognized compensation cost is expected to be recognized over an estimated weighted-average period of approximately 2.4 years. As of December 31, 2019 and 2018, there was $221 and $640, respectively, of total unrecognized compensation cost related to unvested stock options under the 2009 Plan. This unrecognized compensation cost is expected to recognized over an estimated weighted-average amortization period of approximately 1.6 years. The Company uses the Black-Scholes option pricing model to estimate the fair value of its stock option awards. The calculation of the fair value of the awards using the Black-Scholes option pricing model is affected by the Company’s stock price on the date of grant as well as assumptions regarding the following: Valuation of Stock Options The Company did not grant any options under the 2009 Plan during the year ended December 31, 2019. The assumptions used to compute stock-based compensation costs for the stock options granted during the year ended December 31, 2018 are set forth below: Year Ended December 31, Weighted average risk-free rate 2.51 % Expected dividend yield — Weighted average expected life (years) 6.08 Weighted average volatility 56.87 % Details on the assumptions used above are set forth below: The risk-free interest rate is based on the yield curve of a zero-coupon U.S. Treasury bond on the date the stock option award is granted with a maturity equal to the expected term of the stock option award. The assumed dividend yield is based on the Company’s expectation that it will not pay dividends in the foreseeable future. The expected term represents the period of time that awards granted are expected to be outstanding. The Company calculated the expected term using the simplified method as the Company did not have enough historical data to allow for a weighted average term based on historical exercise patterns. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Deferred income taxes are recognized for the tax consequences in future years for differences between the tax bases of assets and liabilities and their financial reporting amounts at each year-end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense is the combination of the tax payable for the year and the change during the year in deferred tax assets and liabilities. For the years ended December 31, 2019 and 2018, the Company had net losses before income taxes of $12,866 and $10,177, respectively. Net losses relating to U.S. operations for were $12,766 and $9,880, respectively. The difference between income taxes expected at the U.S. federal statutory income tax rate of 21% and the reported income tax expense (benefit) are summarized as follows: December 31, 2019 2018 Income tax at statutory rate $ (2,703) $ (2,138) Valuation allowance 2,948 2,266 State income tax, net of federal benefit (606) (521) Business tax credit net of reserves — (325) Non-deductible expenses 365 341 Foreign income taxes at different rate 1 3 Income tax benefit $ 5 $ (374) Effective tax rate (0.04) % 3.67 % The provision expense (benefit) for income taxes consists of the following: Year Ended December 31, 2019 2018 Current: Federal $ — $ — State 5 13 Foreign — — Total current 5 13 Deferred: Federal — (346) State — (41) Foreign — — Total deferred — (387) Total $ 5 $ (374) The components of net deferred income taxes consist of the following: December 31, 2019 2018 Deferred tax assets: Net operating loss $ 26,285 $ 24,280 Reserves and accruals 3,842 2,836 Tax credits 1,463 1,349 Gross deferred tax assets 31,590 28,465 Less valuation allowance (31,349) (28,401) Total deferred tax assets 241 64 Deferred tax liabilities: Amortization of acquired intangibles (241) (64) Total deferred tax liabilities (241) (64) Net deferred tax liabilities $ — $ — As of December 31, 2019, the Company had net operating loss carryforwards of $106,644 and $53,197 for federal and state income tax purposes, respectively. The federal net operating losses of $85,674 which were generated in tax years beginning before January 1, 2018, will begin to expire in 2030 if not utilized. The balance of the net operating losses, $20,970 do not expire. The state net operating losses expire at various times depending on the state with a majority beginning to expire in 2030 if not utilized. As of December 31, 2019, the Company had R&D credit carryforwards of approximately $948 and $515 for federal and state income tax purposes, respectively. The federal and Texas R&D credits will begin to expire in 2034, unless previously utilized. California R&D credits carry forward indefinitely. Utilization of the net operating losses ("NOL") and tax credit carryforwards may be subject to a substantial annual limitation due to ownership change limitations that may have occurred or that could occur in the future, as required by Section 382 of the Internal Revenue Code (IRC) of 1986, as amended (the "Code"), as well as similar state and foreign provisions. These ownership changes may limit the amount of NOL and tax credit carryforwards that can be utilized annually to offset future taxable income. In general, an “ownership change” as defined by Section 382 of the Code results from a transaction or series of transactions over a three-year period resulting in an ownership change of more than 50 percentage points of the outstanding stock of a company by certain stockholders. As of December 31, 2019, the Company had not yet completed its analysis of the deferred tax assets for its NOL and tax credits. The future utilization of the Company’s net operating loss to offset future taxable income may be subject to an annual limitation under IRC Section 382 as a result of ownership changes that may have occurred previously or that could occur in the future. The Company has not yet determined whether such an ownership change has occurred. In order to make this determination, the Company will need to complete an analysis regarding the limitation of the net operating loss. The Company has established a full valuation allowance for its deferred tax assets due to uncertainties that preclude it from determining that it is more likely than not that the Company will be able to generate sufficient taxable income to realize such assets. The Company monitors positive and negative factors that may arise in the future as it assesses the need for a valuation allowance against its deferred tax assets. As of December 31, 2019 and 2018, the Company has a valuation allowance of $31,349 and $28,401 respectively, against its deferred tax assets. The Company accounts for the provisions under the Income Taxes topic of the ASC which addresses accounting for the uncertainty in income taxes. The technical merits of a tax position derive from both statutory and judicial authority (legislation and statutes, legislative intent, regulations, rulings, and case law) and their applicability to the facts and circumstances of the tax position. If a tax position does not meet the more-likely-than-not recognition threshold, the benefit of that position is not recognized in the financial statements. The second step is measurement. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. The tax position is measured as the largest amount of benefit that has a greater than 50% likelihood of being realized upon ultimate resolution with a taxing authority. Uncertain tax positions are evaluated based upon the facts and circumstances that exist at each reporting period. Subsequent changes in judgment based upon new information may lead to changes in recognition, de-recognition, and measurement. Adjustments may result, for example, upon resolution of an issue with the taxing authorities, or expiration of a statute of limitations barring an assessment for an issue. The following is a tabular reconciliation of the total amounts of unrecognized tax benefits: December 31, 2019 2018 Unrecognized tax benefits, beginning of period $ 1,516 $ 889 Tax positions taken in prior periods: Gross increases — 166 Gross decreases — — Tax positions taken in current period: Gross increases 15 461 Settlements — — Lapse of statute of limitations — — Unrecognized tax benefits, end of period $ 1,531 $ 1,516 The Company’s practice is to recognize interest and/or penalties related to income tax matters in income tax expense. The Company had no accrual for interest and penalties on the consolidated balance sheets and has not recognized interest and/or penalties in the consolidated statements of operations and comprehensive loss for the years ended December 31, 2019 and 2018. The Company is subject to taxation in the United States and various state jurisdictions. The Company’s tax years from inception are subject to examination by the United States and state taxing authorities due to the carryforward of unutilized NOLs. On January 22, 2018, the FASB released guidance on the accounting for tax on the Global Intangible Low-Taxed Income (“GILTI”) provisions of H.R. 1, "The Tax Cuts and Jobs Act" signed into law in 2017 (the "Tax Act"). Under U.S. GAAP, the Company is allowed to make an accounting policy election of either (1) treating taxes due on the future U.S. inclusions in taxable income related to GILTI as a current-period expense when incurred, or the period cost method, or (2) factoring such amounts into the Company's measurement of its deferred taxes, or the deferred method. The Company has selected the period cost method as its accounting policy with respect to the potential GILTI tax obligations. The Company has ownership interest in controlled foreign corporations. The Company analyzed the potential impact of the GILTI provisions of the Tax Act, as well as Base Erosion and Anti-Abuse Tax ("BEAT"). Based on the foreign subsidiaries' tax position, the Company did not incur any impact relating to these provisions for the years ended December 31, 2019 or 2018. |
Segment and Geographic Informat
Segment and Geographic Information | 12 Months Ended |
Dec. 31, 2019 | |
Domestic and Foreign Operations [Abstract] | |
Segment and Geographic Information | Segment and Geographic Information The Company's chief operating decision maker is its Chief Executive Officer ("CEO"). The CEO reviews the financial information presented on a consolidated basis for purposes of allocating resources and evaluating the Company’s financial performance. Accordingly, the Company has determined that it operates in a single reporting segment. The Company generates revenue in domestic and foreign regions. Net revenues attributed to the United States and international geographies are based upon the country in which the customer is located. The United Kingdom accounted for 1% and 21% of total revenue for the years ended December 31, 2019 and 2018, respectively. Information about these operations is presented below: December 31, 2019 2018 Net revenues United States $ 18,950 $ 24,477 Europe 17 6,358 Other international revenue 183 48 Total net revenue $ 19,150 $ 30,883 Identifiable long-lived assets attributed to the United States and international geographies are based upon the country in which the asset is located or owned. As of December 31, 2019 and 2018, all of the Company’s identifiable long-lived assets were in the United States. |
Related-Party Transactions
Related-Party Transactions | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions [Abstract] | |
Related-Party Transactions | Related-Party Transactions As consideration for the Transfer Sponsor Warrants transferred to Phunware stockholders, a promissory note was issued to the Sponsors (the “Transfer Sponsor Warrant Note”). The amount of the note was approximately $1,993, which represented $0.50 per warrant transferred to former stockholders of Phunware. The Transfer Sponsor Warrant Note bore no interest. The Transfer Sponsor Warrants have an exercise price of $11.50 per share. The Transfer Sponsor Warrant Note was to mature on December 26, 2019. The Transfer Sponsor Warrant Note was waived and forgiven by the noteholders on January 15, 2019. With the Reverse Merger and Recapitalization, the Company assumed $255 in payables from Stellar for Nautilus Energy Management Corporation, an affiliate of a current member and former member of the Company’s board of directors. On November 15, 2019, the Company issued a Note (as defined above) in the principal amount of $195, in exchange for cash consideration, to Cane Capital, LLC, an entity owned in part by Alan S. Knitowski, the Company’s Chief Executive Officer and a member of its board of directors. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events The Company has evaluated subsequent events through March 30, 2020, the date the financial statements were issued. Related Party Bridge Loans Through the date noted above, various related parties loaned the Company $560. The Related Party Bridge Loans ("RPBLs") have an interest of 10% per annum and will mature on November 14, 2024. Payments on or payoff of the RPBLs may be made early with no penalty. The RPBLs were made by the following related parties and amounts thereof: (i) $204 by Cane Capital, LLC, an entity owned in part by our Chief Executive Officer; (ii) $151 by Curo Capital Appreciation Fund, LLC, an entity in which the Company's Chief Executive Officer and Chief Technology Officer serve as co-presidents, (iii) $155 by various individuals associated by familiar relationship with our Chief Executive Officer; and (iv) $50 by Luan Dang, the Company's Chief Technology Officer. Senior Convertible Note On March 19, 2020, the Company entered into a Securities Purchase Agreement (“Purchase Agreement”) for the sale of a Senior Convertible Note with an institutional investor (the “Investor”) with an initial principal amount of $3,000 (the “Senior Convertible Note”) for a cash purchase price of $2,760 (reflecting an original issue discount of $240) in a private placement (the “Private Placement”) that closed on March 20, 2020. After deducting the placement agent fee and other estimated expenses associated with the Private Placement, estimated net cash proceeds at the closing were approximately $2,371. In addition, we granted the Investor participation rights in future equity and equity-linked offerings of securities during the two years after the closing in an amount of up to 30% of the securities being sold in such offerings. Interest The Senior Convertible Note was issued to the Investor on March 20, 2020, bears interest at a rate of 7% per annum and matures on December 31, 2021 (subject to extension in certain circumstances, including bankruptcy and outstanding events of default). Upon any conversion or redemption, the Senior Convertible Note shall include a make-whole of interest from such date of determination through the maturity date. After the occurrence and during the continuance of an Event of Default (as defined in the Senior Convertible Note), the Senior Convertible Note will accrue interest at the rate of 18.0% per annum. Amortization Starting on April 30, 2020 and on the last trading day of the month for each month thereafter, and on the maturity date (each, an “Installment Date”), unless deferred or accelerated as described below, the Company is required to make monthly amortization payments equal to 1/20th of the initial principal and interest of the Senior Convertible Note payable (the “Installment Amount”), which, subject to the satisfaction of certain equity conditions set forth in the Senior Convertible Note, shall be satisfied in shares of our common stock (each, an “Installment Conversion”) at a conversion price equal to the lower of (x) the conversion price then in effect and (y) the greater of the Floor Price (as defined in the Senior Convertible Note) and 85% of the lowest volume weighted average price in the 10 days prior to the Installment Date or, at our option, may be satisfied in cash at a redemption price equal to 105% of such Installment Amount (each, an “Installment Redemption”). Shares to be issued with respect to any such installment will be predelivered on the second (2 nd ) trading day after the applicable Installment Notice Date (as defined in the Senior Convertible Note) with a true-up on the applicable Installment Date. Notwithstanding the foregoing, the noteholder may, at its sole option, elect to defer any Installment Amount until a subsequent Installment Date selected by the noteholder and may also elect to accelerate the conversion of future Installment Amounts to the current Installment Date, so long as such accelerated amount does not exceed three times any applicable Installment Amount. Conversion Subject to certain beneficial ownership limitations, the Senior Convertible Note is convertible, at the option of the noteholder, into shares of our common stock at a conversion price of $3.00 per share. The conversion price is subject to full ratchet antidilution protection upon any subsequent transaction at a price lower than the conversion price then in effect and standard adjustments in the event of any stock split, stock dividend, stock combination, recapitalization or other similar transaction. If we enter into any agreement to issue (or issue) any variable rate securities, the noteholder has the additional right to substitute such variable price (or formula) for the conversion price. Subsequent Placement Optional Redemption At any time after the earlier of the date a noteholder becomes aware of any placement by us of equity or equity-linked securities or the date of consummation of such a placement with net proceeds in the aggregate exceeding $5,000,000, subject to certain limited exceptions, the noteholder will have the right to have us redeem a portion of the Senior Convertible Note not in excess of 30% of the net proceeds from such placement at a redemption price of 110% of the portion of the Senior Convertible Note subject to redemption. If the noteholder is participating in any such placement, the noteholder may apply the redemption amount against the purchase price of the securities in such placement. Company Redemption Rights At any time on or prior to May 19, 2020, we may redeem the Senior Convertible Note at a price equal to 100% of the outstanding principal of the Senior Convertible Note (or, if greater, the market value of the shares underlying the Senior Convertible Note) to be redeemed, and accrued and unpaid interest and unpaid late charges thereon. Thereafter, the Company’s optional redemption price will equal 110% of the outstanding principal of the Senor Convertible Note (or, if greater, the market value of the shares underlying the Senior Convertible Note) to be redeemed, and accrued and unpaid interest and unpaid late charges thereon. Events of Default In connection with an Event of Default, the noteholder may require us to redeem in cash any or all of the Senior Convertible Note. The redemption price will equal 115% of the outstanding principal of the Senior Convertible Note to be redeemed, and accrued and unpaid interest and unpaid late charges thereon, or an amount equal to market value of the shares of our common stock underlying the Senior Convertible Note, as determined in accordance with the Senior Convertible Note, if greater. If an Event of Default has occurred, the noteholder may elect to alternatively convert the Senior Convertible Note (including the 15% premium that would otherwise be payable in a cash acceleration thereof) at an alternate conversion price equal to the lower of (x) the conversion price then in effect and (y) the greater of the Floor Price (as defined in the Senior Convertible Note) and 85% of the lowest volume weighted average price in the 10 days prior to the applicable conversion date. Change of Control In connection with a Change of Control (as defined in the Senior Convertible Note), a noteholder may require us to redeem all or any portion of the Senior Convertible Note. The redemption price per share will equal the greatest of (i) 115% of the outstanding principal of the Senior Convertible Note to be redeemed, and accrued and unpaid interest and unpaid late charges thereon, (ii) 115% of the market value of the shares of our common stock underlying the Senior Convertible Note, as determined in accordance with the Senior Convertible Note, and (iii) 115% of the aggregate cash consideration that would have been payable in respect of the shares of our common stock underlying the Senior Convertible Note, as determined in accordance with the Senior Convertible Note. Covenants We will be subject to certain customary affirmative and negative covenants regarding the incurrence of indebtedness, the existence of liens, the repayment of indebtedness, the payment of cash in respect of dividends, distributions or redemptions, and the transfer of assets, among other matters. We also will be subject to a financial covenant that requires us to maintain available cash in the amount of $200,000 at the end of each fiscal quarter. Registration Rights The Company is required to file a registration statement covering the resale of the shares underlying the Senior Convertible Note within 60 days and to have the registration statement declared effective within 90 days of after the closing of the Purchase Agreement. It also grants the Investor customary “piggyback” registration rights. If we fail to file the registration statement or have it declared effective by the deadlines above, or if certain other conditions relating to the availability of the registration statement and current public information are not met, we will pay certain Registration Delay Payments to such noteholders (as defined in the Registration Rights Agreement). COVID-19 The COVID-19 outbreak in the United States has caused business disruption through mandated and voluntary closing of businesses and cancellation of events for which the Company's application transition business serves. Furthermore, the Company’s platform software and services business serves healthcare and hospitals throughout the United States. While the disruption is currently expected to be temporary, there is considerable uncertainty around the duration of the closings. While the related financial impact and duration cannot be reasonably estimated at this time, the Company is taking steps to implement measures to reduce operating expenses. To that end, on March 27, 2020, the Company committed to cost reduction by furloughing approximately 37 persons, or approximately 42%, of its workforce. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of EstimatesThe preparation of financial statements in conformity with U.S. GAAP requires management to make certain 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 revenue and expenses during the reporting period. Items subject to the use of estimates include, but are not limited to, the standalone selling price for our products and services, stock-based compensation, useful lives of long-lived assets including intangibles, fair value of intangible assets and the recoverability or impairment of tangible and intangible assets, including goodwill, reserves and certain accrued liabilities, the benefit period of deferred commissions and provision for (benefit from) income taxes. Actual results could differ from those estimates and such differences could be material to the consolidated financial statements. |
Changes in Accounting Policies | Changes in Accounting Policies On January 1, 2019, we adopted Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers , as amended (“ASU 2014-09” or "ASC 606"), and have revised certain related accounting policies in connection with revenue recognition and deferred costs as more fully described below. Other recently adopted accounting policies can found under the subheading " Recently Adopted Accounting Standards " below. |
Revenue Recognition | Revenue Recognition Revenue is recognized upon transfer of control of promised products or services in an amount that reflects the consideration we expect to receive in exchange for those products or services. The Company enters into contracts that can include various combinations of products and services, which are generally capable of being distinct, distinct within the context of the contract, and accounted for as separate performance obligations. Contract Balances The timing of revenue recognition may differ from the timing of invoicing for contracts with customers. When the timing of revenue recognition differs from the timing of invoicing, the Company uses judgment to determine whether the contract includes a significant financing component requiring adjustment to the transaction price. Various factors are considered in this determination including the duration of the contract, payment terms, and other circumstances. Generally, the Company determined that contracts do not include a significant financing component. The Company applies the practical expedient for instances where, at contract inception, the expected timing difference between when promised goods or services are transferred and associated payment will be one year or less. Payment terms vary by contract type; however, contracts typically stipulate a requirement for the customer to pay within 30 days. Transaction price may be allocated to performance obligations that are unsatisfied or are partially unsatisfied. Amounts relating to remaining performance obligations on non-cancelable contracts include both the deferred revenue balance and amounts that will be invoiced and recognized as revenue in future periods. As of December 31, 2019, approximately $12,989 of revenue is expected to be recognized from remaining performance obligations, a majority of which is related to multi-year subscription and support and maintenance arrangements. The Company expects to recognize revenue on approximately 72% of these remaining performance obligations within the next 24 months and the remainder thereafter. Significant Judgments Our contracts with customers often include promises to transfer multiple products and services to a customer. Determining whether products and services are considered distinct performance obligations that should be accounted for separately versus together may require significant judgment. For contracts with multiple performance obligations, the contract price is allocated to separate performance obligations on a relative standalone basis for which significant judgment is required. Judgment is required to determine whether a software license is considered distinct and accounted for separately, or not distinct and accounted for together with the software support and services and recognized over time. Platform Subscriptions and Services Revenue The Company derives subscription revenue from software license fees, which comprise subscription fees from customers licensing the Company’s Software Development Kits (SDKs), which includes accessing the MaaS platform and/or MaaS platform data; application development service revenue from the development of customer applications, or apps, which are built and delivered to customers; and support fees. The Company’s contract terms generally range from one three Subscription revenue from SDK licenses gives the customer the right to access the Company’s MaaS platform. In accordance with ASC 606, a ‘right to access’ license is recognized over the license period. Application development revenue is derived from development services around designing and building new applications or enhancing existing applications. The Company recognizes application development revenue upon the transfer of control of the completed application or application development services. The Company typically bills for application development revenue in advance at contract signing, but may at times, bill one-half in advance at contract execution and one-half upon completion. Support and maintenance revenue is comprised of support fees for customer applications, software updates, and technical support for application development services for a support term. Support revenue is recognized ratably over the support term. Support and maintenance is typically billed annually in advance. When a customer contract consists of licensing, application development and support and maintenance, the Company considers these separate performance obligations, which would require an allocation of consideration. From time to time, the Company also provides professional services by outsourcing employees to customers on a time and materials basis. Revenues from these arrangements are recognized as the services are performed. The Company typically bills professional service customers in the month in which the services are performed. Application Transaction Revenue The Company also generates revenue by charging advertisers to deliver advertisements (ads) to users of mobile connected devices. Depending on the specific terms of each advertising contract, the Company generally recognizes revenue based on the activity of mobile users viewing these ads. Fees from advertisers are commonly based on the number of ads delivered or views, clicks, or actions by users on mobile advertisements delivered, and the Company recognizes revenue at the time the user views, clicks, or otherwise acts on the ad. The Company sells ads through several offerings: cost per thousand impressions, on which advertisers are charged for each ad delivered to 1,000 consumers; cost per click, on which advertisers are charged for each ad clicked or touched on by a user; and cost per action, on which advertisers are charged each time a consumer takes a specified action, such as downloading an app. In addition, the Company generates application transaction revenue thru in-app purchases from an application on our platform. In the normal course of business, the Company acts as an intermediary in executing transactions with third parties. The determination of whether revenue should be reported on a gross or net basis is based on an assessment of whether the Company is acting as the principal or an agent in its transactions with advertisers. Control is a determining factor in assessing principal versus agent relation. The determination of whether the Company is acting as a principal or an agent in a transaction involves judgment and is based on an evaluation of the terms of each arrangement. ASC 606 provides indicators of when an entity controls specified goods or services and is therefore acting as a principal. Based on the indicators of control, the Company has determined that it is the principal in all advertising arrangements because it is responsible for fulfilling the promise to provide the specified advertisements to advertising agencies or companies; establishing the selling prices of the advertisements sold; and credit risk with its advertising traffic providers. Accordingly, the Company acts as the principal in all advertising arrangements and therefore reports revenue earned and costs incurred related to these transactions on a gross basis. Deferred Commissions The Company defers commission costs and amortizes them in a manner consistent with how we recognize revenue. Key judgments that impact our commission expense include estimating our customer life and the determination of the impairment of commission assets we deem to be unrecoverable. The Company applies a practical expedient and expenses these costs as incurred if the amortization period is one year or less. Changes in deferred commissions were as follows (in thousands): Year Ended December 31, Balance, beginning of the period $ 369 Deferral of commissions earned 171 Recognition of commission expense (231) Balance, end of the period $ 309 |
Concentrations of Credit Risk | Concentrations of Credit Risk The Company’s financial instruments that are exposed to concentrations of credit risk consist primarily of cash and trade accounts receivable. Although the Company limits its exposure to credit loss by depositing its cash with established financial institutions that management believes have good credit ratings and represent minimal risk of loss of principal, its deposits, at times, may exceed federally insured limits. Collateral is not required for accounts receivable, and the Company believes the carrying value approximates fair value. Revenue from Fox Networks Group (“Fox”) was 50% and 42% of total net revenues for the years ended December 31, 2019 and 2018, respectively. Revenue from Fetch Media Ltd. was 21% of total revenue for 2018. |
Cash, Cash Equivalents, and Restricted Cash | Cash, Cash Equivalents, and Restricted Cash The Company considers all investments with a maturity of three months or less from the date of acquisition to be cash equivalents. The Company had no cash equivalents at December 31, 2019 or 2018. As a result of the issuance of the Notes (defined and discussed further below), the Company had $86 in restricted cash as of December 31, 2019. |
Accounts Receivable and Reserves | Accounts Receivable and Reserves Accounts receivable are presented net of allowances. The Company considers receivables past due based on the contractual payment terms. The Company makes judgments as to its ability to collect outstanding receivables and records a bad debt allowance for receivables when collection becomes doubtful. The allowances are based upon historical loss patterns, current and prior trends in its aged receivables, credit memo activity, and specific circumstances of individual receivable balances. Accounts receivable consisted of the following: December 31, December 31, Accounts receivable $ 4,850 $ 6,882 Less allowances for doubtful accounts (3,179) (3,276) Accounts receivable, net $ 1,671 $ 3,606 Changes in the allowance for doubtful accounts are as follows: December 31, December 31, Balance as at beginning of period $ 3,276 $ 3,089 Allowances for bad debt 114 167 Issuance of credit memos (211) 20 Balance at end of period $ 3,179 $ 3,276 |
Property and Equipment | Property and Equipment Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets, generally ranging from three to seven years. Leasehold improvements are amortized over the shorter of their useful lives or the remaining terms of the related leases. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill arises from purchase business combinations and is measured as the excess of the cost of the business acquired over the sum of the acquisition-date fair values of tangible and identifiable intangible assets acquired, less any liabilities assumed. In accordance with ASC 350, Intangibles — Goodwill and Other , the Company does not amortize goodwill or intangible assets with indefinite lives but rather assesses their carrying value for indications of impairment annually, or more frequently if events or changes in circumstances indicate that the carrying amount may be impaired. The goodwill impairment test required by ASC 350 is a two-step process. The first step of the goodwill impairment test, used to identify potential impairment, compares the fair value of a reporting unit with its carrying amount, or the net book value of the company or reporting unit, including goodwill. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired; thus, the second step of the impairment test is unnecessary. If the carrying amount of a reporting unit exceeds its fair value, the second step of the goodwill impairment test shall be performed to measure the amount of impairment loss, if any. The Company attributes goodwill to its sole reporting unit for impairment testing. The fair value used by the Company was derived from the market capitalization approach, whereby the Company utilizes the historical market price of its stock traded on the Nasdaq to estimate the fair value of its reporting unit. The determination of whether goodwill has become impaired involves a significant level of judgment in the assumptions underlying the approach used to determine the value of the reporting unit. Changes in the Company’s strategy and/or market conditions could significantly impact these judgments and require adjustments to recorded amounts of goodwill. Identifiable intangible assets consist of acquired trade names, customer lists, technology, in-process research and development, and order backlog associated with the acquired businesses. Amortization of finite-lived intangible assets is calculated using either the straight-line or accelerated amortization model based on the Company’s best estimate of the distribution of the economic value of the identifiable intangible assets. The Company did not recognize any goodwill or intangible impairment losses in the years ended December 31, 2019 or 2018. |
Long-Lived Assets | Long-Lived Assets Long-lived asset with definite lives are reviewed for impairment whenever events or changes in circumstances indicate that an asset’s carrying value may not be recoverable. In accordance with authoritative guidance, the Company evaluates the recoverability of each of our long-lived assets, including property and equipment, by comparing its carrying amount to the undiscounted future cash flows expected to be generated. If the total of undiscounted future cash flows is less than the carrying amount of an asset, an impairment would be recognized for the amount by which the carrying amount of the asset exceeds its fair value. The Company did not recognize any impairment losses during the years ended December 31, 2019 or 2018. |
Leases | Leases Leases are reviewed and classified as capital or operating at their inception. For leases that contain rent escalations or periods during the lease term where rent is not required, the Company recognizes rent expense based on allocating the total rent payable on a straight-line basis over the term of the lease excluding lease extension periods. The difference between rent payments and straight-line rent expense is recorded as deferred rent. Deferred rent that will be recognized during the succeeding 12-month period is recorded as the current portion of deferred rent and is included in accrued expenses and other and the remainder is recorded in deferred rent on the consolidated balance sheets. |
Advertising Costs | Advertising Costs Advertising costs are expensed as incurred. Total advertising costs were $0 and $225 for the years ended December 31, 2019 and 2018, respectively, and were included in sales and marketing expenses on the consolidated statements of operations and comprehensive loss. |
Stock-Based Compensation | Stock-Based CompensationCompensation expense related to stock-based transactions, including employee and non-employee director awards, is measured and recognized in the financial statements based on fair value on the grant date of the award. The Company recognized stock-based compensation expense for awards with only service conditions on a straight-line basis over the requisite service period of the related award. The Company has not granted any awards with market or performance conditions. Forfeitures of all stock-based awards are accounted for when they occur. |
Retirement Plan | Retirement Plan At December 31, 2019, the Company administered one employee retirement plan that qualified as a deferred salary arrangement under Section 401(k) of the Internal Revenue Code (the "IRC"). Under the retirement plan, participating employees may contribute a portion of their pretax earnings, up to the Internal Revenue Service annual contribution limit. No employer matching contributions were made to the retirement plan during the years ended December 31, 2019 or 2018. |
Income Taxes | Income Taxes The Company accounts for income taxes in accordance with ASC 740, Income Taxes ("ASC 740"). Under ASC 740, deferred tax assets and liabilities reflect the future tax consequences of the differences between the financial reporting and tax bases of assets and liabilities using current enacted tax rates. Valuation allowances are recorded when the realizability of such deferred tax assets does not meet the more-likely-than-not threshold under ASC 740. Significant judgment is required in determining any valuation allowance recorded against deferred tax assets. In assessing the need for a valuation allowance, the Company considers all available evidence, including past operating results, estimates of future taxable income and the feasibility of tax planning strategies. In the event of a change in the determination as to the amount of deferred tax assets that can be realized, an adjustment of the valuation allowance with a corresponding impact to the provision for income taxes will be made in the period in which such determination was made. The guidance on accounting for uncertainty in income taxes prescribes a recognition threshold and measurement attribute criterion for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company has not recognized interest or penalties on the consolidated balance sheets or statements of operations and comprehensive loss. |
Redeemable Convertible Preferred Stock | Redeemable Convertible Preferred Stock In 2018, the Company issued 6,000 shares for aggregate cash proceeds of $6,000 from the Series A 8% convertible preferred stock financing (“Series A Financing”) in conjunction with the Reverse Merger and Recapitalization. In accordance with ASC 480, redemption provisions not solely within the control of the Company require the security to be classified outside of permanent equity. |
Comprehensive Loss | Comprehensive Loss The Company utilizes the guidance in ASC 220, Comprehensive Income , for the reporting and display of comprehensive loss and its components in the consolidated financial statements. Comprehensive loss comprises net loss and cumulative foreign currency translation adjustments. The accumulated comprehensive loss at December 31, 2019 and 2018 was due to foreign currency translation adjustments. |
Loss per Common Share | Loss per Common Share Basic loss per common share is computed by dividing net loss applicable to common stockholders by the weighted average number of shares of common stock outstanding during the period. Restricted shares subject to repurchase provisions relating to early exercises under the Company's 2009 Equity Incentive Plan were excluded from basic shares outstanding. Diluted loss per common share is computed by giving effect to all potential shares of common stock, including those related to the Company's outstanding warrants and stock equity plans, to the extent dilutive. For all periods presented, these shares were excluded from the calculation of diluted loss per share of common stock because their inclusion would have been anti-dilutive. As a result, diluted loss per common share is the same as basic loss per common share for all periods presented. As of December 31, 2019 and 2018, 6,219 and 40,707 shares were restricted, respectively, relating to early exercises of the Company’s 2009 Stock Option Plan and are excluded from basic shares outstanding for the years then ended. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Authoritative guidance on fair value measurements defines fair value, establishes a consistent framework for measuring fair value, and expands disclosures for each major asset and liability category measured at fair value on either a recurring or non-recurring basis. Fair value is an exit price representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the authoritative guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows Level 1 — Observable inputs such as quoted prices in active markets. Level 2 — Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly. Level 3 — Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The carrying value of accounts receivable, prepaid expenses, other current assets, accounts payable, and accrued expenses are considered to be representative of their respective fair values because of the short-term nature of those instruments. |
Loss Contingencies | Loss Contingencies We are subject to the possibility of various loss contingencies arising in the ordinary course of business. We accrue for loss contingencies when it is probable that an asset has been impaired or a liability has been incurred and the amount of loss can be reasonably estimated. If we determine that a loss is possible and the range of the loss can be reasonably determined, then we disclose the range of the possible loss. We regularly evaluate current information available to us to determine whether an accrual is required, an accrual should be adjusted or a range of possible loss should be disclosed. From time to time, we are involved in disputes, litigation, and other legal actions. However, there are many uncertainties associated with any litigation, and these actions or other third-party claims against us may cause us to incur substantial settlement charges, which are inherently difficult to estimate and could adversely affect our results of operations. The actual liability in any such matters may be materially different from our estimates, which could result in the need to adjust our liability and record additional expenses. |
Subsequent Events | Subsequent Events In accordance with U.S. GAAP, we have evaluated events that have occurred after the date of the financial statements through the date the financial statements are issued to determine if events or transactions occurring after the date of the financial statements require potential adjustment to or disclosure in the financial statements. See Note 17 for additional discussion on the Company’s subsequent events. |
Emerging Growth Company | Emerging Growth Company Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such an election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, will adopt the new or revised standard at the time private companies adopt the new or revised standard. |
Recent Accounting Pronouncements | Recently Adopted Accounting Standards In May 2014, the FASB and the International Accounting Standards Board jointly issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers , which is a comprehensive new revenue recognition standard that will supersede nearly all existing revenue recognition guidance under U.S. GAAP and International Financial Reporting Standards. The standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In doing so, companies will need to use more judgment and make more estimates than under previous authoritative guidance. These may include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price, and allocating the transaction price to each separate performance obligation. The Company elected to take advantage of the extended transition period provided in Securities Act Section 7(a)(2)(B) for complying with new or revised accounting standards. As a result, we adopted the ASU and related guidance as of January 1, 2019 using the modified retrospective method. The most significant impact of the standard relates to the elimination of the requirement to have vendor specific objective evidence, or VSOE, of fair value to separate and recognize revenue for products and services in a contract. The elimination of the VSOE requirement causes a significant change to the timing of revenue recognition for multiple-element arrangements with our MaaS subscriptions, application development services and related support and maintenance on the development services that lacked VSOE of fair value. Under ASC 606, we recognize the application development services at the time of delivery to our customer and recognize the license subscription and support services ratably over the term of the subscription agreements. Under the previous standards, we recognized all revenue from those arrangements ratably over the term of the subscription or support agreements. Due to the complexity of our revenue contracts, the actual revenue recognition treatment required under the new standard depends on contract-specific terms and in some instances may vary from recognition at the time of delivery. The timing of revenue recognized from professional services, support and maintenance and hardware remains substantially unchanged. In addition, Accounting Standards Codification Subtopic 340-40, Other Assets and Deferred Costs - Contracts with Customers , or ASC 340, requires us to recognize an asset for the incremental costs of obtaining a contract with a customer if our sales incentive programs meet the requirements for capitalization. Previously we recorded these incremental costs of obtaining a contract as commission expense when we booked a sales transaction; whereas under ASC 340, we record an asset for the incremental cost to obtain a contract and recognize the cost over the period commensurate with revenue recognition. When implementing ASC 606, the Company applied the practical expedient to reflect the aggregate effect of all contracts that were not completed as of January 1, 2019 when identifying satisfied and unsatisfied performance obligations, determining the transaction price, and allocating the transaction price to the satisfied and unsatisfied performance obligations. The following table sets forth the cumulative impact of the adoption of the new revenue standard for select condensed consolidated balance sheet line items: Balance at December 31, 2018 Adjustments due Balance at Assets: Prepaid expenses and other current assets $ 272 $ 369 $ 641 Liabilities: Deferred revenue short-term $ 2,629 $ (465) $ 2,164 Deferred revenue long-term $ 5,622 $ (253) $ 5,369 Stockholders’ deficit: Accumulated deficit $ (111,820) $ 1,087 $ (110,733) The following tables summarize the significant impacts of adopting ASC 606 on our financial statements as of and for the year ended December 31, 2019: Consolidated Balance Sheet December 31, 2019 As reported Impact of Adoption Balances Without Adoption of ASC 606 Assets: Prepaid expenses and other current assets $ 368 $ (309) $ 59 Liabilities: Deferred revenue short-term $ 3,360 $ 205 $ 3,565 Deferred revenue long-term $ 3,764 $ 113 $ 3,877 Stockholders’ deficit: Accumulated deficit $ (123,604) $ (627) $ (124,231) Consolidated Statement of Operations Year Ended December 31, 2019 As reported Impact of Adoption Amounts Without Adoption of ASC 606 Net revenue $ 19,150 $ 401 $ 19,551 Sales and marketing $ 2,706 $ (60) $ 2,646 Net loss $ (12,871) $ 461 $ (12,410) Net loss per share, basic and diluted $ (0.35) $ 0.01 $ (0.34) In connection with our adoption of ASC 606 on January 1, 2019, there was an increase to the Company’s deferred income tax liabilities and an offsetting reduction in the valuation allowance recorded against deferred tax assets. No income tax impact was recorded to retained earnings upon adoption as a result of the full valuation allowance on United States deferred tax assets. During the year ended December 31, 2019, there is no income tax expense or benefit recorded as a result of the adoption of the ASC 606. In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash (“ASU 2016-18"), which provides amendments to current guidance to address the classification and presentation of changes in restricted cash in the statement of cash flows. We adopted ASU 2016-18 effective January 1, 2019 on a retrospective basis. As a result of this retrospective adoption, the reclassification of restricted cash into a change in total cash resulted in an increase in cash provided by financing activities of $5,500 for the year ended December 31, 2018. The following table sets forth a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheet that sum to the total of the same such amounts shown in the consolidated statement of cash flows. Balance at the Beginning of Period January 1, 2019 January 1, 2018 Cash and cash equivalents $ 844 $ 308 Restricted cash 5,500 — Total cash, cash equivalents, and restricted cash shown in the consolidated statement of cash flows $ 6,344 $ 308 Balance at the End of Period December 31, 2019 December 31, 2018 Cash and cash equivalents $ 276 $ 844 Restricted cash 86 5,500 Total cash, cash equivalents, and restricted cash shown in the consolidated statement of cash flows $ 362 $ 6,344 In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business ("ASU 2017-01"). ASU 2017-01 provides a new framework for entities to determine whether a set of assets and activities (together referred to as “a set”) is a business. The amendments in the ASU will assist entities when they evaluate whether transactions should be accounted for as acquisitions (or disposals) either of businesses or of assets. This distinction is important since there are significant differences between the accounting for business combinations and the accounting for acquisitions of assets. The Company adopted this guidance for the fiscal year ended December 31, 2019. The adoption of this standard did not have an impact to the consolidated financial statements upon adoption. In June 2018, the FASB issued ASU No. 2018-07, Compensation - Stock Compensation (Topic 718): Improvements to Non-Employee Share-Based Payment Accounting (“ASU 2018-07”), which simplifies the accounting for nonemployee share-based payment transactions for acquiring goods and services. Currently, the accounting requirements for nonemployee and employee share-based payment transactions are significantly different. This standard expands the scope of Topic 718 to include share-based payments issued to nonemployees for goods or services by aligning the accounting for share-based payments to nonemployees and employees. As the Company is an emerging growth company and has elected to defer implementation of new or updated accounting standards, ASU 2018-07 is effective for the Company for annual reporting periods beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020. However, early adoption is permitted, but no earlier than the entities adoption of Topic 606. The Company adopted this Update during its fiscal year ended December 31, 2019. The adoption did not have a material impact on the Company’s consolidated financial statements. Recent Accounting Standards Not Yet Adopted In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) ("ASU 2016-02"). The core principle of ASU 2016-02 is that a lessee should recognize the assets and liabilities that arise from leases. For operating leases, a lessee is required to recognize a right-of-use asset and a lease liability, initially measured at the present value of the lease payments, in the statement of financial position. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. Under current U.S. GAAP, the Company recognizes rent expense on a straight-line basis for all operating leases, taking into account fixed accelerations, as well as reasonably assured renewal periods. In November 2019, the FASB issued Accounting Standards Update ("ASU") No. 2019-10 ("ASU 2019-10"). ASU 2019-10 delayed the effective date of ASU 2016-02 for certain types of businesses, including private companies. Under the JOBS Act, the Company has previously elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an Emerging Growth Company ("EGC"), can adopt the new or revised standard at the time private companies adopt the new or revised standard. Accordingly, this ASU is now effective for the Company for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. Although earlier application is permitted, the Company plans to implement this guidance beginning the first quarter of its fiscal year 2021. The Company currently does not expect the ASU 2016-02 to materially impact our results of operations; although, based upon our current operating leases outstanding, we believe this guidance may have a material impact on our consolidated balance sheet. We do not plan on recasting prior periods. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments ("ASU 2016-13"). ASU 2016-13 introduces a model based on expected losses to estimate credit losses for most financial assets and certain other instruments. In addition, for available-for-sale debt securities with unrealized losses, the losses will be recognized as allowances rather than reductions in the amortized cost of the securities. As a Smaller Reporting Company ("SRC") as defined by the Securities and Exchange Commission ("SEC"), the standard is currently effective for the Company annual reporting periods beginning after December 15, 2022, with early adoption permitted for annual reporting periods beginning after December 15, 2019. We currently intend to adopt ASU No. 2016-13 effective January 1, 2023. Entities will apply the standard’s provisions by recording a cumulative-effect adjustment to retained earnings. We do not expect the adoption of ASU 2016-13 to have a material impact on our consolidated financial statements and disclosures. In January 2017, the FASB issued ASU 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment ("ASU 2017-04"). ASU 2017-04 simplifies how all entities assess goodwill for impairment by eliminating Step 2 from the goodwill impairment test. As amended, the goodwill impairment test will consist of one step; comparing the fair value of a reporting unit with its carrying amount. An entity should recognize a goodwill impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. Public business entities that are SEC filers should adopt the amendments in this ASU for their annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. As an SRC, the amendments in this Update would be effective for the Company for its annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2022. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company does not anticipate the adoption of ASU 2017-04 will have a material impact on our consolidated financial statements and disclosures. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement ("ASU 2018-13"). ASU 2018-13 improves the effectiveness of disclosures about fair value measurements required under ASC 820. ASU 2018-13 is effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. Early adoption is permitted upon issuance of this Update. An entity is permitted to early adopt any removed or modified disclosures upon issuance of this Update and delay adoption of the additional disclosures until their effective date. The Company does not believe the adoption of ASU 2018-13 will have a material effect on our financial statements and their disclosures. In December 2019, the FASB issued Accounting Standard Update No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”), which simplifies the accounting for income taxes. Should the Company retain its EGC status through the fifth anniversary of the date of its initial public offering, this guidance will be effective for us in our financial statements and consolidated notes thereto for the fiscal year ending December 31, 2021 on a prospective basis. Early adoption is permitted. The Company is currently evaluating the impact of the new guidance on its consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Schedule of change in deferred commissions | Changes in deferred commissions were as follows (in thousands): Year Ended December 31, Balance, beginning of the period $ 369 Deferral of commissions earned 171 Recognition of commission expense (231) Balance, end of the period $ 309 |
Schedule of concentration of accounts receivable | The following table sets forth the Company's concentration of accounts receivable, net of specific allowances for doubtful accounts. December 31, 2019 December 31, 2018 Fox Networks Group —% 66% HID Global 23% —% American Made Media Consultants, LLC 15% —% Presidio Networked Solutions LLC 11% —% MD Anderson 10% —% |
Schedule of accounts receivable | Accounts receivable consisted of the following: December 31, December 31, Accounts receivable $ 4,850 $ 6,882 Less allowances for doubtful accounts (3,179) (3,276) Accounts receivable, net $ 1,671 $ 3,606 |
Schedule of allowance for doubtful debt | Changes in the allowance for doubtful accounts are as follows: December 31, December 31, Balance as at beginning of period $ 3,276 $ 3,089 Allowances for bad debt 114 167 Issuance of credit memos (211) 20 Balance at end of period $ 3,179 $ 3,276 |
Deferred revenue | The Company’s deferred revenue balance consisted of the following: December 31, December 31, Current deferred revenue Platform subscriptions and services revenue $ 3,278 $ 1,506 Application transaction revenue 82 133 PhunCoin deposits — 990 Total current deferred revenue $ 3,360 $ 2,629 Non-current deferred revenue Platform subscriptions and services revenue $ 3,764 $ 5,622 Total non-current deferred revenue $ 3,764 $ 5,622 Total deferred revenue $ 7,124 $ 8,251 |
Adoption of ASC 606 | The following table sets forth the cumulative impact of the adoption of the new revenue standard for select condensed consolidated balance sheet line items: Balance at December 31, 2018 Adjustments due Balance at Assets: Prepaid expenses and other current assets $ 272 $ 369 $ 641 Liabilities: Deferred revenue short-term $ 2,629 $ (465) $ 2,164 Deferred revenue long-term $ 5,622 $ (253) $ 5,369 Stockholders’ deficit: Accumulated deficit $ (111,820) $ 1,087 $ (110,733) The following tables summarize the significant impacts of adopting ASC 606 on our financial statements as of and for the year ended December 31, 2019: Consolidated Balance Sheet December 31, 2019 As reported Impact of Adoption Balances Without Adoption of ASC 606 Assets: Prepaid expenses and other current assets $ 368 $ (309) $ 59 Liabilities: Deferred revenue short-term $ 3,360 $ 205 $ 3,565 Deferred revenue long-term $ 3,764 $ 113 $ 3,877 Stockholders’ deficit: Accumulated deficit $ (123,604) $ (627) $ (124,231) Consolidated Statement of Operations Year Ended December 31, 2019 As reported Impact of Adoption Amounts Without Adoption of ASC 606 Net revenue $ 19,150 $ 401 $ 19,551 Sales and marketing $ 2,706 $ (60) $ 2,646 Net loss $ (12,871) $ 461 $ (12,410) Net loss per share, basic and diluted $ (0.35) $ 0.01 $ (0.34) |
Reconciliation of cash, cash equivalents and restricted cash | The following table sets forth a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheet that sum to the total of the same such amounts shown in the consolidated statement of cash flows. Balance at the Beginning of Period January 1, 2019 January 1, 2018 Cash and cash equivalents $ 844 $ 308 Restricted cash 5,500 — Total cash, cash equivalents, and restricted cash shown in the consolidated statement of cash flows $ 6,344 $ 308 Balance at the End of Period December 31, 2019 December 31, 2018 Cash and cash equivalents $ 276 $ 844 Restricted cash 86 5,500 Total cash, cash equivalents, and restricted cash shown in the consolidated statement of cash flows $ 362 $ 6,344 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of changes in goodwill | Changes in the Company’s goodwill balance for the years ended December 31, 2019 and 2018, are summarized in the table below: 2019 2018 Balance as at beginning of period $ 25,821 $ 25,886 Foreign currency translation 36 (65) Balance at end of period $ 25,857 $ 25,821 |
Schedule of finite-lived intangible assets | The finite-lived intangible assets that are being amortized are summarized in the table below: Weighted Average Useful Life (years) December 31, 2019 December 31, 2018 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Trade name 4.6 $ 649 $ (649) $ — $ 648 $ (648) $ — Acquired technology 5.1 4,828 (4,798) 30 4,828 (4,763) 65 In-process research and development 5.0 94 (94) — 94 (94) — Customer relationships 5.7 4,604 (4,381) 223 4,576 (4,120) 456 Order backlog 1.5 329 (329) — 329 (329) — $ 10,504 $ (10,251) $ 253 $ 10,475 $ (9,954) $ 521 |
Schedule of expected future annual amortization expense | Expected future annual amortization expense for finite-lived intangible assets as of December 31, 2019, is as follows: Year Amortization 2020 $ 142 2021 90 2022 21 2023 — Total $ 253 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of estimated useful lives of property and equipment | The estimated useful lives of property and equipment consist of the following: Life (years) December 31, December 31, Equipment 3-5 $ 907 $ 907 Furniture and fixtures 7 32 32 Leasehold improvements 5 or remaining lease term 258 241 Total property and equipment $ 1,197 $ 1,180 Accumulated depreciation (1,173) (1,114) Total property and equipment, net $ 24 $ 66 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Payables and Accruals [Abstract] | |
Schedule of accrued expenses | Accrued expenses consist of the following: December 31, December 31, Partner revenue share $ 155 $ 201 Payroll related expenses 3,202 2,496 Taxes 323 123 Other 355 208 Total accrued expenses $ 4,035 $ 3,028 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of future minimum annual lease payments under operating leases | Future minimum annual lease payments under the Company’s operating leases are as follows: Future minimum lease obligations years ending December 31, Lease Obligations 2020 $ 791 2021 836 2022 725 2023 622 2024 609 Thereafter 209 Total $ 3,792 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Schedule of Warrant Activity | A summary of the Company’s warrant activity by warrant type is as follows: Warrant Type Cash Exercise Price per share Warrants/UPO's Outstanding 12/31/2018 Warrants issued for UPO exercises Warrants/UPO’s Exercised Warrants Outstanding 12/31/2019 Cash Cashless Common stock warrant (Series D-1) $ 5.54 14,866 — — — 14,866 Common stock warrants (Series F) $ 9.22 1,085,059 — (400,740) (306,917) 377,402 Public Warrants (PHUNW) $ 11.50 6,900,610 — — (5,139,319) 1,761,291 Private Placement Warrants $ 11.50 10,182,060 — (216,556) (8,307,123) 1,658,381 Unit Purchase Options (UPOs) $ 11.50 130,000 — — (130,000) — Unit Purchase Option Warrants $ 11.50 — 116,172 — (92,000) 24,172 Total 18,312,595 116,172 (617,296) (13,975,359) 3,836,112 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Share-based Payment Arrangement, Restricted Stock and Restricted Stock Unit, Activity | A summary of the Company’s restricted stock unit activity under the 2018 Plan is set forth below: Shares Weighted Average Grant Date Fair Value Outstanding as of December 31, 2018 — $ — Granted 3,245,922 2.93 Released (521,979) 1.79 Forfeited (286,975) 3.10 Outstanding as of December 31, 2019 2,436,968 $ 3.15 |
Schedule of Stock Options Activity | A summary of the Company’s stock option activity under the 2009 Plan and related information is set forth below: Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value 12/31/2017 Outstanding 1,417,373 $ 0.54 7.18 $ 53 Granted 1,770,225 1.11 Exercised (293,778) 0.58 Cancelled/Expired (528,997) 0.78 12/31/2018 Outstanding 2,364,823 $ 0.90 8.12 $ 71,332 Granted — — Exercised (488,090) 0.57 Cancelled/Expired (411,283) 1.68 12/31/2019 Outstanding 1,465,450 $ 0.80 6.86 $ 771 Options exercisable 1,016,089 $ 0.73 6.33 $ 560 The aggregate intrinsic value is based on the Company’s stock price trading price on the NASDAQ Capital Market. The aggregate intrinsic value of options exercised was $7,619 and $483 for the years ended December 31, 2019 and 2018, respectively, and is calculated based on the difference between the estimated fair value of the Company’s common stock at the date of exercise and the exercise price. |
Compensation Cost | Compensation cost that has been included on the Company’s consolidated statements of operations for all stock-based compensation arrangements is set forth below: Year Ended Stock-based compensation December 31, December 31, Cost of revenues $ 146 $ 45 Sales and marketing 12 42 General and administrative 1,417 313 Research and development 209 50 Total stock-based compensation $ 1,784 $ 450 |
Valuation of Stock Options | The assumptions used to compute stock-based compensation costs for the stock options granted during the year ended December 31, 2018 are set forth below: Year Ended December 31, Weighted average risk-free rate 2.51 % Expected dividend yield — Weighted average expected life (years) 6.08 Weighted average volatility 56.87 % |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Effective Income Tax Rate Reconciliation | The difference between income taxes expected at the U.S. federal statutory income tax rate of 21% and the reported income tax expense (benefit) are summarized as follows: December 31, 2019 2018 Income tax at statutory rate $ (2,703) $ (2,138) Valuation allowance 2,948 2,266 State income tax, net of federal benefit (606) (521) Business tax credit net of reserves — (325) Non-deductible expenses 365 341 Foreign income taxes at different rate 1 3 Income tax benefit $ 5 $ (374) Effective tax rate (0.04) % 3.67 % |
Provision Expense (Benefit) for Income Taxes | The provision expense (benefit) for income taxes consists of the following: Year Ended December 31, 2019 2018 Current: Federal $ — $ — State 5 13 Foreign — — Total current 5 13 Deferred: Federal — (346) State — (41) Foreign — — Total deferred — (387) Total $ 5 $ (374) |
Components of Net Deferred Income Taxes | The components of net deferred income taxes consist of the following: December 31, 2019 2018 Deferred tax assets: Net operating loss $ 26,285 $ 24,280 Reserves and accruals 3,842 2,836 Tax credits 1,463 1,349 Gross deferred tax assets 31,590 28,465 Less valuation allowance (31,349) (28,401) Total deferred tax assets 241 64 Deferred tax liabilities: Amortization of acquired intangibles (241) (64) Total deferred tax liabilities (241) (64) Net deferred tax liabilities $ — $ — |
Reconciliation of Unrecognized Tax Benefits | The following is a tabular reconciliation of the total amounts of unrecognized tax benefits: December 31, 2019 2018 Unrecognized tax benefits, beginning of period $ 1,516 $ 889 Tax positions taken in prior periods: Gross increases — 166 Gross decreases — — Tax positions taken in current period: Gross increases 15 461 Settlements — — Lapse of statute of limitations — — Unrecognized tax benefits, end of period $ 1,531 $ 1,516 |
Segment and Geographic Inform_2
Segment and Geographic Information (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Domestic and Foreign Operations [Abstract] | |
Schedule of Segment and Geographic Information | Information about these operations is presented below: December 31, 2019 2018 Net revenues United States $ 18,950 $ 24,477 Europe 17 6,358 Other international revenue 183 48 Total net revenue $ 19,150 $ 30,883 |
The Company and Basis of Pres_2
The Company and Basis of Presentation (Details) | Feb. 27, 2018$ / shares |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Per share merger consideration paid to Phunware stockholders | $ 0.459 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Revenue, Expected Timing of Performance Obligation (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Accounting Policies [Abstract] | |
Remaining performance obligation | $ 12,989 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-01-01 | |
Accounting Policies [Abstract] | |
Percent of revenue expected to be recognized over next 12 months | 72.00% |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, expected timing | 24 months |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details) | 12 Months Ended | ||
Dec. 31, 2019USD ($)stockholdershares | Dec. 31, 2018USD ($)shares | Dec. 31, 2017USD ($) | |
Product Information [Line Items] | |||
Number of customers per impressions | stockholder | 1,000 | ||
Cash equivalents | $ 0 | $ 0 | |
Restricted cash | 86,000 | 5,500,000 | $ 0 |
Deferred revenue recognized | 3,585,000 | ||
Advertising costs | 0 | 225,000 | |
Net cash provided by (used in) financing activities | 99,000 | 12,316,000 | |
Accounting Standards Update 2016-18 | |||
Product Information [Line Items] | |||
Net cash provided by (used in) financing activities | $ 5,500,000 | ||
Convertible Notes Payable | |||
Product Information [Line Items] | |||
Restricted cash | $ 86,000 | ||
2009 Stock Option and Incentive Plan | |||
Product Information [Line Items] | |||
Restricted shares excluded from basic shares outstanding (in shares) | shares | 6,219,000 | 40,707,000 | |
Redeemable Preferred Stock | |||
Product Information [Line Items] | |||
Redeemable preferred stock issued (in shares) | shares | 6,000,000 | ||
Cash proceeds from redeemable preferred stock | $ 6,000,000 | ||
Dividend rate of preferred stock (as a percent) | 8.00% | ||
Sales Revenue, Net | Fox Networks Group | |||
Product Information [Line Items] | |||
Concentration risk (as a percent) | 50.00% | 42.00% | |
Sales Revenue, Net | Fetch Media Ltd. | |||
Product Information [Line Items] | |||
Concentration risk (as a percent) | 21.00% | ||
Accounts Receivable | Fox Networks Group | |||
Product Information [Line Items] | |||
Concentration risk (as a percent) | 0.00% | 66.00% | |
Minimum | |||
Product Information [Line Items] | |||
Term of license subscription agreement (in months) | 1 year | ||
Property and equipment, useful life (in years) | three | ||
Maximum | |||
Product Information [Line Items] | |||
Term of license subscription agreement (in months) | 3 years | ||
Property and equipment, useful life (in years) | seven years |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Deferred Commissions (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Deferred Commissions [Roll Forward] | |
Balance, beginning of the period | $ 369 |
Deferral of commissions earned | 171 |
Recognition of commission expense | (231) |
Balance, end of the period | $ 309 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Concentration of Accounts Receivable (Details) - Accounts Receivable | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Fox Networks Group | ||
Product Information [Line Items] | ||
Concentration risk (as a percent) | 0.00% | 66.00% |
HID Global | ||
Product Information [Line Items] | ||
Concentration risk (as a percent) | 23.00% | 0.00% |
American Made Media Consultants, LLC | ||
Product Information [Line Items] | ||
Concentration risk (as a percent) | 15.00% | 0.00% |
Presidio Networked Solutions LLC | ||
Product Information [Line Items] | ||
Concentration risk (as a percent) | 11.00% | 0.00% |
MD Anderson | ||
Product Information [Line Items] | ||
Concentration risk (as a percent) | 10.00% | 0.00% |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Accounts Receivable (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Accounting Policies [Abstract] | ||
Accounts receivable | $ 4,850 | $ 6,882 |
Less allowances for doubtful accounts | (3,179) | (3,276) |
Accounts receivable, net | $ 1,671 | $ 3,606 |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies - Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Balance as at beginning of period | $ 3,276 | $ 3,089 |
Allowances for bad debt | 114 | 167 |
Issuance of credit memos | (211) | |
Issuance of credit memos | 20 | |
Balance at end of period | $ 3,179 | $ 3,276 |
Summary of Significant Accou_10
Summary of Significant Accounting Policies - Deferred Revenue (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Schedule of deferred revenue | ||
Total current deferred revenue | $ 3,360 | $ 2,629 |
Total non-current deferred revenue | 3,764 | 5,622 |
Total deferred revenue | 7,124 | 8,251 |
Platform subscriptions and services revenue | ||
Schedule of deferred revenue | ||
Total current deferred revenue | 3,278 | 1,506 |
Total non-current deferred revenue | 3,764 | 5,622 |
Application transaction revenue | ||
Schedule of deferred revenue | ||
Total current deferred revenue | 82 | 133 |
PhunCoin deposits | ||
Schedule of deferred revenue | ||
Total current deferred revenue | $ 0 | $ 990 |
Summary of Significant Accou_11
Summary of Significant Accounting Policies - Condensed Consolidated Balance Sheet Line Items (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
Assets: | |||
Prepaid expenses and other current assets | $ 368 | $ 641 | $ 272 |
Liabilities: | |||
Deferred revenue short-term | 3,360 | 2,164 | |
Deferred revenue long-term | 3,764 | 5,369 | |
Stockholders’ deficit: | |||
Accumulated deficit | (123,604) | (110,733) | (111,820) |
Before Adoption | |||
Assets: | |||
Prepaid expenses and other current assets | 59 | 272 | |
Liabilities: | |||
Deferred revenue short-term | 3,565 | 2,629 | |
Deferred revenue long-term | 3,877 | 5,622 | |
Stockholders’ deficit: | |||
Accumulated deficit | (124,231) | $ (111,820) | |
Impact of Adoption | |||
Assets: | |||
Prepaid expenses and other current assets | (309) | 369 | |
Liabilities: | |||
Deferred revenue short-term | 205 | (465) | |
Deferred revenue long-term | 113 | (253) | |
Stockholders’ deficit: | |||
Accumulated deficit | $ (627) | $ 1,087 |
Summary of Significant Accou_12
Summary of Significant Accounting Policies - Condensed Consolidated Statements of Operations (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Condensed Income Statements, Captions [Line Items] | ||
Net revenues | $ 19,150 | $ 30,883 |
Sales and marketing | 2,706 | 5,417 |
Net loss | $ (12,871) | $ (9,803) |
Net loss per share, basic and diluted (in dollars per share) | $ (0.35) | $ (0.38) |
Impact of Adoption | ||
Condensed Income Statements, Captions [Line Items] | ||
Net revenues | $ 401 | |
Sales and marketing | (60) | |
Net loss | $ 461 | |
Net loss per share, basic and diluted (in dollars per share) | $ 0.01 | |
Before Adoption | ||
Condensed Income Statements, Captions [Line Items] | ||
Net revenues | $ 19,551 | |
Sales and marketing | 2,646 | |
Net loss | $ (12,410) | |
Net loss per share, basic and diluted (in dollars per share) | $ (0.34) |
Summary of Significant Accou_13
Summary of Significant Accounting Policies - Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Accounting Policies [Abstract] | |||
Cash | $ 276 | $ 844 | $ 308 |
Restricted cash | 86 | 5,500 | 0 |
Total cash, cash equivalents, and restricted cash shown in the consolidated statement of cash flows | $ 362 | $ 6,344 | $ 308 |
Reverse Merger (Details)
Reverse Merger (Details) - USD ($) $ / shares in Units, $ in Thousands | Dec. 26, 2018 | Feb. 27, 2018 | Dec. 31, 2019 | Dec. 31, 2018 |
Per share merger consideration paid to Phunware stockholders | $ 0.459 | |||
Amount of note | $ 1,993 | |||
Transferred per warrant (in dollars per share) | $ 0.50 | |||
Issuance of common stock, net of issuance costs | $ 9,565 | |||
Warrant | ||||
Warrants issued to Phunware shareholders (in shares) | 3,985,244,000 | |||
Stellar Common Stock | ||||
Sale of option to purchase common stock (in shares) | 250,000 | |||
Private Placement | Warrant | ||||
Private placement warrant shares (in shares) | 2,211,572 | |||
Series A convertible preferred stock | ||||
Issued shares of preferred stock (in shares) | 6,000 | |||
Issuance of common stock, net of issuance costs | $ 6,000 | |||
Merger Agreement | ||||
Cash | $ 301,000 | |||
Warrants to purchase common stock (in shares) | 3,985,244,000 | |||
Shares forfeited by Phunware shareholders (in shares) | 187,188 | |||
Transaction costs | $ 400 | |||
Warrants transferred (in shares) | 250,000 | |||
Shares transferred to service providers (in shares) | 181,391 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Changes in Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Goodwill [Roll Forward] | ||
Balance as at beginning of period | $ 25,821 | $ 25,886 |
Foreign currency translation | 36 | (65) |
Balance at end of period | $ 25,857 | $ 25,821 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Finite-Lived Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Finite-Lived Intangible Assets, Net [Abstract] | ||
Gross Carrying Amount | $ 10,504 | $ 10,475 |
Accumulated Amortization | (10,251) | (9,954) |
Net Carrying Amount | $ 253 | 521 |
Trade name | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Weighted Average Useful Life (years) | 4 years 7 months 6 days | |
Gross Carrying Amount | $ 649 | 648 |
Accumulated Amortization | (649) | (648) |
Net Carrying Amount | $ 0 | 0 |
Acquired technology | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Weighted Average Useful Life (years) | 5 years 1 month 6 days | |
Gross Carrying Amount | $ 4,828 | 4,828 |
Accumulated Amortization | (4,798) | (4,763) |
Net Carrying Amount | $ 30 | 65 |
In-process research and development | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Weighted Average Useful Life (years) | 5 years | |
Gross Carrying Amount | $ 94 | 94 |
Accumulated Amortization | (94) | (94) |
Net Carrying Amount | $ 0 | 0 |
Customer relationships | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Weighted Average Useful Life (years) | 5 years 8 months 12 days | |
Gross Carrying Amount | $ 4,604 | 4,576 |
Accumulated Amortization | (4,381) | (4,120) |
Net Carrying Amount | $ 223 | 456 |
Order backlog | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Weighted Average Useful Life (years) | 1 year 6 months | |
Gross Carrying Amount | $ 329 | 329 |
Accumulated Amortization | (329) | (329) |
Net Carrying Amount | $ 0 | $ 0 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expense | $ 268 | $ 372 |
Goodwill and Other Intangible_6
Goodwill and Other Intangible Assets - Expected Future Annual Amortization Expense (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||
2020 | $ 142 | |
2021 | 90 | |
2022 | 21 | |
2023 | 0 | |
Total expected future annual amortization expense | $ 253 | $ 521 |
Property and Equipment - Estima
Property and Equipment - Estimated Useful Life (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Total property and equipment | $ 1,197 | $ 1,180 |
Accumulated depreciation | (1,173) | (1,114) |
Total property and equipment, net | 24 | 66 |
Equipment | ||
Total property and equipment | $ 907 | 907 |
Equipment | Minimum | ||
Estimated useful lives | 3 years | |
Equipment | Maximum | ||
Estimated useful lives | 5 years | |
Furniture and fixtures | ||
Total property and equipment | $ 32 | 32 |
Estimated useful lives | 7 years | |
Leasehold improvements | ||
Total property and equipment | $ 258 | $ 241 |
Estimated useful lives | 5 years |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Property, Plant and Equipment [Line Items] | ||
Depreciation expense | $ 59 | $ 62 |
Minimum | Property, Plant and Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 3 years | |
Maximum | Property, Plant and Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 7 years |
Accrued Expenses - Schedule of
Accrued Expenses - Schedule of Accrued Expenses (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Payables and Accruals [Abstract] | ||
Partner revenue share | $ 155 | $ 201 |
Payroll related expenses | 3,202 | 2,496 |
Taxes | 323 | 123 |
Other | 355 | 208 |
Total accrued expenses | $ 4,035 | $ 3,028 |
Factoring Agreement (Details)
Factoring Agreement (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Jun. 15, 2016 | |
Factoring Agreement [Line Items] | |||
Advances, maximum percentage amount of eligible accounts receivable | 80.00% | ||
Factor expense | $ 555 | $ 718 | |
Factored receivables payable | 1,077 | 2,434 | |
Future advances | $ 1,923 | $ 566 | |
First 30 Days | |||
Factoring Agreement [Line Items] | |||
Fees paid for factored receivables (as a percent) | 1.80% | ||
Every Ten Days Thereafter | |||
Factoring Agreement [Line Items] | |||
Fees paid for factored receivables (as a percent) | 0.65% |
Debt (Details)
Debt (Details) | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2019USD ($)$ / shares | Jun. 30, 2019USD ($) | Dec. 31, 2019USD ($)stockholder$ / shares | |
Convertible Notes Payable | |||
Debt Instrument [Line Items] | |||
Convertible notes issued | $ 20,000,000 | ||
Interest rate of notes (as a percent) | 7.00% | 7.00% | |
Conversion price (in dollars per share) | $ / shares | $ 11.50 | $ 11.50 | |
Debt instrument, convertible, stock price trigger (in dollars per share) | $ / shares | $ 17.25 | ||
Consecutive trading days | stockholder | 30 | ||
Long-term debt | $ 250,000 | $ 250,000 | |
Convertible Notes Payable | Minimum | |||
Debt Instrument [Line Items] | |||
Threshold trading days | stockholder | 20 | ||
Note Purchase Agreement | Maximum | |||
Debt Instrument [Line Items] | |||
Convertible notes issued | $ 20,000,000 | ||
Note Purchase Agreement 2 | |||
Debt Instrument [Line Items] | |||
Convertible notes issued | $ 20,000,000 | ||
Promissory Notes | |||
Debt Instrument [Line Items] | |||
Interest rate of notes (as a percent) | 10.00% | 10.00% | |
Long-term debt | $ 855,000 | $ 855,000 | |
Debt instrument, debt default (as a perccent) | 12.00% | 12.00% | |
Promissory Notes | Maximum | |||
Debt Instrument [Line Items] | |||
Convertible notes issued | $ 20,000,000 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) $ in Thousands | Mar. 13, 2020USD ($) | Mar. 09, 2020USD ($) | Dec. 17, 2019USD ($) | Jul. 12, 2019USD ($) | Sep. 26, 2017USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Aug. 20, 2019USD ($) | Jul. 16, 2019USD ($)ft² |
Lessee, Lease, Description [Line Items] | |||||||||
Operating leases totaled | $ 727 | $ 643 | |||||||
Unpaid invoices for advertising campaign services | 562 | 0 | |||||||
CALIFORNIA | |||||||||
Lessee, Lease, Description [Line Items] | |||||||||
Rentable square feet | ft² | 8,687 | ||||||||
Monthly rent | $ 354 | ||||||||
Deposited amount | $ 118 | ||||||||
TEXAS | |||||||||
Lessee, Lease, Description [Line Items] | |||||||||
Monthly rent | $ 223 | ||||||||
Monthly rent in year two | $ 231 | ||||||||
Uber's First Amended Cross-Complaint | Pending Litigation | |||||||||
Lessee, Lease, Description [Line Items] | |||||||||
Loss contingency, damages sought | $ 17,000 | ||||||||
Uber's First Amended Cross-Complaint | Judicial Ruling | Subsequent Event | |||||||||
Lessee, Lease, Description [Line Items] | |||||||||
Loss contingency, damages awarded | $ 78 | ||||||||
Plaintiffs v. The Company | Pending Litigation | |||||||||
Lessee, Lease, Description [Line Items] | |||||||||
Loss contingency, damages sought | $ 1,000 | ||||||||
Phunware, Inc v Uber Technologies, Inc. | |||||||||
Lessee, Lease, Description [Line Items] | |||||||||
Loss contingency, damages sought | $ 3,000 | ||||||||
Ellenoff Grossman & Schole LLP v. Stellar Acquisition III, Corp | Pending Litigation | |||||||||
Lessee, Lease, Description [Line Items] | |||||||||
Accounts payable and accrued expenses related to alleged unpaid invoices | $ 690 | $ 690 | |||||||
Ellenoff Grossman & Schole LLP v. Stellar Acquisition III, Corp | Pending Litigation | Subsequent Event | |||||||||
Lessee, Lease, Description [Line Items] | |||||||||
Loss contingency, damages sought | $ 690 | ||||||||
Period to respond to complaint (in days) | 30 days |
Commitments and Contingencies -
Commitments and Contingencies - Future Minimum Annual Lease Payments (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2020 | $ 791 |
2021 | 836 |
2022 | 725 |
2023 | 622 |
2024 | 609 |
Thereafter | 209 |
Total | $ 3,792 |
PhunCoin & PhunToken (Details)
PhunCoin & PhunToken (Details) | 12 Months Ended | |
Dec. 31, 2019USD ($)shares | Dec. 31, 2018stockholdershares | |
Product Information [Line Items] | ||
Aggregate of receivable amount | $ 577,900,000 | |
Ongoing monthly dividends, percentage of monthly credits purchased | 2.50% | |
Warrant shares of outstanding (in shares) | shares | 3,836,112 | 18,312,595 |
Number of stockholders issued warrants | stockholder | 68 | |
PhunCoin Warrant | ||
Product Information [Line Items] | ||
Warrant shares of outstanding (in shares) | shares | 27,400,000,000 | |
Value assigned to warrants of PhunCoin | $ 0 | |
PhunCoin | ||
Product Information [Line Items] | ||
Aggregate of receivable amount | $ 1,207,000 |
Series A Convertible Preferre_2
Series A Convertible Preferred Stock (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Class of Stock [Line Items] | ||
Aggregate cash proceeds amount | $ 9,565 | |
Preferred stock stated value of per share (in dollars per share) | $ 0.0001 | |
Restricted cash | $ 5,500 | |
Operating account | $ 740 | |
Preferred stock authorized (in shares) | 100,000,000 | |
Preferred shares outstanding (in shares) | 0 | 6,000 |
Series A 8% convertible preferred stock | ||
Class of Stock [Line Items] | ||
Issued shares of preferred stock (in shares) | 6,000 | |
Aggregate cash proceeds amount | $ 6,000 | |
Preferred stock stated value of per share (in dollars per share) | $ 1,000 | |
Deposited amount | $ 5,500 | |
Proceeds into restricted escrow account | $ 6,000 | |
Conversion price (in dollars per share) | $ 11.50 | |
Series A 8% convertible preferred stock | 30 Day Anniversary | ||
Class of Stock [Line Items] | ||
Percentage of shares mandatorily redeemable | 104.00% | |
Shares mandatorily redeemable (in shares) | 3,000 | |
Series A 8% convertible preferred stock | 60 Day Anniversary | ||
Class of Stock [Line Items] | ||
Percentage of shares mandatorily redeemable | 104.00% | |
Shares mandatorily redeemable (in shares) | 2,500 | |
Series A 8% convertible preferred stock | 90 Day Anniversary | ||
Class of Stock [Line Items] | ||
Percentage of shares mandatorily redeemable | 104.00% | |
Shares mandatorily redeemable (in shares) | 500 | |
Series A Preferred Stock | ||
Class of Stock [Line Items] | ||
Aggregate cash proceeds amount | $ 6,000 | |
Series A convertible preferred stock redeemed for cash (in shares) | 6,000,000 | |
Total proceeds issue price | $ 6,240 | |
Dividends | $ 240 | |
Redeemable Preferred Stock | ||
Class of Stock [Line Items] | ||
Dividend rate of preferred stock (as a percent) | 8.00% |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2016 | Dec. 31, 2012 | |
Common stock, shares authorized (in shares) | 1,000,000,000 | |||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | ||
Common stock, shares outstanding (in shares) | 39,817,917 | 27,253,457 | ||
Restricted shares subject to repurchase for unvested shares related to early option exercises under stock equity plans | 6,219 | 40,707 | ||
Warrants/UPO's Exercised, Cash | 617,296 | |||
Aggregate gross proceeds from exercise of warrants | $ 6,184 | |||
Issuance of shares of common stock (in shares) | 10,913,146 | |||
Issuance of common stock shares (in shares) | 1,085,096 | |||
Issuance of common stock, net of issuance costs | $ 9,565 | |||
Exercise price per share (in dollars per share) | $ 11.50 | |||
Warrant shares of outstanding (in shares) | 3,836,112 | 18,312,595 | ||
Cash | ||||
Aggregate gross proceeds from exercise of warrants | $ 6,092 | |||
Digital Currencies | ||||
Aggregate gross proceeds from exercise of warrants | $ 92 | |||
Stock Options | ||||
Sale of option to purchase common stock (in shares) | 130,000 | |||
Common stock exercise price (in dollars per share) | $ 11.50 | |||
Warrant shares of outstanding (in shares) | 24,172 | |||
Cashless Exercises | ||||
Warrants exercised under cashless (net) provisions | 13,975,359 | |||
Cash and Cashless Exercises | ||||
Sale of option to purchase common stock (in shares) | 11,530,442 | |||
Warrant | ||||
Issuance of shares of common stock (in shares) | 2,951,741 | |||
Warrant to purchase aggregate shares of common stock (in shares) | 1,085,059 | 14,866 | ||
Exercise price per share (in dollars per share) | $ 9.22 | $ 5.54 | ||
Warrants exercised on a cashless basis (in shares) | 5,139,319 | |||
Public Warrants | Warrant | ||||
Exercise price per share (in dollars per share) | $ 0.01 | |||
Last sale price of shares of common stock (exceeds, in dollars per share) | $ 21 | |||
Number of days within 30-trading day period | 20 days | |||
Trading day period | 30 days | |||
Warrant shares of outstanding (in shares) | 1,761,291 | |||
Private Placement | Warrant | ||||
Exercise price per share (in dollars per share) | $ 11.50 | |||
Minimum number of days written notice to redeem Public Warrants | 30 days | |||
Warrants exercisable, number of days following reverse merger and recapitalization | 30 days | |||
PhunCoin Warrant | ||||
Exercise price per share (in dollars per share) | $ 11.50 | |||
Warrant shares of outstanding (in shares) | 27,400,000,000 |
Stockholders' Equity - Warrant
Stockholders' Equity - Warrant Activity (Details) | 12 Months Ended |
Dec. 31, 2019$ / sharesshares | |
Class of Warrant or Right [Line Items] | |
Exercise price per share (in dollars per share) | $ / shares | $ 11.50 |
Warrants/UPO's Outstanding 12/31/2018 | 18,312,595 |
Warrants issued for UPO exercises | 116,172 |
Warrants/UPO's exercised, cash | (617,296) |
Warrants/UPO's exercised, cashless | (13,975,359) |
Warrants Outstanding 12/31/2019 | 3,836,112 |
Common stock warrant (Series D-1) | |
Class of Warrant or Right [Line Items] | |
Exercise price per share (in dollars per share) | $ / shares | $ 5.54 |
Warrants/UPO's Outstanding 12/31/2018 | 14,866 |
Warrants Outstanding 12/31/2019 | 14,866 |
Common stock warrants (Series F) | |
Class of Warrant or Right [Line Items] | |
Exercise price per share (in dollars per share) | $ / shares | $ 9.22 |
Warrants/UPO's Outstanding 12/31/2018 | 1,085,059 |
Warrants/UPO's exercised, cash | (400,740) |
Warrants/UPO's exercised, cashless | (306,917) |
Warrants Outstanding 12/31/2019 | 377,402 |
Public Warrants (PHUNW) | |
Class of Warrant or Right [Line Items] | |
Exercise price per share (in dollars per share) | $ / shares | $ 11.50 |
Warrants/UPO's Outstanding 12/31/2018 | 6,900,610 |
Warrants/UPO's exercised, cashless | (5,139,319) |
Private Placement Warrants | |
Class of Warrant or Right [Line Items] | |
Exercise price per share (in dollars per share) | $ / shares | $ 11.50 |
Warrants/UPO's Outstanding 12/31/2018 | 10,182,060 |
Warrants/UPO's exercised, cash | (216,556) |
Warrants/UPO's exercised, cashless | (8,307,123) |
Warrants Outstanding 12/31/2019 | 1,658,381 |
Unit Purchase Options (UPOs) | |
Class of Warrant or Right [Line Items] | |
Exercise price per share (in dollars per share) | $ / shares | $ 11.50 |
Warrants/UPO's Outstanding 12/31/2018 | 130,000 |
Warrants/UPO's exercised, cashless | (130,000) |
Warrants Outstanding 12/31/2019 | 0 |
Unit Purchase Option Warrants | |
Class of Warrant or Right [Line Items] | |
Exercise price per share (in dollars per share) | $ / shares | $ 11.50 |
Warrants issued for UPO exercises | 116,172 |
Warrants/UPO's exercised, cashless | (92,000) |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Issuance of common stock shares (in shares) | 1,085,096 | ||||
Selling and Marketing Expense | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Maximum number of shares participant may purchase | 2,000 | ||||
Stock Options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Weighted average grant-date fair value of stock options granted (in dollars per share) | $ 0.15 | ||||
Total fair value for options | $ 348 | $ 343 | |||
Exercised option (in shares) | 488,090 | 293,778 | |||
Aggregate intrinsic value of options | $ 7,619 | $ 7,619 | $ 483 | ||
Unrecognized compensation expense | $ 221 | $ 221 | $ 640 | ||
Straight-line basis over weighted average period | 1 year 7 months 6 days | ||||
Restricted Stock Units (RSUs) - Employees | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Restricted stock unit awards granted (in shares) | 620,363 | ||||
Restricted stock unit awards grant date fair value (in dollars per share) | $ 7.34 | ||||
Restricted Stock Units (RSUs) - Non-Employee Directors | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Restricted stock unit awards granted (in shares) | 336,595 | 45,000 | |||
Restricted stock unit awards grant date fair value (in dollars per share) | $ 7.34 | ||||
Restricted Stock Units (RSUs) - Team Members | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Restricted stock unit awards granted (in shares) | 240,964 | 1,603,000 | |||
Restricted stock unit awards grant date fair value (in dollars per share) | $ 2.11 | ||||
Vesting period of award | 4 years | ||||
Restricted Stock Units (RSUs) - Non-Employees | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Restricted stock unit awards granted (in shares) | 400,000 | ||||
Restricted stock unit awards grant date fair value (in dollars per share) | $ 1.26 | $ 1.26 | |||
2018 Equity Incentive Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Issuance of common stock shares (in shares) | 1,471,669,000 | ||||
Common stock reserved for issuance (in shares) | 205,206 | 205,206 | 2,729,416 | ||
2018 Equity Incentive Plan | Employee Stock | Post-Closing Outstanding Shares | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Annual percentage increase | 10.00% | 10.00% | |||
2018 Equity Incentive Plan | Employee Stock | Outstanding Shares on Last Day of Immediately Preceding Year | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Annual percentage increase | 5.00% | 5.00% | |||
2009 Equity Incentive Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Unvested shares (in shares) | 6,219,000 | 6,219,000 | 40,707,000 | ||
Accrued expenses | $ 3 | $ 3 | $ 34 | ||
Unamortized fair value of the restricted stock units | $ 6,328 | $ 6,328 | |||
Amortization period of restricted stock cost | 2 years 4 months 24 days | ||||
2018 Employee Stock Purchase Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Common stock reserved for issuance (in shares) | 272,942 | 272,942 | 272,942 | ||
Expiration period | 27 months | ||||
ESPP, purchase price percentage | 85.00% | ||||
2018 Employee Stock Purchase Plan | Employee Stock | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Annual percentage increase | 3.00% | 3.00% | |||
Percent of shares outstanding on last day | 1.50% | 1.50% |
Stock-Based Compensation - Rest
Stock-Based Compensation - Restricted Stock Unit Activity (Details) - $ / shares | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2019 | Sep. 30, 2019 | Dec. 31, 2019 | |
Restricted Stock Units (RSUs) | |||
Shares | |||
Outstanding, beginning balance (in shares) | 0 | ||
Granted (in shares) | 3,245,922 | ||
Released (in shares) | (521,979) | ||
Forfeited (in shares) | (286,975) | ||
Outstanding, beginning balance (in shares) | 2,436,968 | 2,436,968 | |
Weighted Average Grant Date Fair Value | |||
Outstanding, beginning balance (in dollars per share) | $ 0 | ||
Granted (in dollars per share) | 2.93 | ||
Released (in dollars per share) | 1.79 | ||
Forfeited (in dollars per share) | 3.10 | ||
Outstanding, ending balance (in dollars per share) | $ 3.15 | $ 3.15 | |
Restricted Stock Units (RSUs) - Team Members | |||
Shares | |||
Granted (in shares) | 240,964 | 1,603,000 | |
Weighted Average Grant Date Fair Value | |||
Outstanding, beginning balance (in dollars per share) | $ 2.11 | ||
Outstanding, ending balance (in dollars per share) | $ 2.11 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Stock Option Activity (Details) - Stock Option - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Shares | |||
Beginning balance (in shares) | 2,364,823 | 1,417,373 | |
Granted (in shares) | 0 | 1,770,225 | |
Exercised (in shares) | (488,090) | (293,778) | |
Canceled/expired (in shares) | (411,283) | (528,997) | |
Ending balance (in shares) | 1,465,450 | 2,364,823 | 1,417,373 |
Options vested and exercisable (in shares) | 1,016,089,000 | ||
Weighted Average Grant Date Fair Value | |||
Beginning balance (in dollars per share) | $ 0.90 | $ 0.54 | |
Granted (in dollars per share) | 0 | 1.11 | |
Exercised (in dollars per share) | 0.57 | 0.58 | |
Cancelled/expired (in dollars per share) | 1.68 | 0.78 | |
Ending balance (in dollars per share) | 0.80 | $ 0.90 | $ 0.54 |
Options vested and exercisable (in dollars per share) | $ 0.73 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Additional Disclosures [Abstract] | |||
Outstanding (in years) | 6 years 10 months 9 days | 8 years 1 month 13 days | 7 years 2 months 4 days |
Weighted Average Remaining Contractual Term (years), Exercisable | 6 years 3 months 29 days | ||
Share-Based Compensation Arrangement by Share-based Payment Award, Options, Aggregate Intrinsic Value [Abstract] | |||
Outstanding | $ 771 | $ 71,332 | $ 53 |
Options vested and exercisable | $ 560 |
Stock-Based Compensation - Valu
Stock-Based Compensation - Valuation of Stock Options (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Share-based Payment Arrangement [Abstract] | |
Weighted average risk-free rate | 2.51% |
Expected dividend yield | 0.00% |
Weighted average expected life (years) | 6 years 29 days |
Weighted average volatility | 56.87% |
Stock-Based Compensation - Comp
Stock-Based Compensation - Compensation Cost (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation | $ 1,784 | $ 450 |
Cost of revenues | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation | 146 | 45 |
Sales and marketing | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation | 12 | 42 |
General and administrative | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation | 1,417 | 313 |
Research and development | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation | $ 209 | $ 50 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Examination [Line Items] | ||
Loss before taxes | $ (12,866) | $ (10,177) |
Net losses before income taxes | $ (12,871) | (9,803) |
U.S. federal statutory income tax rate (as a percent) | 21.00% | |
Net operating loss carryforwards federal | $ 106,644 | |
Net operating loss carryforwards state | 53,197 | |
Federal net operating losses subject to expiration | 85,674 | |
Federal net operating losses not subject to expiration | 20,970 | |
R&D credit carryforwards federal | 948 | |
R&D credit carryforwards state | 515 | |
Valuation allowance | 31,349 | 28,401 |
United States | ||
Income Tax Examination [Line Items] | ||
Net losses before income taxes | $ (12,766) | $ (9,880) |
Income Taxes - Effective Income
Income Taxes - Effective Income Tax Rate Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | ||
Income tax at statutory rate | $ (2,703) | $ (2,138) |
Valuation allowance | 2,948 | 2,266 |
State income tax, net of federal benefit | (606) | (521) |
Business tax credit net of reserves | 0 | (325) |
Non-deductible expenses | 365 | 341 |
Foreign income taxes at different rate | 1 | 3 |
Income tax benefit | $ 5 | $ (374) |
Effective tax rate (as a percent) | (0.04%) | 3.67% |
Income Taxes - Provision Expens
Income Taxes - Provision Expense (Benefit) For Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Current: | ||
Federal | $ 0 | $ 0 |
State | 5 | 13 |
Foreign | 0 | 0 |
Total current | 5 | 13 |
Deferred: | ||
Federal | 0 | (346) |
State | 0 | (41) |
Foreign | 0 | 0 |
Total deferred | 0 | (387) |
Total | $ 5 | $ (374) |
Income Taxes - Components in Ne
Income Taxes - Components in Net Deferred Income Taxes (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred tax assets: | ||
Net operating loss | $ 26,285 | $ 24,280 |
Reserves and accruals | 3,842 | 2,836 |
Tax credits | 1,463 | 1,349 |
Gross deferred tax assets | 31,590 | 28,465 |
Less valuation allowance | (31,349) | (28,401) |
Total deferred tax assets | 241 | 64 |
Deferred tax liabilities: | ||
Amortization of acquired intangibles | (241) | (64) |
Total deferred tax liabilities | (241) | (64) |
Net deferred tax liabilities | $ 0 | $ 0 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ||
Unrecognized tax benefits, beginning of period | $ 1,516 | $ 889 |
Tax positions taken in prior periods: | ||
Gross increases | 0 | 166 |
Gross decreases | 0 | 0 |
Tax positions taken in current period: | ||
Gross increases | 15 | 461 |
Settlements | 0 | 0 |
Lapse of statute of limitations | 0 | 0 |
Unrecognized tax benefits, end of period | $ 1,531 | $ 1,516 |
Segment and Geographic Inform_3
Segment and Geographic Information (Details) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Domestic and Foreign Operations [Abstract] | ||
Total revenue accounted to United Kingdom (as a percent) | 1.00% | 21.00% |
Segment and Geographic Inform_4
Segment and Geographic Information - Schedule of Domestic and Foreign Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Net revenues | ||
Net revenues | $ 19,150 | $ 30,883 |
United States | ||
Net revenues | ||
Net revenues | 18,950 | 24,477 |
Europe | ||
Net revenues | ||
Net revenues | 17 | 6,358 |
Other international revenue | ||
Net revenues | ||
Net revenues | $ 183 | $ 48 |
Related-Party Transactions (Det
Related-Party Transactions (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Nov. 15, 2019 | |
Related Party Transaction [Line Items] | ||
Transferred per warrant (in dollars per share) | $ 0.50 | |
Exercise price of warrants (in dollars per share) | $ 11.50 | |
Reverse merger and recapitalization | $ 255,000 | |
Cane Capital, LLC | ||
Related Party Transaction [Line Items] | ||
Principal amount of note | $ 195,000 |
Subsequent Events (Details)
Subsequent Events (Details) | Mar. 20, 2020USD ($)$ / shares | Mar. 30, 2020USD ($) | Mar. 27, 2020employee | Mar. 19, 2020USD ($) | Dec. 31, 2019USD ($)$ / shares |
Convertible Notes Payable | |||||
Subsequent Event [Line Items] | |||||
Net price at issuance | $ 250,000 | ||||
Interest rate of notes (as a percent) | 7.00% | ||||
Conversion price (in dollars per share) | $ / shares | $ 11.50 | ||||
Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Number of employees furloughed | employee | 37 | ||||
Number of employees furloughed (as a percent) | 42.00% | ||||
Subsequent Event | Contributions for Notes Payable | |||||
Subsequent Event [Line Items] | |||||
Related party transaction, amount of transaction | $ 560,000 | ||||
Related party transaction, rate | 10.00% | ||||
Subsequent Event | Contributions for Notes Payable | Cane Capital, LLC | |||||
Subsequent Event [Line Items] | |||||
Related party transaction, amount of transaction | $ 204,000 | ||||
Subsequent Event | Contributions for Notes Payable | Individuals Associated With Chief Executive Officer | |||||
Subsequent Event [Line Items] | |||||
Related party transaction, amount of transaction | 155,000 | ||||
Subsequent Event | Contributions for Notes Payable | Chief Technology Officer | |||||
Subsequent Event [Line Items] | |||||
Related party transaction, amount of transaction | 50,000 | ||||
Subsequent Event | Contributions for Notes Payable | Curo Capital Appreciation Fund, LLC | |||||
Subsequent Event [Line Items] | |||||
Related party transaction, amount of transaction | $ 151,000 | ||||
Subsequent Event | Convertible Notes Payable | |||||
Subsequent Event [Line Items] | |||||
Principal amount of note | $ 3,000,000 | ||||
Net price at issuance | 2,760,000 | ||||
Original issue discount | $ 240,000 | ||||
Estimated net cash proceeds | $ 2,371,000 | ||||
Maximum participation rights in future offerings (as a percent) | 30.00% | ||||
Interest rate of notes (as a percent) | 7.00% | ||||
Debt instrument, debt default (as a perccent) | 18.00% | ||||
Monthly amortization payments (as a percent) | 5.00% | ||||
Installment conversion, lowest volume weighted average price (as a percent) | 85.00% | ||||
Installment conversion, redemption price (as a percent) | 105.00% | ||||
Conversion price (in dollars per share) | $ / shares | $ 3 | ||||
Subsequent placement optional redemption, excess aggregate proceeds (as a percent) | $ 5,000,000 | ||||
Subsequent placement optional redemption, maximum net proceeds from placement (as a percent) | 30.00% | ||||
Subsequent placement optional redemption, redemption price (as a percent) | 110.00% | ||||
Debt default, redemption price (as a percent) | 115.00% | ||||
Cash acceleration premium (as a percent) | 15.00% | ||||
Redemption price of outstanding principal (as a percent) | 115.00% | ||||
Redemption price of market value of shares of common stock (as a percent) | 115.00% | ||||
Redemption price of aggregate cash consideration payable (as a percent) | 115.00% | ||||
Minimum available cash required at end of each fiscal quarter | $ 200,000 | ||||
Required period to file registration statement (in days) | 60 days | ||||
Required period to declare registration statement effective (in days) | 90 days | ||||
Subsequent Event | Convertible Notes Payable | On Or Prior To May 19, 2020 | |||||
Subsequent Event [Line Items] | |||||
Redemption price (as a percent) | 100.00% | ||||
Subsequent Event | Convertible Notes Payable | After May 19, 2020 | |||||
Subsequent Event [Line Items] | |||||
Optional redemption price (as a percent) | 110.00% |
Uncategorized Items - phun-2019
Label | Element | Value |
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 1,087,000 |
Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 1,087,000 |