Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Feb. 15, 2019 | Jun. 30, 2018 | |
Document And Entity Information [Abstract] | |||
Entity Registrant Name | SolarWinds Corporation | ||
Entity Central Index Key | 1,739,942 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | false | ||
Entity Small Business | false | ||
Entity Shell Company | false | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2018 | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Common Stock, Shares Outstanding | 309,942,574 | ||
Entity Public Float | $ 0 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 382,620 | $ 277,716 |
Accounts receivable, net of allowances of $3,196 and $2,065 as of December 31, 2018 and December 31, 2017, respectively | 100,528 | 85,133 |
Income tax receivable | 893 | 1,713 |
Prepaid and other current assets | 16,267 | 24,331 |
Total current assets | 500,308 | 388,893 |
Property and equipment, net | 35,864 | 34,209 |
Deferred taxes | 6,873 | 4,425 |
Goodwill | 3,683,961 | 3,695,640 |
Intangible assets, net | 956,261 | 1,194,499 |
Other assets, net | 11,382 | 9,398 |
Total assets | 5,194,649 | 5,327,064 |
Current liabilities: | ||
Accounts payable | 9,742 | 9,657 |
Accrued liabilities and other | 52,055 | 39,593 |
Accrued interest payable | 290 | 11,632 |
Income taxes payable | 15,682 | 9,049 |
Current portion of deferred revenue | 270,433 | 241,513 |
Current debt obligation | 19,900 | 16,950 |
Total current liabilities | 368,102 | 328,394 |
Long-term liabilities: | ||
Deferred revenue, net of current portion | 25,699 | 20,278 |
Non-current deferred taxes | 147,144 | 167,523 |
Other long-term liabilities | 133,532 | 148,121 |
Long-term debt, net of current portion | 1,904,072 | 2,245,622 |
Total liabilities | 2,578,549 | 2,909,938 |
Commitments and contingencies (Note 16) | ||
Redeemable convertible Class A common stock, $0.001 par value: no shares authorized, issued or outstanding at December 31, 2018; 5,755,000 shares authorized and 2,661,030 shares issued and outstanding as of December 31, 2017 | 0 | 3,146,887 |
Stockholders’ equity (deficit): | ||
Common stock, $0.001 par value: 1,000,000,000 shares authorized and 304,942,415 shares issued and outstanding as of December 31, 2018; 233,000,000 shares authorized and 100,734,056 shares issued and outstanding as of December 31, 2017 | 305 | 101 |
Preferred stock, $0.001 par value: 50,000,000 shares authorized and no shares issued and outstanding as of December 31, 2018; no shares authorized, issued and outstanding as of December 31, 2017 | 0 | 0 |
Additional paid-in capital | 3,011,080 | 0 |
Accumulated other comprehensive income (loss) | 17,043 | 75,294 |
Accumulated deficit | (412,328) | (805,156) |
Total stockholders’ equity (deficit) | 2,616,100 | (729,761) |
Total liabilities, redeemable convertible common stock and stockholders’ equity (deficit) | $ 5,194,649 | $ 5,327,064 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Current assets: | ||
Allowance for doubtful accounts receivable | $ 3,196 | $ 2,065 |
Temporary Equity | ||
Class A common stock, par value (in dollars per share) | $ 0 | $ 0.001 |
Class A common stock, authorized (in shares) | 0 | 5,755,000 |
Class A common stock, issued (in shares) | 0 | 2,661,030 |
Class A common stock, outstanding (in shares) | 0 | 2,661,030 |
Common Stock | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized (in shares) | 1,000,000,000 | 233,000,000 |
Common stock, issued (in shares) | 304,942,415 | 100,734,056 |
Common stock, outstanding (in shares) | 304,942,415 | 100,734,056 |
Preferred Stock | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0 |
Preferred stock, authorized (in shares) | 50,000,000 | 0 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Feb. 04, 2016 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenue: | ||||
Total revenue | $ 422,094 | $ 833,089 | $ 728,017 | |
Cost of revenue: | ||||
Amortization of acquired technologies | 147,517 | 175,991 | 171,033 | |
Total cost of revenue | 193,755 | 246,735 | 231,731 | |
Gross profit | 228,339 | 586,354 | 496,286 | |
Operating expenses: | ||||
Sales and marketing | 165,355 | 227,468 | 205,631 | |
Research and development | 65,806 | 96,272 | 86,618 | |
General and administrative | 71,011 | 80,641 | 67,303 | |
Amortization of acquired intangibles | 58,553 | 66,788 | 67,080 | |
Total operating expenses | 360,725 | 471,169 | 426,632 | |
Operating income (loss) | (132,386) | 115,185 | 69,654 | |
Other income (expense): | ||||
Interest expense, net | (169,900) | (142,008) | (169,786) | |
Other income (expense), net | (56,959) | (94,887) | 38,664 | |
Total other income (expense) | (226,859) | (236,895) | (131,122) | |
Loss before income taxes | (359,245) | (121,710) | (61,468) | |
Income tax expense (benefit) | (96,651) | (19,644) | 22,398 | |
Net loss | (262,594) | (102,066) | (83,866) | |
Net income (loss) available to common stockholders | $ (480,498) | $ 364,635 | $ (351,873) | |
Net income (loss) available to common stockholders per share: | ||||
Basic earnings (loss) per share (in dollars per share) | $ (4.98) | $ 2.60 | $ (3.50) | |
Diluted earnings (loss) per share (in dollars per share) | $ (4.98) | $ 2.56 | $ (3.50) | |
Weighted-average shares used to compute net income (loss) available to common stockholders per share: | ||||
Shares used in computation of basic earnings (loss) per share (in shares) | 96,465 | 140,301 | 100,433 | |
Shares used in computation of diluted earnings (loss) per share (in shares) | 96,465 | 142,541 | 100,433 | |
Predecessor | ||||
Revenue: | ||||
Total revenue | $ 47,327 | |||
Cost of revenue: | ||||
Amortization of acquired technologies | 2,186 | |||
Total cost of revenue | 11,737 | |||
Gross profit | 35,590 | |||
Operating expenses: | ||||
Sales and marketing | 47,064 | |||
Research and development | 32,183 | |||
General and administrative | 79,636 | |||
Amortization of acquired intangibles | 917 | |||
Total operating expenses | 159,800 | |||
Operating income (loss) | (124,210) | |||
Other income (expense): | ||||
Interest expense, net | (473) | |||
Other income (expense), net | (284) | |||
Total other income (expense) | (757) | |||
Loss before income taxes | (124,967) | |||
Income tax expense (benefit) | (53,156) | |||
Net loss | (71,811) | |||
Net income (loss) available to common stockholders | $ (71,811) | |||
Net income (loss) available to common stockholders per share: | ||||
Basic earnings (loss) per share (in dollars per share) | $ (1) | |||
Diluted earnings (loss) per share (in dollars per share) | $ (1) | |||
Weighted-average shares used to compute net income (loss) available to common stockholders per share: | ||||
Shares used in computation of basic earnings (loss) per share (in shares) | 71,989 | |||
Shares used in computation of diluted earnings (loss) per share (in shares) | 71,989 | |||
Recurring Revenue | ||||
Revenue: | ||||
Total revenue | $ 272,194 | $ 668,529 | $ 571,384 | |
Cost of revenue: | ||||
Cost of recurring revenue | 46,238 | 70,744 | 60,698 | |
Recurring Revenue | Predecessor | ||||
Revenue: | ||||
Total revenue | $ 36,051 | |||
Cost of revenue: | ||||
Cost of recurring revenue | 9,551 | |||
Subscription | ||||
Revenue: | ||||
Total revenue | 126,960 | 265,591 | 213,754 | |
Cost of revenue: | ||||
Amortization of acquired technologies | 23,258 | 31,134 | 28,616 | |
Subscription | Predecessor | ||||
Revenue: | ||||
Total revenue | 6,551 | |||
Cost of revenue: | ||||
Amortization of acquired technologies | 731 | |||
Maintenance | ||||
Revenue: | ||||
Total revenue | 145,234 | 402,938 | 357,630 | |
Maintenance | Predecessor | ||||
Revenue: | ||||
Total revenue | 29,500 | |||
License | ||||
Revenue: | ||||
Total revenue | 149,900 | 164,560 | 156,633 | |
Cost of revenue: | ||||
Amortization of acquired technologies | $ 124,259 | $ 144,857 | $ 142,417 | |
License | Predecessor | ||||
Revenue: | ||||
Total revenue | 11,276 | |||
Cost of revenue: | ||||
Amortization of acquired technologies | $ 1,455 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) $ in Thousands | 1 Months Ended |
Feb. 04, 2016USD ($) | |
Predecessor | |
Net loss | $ (71,811) |
Other comprehensive income (loss): | |
Foreign currency translation adjustment | 3,835 |
Unrealized gains on investments, net of income tax expense $15 for the period ended February 4, 2016 | 27 |
Other comprehensive income (loss) | 3,862 |
Comprehensive income (loss) | $ (67,949) |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) $ in Thousands | 1 Months Ended |
Feb. 04, 2016USD ($) | |
Predecessor | |
Unrealized gains on investments, tax | $ 15 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Earnings |
Balance at beginning of period (in shares) (Predecessor) at Dec. 31, 2015 | 71,884,000 | ||||
Balance at beginning of period (Predecessor) at Dec. 31, 2015 | $ 523,261 | $ 72 | $ 135,872 | $ (28,231) | $ 415,548 |
Comprehensive income: | |||||
Foreign currency translation adjustment | Predecessor | 3,835 | 3,835 | |||
Unrealized gains on investments, net of tax | Predecessor | 27 | 27 | |||
Net loss | Predecessor | (71,811) | (71,811) | |||
Comprehensive income (loss) | Predecessor | (67,949) | ||||
Exercise of stock options (in shares) | Predecessor | 50,000 | ||||
Exercise of stock options | Predecessor | 1,311 | 1,311 | |||
Restricted stock units issued, net of shares withheld for taxes (in shares) | Predecessor | 107,000 | ||||
Restricted stock units issued, net of shares withheld for taxes | Predecessor | (2,333) | (2,333) | |||
Stock-based compensation | Predecessor | 87,799 | 87,799 | |||
Balance at end of period (in shares) (Predecessor) at Feb. 04, 2016 | 72,041,000 | ||||
Balance at end of period (in shares) at Feb. 04, 2016 | 0 | ||||
Balance at end of period (Predecessor) at Feb. 04, 2016 | 542,089 | $ 72 | 222,649 | (24,369) | 343,737 |
Balance at end of period at Feb. 04, 2016 | 0 | $ 0 | 0 | 0 | 0 |
Comprehensive income: | |||||
Foreign currency translation adjustment | (66,047) | (66,047) | |||
Unrealized gains on investments, net of tax | 0 | ||||
Net loss | (262,594) | (262,594) | |||
Comprehensive income (loss) | (328,641) | ||||
Stock-based compensation | 17 | 17 | |||
Balance at end of period (in shares) at Dec. 31, 2016 | 99,356,000 | ||||
Balance at end of period at Dec. 31, 2016 | (519,643) | $ 99 | 0 | (66,047) | (453,695) |
Comprehensive income: | |||||
Foreign currency translation adjustment | 141,341 | 141,341 | |||
Unrealized gains on investments, net of tax | 0 | ||||
Net loss | (83,866) | (83,866) | |||
Comprehensive income (loss) | 57,475 | ||||
Exercise of stock options (in shares) | 5,000 | ||||
Exercise of stock options | 1 | 1 | |||
Stock-based compensation | $ 80 | 80 | |||
Balance at end of period (in shares) at Dec. 31, 2017 | 100,734,056 | 100,734,000 | |||
Balance at end of period at Dec. 31, 2017 | $ (729,761) | $ 101 | 0 | 75,294 | (805,156) |
Comprehensive income: | |||||
Foreign currency translation adjustment | (58,251) | (58,251) | |||
Unrealized gains on investments, net of tax | 0 | ||||
Net loss | (102,066) | (102,066) | |||
Comprehensive income (loss) | $ (160,317) | ||||
Exercise of stock options (in shares) | 46,100 | 46,000 | |||
Exercise of stock options | $ 16 | 16 | |||
Stock-based compensation | $ 5,833 | 5,833 | |||
Balance at end of period (in shares) at Dec. 31, 2018 | 304,942,415 | 304,942,000 | |||
Balance at end of period at Dec. 31, 2018 | $ 2,616,100 | $ 305 | $ 3,011,080 | $ 17,043 | $ (412,328) |
Consolidated Statements of Rede
Consolidated Statements of Redeemable Convertible Class A Common Stock and Stockholders' Equity (Deficit) - USD ($) $ in Thousands | Total | IPO | Common Stock | Common StockIPO | Additional Paid-in Capital | Additional Paid-in CapitalIPO | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit |
Balance at end of period (in shares) at Feb. 04, 2016 | 0 | |||||||
Balance at end of period at Feb. 04, 2016 | $ 0 | |||||||
Balance at end of period (in shares) at Feb. 04, 2016 | 0 | |||||||
Balance at end of period at Feb. 04, 2016 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | |||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||
Issuance of stock (in shares) | 2,662,000 | |||||||
Issuance of stock | $ 2,661,600 | |||||||
Accumulating dividends | $ 217,904 | |||||||
Balance at end of period (in shares) at Dec. 31, 2016 | 2,662,000 | |||||||
Balance at end of period at Dec. 31, 2016 | $ 2,879,504 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Foreign currency translation adjustment | (66,047) | (66,047) | ||||||
Net loss | (262,594) | (262,594) | ||||||
Comprehensive income (loss) | (328,641) | |||||||
Issuance of stock (in shares) | 99,356,000 | |||||||
Issuance of stock | 26,885 | $ 99 | 26,786 | |||||
Accumulating dividends | (217,904) | (26,803) | (191,101) | |||||
Stock-based compensation | 17 | 17 | ||||||
Balance at end of period (in shares) at Dec. 31, 2016 | 99,356,000 | |||||||
Balance at end of period at Dec. 31, 2016 | (519,643) | $ 99 | 0 | (66,047) | (453,695) | |||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||
Issuance of stock | $ 74 | |||||||
Repurchase of stock (in shares) | (1,000) | |||||||
Repurchase of stock | $ (697) | |||||||
Accumulating dividends | $ 268,006 | |||||||
Balance at end of period (in shares) at Dec. 31, 2017 | 2,661,030 | |||||||
Balance at end of period at Dec. 31, 2017 | $ 3,146,887 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Foreign currency translation adjustment | 141,341 | 141,341 | ||||||
Net loss | (83,866) | (83,866) | ||||||
Comprehensive income (loss) | 57,475 | |||||||
Exercise of stock options (in shares) | 5,000 | |||||||
Exercise of stock options | 1 | 1 | ||||||
Issuance of stock (in shares) | 1,468,000 | |||||||
Issuance of stock | 399 | $ 2 | 397 | |||||
Repurchase of stock (in shares) | (95,000) | |||||||
Repurchase of stock | (67) | (67) | ||||||
Accumulating dividends | (268,006) | (411) | (267,595) | |||||
Stock-based compensation | $ 80 | 80 | ||||||
Balance at end of period (in shares) at Dec. 31, 2017 | 100,734,056 | 100,734,000 | ||||||
Balance at end of period at Dec. 31, 2017 | $ (729,761) | $ 101 | 0 | 75,294 | (805,156) | |||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||
Repurchase of stock | (17) | |||||||
Accumulating dividends | $ 231,549 | |||||||
Conversion of Class A shares and accumulated dividends to Common Stock upon initial public offering (in shares) | (2,661,000) | |||||||
Conversion of Class A shares and accumulated dividends to common stock upon initial public offering | $ (3,378,419) | |||||||
Balance at end of period (in shares) at Dec. 31, 2018 | 0 | |||||||
Balance at end of period at Dec. 31, 2018 | $ 0 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Foreign currency translation adjustment | (58,251) | (58,251) | ||||||
Net loss | (102,066) | (102,066) | ||||||
Comprehensive income (loss) | $ (160,317) | |||||||
Exercise of stock options (in shares) | 46,100 | 46,000 | ||||||
Exercise of stock options | $ 16 | 16 | ||||||
Issuance of stock (in shares) | 1,408,000 | 25,000,000 | ||||||
Issuance of stock | 406 | $ 353,526 | $ 1 | $ 25 | 405 | $ 353,501 | ||
Repurchase of stock (in shares) | (57,000) | |||||||
Repurchase of stock | (473) | (473) | ||||||
Accumulating dividends | (231,549) | (15,196) | (216,353) | |||||
Conversion of Class A shares and accumulated dividends to common stock upon initial public offering (in shares) | 177,811,000 | |||||||
Conversion of Class A shares and accumulated dividends to common stock upon initial public offering | 3,378,419 | $ 178 | 2,666,994 | 711,247 | ||||
Stock-based compensation | $ 5,833 | 5,833 | ||||||
Balance at end of period (in shares) at Dec. 31, 2018 | 304,942,415 | 304,942,000 | ||||||
Balance at end of period at Dec. 31, 2018 | $ 2,616,100 | $ 305 | $ 3,011,080 | $ 17,043 | $ (412,328) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Feb. 04, 2016 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cash flows from operating activities | ||||
Net loss | $ (262,594) | $ (102,066) | $ (83,866) | |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||
Depreciation and amortization | 215,325 | 258,362 | 250,876 | |
Provision for doubtful accounts | 1,713 | 2,498 | 2,489 | |
Stock-based compensation expense | 17 | 5,833 | 80 | |
Amortization of debt issuance costs | 18,766 | 11,675 | 18,859 | |
Loss on extinguishment of debt | 22,767 | 80,137 | 18,559 | |
Deferred taxes | (108,735) | (22,101) | (101,522) | |
(Gain) loss on foreign currency exchange rates | 33,088 | 13,410 | (54,875) | |
Other non-cash expenses (benefits) | 889 | 3,443 | (3,754) | |
Changes in operating assets and liabilities, net of assets acquired and liabilities assumed in business combinations: | ||||
Accounts receivable | (15,574) | (18,010) | (2,358) | |
Income taxes receivable | (498) | 707 | 35,005 | |
Prepaid and other current assets | (2,387) | (4,497) | 6,184 | |
Accounts payable | (16,372) | (28) | 293 | |
Accrued liabilities and other | (27,151) | 9,776 | (7,544) | |
Accrued interest payable | 11,023 | (11,342) | 609 | |
Income taxes payable | 4,925 | (10,673) | 119,594 | |
Deferred revenue | 186,519 | 35,507 | 34,043 | |
Other long-term liabilities | (546) | 1,511 | 21 | |
Net cash provided by operating activities | 61,175 | 254,142 | 232,693 | |
Cash flows from investing activities | ||||
Purchases of investments | (2,000) | 0 | 0 | |
Maturities of investments | 0 | 0 | 2,000 | |
Purchases of property and equipment | (6,946) | (15,945) | (7,594) | |
Purchases of intangible assets | (3,198) | (2,687) | (4,786) | |
Acquisitions, net of cash acquired | (507,531) | (60,578) | (23,999) | |
Acquisition of SolarWinds, Inc., net of cash acquired | (4,335,086) | 0 | 0 | |
Proceeds from sale of cost method investment and other | 0 | 11,217 | 0 | |
Net cash provided by (used in) investing activities | (4,854,761) | (67,993) | (34,379) | |
Cash flows from financing activities | ||||
Proceeds from our initial public offering, net of underwriting discounts | 0 | 357,188 | 0 | |
Proceeds from issuance of common stock and incentive restricted stock | 2,679,935 | 1,723 | 313 | |
Repurchase of common stock and incentive restricted stock | (4) | (578) | (930) | |
Exercise of stock options | 0 | 16 | 1 | |
Premium paid on debt extinguishment | 0 | (36,900) | 0 | |
Proceeds from credit agreement | 2,724,516 | 626,950 | 3,500 | |
Repayments of borrowings from credit agreement | (341,215) | (1,014,900) | (36,950) | |
Payment of debt issuance costs | (164,942) | (5,561) | (1,288) | |
Payment for deferred offering costs | 0 | (3,662) | 0 | |
Net cash provided by (used in) financing activities | 4,898,290 | (75,724) | (35,354) | |
Effect of exchange rate changes on cash and cash equivalents | (3,061) | (5,521) | 13,113 | |
Net increase in cash and cash equivalents | 101,643 | 104,904 | 176,073 | |
Cash and cash equivalents | ||||
Beginning of period | 0 | 277,716 | 101,643 | |
End of period | $ 0 | 101,643 | 382,620 | 277,716 |
Supplemental disclosure of cash flow information | ||||
Cash paid for interest | 140,719 | 142,944 | 147,106 | |
Cash paid (received) for income taxes | 6,877 | 8,950 | (32,069) | |
Non-cash investing and financing transactions | ||||
Non-cash equity contribution by SolarWinds, Inc.’s management at Take Private | 9,429 | 0 | 0 | |
Conversion of redeemable convertible Class A common stock and accumulated dividends to common stock | 0 | $ 3,378,419 | $ 0 | |
Predecessor | ||||
Cash flows from operating activities | ||||
Net loss | (71,811) | |||
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||
Depreciation and amortization | 3,908 | |||
Provision for doubtful accounts | 64 | |||
Stock-based compensation expense | 87,763 | |||
Amortization of debt issuance costs | 12 | |||
Loss on extinguishment of debt | 0 | |||
Deferred taxes | (17,864) | |||
(Gain) loss on foreign currency exchange rates | (692) | |||
Other non-cash expenses (benefits) | 13 | |||
Changes in operating assets and liabilities, net of assets acquired and liabilities assumed in business combinations: | ||||
Accounts receivable | 2,181 | |||
Income taxes receivable | (34,534) | |||
Prepaid and other current assets | (1,829) | |||
Accounts payable | 10,668 | |||
Accrued liabilities and other | 43,894 | |||
Accrued interest payable | 362 | |||
Income taxes payable | (568) | |||
Deferred revenue | 7,536 | |||
Other long-term liabilities | (88) | |||
Net cash provided by operating activities | 29,015 | |||
Cash flows from investing activities | ||||
Purchases of investments | 0 | |||
Maturities of investments | 22,839 | |||
Purchases of property and equipment | (809) | |||
Purchases of intangible assets | (316) | |||
Acquisitions, net of cash acquired | 0 | |||
Acquisition of SolarWinds, Inc., net of cash acquired | 0 | |||
Proceeds from sale of cost method investment and other | 0 | |||
Net cash provided by (used in) investing activities | 21,714 | |||
Cash flows from financing activities | ||||
Proceeds from our initial public offering, net of underwriting discounts | 0 | |||
Proceeds from issuance of common stock and incentive restricted stock | 0 | |||
Repurchase of common stock and incentive restricted stock | (2,332) | |||
Exercise of stock options | 1,311 | |||
Premium paid on debt extinguishment | 0 | |||
Proceeds from credit agreement | 0 | |||
Repayments of borrowings from credit agreement | 0 | |||
Payment of debt issuance costs | 0 | |||
Payment for deferred offering costs | 0 | |||
Net cash provided by (used in) financing activities | (1,021) | |||
Effect of exchange rate changes on cash and cash equivalents | 3,086 | |||
Net increase in cash and cash equivalents | 52,794 | |||
Cash and cash equivalents | ||||
Beginning of period | 196,913 | $ 249,707 | ||
End of period | 249,707 | |||
Supplemental disclosure of cash flow information | ||||
Cash paid for interest | 238 | |||
Cash paid (received) for income taxes | 14 | |||
Non-cash investing and financing transactions | ||||
Non-cash equity contribution by SolarWinds, Inc.’s management at Take Private | 0 | |||
Conversion of redeemable convertible Class A common stock and accumulated dividends to common stock | $ 0 |
Organization and Nature of Oper
Organization and Nature of Operations | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Nature of Operations | 1. Organization and Nature of Operations SolarWinds Corporation and its subsidiaries (“Company” or “Successor”) is a leading provider of information technology, or IT, infrastructure management software. References to “we,” “us” and “our” refer to Company or Predecessor (as defined below) as the context requires. Our products give organizations worldwide, regardless of type, size or IT infrastructure complexity, the power to monitor and manage the performance of their IT environments, whether on-premise, in the cloud, or in hybrid infrastructure models. Our approach, which we refer to as the SolarWinds Model, combines powerful, scalable, affordable, easy to use products with high-velocity, low-touch sales. We’ve built our business to enable the technology professionals who use our products to manage “all things IT.” Our range of customers has expanded over time from network and systems engineers to a broad set of technology professionals, such as database administrators, storage administrators, web operators and DevOps professionals, as well as managed service providers, or MSPs. Our SolarWinds Model enables us to sell our products for use in organizations ranging in size from very small businesses to large enterprises. SolarWinds Corporation was incorporated in the State of Delaware in 2015 under the name Project Aurora Parent, Inc. It changed its name to SolarWinds Parent, Inc. in May 2016, and in May 2018 changed its name to SolarWinds Corporation. Take Private In February 2016, we were acquired by affiliates of investment firms Silver Lake and Thoma Bravo, or the Sponsors, to complete a take private transaction, or the Take Private, of SolarWinds, Inc. In May 2018, SolarWinds, Inc. changed its name to SolarWinds North America, Inc., or Predecessor. Following the Take Private, we pursued our initiatives in the cloud and MSP markets, growing our product offerings and market opportunity through organic product development and targeted acquisitions while at the same time continuing to invest in our on-premise IT management product portfolio. The purchase accounting adjustments related to the Take Private were reflected in our consolidated financial statements for the period ended December 31, 2016. The financial statements presented as of and for the years ended December 31, 2018 and 2017 and for the period from February 5, 2016 to December 31, 2016 represent those of the Successor. The financial statements presented for the period January 1, 2016 to February 4, 2016 represent those of Predecessor. See further information regarding the purchase accounting adjustments of the Take Private in Note 3. Take Private . Initial Public Offering In October 2018, we completed our initial public offering, or IPO, in which we sold and issued 25,000,000 shares of our common stock at an issue price of $15.00 per share. We raised a total of $375.0 million in gross proceeds from the offering, or approximately $353.0 million in net proceeds after deducting underwriting discounts and commissions of $17.8 million and offering-related expenses of approximately $4.2 million . A portion of the net proceeds from the offering were used to repay the $315.0 million in borrowings outstanding under our Second Lien Term Loan (as defined below). Upon the closing of our IPO, all shares of Class A Common Stock that were outstanding immediately prior to the closing of the offering converted into shares of common stock at a conversion price of $19.00 per share as in accordance with the terms of our certificate of incorporation, as amended. In addition, we converted the accrued and unpaid dividends on the Class A Common Stock into shares of common stock equal to the result of the accrued and unpaid dividends on each share of Class A Common Stock divided by the conversion price of $19.00 per share. See Note 10. Redeemable Convertible Class A Common Stock and Note 11. Stockholders’ Equity (Deficit) and Stock-Based Compensation for additional details. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Consolidation The accompanying consolidated financial statements of Successor include the accounts of SolarWinds Corporation and the accounts of its wholly owned subsidiaries for the years ended December 31, 2018 and 2017 and the period from February 5, 2016 through December 31, 2016. The accompanying consolidated financial statements of Predecessor include the accounts of SolarWinds North America, Inc. and the accounts of its wholly owned subsidiaries through February 4, 2016. We have eliminated all intercompany balances and transactions. Use of Estimates The preparation of financial statements in conformity with GAAP requires our management to make estimates and assumptions that affect the reported amounts and the disclosure of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. The actual results that we experience may differ materially from our estimates. The accounting estimates that require our most significant, difficult and subjective judgments include: • the valuation of goodwill, intangibles, long-lived assets and contingent consideration; • revenue recognition; • stock-based compensation; • income taxes; and • loss contingencies. Foreign Currency Translation The functional currency of our foreign subsidiaries is determined in accordance with authoritative guidance issued by the Financial Accounting Standards Board, or FASB. We translate assets and liabilities for these subsidiaries at exchange rates in effect at the balance sheet date. We translate income and expense accounts for these subsidiaries at the average monthly exchange rates for the periods. We record resulting translation adjustments as a component of accumulated other comprehensive income (loss) within stockholders’ equity (deficit). We record gains and losses from currency transactions denominated in currencies other than the functional currency as other income (expense) in our consolidated statements of operations. There were no equity transactions denominated in foreign currencies for the years ended December 31, 2018 and 2017 . Local currency transactions of international subsidiaries that have the U.S. dollar as the functional currency are remeasured into U.S. dollars using current rates of exchange for monetary assets and liabilities and historical rates of exchange for non-monetary assets and liabilities. We recorded a net transaction loss related to the remeasurement of monetary assets and liabilities of $14.9 million and a net transaction gain of $54.0 million within our consolidated statements of operations for the years ended December 31, 2018 and 2017 , respectively, primarily related to various intercompany loans. We recorded a net transaction loss related to the remeasurement of monetary assets and liabilities of $34.5 million within our consolidated statement of operations for the Successor period from February 5, 2016 through December 31, 2016, primarily related to various intercompany loans and borrowings under our Euro term loan. Gains and losses from remeasurement of monetary assets and liabilities were no t material for the Predecessor period from January 1, 2016 through February 4, 2016. As of July 1, 2018, we changed our assertion regarding the planned settlement of a certain intercompany loan. We evaluated our investment strategy in light of our global treasury plans and the new Tax Act (as defined below) and have determined there is no need to settle the principal related to the loan. The intercompany loan has been designated as long-term based on the assertion that settlement is not planned or anticipated in the foreseeable future. Therefore, beginning on July 1, 2018, the foreign currency transaction gains and losses resulting from the remeasurement of this long-term intercompany loan denominated in a currency other than the subsidiary's functional currency are recognized as a component of accumulated other comprehensive income (loss) upon consolidation. In the year ended December 31, 2018 , a foreign currency translation adjustment of $10.4 million was recognized as a component of accumulated other comprehensive income (loss) related to this long-term intercompany loan. Recent Accounting Pronouncements Not Yet Adopted Under the Jumpstart our Business Startups Act, or the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards until such time as those standards apply to non-public companies. We intend to take advantage of the longer phase-in periods for the adoption of new or revised financial accounting standards permitted under the JOBS Act until we are no longer an emerging growth company. In May 2014, FASB issued “Revenue from Contracts with Customers,” which replaced all existing revenue guidance, including prescriptive industry-specific guidance. This standard’s core principle is that an entity will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Entities will need to apply more judgment and make more estimates than under the previous guidance. In July 2015, FASB deferred the effective date for all entities by one year, making the guidance for non-public companies effective for annual reporting periods beginning after December 15, 2018. Early adoption is permitted to the original effective date of December 15, 2016. The standard permits the use of either a full-retrospective or a modified-retrospective transition method. We will adopt the new standard effective first quarter 2019 using the modified-retrospective method for adoption. The most significantly impacted areas are the following: • License and Recurring Revenue. We expect that adoption of the new standard will result in changes to the classification and timing of our revenue recognition. Under the new guidance, the requirement to establish VSOE to recognize license revenue separately from the other elements is eliminated. This change is expected to impact the allocation of the transaction price and timing of our revenue recognition between deliverables, or performance obligations, within an arrangement. In addition, we will recognize time-based license revenue upon the transfer of the license and the associated maintenance revenue over the contract period under the new standard instead of recognizing both the license and maintenance revenue ratably over the contract period. We expect the overall adoption impact to total revenue to be immaterial, though we do expect some changes to the timing and classification between license and recurring revenue. Additionally, some historical deferred revenue, primarily from arrangements involving time-based licenses, will never be recognized as revenue and instead will be a cumulative effect adjustment within accumulated deficit. We expect a reduction of approximately $2.8 million to the deferred revenue balance as a cumulative effect adjustment as of January 1, 2019. • Contract Acquisition Costs. We expense all sales commissions as incurred under current guidance. The new guidance requires the deferral and amortization of certain incremental costs incurred to obtain a contract. This guidance will require us to capitalize and amortize certain sales commission costs over the remaining contractual term or over an expected period of benefit, which we have determined to be approximately six years . As part of the transition to the new guidance, we expect to recognize a contract asset of approximately $5.2 million as a cumulative effect adjustment as of January 1, 2019. • Other Items. The impact of the adoption of the new standard on income taxes will result in an increase of deferred income tax liabilities of approximately $1.7 million as of January 1, 2019. We do not expect that the adoption of this standard will impact our operating cash flows. We do not expect the changes described above to have a material impact on our quarterly or annual consolidated financial statements, however the exact impact of the new standard will be dependent on facts and circumstances that could vary from quarter to quarter. The quantitative amounts provided above are estimates of the expected effects of our adoption of the new standard. These amounts represent our best estimates of the effects of adopting the new standard at the time of the preparation of this Annual Report on Form 10-K. The actual impact of the new revenue standard is subject to change from these estimates and such change may be significant. In February 2016, FASB issued an accounting standard to provide updated guidance requiring the recognition of all lease assets and liabilities on the balance sheet. The accounting standard required the use of a modified retrospective transition method. In July 2018, FASB issued additional guidance that provides entities with an optional transition method in which an entity can apply the new standard at the adoption date and recognize a cumulative-effect adjustment to the opening balance retained earnings in the period of adoption. The updated accounting guidance is effective for non-public companies for fiscal years beginning after December 15, 2019 and interim periods beginning the following year. Early adoption is permitted and the standard provides for certain practical expedients. We expect to adopt the updated guidance in fiscal year 2020. Our evaluation of the new standard will extend into future periods and we will update our disclosures, including the expected impacts of the new standard, as we progress towards the required adoption date. In January 2017, FASB issued an accounting standard to simplify the accounting for goodwill impairment. The new guidance removes step two of the two-step quantitative goodwill impairment test, which requires a hypothetical purchase price allocation. The updated guidance is effective for non-public companies for fiscal years beginning after December 15, 2021 and may be adopted early for any interim or annual goodwill impairment tests performed after January 1, 2017. We expect to adopt the updated guidance in fiscal year 2022. We do not believe that this standard will have a material impact on our consolidated financial statements. Acquisitions We account for acquired businesses, including the Take Private, using the acquisition method of accounting, which requires that the assets acquired, liabilities assumed, contractual contingencies and contingent consideration be recorded at the date of acquisition at their respective fair values. Goodwill represents the excess of the purchase price, including any contingent consideration, over the fair value of the net assets acquired. Goodwill is allocated to our reporting units expected to benefit from the business combination based on the relative fair value at the acquisition date. It further requires acquisition related costs to be recognized separately from the acquisition and expensed as incurred, restructuring costs to be expensed in periods subsequent to the acquisition date and changes in accounting for deferred tax asset valuation allowances and acquired income tax uncertainties after the measurement period to impact the provision for income taxes. The acquired developed product technologies recorded for each acquisition were feasible at the date of acquisition as they were being actively marketed and sold by the acquired company at the acquisition date. In addition to the acquired developed product technologies, we also recorded intangible assets for the acquired companies’ customer relationships, customer backlog, trademarks and tradenames, in process research and development and certain non-competition covenants. We include the operating results of acquisitions in our consolidated financial statements from the effective date of the acquisitions. Acquisition related costs are primarily included in general and administrative expenses in our consolidated statements of operations. The fair value of identifiable intangible assets is based on significant judgments made by management. We typically engage third party valuation appraisal firms to assist us in determining the fair values and useful lives of the assets acquired. Such valuations and useful life determinations require us to make significant estimates and assumptions. These estimates and assumptions are based on historical experience and information obtained from management, and also include, but are not limited to, future expected cash flows earned from the product technology and discount rates applied in determining the present value of those cash flows. Unanticipated events and circumstances may occur that could affect the accuracy or validity of such assumptions, estimates or actual results. Acquired identifiable intangible assets are amortized on the net cash flow method or straight-line method over their estimated economic lives, which are generally three to ten years for trademarks, customer relationships, customer backlog, non-competition covenants and acquired developed product technologies and ten years for intellectual property. We include amortization of acquired developed product technologies in cost of revenue and amortization of other acquired intangible assets in operating expenses in our consolidated statements of operations. We record acquired in process research and development as indefinite-lived intangible assets. On completion of the related development projects, the in process research and development assets are reclassified to developed technology and amortized over their estimated economic lives. Impairment of Goodwill, Intangible Assets and Long-lived Assets Goodwill We test goodwill for impairment annually, in the fourth quarter, or more frequently if impairment indicators arise. Goodwill is tested for impairment at the reporting unit level using a fair value approach. We first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value, a “Step 0” analysis. If, based on a review of qualitative factors, it is more likely than not that the fair value of a reporting unit is less than its carrying value we perform “Step 1” of the goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. If the carrying value exceeds the fair value, we measure the amount of impairment loss, if any, by comparing the implied fair value of the reporting unit goodwill with its carrying amount, the “Step 2” analysis. In 2018 and 2017 , we performed a qualitative, “Step 0,” assessment for our reporting units and determined there were no indicators of impairment. No impairment charges have been required to date. Indefinite-lived Intangible Assets We review our indefinite-lived intangible assets for impairment annually, in the fourth quarter, or more frequently if a triggering event occurs. We first assess qualitative factors to determine whether it is more likely than not that an indefinite-lived intangible asset is impaired as a basis for determining whether it is necessary to perform the quantitative test. If necessary, the quantitative test is performed by comparing the fair value of indefinite lived intangible assets to the carrying value. In the event the carrying value exceeds the fair value of the assets, the assets are written down to their fair value. As of December 31, 2018 and 2017 , we performed a qualitative, “Step 0,” assessment and determined there were no indicators that our indefinite-lived intangible assets were impaired. Long-lived Assets We evaluate the recoverability of our long-lived assets, including finite-lived intangible assets and other assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. Events or changes in circumstances that could result in an impairment review include, but are not limited to, significant underperformance relative to historical or projected future operating results, significant changes in the manner of use of the acquired assets or the strategy for our overall business, and significant negative industry or economic trends. In the event that the net book value of our long-lived assets exceeds the future undiscounted net cash flows attributable to such assets, an impairment charge would be required. Impairment, if any, is recognized in the period of identification to the extent the carrying amount of an asset or asset group exceeds the fair value of such asset or asset group. As of December 31, 2018 and 2017 , there were no indicators that our long-lived assets were impaired. Fair Value Measurements We apply the authoritative guidance on fair value measurements for financial assets and liabilities that are measured at fair value on a recurring basis and non-financial assets and liabilities, such as goodwill, intangible assets and property, plant and equipment that are measured at fair value on a non-recurring basis. The guidance establishes a three-tiered fair value hierarchy that prioritizes inputs to valuation techniques used in fair value calculations. The three levels of inputs are defined as follows: Level 1: Unadjusted quoted prices for identical assets or liabilities in active markets accessible by us. Level 2: Inputs that are observable in the marketplace other than those inputs classified as Level 1. Level 3: Inputs that are unobservable in the marketplace and significant to the valuation. See Note 6. Fair Value Measurements for a summary of our financial instruments accounted for at fair value on a recurring basis. The carrying amounts reported in our consolidated balance sheets for cash, accounts receivable, accounts payable and other accrued expenses approximate fair value due to relatively short periods to maturity. Accounts Receivable Accounts receivable represent trade receivables from customers when we have sold subscriptions, perpetual licenses or related maintenance services and have not yet received payment. We present accounts receivable net of an allowance for doubtful accounts. We maintain an allowance for doubtful accounts for estimated losses resulting from the inability of customers to make required payments. In doing so, we consider the current financial condition of the customer, the specific details of the customer account, the age of the outstanding balance and the current economic environment. Any change in the assumptions used in analyzing a specific account receivable might result in an additional allowance for doubtful accounts being recognized in the period in which the change occurs. We have historically had insignificant write-offs related to bad debts. Deferred Offering Costs Deferred offering costs, primarily consisting of legal, accounting, printer, and other direct fees and costs, related to our initial public offering were capitalized. The deferred offering costs of $3.7 million were offset against proceeds from our initial public offering during the year ended December 31, 2018. As of December 31, 2017 , we had no t yet capitalized any offering costs in the consolidated balance sheet. Property and Equipment We record property and equipment at cost and depreciate them using the straight-line method over their estimated useful lives as follows: Useful Life Equipment, servers and computers 3 - 5 Furniture and fixtures 5 - 7 Software 3 - 5 Leasehold improvements Lesser of lease term or useful life Upon retirement or sale of property and equipment, we remove the cost of assets disposed of and any related accumulated depreciation from our accounts and credit or charge any resulting gain or loss to operating expense. We expense repairs and maintenance as they are incurred. Research and Development Costs Research and development expenses primarily consist of personnel costs and contractor fees related to the development of new software products and enhancements to existing software products. Personnel costs include salaries, bonuses and stock-based compensation and related employer-paid payroll taxes, as well as an allocation of our facilities, depreciation, benefits and IT costs. Research and development costs are charged to operations as incurred with the exception of those software development costs that may qualify for capitalization. Software development costs incurred subsequent to establishing technological feasibility through the general release of the software products are capitalized. Our new software products and significant enhancements to our existing products are available for general release soon after technological feasibility has been established. Due to the short time period between technological feasibility and general release, capitalized software development costs were insignificant for the years ended December 31, 2018 and 2017 , the Successor period from February 5, 2016 to December 31, 2016, and the Predecessor period from January 1, 2016 to February 4, 2016. Internal-Use Software and Website Development Costs We capitalize costs related to developing new functionality for our suite of products that are hosted and accessed by our customers on a subscription basis. We also capitalize costs related to specific upgrades and enhancements when it is probable the expenditures will result in additional functionality. Costs incurred in the preliminary stages of development are expensed as incurred. Once an application has reached the development stage, internal and external costs, if direct and incremental, are capitalized until the software is substantially complete and ready for its intended use. Capitalized costs are recorded as part of other assets, net in our consolidated balance sheets. Maintenance and training costs are expensed as incurred. Internal-use software is amortized on a straight-line basis over its estimated useful life, generally three years , and included in cost of recurring revenue in the consolidated statements of operations. There were no impairments to internal-use software and we did not incur any significant website development costs during the periods presented. We had $5.0 million and $4.7 million of internal-use software, net capitalized as of December 31, 2018 and 2017 , respectively. Amortization expense of internal-use software and website development costs was $2.5 million , $1.1 million and $0.2 million for the years ended December 31, 2018 and 2017 , and the Successor period from February 5, 2016 to December 31, 2016, respectively. Amortization expense of internal-use software and website development costs was insignificant for the Predecessor period from January 1, 2016 to February 4, 2016. Debt Issuance Costs Debt issuance costs for our credit facilities outstanding are presented as a deduction from the corresponding debt liability on our consolidated balance sheets and amortized on an effective interest rate method over the term of the associated debt as interest expense in our consolidated statements of operations. Amortization of debt issuance costs included in interest expense was $11.7 million , $18.9 million and $18.8 million for the years ended December 31, 2018 and 2017 , and the Successor period from February 5, 2016 to December 31, 2016, respectively. Amortization of debt issuance costs included in interest expense was insignificant for the period from January 1, 2016 to February 4, 2016. See Note 9. Debt for discussion of our credit facilities. Contingencies We account for claims and contingencies in accordance with authoritative guidance that requires we record an estimated loss from a claim or loss contingency when information available prior to issuance of our consolidated financial statements indicates a liability has been incurred at the date of our consolidated financial statements and the amount of the loss can be reasonably estimated. If we determine that it is reasonably possible but not probable that an asset has been impaired or a liability has been incurred, we disclose the amount or range of estimated loss if material or that the loss cannot be reasonably estimated. Accounting for claims and contingencies requires us to use our judgment. We consult with legal counsel on those issues related to litigation and seek input from other experts and advisors with respect to matters in the ordinary course of business. See Note 16. Commitments and Contingencies for a discussion of contingencies. Accumulated Other Comprehensive Income (Loss) Changes in accumulated other comprehensive income (loss) by component are summarized below: Foreign Currency Translation Adjustments Accumulated Other Comprehensive Income (Loss) (in thousands) Balance at December 31, 2016 $ (66,047 ) $ (66,047 ) Other comprehensive gain (loss) before reclassification 141,341 141,341 Amount reclassified from accumulated other comprehensive income (loss) — — Net current period other comprehensive income (loss) 141,341 141,341 Balance at December 31, 2017 75,294 75,294 Other comprehensive gain (loss) before reclassification (58,251 ) (58,251 ) Amount reclassified from accumulated other comprehensive income (loss) — — Net current period other comprehensive income (loss) (58,251 ) (58,251 ) Balance at December 31, 2018 $ 17,043 $ 17,043 Revenue Recognition We generate recurring revenue from fees received for subscriptions and from the sale of maintenance services associated with our perpetual license products and license revenue from the sale of perpetual license products. We recognize revenue when persuasive evidence of an arrangement exists, delivery has occurred, the sales price is fixed or determinable and collectability is reasonably assured. Our return policy generally does not allow our customers to return software products. We generally use a purchase order, an authorized credit card, an electronic or manually signed license agreement, or the receipt of a cash payment as evidence of an arrangement. We consider delivery to have occurred and recognize revenue when risk of loss transfers to the customer, reseller or distributor or the customer has access to their subscription which is generally upon electronic transfer of the license key or password that provides immediate availability of the product to the purchaser. We account for sales incentives to customers, resellers or distributors as a reduction of revenue at the time we recognize the revenue from the related product sale. We report revenue net of any sales tax collected. We sell our products through our direct sales force and through our distributors and resellers. Our distributors and resellers do not carry inventory of our software and we generally require them to specify the end user of the software at the time of the order. If the distributor or reseller does not provide end-user information, then we will generally not fulfill the order. Our distributors and resellers have no rights of return or exchange for software that they purchase from us and payment for these purchases is due to us without regard to whether the distributors or resellers collect payment from their customers. Sales through resellers and distributors are typically evidenced by a reseller or distributor agreement, together with purchase orders or authorized credit cards on a transaction-by-transaction basis. Recurring Revenue. Recurring revenue consists of subscription and maintenance revenue. • Subscription Revenue . We primarily derive subscription revenue from fees received for subscriptions to our software-as-a-service, or SaaS, products and our time-based license arrangements. We generally invoice subscription agreements monthly based on usage or monthly in advance over the subscription period. Subscription revenue is generally recognized ratably over the subscription term when all revenue recognition criteria have been met. We typically sell our subscription products separately from our perpetual license offerings. Our subscription revenue includes our cloud management and MSP products. • Maintenance Revenue . We derive maintenance revenue from the sale of maintenance services associated with our perpetual license products. We typically include one year of maintenance service as part of the initial purchase price of each perpetual software offering and then sell renewals of this maintenance agreement. We recognize maintenance revenue ratably on a daily basis over the contract period. Customers with maintenance agreements are entitled to receive unspecified upgrades or enhancements to new versions of their software products on a when-and-if-available basis. License Revenue . We use the residual method to recognize revenue when a license agreement includes one or more elements to be delivered and vendor-specific objective evidence, or VSOE, of fair value for all undelivered elements exists. Because our software is generally sold with maintenance services, we calculate the amount of revenue allocated to the software license by determining the fair value of the maintenance services and subtracting it from the total invoice or contract amount. We establish VSOE of the fair value of maintenance services by our standard maintenance renewal price list since we generally charge list price for our maintenance renewal agreements. If evidence of the fair value of one or more undelivered elements does not exist, all revenue is generally deferred and recognized when delivery of those elements occurs or when fair value can be established. When the undelivered element for which we do not have VSOE of fair value is maintenance services, revenue for the entire arrangement is recognized ratably over the contract period. Deferred Revenue Deferred revenue primarily consists of billings or payments received in advance of revenue recognition from maintenance services associated with our perpetual license products. We generally bill maintenance agreements annually in advance for services to be performed over a 12 -month period. Customers have the option to purchase maintenance renewals for periods other than 12 months . We initially record the amounts to be paid under maintenance agreements as deferred revenue and recognize these amounts ratably on a daily basis over the term of the maintenance agreement. We record deferred revenue that will be recognized during the succeeding 12 -month period as current deferred revenue and the remaining portion is recorded as long-term deferred revenue. Cost of Revenue Cost of recurring revenue. Cost of recurring revenue consists of technical support personnel costs which includes salaries, bonuses and stock-based compensation and related employer-paid payroll taxes for technical support personnel, as well as an allocation of overhead costs. Royalty fees and hosting and server fees related to our cloud management and MSP products are also included in cost of recurring revenue. Cost of license revenue is immaterial to our financial statements and is included in cost of recurring revenue in our consolidated statements of operations. Amortization of acquired technologies. Amortization of acquired technologies included in cost of revenue relate to our licensed products and subscription products as follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Amortization of acquired license technologies $ 144,857 $ 142,417 $ 124,259 $ 1,455 Amortization of acquired subscription technologies 31,134 28,616 23,258 731 Total amortization of acquired technologies $ 175,991 $ 171,033 $ 147,517 $ 2,186 Advertising We expense advertising costs as incurred. Advertising expense is included in sales and marketing expenses in our consolidated statements of operations. Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Advertising expense $ 38,477 $ 38,213 $ 28,655 $ 2,293 Leases We lease facilities worldwide and certain equipment under non-cancellable lease agreements. The terms of some of our lease agreements provide for rental payments on a graduated basis. We recognize rent expense on a straight-line basis over the lease period and accrue rent expense incurred but not paid. Cash or lease incentives, or tenant allowances, received pursuant to certain leases are recognized on a straight-line basis as a reduction to rent over the lease term. The unamortized portion of tenant allowances is included in accrued liabilities and other and other long-term liabilities. Income Taxes We use the liability method of accounting for income taxes as s |
Take Private
Take Private | 12 Months Ended |
Dec. 31, 2018 | |
Business Combinations [Abstract] | |
Take Private | 3. Take Private In February 2016, as a result of the Take Private, a change in control of the Predecessor occurred and the Predecessor became a wholly-owned subsidiary of Successor. The total amount of funds necessary to complete the Take Private and the related transactions was approximately $4.6 billion . The purchase price included funds paid of $4.3 billion for outstanding common stock of Predecessor, $173.1 million for the settlement of certain stock-based awards outstanding, $90.0 million for Predecessor debt outstanding and the fair value of $9.4 million related to the non-cash equity contribution by Predecessor’s management. The purchase price was funded by equity financing from affiliates of the Sponsors and other co-investors of approximately $2.5 billion , debt financing from Goldman, Sachs & Co., certain affiliates of the foregoing and other lenders of approximately $2.0 billion and our cash on hand. The purchase price paid in connection with the Take Private was allocated to the acquired assets and assumed liabilities at fair value on the date of the acquisition. Goodwill for the Take Private is no t deductible for tax purposes. We incurred Take Private transaction costs of $1.2 million , $2.5 million and $133.1 million for the year ended December 31, 2017, the Successor period from February 5, 2016 to December 31, 2016 and the Predecessor period from January 1, 2016 to February 4, 2016, respectively, which are primarily included in general and administrative expenses. These costs primarily relate to accounting, legal, advisory and other professional fees. The costs for the Predecessor period from January 1, 2016 to February 4, 2016 also includes $87.5 million of stock-based compensation expense, employer-paid payroll taxes and other costs related to the accelerated vesting of the Predecessor stock options and certain restricted stock units. The following table summarizes the consideration paid and the amounts recognized for the assets acquired and liabilities assumed: Total Fair Value (in thousands) Current assets, including cash acquired of $248.3 million $ 351,721 Property and equipment 35,255 Other assets 12,964 Identifiable intangible assets 1,495,400 Goodwill 3,212,255 Current liabilities (87,459 ) Deferred tax liabilities (366,454 ) Deferred revenue (31,813 ) Other long-term liabilities (28,993 ) Total consideration $ 4,592,876 The following table summarizes the fair value of the acquired identifiable intangible assets and weighted-average useful life: Fair Value Weighted-average useful life (in thousands) (in years) Developed product technologies $ 906,200 6 Customer relationships 450,100 10 Tradenames - indefinite-lived 82,300 — In process research and development 48,300 — Customer backlog 6,200 2 Trademarks 2,300 1 Total identifiable intangible assets $ 1,495,400 4. Acquisitions 2018 Acquisitions In the year ended December 31, 2018 , we completed acquisitions for a combined purchase price of approximately $62.9 million in cash, including $2.4 million of cash acquired. The acquisitions were funded with available cash on hand. We incurred $1.2 million in acquisition related costs, which are included in general and administrative expense for the year ended December 31, 2018 . Goodwill for these acquisitions is no t deductible for tax purposes. The initial determination of the fair value of the assets acquired and liabilities assumed is based on a preliminary valuation and the estimates and assumptions for these items are subject to change as we obtain additional information during the measurement period. Subsequent changes to the purchase price or other fair value adjustments determined during the measurement period will be recorded as an adjustment to goodwill. The measurement period adjustments recognized during the period were immaterial and primarily related to working capital adjustments. We may have additional measurement period adjustments as we finalize the fair value of certain assets acquired and liabilities assumed. The amounts of revenue and net loss related to these acquisitions included in our consolidated financial statements from the effective date of the respective acquisitions are insignificant for the year ended December 31, 2018 . Pro forma information for these acquisitions have not been provided because the impact of the historical financials on our revenue, net loss and net income (loss) per share is not material. We recognize revenue on the acquired products in accordance with our revenue recognition policy as described above in Note 2. Summary of Significant Accounting Policies . The following table summarizes the consideration paid and the amounts recognized for the assets acquired and liabilities assumed for our acquisitions completed in the year ended December 31, 2018 : Total Fair Value (in thousands) Current assets, including cash acquired $ 4,821 Deferred tax asset 1,550 Fixed assets 1,352 Identifiable intangible assets 18,412 Goodwill 43,746 Current liabilities (3,331 ) Deferred tax liabilities (666 ) Deferred revenue (2,944 ) Total consideration $ 62,940 The following table summarizes the fair value of the acquired identifiable intangible assets and weighted-average useful life: Fair Value Weighted-average useful life (in thousands) (in years) Developed product technologies $ 13,317 5 Customer relationships 4,805 4 Trademarks 290 3 Total identifiable intangible assets $ 18,412 2016 Acquisition - Successor LOGICnow Acquisition In May 2016, we acquired LOGICnow Acquisition Company B.V.’s share capital and subsidiaries and LOGICnow Management, LLC, or LOGICnow, for approximately $499.5 million in cash, including $6.9 million of cash acquired. LOGICnow provides integrated cloud-based IT Service Management solutions focused primarily on the MSP market. The acquisition was funded with $190.0 million in additional equity financing from the Sponsors, $253.8 million of net additional debt borrowings and cash on hand. We incurred $10.1 million in acquisition related costs, which are included in general and administrative expense for the Successor period of February 5, 2016 through December 31, 2016. Goodwill for this acquisition is no t deductible for tax purposes. The following table summarizes the consideration paid and the amounts recognized for the assets acquired and liabilities assumed: Total Fair Value (in thousands) Current assets, including cash acquired $ 25,969 Property and equipment and other assets 5,848 Identifiable intangible assets 119,300 Goodwill 374,086 Current liabilities (14,785 ) Deferred tax liabilities (8,401 ) Deferred revenue (2,548 ) Total consideration $ 499,469 The following table summarizes the fair value of the acquired identifiable intangible assets and weighted-average useful life: Fair Value Weighted-average useful life (in thousands) (in years) Developed product technologies $ 31,100 4 Customer relationships 87,000 5 Trademarks 1,200 1 Total identifiable intangible assets $ 119,300 We estimated the amounts of revenue and net loss related to the LOGICnow acquisition included in our consolidated financial statements from the effective date of the acquisition for the Successor period ended December 31, 2016 to be $57.5 million and $10.7 million , respectively. We recognize revenue on the acquired products in accordance with our revenue recognition policy as described above in Note 2. Summary of Significant Accounting Policies . The following table presents our unaudited pro forma revenue and net loss for the year ended December 31, 2016 as if the LOGICnow acquisition had occurred on January 1, 2015. The pro forma financial information illustrates the measurable effects of a particular transaction, while excluding effects that rely on highly judgmental estimates of how operating decisions may or may not have changed as a result of that transaction. Accordingly, we adjusted the pro forma results for quantifiable items such as the amortization of acquired intangible assets, stock-based compensation, acquisition costs and the estimated income tax provision of the pro forma combined results. The acquisition pro forma results were not adjusted for post-acquisition decisions made by management such as changes in the product offerings, pricing and packaging of the products. We prepared the pro forma financial information for the combined entities for comparative purposes only, and it is not indicative of what actual results would have been if the acquisition had taken place on January 1, 2015, or of any future results. Year ended December 31, 2016 (in thousands) (unaudited) Revenue $ 507,981 Net loss (353,719 ) |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2018 | |
Business Combinations [Abstract] | |
Acquisitions | 3. Take Private In February 2016, as a result of the Take Private, a change in control of the Predecessor occurred and the Predecessor became a wholly-owned subsidiary of Successor. The total amount of funds necessary to complete the Take Private and the related transactions was approximately $4.6 billion . The purchase price included funds paid of $4.3 billion for outstanding common stock of Predecessor, $173.1 million for the settlement of certain stock-based awards outstanding, $90.0 million for Predecessor debt outstanding and the fair value of $9.4 million related to the non-cash equity contribution by Predecessor’s management. The purchase price was funded by equity financing from affiliates of the Sponsors and other co-investors of approximately $2.5 billion , debt financing from Goldman, Sachs & Co., certain affiliates of the foregoing and other lenders of approximately $2.0 billion and our cash on hand. The purchase price paid in connection with the Take Private was allocated to the acquired assets and assumed liabilities at fair value on the date of the acquisition. Goodwill for the Take Private is no t deductible for tax purposes. We incurred Take Private transaction costs of $1.2 million , $2.5 million and $133.1 million for the year ended December 31, 2017, the Successor period from February 5, 2016 to December 31, 2016 and the Predecessor period from January 1, 2016 to February 4, 2016, respectively, which are primarily included in general and administrative expenses. These costs primarily relate to accounting, legal, advisory and other professional fees. The costs for the Predecessor period from January 1, 2016 to February 4, 2016 also includes $87.5 million of stock-based compensation expense, employer-paid payroll taxes and other costs related to the accelerated vesting of the Predecessor stock options and certain restricted stock units. The following table summarizes the consideration paid and the amounts recognized for the assets acquired and liabilities assumed: Total Fair Value (in thousands) Current assets, including cash acquired of $248.3 million $ 351,721 Property and equipment 35,255 Other assets 12,964 Identifiable intangible assets 1,495,400 Goodwill 3,212,255 Current liabilities (87,459 ) Deferred tax liabilities (366,454 ) Deferred revenue (31,813 ) Other long-term liabilities (28,993 ) Total consideration $ 4,592,876 The following table summarizes the fair value of the acquired identifiable intangible assets and weighted-average useful life: Fair Value Weighted-average useful life (in thousands) (in years) Developed product technologies $ 906,200 6 Customer relationships 450,100 10 Tradenames - indefinite-lived 82,300 — In process research and development 48,300 — Customer backlog 6,200 2 Trademarks 2,300 1 Total identifiable intangible assets $ 1,495,400 4. Acquisitions 2018 Acquisitions In the year ended December 31, 2018 , we completed acquisitions for a combined purchase price of approximately $62.9 million in cash, including $2.4 million of cash acquired. The acquisitions were funded with available cash on hand. We incurred $1.2 million in acquisition related costs, which are included in general and administrative expense for the year ended December 31, 2018 . Goodwill for these acquisitions is no t deductible for tax purposes. The initial determination of the fair value of the assets acquired and liabilities assumed is based on a preliminary valuation and the estimates and assumptions for these items are subject to change as we obtain additional information during the measurement period. Subsequent changes to the purchase price or other fair value adjustments determined during the measurement period will be recorded as an adjustment to goodwill. The measurement period adjustments recognized during the period were immaterial and primarily related to working capital adjustments. We may have additional measurement period adjustments as we finalize the fair value of certain assets acquired and liabilities assumed. The amounts of revenue and net loss related to these acquisitions included in our consolidated financial statements from the effective date of the respective acquisitions are insignificant for the year ended December 31, 2018 . Pro forma information for these acquisitions have not been provided because the impact of the historical financials on our revenue, net loss and net income (loss) per share is not material. We recognize revenue on the acquired products in accordance with our revenue recognition policy as described above in Note 2. Summary of Significant Accounting Policies . The following table summarizes the consideration paid and the amounts recognized for the assets acquired and liabilities assumed for our acquisitions completed in the year ended December 31, 2018 : Total Fair Value (in thousands) Current assets, including cash acquired $ 4,821 Deferred tax asset 1,550 Fixed assets 1,352 Identifiable intangible assets 18,412 Goodwill 43,746 Current liabilities (3,331 ) Deferred tax liabilities (666 ) Deferred revenue (2,944 ) Total consideration $ 62,940 The following table summarizes the fair value of the acquired identifiable intangible assets and weighted-average useful life: Fair Value Weighted-average useful life (in thousands) (in years) Developed product technologies $ 13,317 5 Customer relationships 4,805 4 Trademarks 290 3 Total identifiable intangible assets $ 18,412 2016 Acquisition - Successor LOGICnow Acquisition In May 2016, we acquired LOGICnow Acquisition Company B.V.’s share capital and subsidiaries and LOGICnow Management, LLC, or LOGICnow, for approximately $499.5 million in cash, including $6.9 million of cash acquired. LOGICnow provides integrated cloud-based IT Service Management solutions focused primarily on the MSP market. The acquisition was funded with $190.0 million in additional equity financing from the Sponsors, $253.8 million of net additional debt borrowings and cash on hand. We incurred $10.1 million in acquisition related costs, which are included in general and administrative expense for the Successor period of February 5, 2016 through December 31, 2016. Goodwill for this acquisition is no t deductible for tax purposes. The following table summarizes the consideration paid and the amounts recognized for the assets acquired and liabilities assumed: Total Fair Value (in thousands) Current assets, including cash acquired $ 25,969 Property and equipment and other assets 5,848 Identifiable intangible assets 119,300 Goodwill 374,086 Current liabilities (14,785 ) Deferred tax liabilities (8,401 ) Deferred revenue (2,548 ) Total consideration $ 499,469 The following table summarizes the fair value of the acquired identifiable intangible assets and weighted-average useful life: Fair Value Weighted-average useful life (in thousands) (in years) Developed product technologies $ 31,100 4 Customer relationships 87,000 5 Trademarks 1,200 1 Total identifiable intangible assets $ 119,300 We estimated the amounts of revenue and net loss related to the LOGICnow acquisition included in our consolidated financial statements from the effective date of the acquisition for the Successor period ended December 31, 2016 to be $57.5 million and $10.7 million , respectively. We recognize revenue on the acquired products in accordance with our revenue recognition policy as described above in Note 2. Summary of Significant Accounting Policies . The following table presents our unaudited pro forma revenue and net loss for the year ended December 31, 2016 as if the LOGICnow acquisition had occurred on January 1, 2015. The pro forma financial information illustrates the measurable effects of a particular transaction, while excluding effects that rely on highly judgmental estimates of how operating decisions may or may not have changed as a result of that transaction. Accordingly, we adjusted the pro forma results for quantifiable items such as the amortization of acquired intangible assets, stock-based compensation, acquisition costs and the estimated income tax provision of the pro forma combined results. The acquisition pro forma results were not adjusted for post-acquisition decisions made by management such as changes in the product offerings, pricing and packaging of the products. We prepared the pro forma financial information for the combined entities for comparative purposes only, and it is not indicative of what actual results would have been if the acquisition had taken place on January 1, 2015, or of any future results. Year ended December 31, 2016 (in thousands) (unaudited) Revenue $ 507,981 Net loss (353,719 ) |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | 5. Goodwill and Intangible Assets Goodwill The following table reflects the changes in goodwill for the years ended December 31, 2018 and 2017 : (in thousands) Balance at December 31, 2016 $ 3,533,390 Acquisitions 17,121 Foreign currency translation and other adjustments 145,129 Balance at December 31, 2017 3,695,640 Acquisitions 43,746 Foreign currency translation and other adjustments (55,425 ) Balance at December 31, 2018 $ 3,683,961 The goodwill from acquisitions resulted primarily from our expectations that we will now be able to offer our customers additional products in new markets. Additionally, we expect the acquisitions will attract new customers for our entire line of products. Intangible Assets Intangible assets consisted of the following at December 31, 2018 and 2017 : December 31, 2018 December 31, 2017 Gross Carrying Amount Accumulated Net Gross Carrying Amount Accumulated Amortization Net (in thousands) Developed product technologies $ 1,006,999 $ (494,459 ) $ 512,540 $ 1,006,454 $ (324,196 ) $ 682,258 Customer relationships 541,717 (181,902 ) 359,815 546,207 (118,930 ) 427,277 Intellectual property 829 (129 ) 700 547 (59 ) 488 Trademarks 84,462 (1,256 ) 83,206 85,257 (1,075 ) 84,182 Customer backlog — — — 6,200 (5,906 ) 294 Total intangible assets $ 1,634,007 $ (677,746 ) $ 956,261 $ 1,644,665 $ (450,166 ) $ 1,194,499 Intangible asset amortization expense was as follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Intangible asset amortization expense $ 242,849 $ 238,156 $ 206,086 $ 3,119 As of December 31, 2018, we estimate aggregate intangible asset amortization expense to be as follows: Estimated Amortization (in thousands) 2019 $ 237,461 2020 235,116 2021 205,196 2022 67,497 2023 42,694 The expected amortization expense is an estimate. Actual amounts of amortization expense may differ from estimated amounts due to additional intangible asset acquisitions, changes in foreign currency exchange rates, impairment of intangible assets, future changes to expected asset lives of intangible assets and other events. We had $82.8 million and $83.8 million of trademarks recorded with an indefinite life that are not amortized at December 31, 2018 and 2017, respectively. Our indefinite-lived trademarks primarily include the SolarWinds and THWACK trademarks. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 6. Fair Value Measurements The following table summarizes the fair value of our financial assets that were measured on a recurring basis as of December 31, 2018 and 2017 . There have been no transfers between fair value measurement levels during the year ended December 31, 2018 . Fair Value Measurements at December 31, 2018 Using Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total (in thousands) Money market funds $ 117,100 $ — $ — $ 117,100 Fair Value Measurements at December 31, 2017 Using Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total (in thousands) Money market funds $ 67,100 $ — $ — $ 67,100 As of December 31, 2018 and 2017 , the carrying value of our long-term debt approximates its estimated fair value as the interest rate on the debt agreements is adjusted for changes in the market rates. See Note 9. Debt for additional information regarding our debt. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | 7. Property and Equipment Property and equipment, including software, consisted of the following: December 31, 2018 2017 (in thousands) Equipment, servers and computers $ 32,081 $ 23,790 Furniture and fixtures 7,393 6,760 Software 2,475 3,143 Leasehold improvements 21,341 20,688 $ 63,290 $ 54,381 Less: Accumulated depreciation and amortization (27,426 ) (20,172 ) Property and equipment, net $ 35,864 $ 34,209 Depreciation and amortization expense on property and equipment was as follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Depreciation and amortization $ 13,007 $ 11,617 $ 9,071 $ 778 |
Accrued Liabilities and Other
Accrued Liabilities and Other | 12 Months Ended |
Dec. 31, 2018 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities and Other | 8. Accrued Liabilities and Other Accrued liabilities and other current liabilities were as follows: December 31, 2018 2017 (in thousands) Payroll-related accruals $ 31,028 $ 24,995 Other accrued expenses and current liabilities 21,027 14,598 Total accrued liabilities and other $ 52,055 $ 39,593 |
Debt
Debt | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Debt | 9. Debt Debt Agreements The following table summarizes information relating to our debt: December 31, December 31, 2018 2017 Amount Effective Rate Amount Effective Rate (in thousands, except interest rates) Revolving credit facility $ — — % $ — — % First Lien Term Loan (as amended) due Feb 2024 1,970,100 5.27 % 1,678,050 5.07 % Second Lien Floating Rate Notes (as amended) due Feb 2024 — — % 680,000 10.14 % Total principal amount 1,970,100 2,358,050 Unamortized discount and debt issuance costs (46,128 ) (95,478 ) Total debt 1,923,972 2,262,572 Less: Current portion of long-term debt (19,900 ) (16,950 ) Total long-term debt $ 1,904,072 $ 2,245,622 Senior Secured Debt Senior Secured First Lien Credit Facilities In connection with the Take Private, we entered into a first lien credit agreement with Credit Suisse AG, Cayman Islands Branch, or Credit Suisse, as administrative agent and collateral agent, and a syndicate of institutional lenders and financial institutions, or Initial First Lien Credit Agreement. The Initial First Lien Credit Agreement provided for senior secured first lien credit facilities of up to $1.65 billion , consisting of a $1.275 billion U.S. dollar term loan and a €230.0 million Euro term loan, or collectively, the Initial First Lien Term Loans, and a $125.0 million revolving credit facility (with a letter of credit sub-facility in the amount of $35.0 million ), or the Initial Revolving Credit Facility, consisting of (i) a $100.0 million multicurrency tranche and (ii) a $25.0 million tranche available only in U.S. dollars. On February 5, 2016, we borrowed $1.5 billion in USD equivalent, consisting of the Initial First Lien Term Loans, and $20.0 million under the Initial Revolving Credit Facility. In May 2016, we entered into Amendment No. 1 to the First Lien Credit Agreement, or Amendment No. 1, and borrowed an additional $160.0 million in U.S. dollar term loans to finance a portion of the acquisition of LOGICnow. In August 2016, we entered into Amendment No. 2 to the Initial First Lien Credit Agreement, or Amendment No. 2, which replaced the Initial First Lien Term Loans with a new $1.7 billion U.S. dollar term loan, or the 2016 Refinancing First Lien Term Loan. For certain lenders of the syndicate, Amendment No. 2 was determined to be a debt extinguishment and, accordingly, a loss on debt extinguishment of $22.8 million was recorded to other income (expense) in the consolidated statement of operations for the Successor period ended December 31, 2016. In February 2017, we entered into Amendment No. 3 to the Initial First Lien Credit Agreement, or Amendment No. 3, which replaced the 2016 Refinancing First Lien Term Loan with a new $1.695 billion U.S. dollar term loan, or 2017 Refinancing First Lien Term Loan. For certain lenders of the syndicate, Amendment No. 3 was determined to be a debt extinguishment and, accordingly, a loss on debt extinguishment of $18.6 million was recorded to other income (expense) in the consolidated statement of operations for the year ended December 31, 2017. In March 2018, we entered into Amendment No. 4 to the Initial First Lien Credit Agreement, or Amendment No. 4, which replaced the outstanding borrowings with a new $1.99 billion U.S. dollar term loan, or First Lien Term Loan. The Initial First Lien Credit Agreement, as amended by Amendment No. 1, Amendment No. 2, Amendment No. 3 and Amendment No. 4 is referred to here as the First Lien Credit Agreement. The proceeds of the First Lien Term Loan were used to repay all outstanding borrowings including accrued interest under the 2017 Refinancing First Lien Term Loan and a portion of the Second Lien Notes (as defined below), including accrued interest and related transaction costs. In connection with Amendment No. 4, a loss on debt extinguishment of $21.4 million was recorded to other income (expense) in the consolidated statement of operations for the year ended December 31, 2018 . The First Lien Credit Agreement provides for senior secured first lien credit facilities, consisting as of December 31, 2018 of: • a $1.99 billion First Lien Term Loan with a final maturity date of February 5, 2024; and • a $125.0 million revolving credit facility (with a letter of credit sub-facility in the amount of $35.0 million ), or the Revolving Credit Facility, consisting of (i) a $100.0 million multicurrency tranche and (ii) a $25.0 million tranche available only in U.S. dollars, of which $7.5 million has a final maturity date of February 5, 2021 and $17.5 million has a final maturity date of February 5, 2022. Prior to the completion of our IPO, borrowings under our Revolving Credit Facility bore interest at a floating rate which was, at our option, either (1) a Eurodollar rate for a specified interest period plus an applicable margin of 3.00% or (2) a base rate plus an applicable margin of 2.00% . Upon completion of our IPO, the applicable margins for Eurodollar rate and base rate borrowings are subject to reductions to 2.50% and to 1.50% , respectively. The Eurodollar rate applicable to the Revolving Credit Facility is subject to a “floor” of 0.0% . Prior to the completion of our IPO, borrowings under our First Lien Term Loan bore interest at a floating rate which was, at our option, either (1) a Eurodollar rate for a specified interest period plus an applicable margin of 3.00% or (2) a base rate plus an applicable margin of 2.00% . Upon completion of our IPO, the applicable margins for Eurodollar and base rate borrowings were each subject to a reduction to 2.75% and 1.75% , respectively. The Eurodollar rate applicable to the First Lien Term Loan is subject to a “floor” of 0.0% . The Eurodollar rate is equal to an adjusted London Interbank Offered Rate, or LIBOR, for a one -, two -, three - or six -month interest period with a LIBOR floor of 0% . The base rate for any day is a fluctuating rate per annum equal to the highest of (a) the rate of interest in effect for such day as publicly announced by Credit Suisse as its “prime rate” and (b) the federal funds effective rate in effect on such day plus 0.50% and (c) the one-month adjusted LIBOR plus 1.0% per annum. The First Lien Term Loan requires equal quarterly repayments equal to 0.25% of the original principal amount. In addition to paying interest on loans outstanding under the Revolving Credit Facility and the First Lien Term Loan, we are required to pay a commitment fee of 0.50% per annum of unused commitments under the Revolving Credit Facility. The commitment fee is subject to a reduction to 0.375% per annum based on our first lien net leverage ratio. The First Lien Credit Agreement contains a number of covenants that, among other things, restrict, subject to certain exceptions, our ability to: incur additional indebtedness; incur liens; engage in mergers, consolidations, liquidations or dissolutions; pay dividends and distributions on, or redeem, repurchase or retire our capital stock; and make certain investments, acquisitions, loans, or advances. In addition, the terms of the First Lien Credit Agreement include a financial covenant which requires that, at the end of each fiscal quarter, if the aggregate amount of borrowings under the Revolving Credit Facility exceeds 35% of the aggregate commitments under the Revolving Credit Facility, our first lien net leverage ratio cannot exceed 7.40 to 1.00 . The First Lien Credit Agreement also contains certain customary representations and warranties, affirmative covenants and events of default. As of December 31, 2018 , we were in compliance with all covenants of the First Lien Credit Agreement. The following table summarizes the future minimum principal payments under the First Lien Term Loan outstanding as of December 31, 2018 : As of December 31, 2018 (in thousands) 2019 $ 19,900 2020 19,900 2021 19,900 2022 19,900 2023 19,900 Thereafter 1,870,600 Total minimum principal payments $ 1,970,100 Senior Secured Second Lien Credit Facility In February 2016, in connection with the Take Private, we issued senior secured second lien floating rate notes, or the Second Lien Notes, with approximately $580.0 million aggregate principal amount due in February 2024. In May 2016, we entered into Amendment No.1 to the Second Lien Notes and issued an additional $100.0 million to finance a portion of the acquisition of LOGICnow. The Second Lien Notes bore interest at a rate per annum, reset quarterly, equal to a three-month Adjusted LIBOR Rate, with a “floor” of 1.0% , plus 8.75% . In March 2018, we terminated the agreements governing our Second Lien Notes and repaid or exchanged the then-outstanding principal on our Second Lien Notes of $680.0 million and replaced the Second Lien Notes with a new second lien credit agreement, or the Second Lien Credit Agreement, with Wilmington Trust, National Association or Wilmington Trust, as administrative agent and collateral agent, and certain other financial institutions. The Second Lien Credit Agreement provided for a $315.0 million U.S. dollar term loan, or the Second Lien Term Loan, with a final maturity of February 5, 2025 and did not require periodic principal payments. In connection with the redemption and exchange of our Second Lien Notes, a loss on debt extinguishment of $39.2 million , which includes a $22.7 million redemption premium, was recorded to other income (expense) in the consolidated statement of operations for the year ended December 31, 2018 . In October 2018, we completed our IPO and used a portion of the net proceeds from the offering to repay the $315.0 million in borrowings outstanding under our Second Lien Term Loan. In connection with the repayment of our Second Lien Term Loan, a loss on debt extinguishment of $19.5 million , which includes a $14.2 million prepayment fee, was recorded to other income (expense) in the consolidated statement of operations for the year ended December 31, 2018 . |
Redeemable Convertible Class A
Redeemable Convertible Class A Common Stock | 12 Months Ended |
Dec. 31, 2018 | |
Temporary Equity Disclosure [Abstract] | |
Redeemable Convertible Class A Common Stock | 10. Redeemable Convertible Class A Common Stock Prior to the conversion of Class A Common Stock into common stock at the IPO, the Class A Common Stock accrued dividends at a rate of 9% per annum and had a liquidation preference equal to $1,000 per share plus any accrued and unpaid dividends. Redeemable convertible Class A Common Stock was recorded at liquidation value plus accrued, unpaid dividends in our consolidated balance sheets. Cumulative undeclared and unpaid dividends on Class A Common Stock totaled $485.9 million at December 31, 2017 . In October 2018, we amended our certificate of incorporation to modify the conversion price of the Class A Common Stock from the initial public offering price per share to a stated conversion price of $19.00 per share. Therefore, immediately prior to the completion of our IPO, we converted each outstanding share of our Class A Common Stock into 140,053,370 shares of common stock equal to the result of the liquidation value of such share of Class A Common Stock, divided by $19.00 per share. The liquidation value for each share of Class A Common Stock was equal to $1,000 . At the time of the conversion of the Class A Common Stock, we also converted $717.4 million of accrued and unpaid dividends on the Class A Common Stock into 37,758,109 shares of common stock equal to the result of the accrued and unpaid dividends on each share of Class A Common Stock, divided by $19.00 per share. Upon the modification and conversion of the Class A Common Stock into common stock, we recognized a $711.2 million gain related to the difference between the fair value of the consideration transferred to the Class A Common Stock shareholders and the carrying value of the Class A Common Stock. The gain on conversion of Class A Common Stock was recorded in accumulated deficit and included in net income (loss) available to common shareholders in the computation of net income (loss) per share. |
Stockholders_ Equity (Deficit)
Stockholders’ Equity (Deficit) and Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2018 | |
Equity And Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stockholders’ Equity (Deficit) and Stock-Based Compensation | 11. Stockholders’ Equity (Deficit) and Stock-Based Compensation Successor Common Stock and Preferred Stock As of December 31, 2017, the Company had authorized capital stock of 238,755,000 shares consisting of 5,755,000 shares of Class A Common Stock, par value $0.001 per share, or Class A Common Stock, and 233,000,000 shares of Class B Common Stock, par value of $0.001 per share, or Class B Common Stock. In October 2018, we completed our IPO in which we sold and issued 25,000,000 shares of our common stock at an issue price of $15.00 per share. We raised a total of $375.0 million in gross proceeds from the offering, or approximately $353.0 million in net proceeds after deducting underwriting discounts and commissions of $17.8 million and offering-related expenses of approximately $4.2 million . Upon the closing of our IPO, all shares of Class A Common Stock that were outstanding immediately prior to the closing of the offering converted into shares of common stock in accordance with the terms of our certificate of incorporation, as amended. In addition, we converted the accrued and unpaid dividends on the Class A Common Stock into shares of common stock equal to the result of the accrued and unpaid dividends on each share of Class A Common Stock, divided by the conversion price of $19.00 per share. See Note 10. Redeemable Convertible Class A Common Stock for additional details of the conversion of the Class A Common Stock. All outstanding shares of Class B Common Stock converted into common stock on a one -for-one basis. In October 2018, following consummation of our IPO, we amended our certificate of incorporation to, among other things, set the authorized capital stock of the Company at 1,000,000,000 shares of common stock, par value of $0.001 per share, and 50,000,000 shares of preferred stock, par value of $0.001 per share. Each share of common stock entitles the holder thereof to one vote on each matter submitted to a vote at any meeting of stockholders. 2016 Equity Incentive Plan The board of directors adopted, and the stockholders approved, the SolarWinds Corporation Equity Plan, or 2016 Plan, in June 2016. Under the 2016 Plan, the Company was able to sell or grant shares of Class A Common Stock and Class B Common Stock and common stock-based awards, including nonqualified stock options, to the Company’s employees, consultants, directors, managers and advisors. Our ability to grant any future equity awards under the 2016 Plan terminated in October 2018 following the consummation of our IPO. Our 2016 Plan will continue to govern the terms and conditions of all outstanding equity awards granted under the 2016 Plan. The Company has issued common stock-based incentive awards, consisting of nonqualified stock options exercisable for shares of common stock and restricted shares of common stock, under the 2016 Plan to employees and certain members of the Company’s board of directors. Options and restricted stock issued under the 2016 Plan to employees at the level of vice president and below generally vest annually over four or five years on each anniversary of the vesting commencement date, subject to continued employment through each applicable vesting date. Options and restricted stock issued under the 2016 Plan to employees at the level of group vice president and above generally vest 50% annually over four or five years on each anniversary of the vesting commencement date and 50% annually over four or five years after the end of each applicable fiscal year provided specified performance targets set by the board of directors are achieved for that fiscal year, subject to continued employment through each applicable vesting date. The term of an incentive stock option granted under our 2016 Plan may not exceed ten years . Under the terms of the applicable stock option agreements and restricted stock purchase agreements, the Company has the right (but will not be required) to repurchase restricted stock that has been purchased by an employee or director in the event that stockholder ceases to be employed or engaged (as applicable) by the Company for any reason or in the event of a change of control or due to certain regulatory burdens. The repurchase price for any unvested shares will be equal to the lesser of (i) the price the stockholder paid for those shares and (ii) the fair market value of those shares. The repurchase price for any vested shares will be equal to the fair market value of those shares unless the stockholder was terminated for cause or the stockholder violated any restrictive covenants in its agreements with the Company. If a stockholder is terminated for cause or violates any restrictive covenants, the repurchase price for the stockholder’s vested shares will be the same as for unvested shares. We have granted employees restricted stock and options at exercise prices equal to the fair value of the underlying common stock at the time of grant, as determined by our board of directors on a contemporaneous basis. As of December 31, 2018 , common stock-based incentive awards of 8,115,334 were outstanding under the 2016 Plan consisting of 3,129,900 stock options and 4,985,434 shares of restricted common stock. For the years ended December 31, 2018 and 2017 , and for the period of February 5, 2016 to December 31, 2016, the Company repurchased 272,133 , 640,454 and 14,000 shares, respectively, of vested and unvested restricted common stock upon employee terminations. 2018 Equity Incentive Plan In October 2018, the board of directors adopted, and the stockholders approved, the SolarWinds Corporation 2018 Equity Incentive Plan, or 2018 Plan. Under the 2018 Plan, the Company is able to sell or grant shares of common stock-based awards, including nonstatutory stock options or incentive stock options, stock appreciation rights, restricted stock, restricted stock units, performance stock units and other cash-based or stock-based awards, to the Company’s employees, consultants, directors, managers and advisors. The term of a stock option and stock appreciation right granted under our 2018 Plan may not exceed ten years . We reserved 30,000,000 shares of our common stock for issuance under the 2018 Plan. As of December 31, 2018, stock-based incentive awards of 7,248,388 were outstanding under the 2018 Plan, consisting of 6,277,466 restricted stock units, or RSUs, and 970,922 performance stock units, or PSUs, at the target award amount and 22,751,612 shares were reserved for future grants. RSUs generally vest annually over four years on each anniversary of the vesting commencement date, subject to continued employment through each applicable vesting date. PSUs generally vest over a three -year period based on the achievement of specified performance targets for the fiscal year ended December 31, 2019 and subject to continued service through the applicable vesting dates. Based on the extent to which the performance targets are achieved, vested shares may range from 0% to 150% of the target award amount. Stock-based compensation expense recorded for the year ended December 31, 2018 was $5.8 million and was immaterial for the year ended December 31, 2017 and the Successor period from February 5, 2016 through December 31, 2016. Stock Option Awards Option grant activity under the 2016 Plan was as follows: Number of Shares Outstanding Weighted- Average Exercise Price Aggregate Intrinsic Value (in thousands) Weighted- Average Remaining Contractual Term (in years) Outstanding balances at December 31, 2017 2,156,550 $ 0.45 Options granted 1,327,475 3.40 Options exercised (46,100 ) 0.36 Options forfeited (288,075 ) 1.38 Options expired (35,050 ) 0.36 Outstanding balances at December 31, 2018 3,114,800 $ 1.62 Options exercisable at December 31, 2018 659,950 $ 0.40 $ 8,865 7.92 Options vested and expected to vest at December 31, 2018 3,114,800 $ 1.62 $ 38,022 8.59 Additional information regarding options follows (in thousands except for per share amounts): Year Ended December 31, Year Ended December 31, Period From February 5 Through 2018 2017 2016 Weighted-average grant date fair value per share of options granted during the period $ 1.98 $ 0.28 $ 0.12 Aggregate intrinsic value of options exercised during the period 407 2 — Aggregate fair value of options vested during the period 109 35 — The unrecognized stock-based compensation expense related to unvested stock options and subject to recognition in future periods was approximately $2.2 million as of December 31, 2018 . We expect to recognize this expense over weighted average periods of approximately 3.3 years at December 31, 2018 . Restricted Stock The following table summarizes information about restricted stock activity subject to vesting under the 2016 Plan: Number of Shares Outstanding Unvested balances at December 31, 2017 5,789,401 Restricted stock granted and issued 820,500 Restricted stock vested (1,407,834 ) Restricted stock repurchased - unvested shares (216,633 ) Unvested balances at December 31, 2018 4,985,434 Restricted stock was purchased at fair market value by the employee and common stock was issued at the date of grant. The weighted-average grant date fair market value of restricted common stock purchased was $2.10 per share, $0.67 per share and $0.27 per share for the years ended December 31, 2018 and 2017 and for the Successor Period of February 5, 2016 through December 31, 2016, respectively. The aggregate intrinsic value of restricted stock vested during the years ended December 31, 2018 and 2017 was $3.7 million and $0.8 million , respectively. There were no vestings of restricted stock during the Successor Period ended December 31, 2016. Restricted stock is subject to certain restrictions, such as vesting and a repurchase right. The common stock acquired by the employee is restricted stock because vesting is conditioned upon (i) continued employment through the applicable vesting date and (ii) for employees at the level of group vice president and above, the achievement of certain financial performance targets determined by the board of directors. The restricted stock is subject to repurchase in the event the stockholder ceases to be employed or engaged (as applicable) by the Company for any reason or in the event of a change of control or due to certain regulatory burdens. As the restricted stock is purchased at fair market value at the time of grant, there is no stock-based compensation expense recognized related to these awards. The related liability for unvested shares is included in other long-term liabilities on the consolidated balance sheet and was $2.9 million and $1.7 million as of December 31, 2018 and 2017 , respectively. Restricted Stock Units The following table summarizes information about restricted stock unit activity under the 2018 Plan: Number of Units Outstanding Weighted-Average Grant Date Fair Value Per Share Aggregate Intrinsic Value (in thousands) Weighted-Average Remaining Contractual Term (in years) Unvested balances at December 31, 2017 — $ — Restricted stock units granted 6,283,232 14.21 Restricted stock units vested — — Restricted stock units forfeited (5,766 ) 14.21 Unvested balances at December 31, 2018 6,277,466 $ 14.21 $ 86,817 3.81 The total unrecognized stock-based compensation expense related to unvested restricted stock units and subject to recognition in future periods is $85.1 million as of December 31, 2018 and we expect to recognize this expense over a weighted-average period of 3.81 years . Performance Stock Units The following table summarizes information about performance stock unit activity under the 2018 Plan: Number of Units Outstanding Weighted-Average Grant Date Fair Value Per Share Aggregate Intrinsic Value (in thousands) Weighted-Average Remaining Contractual Term (in years) Unvested balances at December 31, 2017 — $ — Performance stock units granted 970,922 14.21 Performance stock units vested — — Performance stock units forfeited — — Unvested balances at December 31, 2018 970,922 $ 14.21 $ 13,428 2.16 Assuming the PSUs vest at the target award amount, the total unrecognized stock-based compensation expense related to unvested performance stock units and subject to recognition in future periods is $12.6 million as of December 31, 2018 and we expect to recognize this expense over a weighted-average period of 2.16 years . Employee Stock Purchase Plan In October 2018, our board of directors adopted and our stockholders approved our 2018 Employee Stock Purchase Plan, or the ESPP. We reserved a total of 3,750,000 shares of our common stock are available for sale under our ESPP. Our ESPP permits eligible participants to purchase common stock through payroll deductions of up to 20% of their eligible compensation during the offering period. The ESPP will typically be implemented through consecutive six -month offering periods. Amounts deducted and accumulated from participant compensation, or otherwise funded in any participating non-U.S. jurisdiction in which payroll deductions are not permitted, are used to purchase shares of our common stock at the end of each offering period. The purchase price of the shares will be 85% of the lesser of the fair market value of our common stock on the first day of the offering period and the fair market value on the last day of the offering period. No participant may purchase more than $25,000 worth of common stock per calendar year. We did not have an ESPP offering period in 2018, therefore no stock-based compensation expense was recognized related to our ESPP plan. Predecessor Predecessor Stock Plans Our Predecessor Stock Plans included our Amended and Restated Stock Incentive Plan, or 2005 Stock Plan, our 2008 Equity Incentive Plan, or 2008 Stock Plan, and our 2015 Performance Incentive Plan, or 2015 Stock Plan. Our ability to grant any future equity awards under the 2015 Plan terminated in February 2016 following the consummation of the Take Private. As a result of the Take Private, all outstanding stock option awards granted under our Predecessor Stock Plans, whether vested or unvested, were cancelled and converted into the right to receive the per share price of $60.10 less the applicable exercise price per share and applicable withholding taxes. All outstanding restricted stock units, or RSUs, granted under the 2008 Plan, other than those RSUs granted to certain of our management team members, vested in full and were converted into the right to receive the per share price less applicable withholding taxes. The vesting of the RSUs held by certain of our officers (excluding those RSUs issued under the 2015 Plan) accelerated by 50% at the Take Private, and these vested RSUs were cancelled and converted into the right to receive the per share price less applicable withholding taxes. The remaining unvested RSUs held by such officers and all RSUs issued under our 2015 Plan were cancelled and converted into the right to receive the per share price less applicable withholding taxes shortly after those RSUs would have vested based on the underlying original RSU vesting schedule and subject to continued employment of the holders of those RSUs. See Note 16. Commitments and Contingencies for further discussion of the Successor Take Private deferred stock payments related to the Predecessor awards not subject to accelerated vesting. For the period from January 1, 2016 through February 4, 2016, we recognized stock-based compensation expense of $87.8 million , of which $80.3 million related to the acceleration of stock awards at the Take Private. Additional information regarding options follows (in thousands except for per share amounts): Period From January 1 Through February 4, 2016 Weighted-average grant date fair value per share of options granted during the period $ — Aggregate intrinsic value of options exercised during the period 1,584 Aggregate fair value of options vested during the period 3,702 The aggregate fair value of restricted stock units vested during the period from January 1, 2016 through February 4, 2016 was $88.8 million . For restricted stock units granted, the number of shares issued on the date the restricted stock units vest is generally net of the minimum statutory withholding requirements that we pay in cash to the appropriate taxing authorities on behalf of our employees. We withheld and retired approximately 40,000 shares to satisfy $2.3 million of employees’ tax obligations for the period from January 1, 2016 through February 4, 2016. These shares are treated as common stock repurchases in our consolidated financial statements. |
Net Income (Loss) Per Share
Net Income (Loss) Per Share | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Net Income (Loss) Per Share | 12. Net Income (Loss) Per Share A reconciliation of net income (loss) available to common stockholders and the number of shares in the calculation of basic and diluted income (loss) per share follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Basic net earnings (loss) per share Numerator: Net loss $ (102,066 ) $ (83,866 ) $ (262,594 ) $ (71,811 ) Accretion of dividends on Class A common stock (231,549 ) (268,007 ) (217,904 ) — Gain on conversion of Class A common stock 711,247 — — — Earnings allocated to unvested restricted stock (12,997 ) — — — Net income (loss) available to common stockholders $ 364,635 $ (351,873 ) $ (480,498 ) $ (71,811 ) Denominator: Weighted-average common shares outstanding used in computing basic net earnings (loss) per share 140,301 100,433 96,465 71,989 Diluted net earnings (loss) per share Numerator: Net income (loss) available to common stockholders $ 364,635 $ (351,873 ) $ (480,498 ) $ (71,811 ) Denominator: Weighted-average shares used in computing basic net earnings (loss) per share 140,301 100,433 96,465 71,989 Add stock-based incentive stock awards 2,240 — — — Weighted-average shares used in computing diluted net earnings (loss) per share 142,541 100,433 96,465 71,989 The following weighted-average outstanding shares of common stock equivalents were excluded from the computation of the diluted net income (loss) per share attributable to common stockholders for the periods presented because their effect would have been anti-dilutive or for which the performance condition had not been met at the end of the period: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Stock options to purchase common stock 524 1,635 493 659 Performance-based stock options to purchase common stock 119 105 5 — Non-vested restricted stock incentive awards 3,442 3,565 1,524 — Performance-based non-vested restricted stock incentive awards 1,559 2,527 965 — Restricted stock units 1,139 — — 16 Performance stock units 175 — — — Total anti-dilutive shares 6,958 7,832 2,987 675 Prior to the conversion at the IPO, Class A Common Stock was not included in the basic or diluted earnings (loss) per share calculations as it was contingently convertible upon a future event. See Note 10. Redeemable Convertible Class A Common Stock for additional details of the conversion of the Class A Common Stock. The calculation of diluted earnings per share requires us to make certain assumptions related to the use of proceeds that would be received upon the assumed exercise of stock options or purchase of restricted stock. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2018 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plans | 13. Employee Benefit Plans 401(k) Plan We maintain a 401(k) matching program for all eligible employees. We, as sponsor of the plan, use an independent third party to provide administrative services to the plan. We have the right to terminate the plan at any time. Employees are fully vested in all contributions to the plan. Our expense related to the plan was as follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Employee benefit plan expense $ 4,474 $ 4,299 $ 2,145 $ 1,866 |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 14. Related Party Transactions Management Fee Agreement with Silver Lake Management, Thoma Bravo and TB Partners On February 5, 2016, we entered into a Management Fee Agreement with Silver Lake Management Company IV, L.L.C. (Silver Lake Management), Thoma Bravo, LLC (Thoma Bravo) and Thoma Bravo Partners XI, L.P. (TB Partners and, collectively with Silver Lake Management and Thoma Bravo, the Managers), pursuant to which the Managers provided business and organizational strategy and financial and advisory services. Under the Management Fee Agreement, we paid to the Managers quarterly payments of $2.5 million in the aggregate, plus fees for certain corporate transactions in the Managers’ discretion. Each payment of fees under the Management Fee Agreement was allocated among the Managers as follows: 50% to Silver Lake Management, 40.73% to Thoma Bravo and 9.27% to TB Partners. We also reimbursed each of the Managers for all out-of-pocket costs incurred in connection with activities under the Management Fee Agreement, and we indemnified the Managers and their respective related parties from and against all losses, claims, damages and liabilities related to the performance of the Managers obligations under the Management Fee Agreement. The Management Fee Agreement terminated upon the consummation of the IPO in October 2018 and no future payments are required. The following table details the management fees for the respective periods: Year Ended December 31, Period From February 5 Through 2018 2017 2016 (in thousands) Silver Lake Management $ 4,063 $ 5,000 $ 4,519 Thoma Bravo 3,309 4,073 3,681 TB Partners 753 927 838 $ 8,125 $ 10,000 $ 9,038 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 15. Income Taxes U.S. and international components of loss before income taxes were as follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) U.S. $ (116,459 ) $ (13,857 ) $ (255,846 ) $ (107,749 ) International (5,251 ) (47,611 ) (103,399 ) (17,218 ) Loss before income taxes $ (121,710 ) $ (61,468 ) $ (359,245 ) $ (124,967 ) Income tax expense (benefit) was composed of the following: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Current: Federal $ (10,906 ) $ 118,909 $ 9,831 $ (33,958 ) State 2,191 455 579 — International 10,759 1,009 605 (1,343 ) 2,044 120,373 11,015 (35,301 ) Deferred: Federal (14,978 ) (90,498 ) (92,602 ) (11,155 ) State 670 79 (967 ) (2,771 ) International (7,380 ) (7,556 ) (14,097 ) (3,929 ) (21,688 ) (97,975 ) (107,666 ) (17,855 ) $ (19,644 ) $ 22,398 $ (96,651 ) $ (53,156 ) The difference between the income tax expense (benefit) derived by applying the federal statutory income tax rate to our income (loss) before income taxes and the amount recognized in our consolidated financial statements is as follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Expense (benefit) derived by applying the federal statutory income tax rate to income (loss) before income taxes $ (25,558 ) $ (21,514 ) $ (125,736 ) $ (43,739 ) State taxes, net of federal benefit 2,435 297 (241 ) (1,801 ) Permanent items 224 (613 ) 1,819 3,145 Impact of the Tax Act One-time transition tax 140 130,802 — — Rate change — (91,545 ) — — Domestic production activity benefit — (3,794 ) — (308 ) Research and experimentation tax credits (1,955 ) (270 ) 329 (2,199 ) Withholding tax 2,486 — 3,951 — Net operating loss carryback — — — 3,872 Stock-based compensation 238 — — (14,076 ) Effect of foreign operations 2,346 9,035 23,227 1,950 $ (19,644 ) $ 22,398 $ (96,651 ) $ (53,156 ) The Tax Act reduces the U.S. federal corporate tax rate from 35% to 21% , requires companies to pay a one-time transition tax on earnings of certain foreign subsidiaries that have not been taxed previously in the U.S., and creates new taxes on certain foreign sourced earnings. We are required to recognize the effect of the tax law changes in the period of enactment, such as determining the transition tax, re-measuring our U.S. deferred tax assets and liabilities as well as reassessing the net realizability of our deferred tax assets and liabilities. In December 2017, the SEC staff issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (SAB 118) , which allows us to record provisional amounts during a measurement period not to extend beyond one year of the enactment date. Due to the timing of the enactment and the complexity involved in applying the provisions of the Tax Act, we made reasonable estimates of the effects and recorded provisional amounts in our consolidated financial statements for the year ended December 31, 2017 . Included in the provisional amount recorded for the year ended December 31, 2017 is a one-time transition tax of $130.8 million on our accumulated foreign earnings. We have elected to pay the related liability due to this transition tax of $120.8 million over eight years . This income tax expense was partially offset by $91.5 million related to the re-measurement of our deferred tax assets and liabilities at the revised U.S. statutory rates. During 2018, we completed our accounting for the income tax effects of the Tax Act. Upon further analysis of the Tax Act, additional guidance issued by the U.S. Treasury Department, state taxing authorities, and other standard-setting bodies, we finalized our calculation of the transition tax during the year ended December 31, 2018. We recognized an additional expense of $0.1 million to the provisional amounts noted above and included these adjustments as a component of income tax expense from continuing operations. We reduced our liability related to the transition tax by $9.6 million . The final transition tax liability of $111.2 million will be paid over eight years. The components of the net deferred tax amounts recognized in the accompanying consolidated balance sheets were: December 31, 2018 2017 (in thousands) Deferred tax assets: Allowance for doubtful accounts $ 436 $ 201 Accrued expenses 3,133 4,323 Net operating loss 26,652 47,631 Research and experimentation credits 1,689 2,177 Stock-based compensation 1,090 — Interest 1,528 — Deferred revenue 1,164 — Other credits 790 2,920 Total deferred tax assets 36,482 57,252 Valuation allowance (1,775 ) (1,811 ) Deferred tax assets, net of valuation allowance 34,707 55,441 Deferred tax liabilities: Property and equipment 9,107 11,891 Prepaid expenses 1,805 1,230 Deferred revenue — 101 Debt costs 9,118 14,917 Foreign royalty 2,017 714 Intangibles 152,931 189,686 Total deferred tax liabilities 174,978 218,539 Net deferred tax liability $ 140,271 $ 163,098 The Tax Act reduces the U.S. federal corporate tax rate from 35% to 21% for our tax years beginning in 2018, which resulted in the re-measurement of the federal portion of our deferred tax assets and liabilities as of December 31, 2017 from 35% to the new 21% tax rate. At December 31, 2018 and 2017 , we had net operating loss carry forwards for U.S. federal income tax purposes of approximately $12.2 million and $91.5 million , respectively, of which $12.2 million and $4.3 million , respectively, are limited due to IRC Section 382 limitations. These U.S. federal net operating losses are available to offset future U.S. federal taxable income, and begin to expire at various dates from 2021 through 2037. At December 31, 2018 and 2017 , we had net operating loss carry forwards for certain state income tax purposes of approximately $106.7 million and $103.7 million , respectively, some of which are limited due to IRC Section 382. These state net operating losses are available to offset future state taxable income, and begin to expire in 2031. At December 31, 2018 and 2017 , we had foreign net operating loss carry forwards of approximately $78.6 million and $100.5 million , respectively, which are available to offset future foreign taxable income, and begin to expire in 2019. At December 31, 2018 and 2017 , we had research and experimentation tax credit carry forwards of approximately $0.7 million and $0.7 million , respectively, which are available to offset future U.S. federal income tax. These U.S. federal tax credits begin to expire in 2027. We received a corporate income tax holiday in the Philippines which expired in 2018. We anticipate an extension of the corporate tax holiday through 2019. The income tax benefit attributable to this holiday is insignificant as of December 31, 2018 . We establish valuation allowances when necessary to reduce deferred tax assets to amounts expected to be realized. As of December 31, 2018 and 2017 , we have recorded a valuation allowance of $1.8 million and $1.8 million , respectively. The valuation allowance is all related to the deferred tax assets of a Canadian subsidiary. The Tax Act imposes a mandatory transition tax on accumulated foreign earnings as of December 31, 2017. Effective January 1, 2018, the Tax Act creates a new territorial tax system in which we will recognize the tax impact of including certain foreign earnings in U.S. taxable income as a period cost. For the year ended December 31, 2018, we do not anticipate incurring a global intangible low-taxed income, or GILTI, liability; however, to the extent that we incur expense under the GILTI provisions, we will treat it as a component of income tax expense in the period incurred. Although accumulated foreign earnings have been subject to U.S. tax as of December 31, 2017, and future foreign earnings will be subject to a new territorial tax system, we intend to indefinitely reinvest all foreign earnings. Therefore, we have not recognized deferred income taxes for local country income and withholding taxes that could be incurred on distributions of certain foreign earnings or for outside basis differences in our subsidiaries. Gross unrecognized tax benefits, all of which, if recognized, would affect our effective tax rate were as follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Gross unrecognized tax benefits $ 19,709 $ 19,504 $ 22,888 $ 17,631 Our policy is to include interest and penalties related to unrecognized tax benefits as a component of income tax expense. At December 31, 2018 and 2017 , we had accrued interest and penalties related to unrecognized tax benefits of approximately $4.1 million and $3.0 million , respectively. The aggregate changes in the balance of our gross unrecognized tax benefits, excluding accrued interest, were as follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Balance, beginning of year $ 19,504 $ 22,888 $ 17,631 $ 16,370 Increases for tax positions related to the current year 59 502 4,421 1,335 Decreases for tax positions related to the current year — (715 ) — — Increases for tax positions related to prior years 146 — 836 230 Decreases for tax positions related to prior years — (3,171 ) — (304 ) Reductions due to lapsed statute of limitations — — — — Balance, end of year $ 19,709 $ 19,504 $ 22,888 $ 17,631 We do not believe that it is reasonably possible that our unrecognized tax benefits will significantly change in the next twelve months. We file U.S., state and foreign income tax returns in jurisdictions with varying statutes of limitations. The 2011 through 2017 tax years generally remain open and subject to examination by federal tax authorities. The 2011 through 2017 tax years generally remain open and subject to examination by the state tax authorities and foreign tax authorities. We are currently under examination by the IRS for the tax years 2011 through the period ending February 2016. We are under audit by the Indian Tax Authority for the 2014 and 2017 tax years. We are currently under audit by the California Franchise Tax Board for the 2012 through 2014 tax years. We were notified in January 2019 that the Massachusetts Department of Revenue would audit the 2015 through February 2016 tax years. We were notified in December 2017 that the Swiss Tax Authorities would audit the 2014 through 2016 tax years. This audit concluded in April 2018 with no adjustments. We are not currently under audit in any other taxing jurisdictions. On July 24, 2018, U.S. Court of Appeals for the Ninth Circuit reversed the decision of the U.S. Tax Court in Altera Corp. v. Commissioner related to the treatment of stock-based compensation in an intercompany cost sharing arrangement. On August 7, 2018, the Ninth Circuit withdrew the opinion to allow time for a reconstituted panel to confer on this appeal. Due to the uncertainty surrounding the status of the current regulations, questions related to the scope of potential benefits or obligations, and the risk of the Tax Court's decision being overturned upon appeal, we have not recorded any benefit or expense as of December 31, 2018. We will continue to monitor ongoing developments and potential impacts to our consolidated financial statements. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 16. Commitments and Contingencies Leases We lease our offices and do not own any real estate. Our corporate headquarters is located in Austin, Texas and currently consists of approximately 348,000 square feet. We also lease office space domestically and internationally in various locations for our operations, including facilities located in Cork, Ireland; Brno, Czech Republic; Durham, North Carolina; Manila, Philippines; Ottawa, Canada; Dundee, United Kingdom; Krakow, Poland; Lehi, Utah and Singapore. At December 31, 2018, future minimum lease payments under non-cancellable operating leases were as follows: Minimum Lease Payments (in thousands) 2019 $ 15,287 2020 15,105 2021 14,138 2022 13,412 2023 12,340 Thereafter 53,734 Total minimum lease payments $ 124,016 Rent expense was as follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Rent expense $ 18,249 $ 16,298 $ 12,688 $ 1,088 Take Private Deferred Stock Payments As a result of the Take Private, RSUs granted to certain of our employees under the existing stock plans not subject to accelerated vesting were cancelled and converted into the right to receive the per share price of $60.10 less applicable withholding taxes shortly after those RSUs would have vested based on the underlying original RSU vesting schedule and subject to continued employment of the holders of those RSUs. As of December 31, 2018 , we had a liability for Take Private deferred stock payments recorded of $1.6 million included in accrued liabilities and other, related to the future payment for service provided. For the year ended December 31, 2018 , we recognized $3.2 million of compensation expense and made cash payments of approximately $4.4 million to employees related to the deferred compensation. We expect to pay approximately $3.3 million through the year 2020. The expected future payment may differ from actual payment amounts due to future employee terminations. Legal Proceedings From time to time, we have been and may be involved in various legal proceedings arising in our ordinary course of business. In the opinion of management, resolution of any pending claims (either individually or in the aggregate) is not expected to have a material adverse impact on our consolidated financial statements, cash flows or financial position and it is not possible to provide an estimated amount of any such loss. However, the outcome of disputes is inherently uncertain. Therefore, although management considers the likelihood of such an outcome to be remote, an unfavorable resolution of one or more matters could materially affect our future results of operations or cash flows, or both, in a particular period. |
Operating Segments and Geograph
Operating Segments and Geographic Information (Notes) | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting [Abstract] | |
Operating Segments and Geographic Information | 17. Operating Segments and Geographic Information We operate as a single segment. Our chief operating decision-maker is considered to be our Chief Executive Officer. The chief operating decision-maker allocates resources and assesses performance of the business at the consolidated level. The authoritative guidance for disclosures about segments of an enterprise establishes standards for reporting information about operating segments. It defines operating segments as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision-maker in deciding how to allocate resources and in assessing performance. Our Chief Executive Officer manages the business as a multi-product business that utilizes its model to deliver software products to customers regardless of their geography or IT environment. Operating results including new license and subscription sales, maintenance renewals and discrete financial information are reviewed at the consolidated entity level for purposes of making resource allocation decisions and for evaluating financial performance. Accordingly, we considered ourselves to be in a single operating and reporting segment structure. We based revenue by geography on the shipping address of each customer. Other than the United States, no single country accounted for 10% or more of our total revenues during these periods. The following tables set forth revenue and net long-lived assets by geographic area: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Revenue United States, country of domicile $ 505,304 $ 459,701 $ 268,426 $ 31,797 International 327,785 268,316 153,668 15,530 Total revenue $ 833,089 $ 728,017 $ 422,094 $ 47,327 December 31, 2018 2017 (in thousands) Long-lived assets, net United States, country of domicile $ 22,953 $ 20,986 Switzerland 4,878 3,941 All other international 8,033 9,282 Total long-lived assets, net $ 35,864 $ 34,209 |
Quarterly Results of Operations
Quarterly Results of Operations | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Results of Operations | 18. Quarterly Results of Operations The following table sets forth our unaudited quarterly consolidated statements of operations data for each of the quarters indicated. The information for each quarter has been prepared on a basis consistent with our audited consolidated financial statements included in this Annual Report on Form 10-K, and reflect, in the opinion of management, all adjustments of a normal, recurring nature that are necessary for a fair statement of the financial information contained in those statements. Our historical results are not necessarily indicative of the results that may be expected in the future. The following quarterly financial data should be read in conjunction with our consolidated financial statements included elsewhere in this Annual Report on Form 10-K. Three months ended, Dec 31, Sep 30, June 30, 2018 Mar 31, 2018 Dec 31, 2017 Sep 30, 2017 June 30, 2017 Mar 31, 2017 (in thousands, except per share data) (unaudited) Revenue $ 221,181 $ 213,277 $ 201,718 $ 196,913 $ 198,339 $ 189,112 $ 175,441 $ 165,125 Gross profit 159,184 151,420 140,043 135,707 139,268 130,409 117,932 108,677 Loss before income taxes (14,342 ) (524 ) (38,577 ) (68,267 ) (4,894 ) (1,418 ) (2,375 ) (52,781 ) Net income (loss) (14,743 ) (398 ) (27,015 ) (59,910 ) (39,761 ) 1,637 (2,004 ) (43,738 ) Net income (loss) available to common stockholders 668,426 (75,006 ) (99,193 ) (129,745 ) (109,563 ) (66,627 ) (68,043 ) (107,640 ) Basic income (loss) per share $ 2.63 $ (0.73 ) $ (0.97 ) $ (1.28 ) $ (1.09 ) $ (0.66 ) $ (0.68 ) $ (1.08 ) Diluted income (loss) per share $ 2.60 $ (0.73 ) $ (0.97 ) $ (1.28 ) $ (1.09 ) $ (0.66 ) $ (0.68 ) $ (1.08 ) Shares used in computation of basic income (loss) per share 254,209 102,078 102,018 101,644 100,737 100,759 100,404 99,817 Shares used in computation of diluted income (loss) per share 256,711 102,078 102,018 101,644 100,737 100,759 100,404 99,817 |
SCHEDULE II - VALUATION AND QUA
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Dec. 31, 2018 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS Beginning Balance Additions (Charge to Expense) Deductions (Write-offs, net of Recoveries) Ending Balance (in thousands) Allowance for doubtful accounts, customers and other: Predecessor period ended February 4, 2016 $ 649 $ 64 $ 45 $ 668 Successor period ended December 31, 2016 — 1,713 711 1,002 Year ended December 31, 2017 1,002 2,489 1,426 2,065 Year ended December 31, 2018 2,065 2,498 1,367 3,196 Tax valuation allowances: Predecessor period ended February 4, 2016 $ — $ — $ — $ — Successor period ended December 31, 2016 — — — — Year ended December 31, 2017 — 1,811 — 1,811 Year ended December 31, 2018 1,811 — 36 1,775 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Basis of Consolidation | The accompanying consolidated financial statements of Successor include the accounts of SolarWinds Corporation and the accounts of its wholly owned subsidiaries for the years ended December 31, 2018 and 2017 and the period from February 5, 2016 through December 31, 2016. The accompanying consolidated financial statements of Predecessor include the accounts of SolarWinds North America, Inc. and the accounts of its wholly owned subsidiaries through February 4, 2016. We have eliminated all intercompany balances and transactions. |
Use of Estimates | The preparation of financial statements in conformity with GAAP requires our management to make estimates and assumptions that affect the reported amounts and the disclosure of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. The actual results that we experience may differ materially from our estimates. The accounting estimates that require our most significant, difficult and subjective judgments include: • the valuation of goodwill, intangibles, long-lived assets and contingent consideration; • revenue recognition; • stock-based compensation; • income taxes; and • loss contingencies. |
Foreign Currency Translation | As of July 1, 2018, we changed our assertion regarding the planned settlement of a certain intercompany loan. We evaluated our investment strategy in light of our global treasury plans and the new Tax Act (as defined below) and have determined there is no need to settle the principal related to the loan. The intercompany loan has been designated as long-term based on the assertion that settlement is not planned or anticipated in the foreseeable future. Therefore, beginning on July 1, 2018, the foreign currency transaction gains and losses resulting from the remeasurement of this long-term intercompany loan denominated in a currency other than the subsidiary's functional currency are recognized as a component of accumulated other comprehensive income (loss) upon consolidation. The functional currency of our foreign subsidiaries is determined in accordance with authoritative guidance issued by the Financial Accounting Standards Board, or FASB. We translate assets and liabilities for these subsidiaries at exchange rates in effect at the balance sheet date. We translate income and expense accounts for these subsidiaries at the average monthly exchange rates for the periods. We record resulting translation adjustments as a component of accumulated other comprehensive income (loss) within stockholders’ equity (deficit). We record gains and losses from currency transactions denominated in currencies other than the functional currency as other income (expense) in our consolidated statements of operations. There were no equity transactions denominated in foreign currencies for the years ended December 31, 2018 and 2017 . Local currency transactions of international subsidiaries that have the U.S. dollar as the functional currency are remeasured into U.S. dollars using current rates of exchange for monetary assets and liabilities and historical rates of exchange for non-monetary assets and liabilities. |
Recent Accounting Pronouncements Not Yet Adopted | Under the Jumpstart our Business Startups Act, or the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards until such time as those standards apply to non-public companies. We intend to take advantage of the longer phase-in periods for the adoption of new or revised financial accounting standards permitted under the JOBS Act until we are no longer an emerging growth company. In May 2014, FASB issued “Revenue from Contracts with Customers,” which replaced all existing revenue guidance, including prescriptive industry-specific guidance. This standard’s core principle is that an entity will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Entities will need to apply more judgment and make more estimates than under the previous guidance. In July 2015, FASB deferred the effective date for all entities by one year, making the guidance for non-public companies effective for annual reporting periods beginning after December 15, 2018. Early adoption is permitted to the original effective date of December 15, 2016. The standard permits the use of either a full-retrospective or a modified-retrospective transition method. We will adopt the new standard effective first quarter 2019 using the modified-retrospective method for adoption. The most significantly impacted areas are the following: • License and Recurring Revenue. We expect that adoption of the new standard will result in changes to the classification and timing of our revenue recognition. Under the new guidance, the requirement to establish VSOE to recognize license revenue separately from the other elements is eliminated. This change is expected to impact the allocation of the transaction price and timing of our revenue recognition between deliverables, or performance obligations, within an arrangement. In addition, we will recognize time-based license revenue upon the transfer of the license and the associated maintenance revenue over the contract period under the new standard instead of recognizing both the license and maintenance revenue ratably over the contract period. We expect the overall adoption impact to total revenue to be immaterial, though we do expect some changes to the timing and classification between license and recurring revenue. Additionally, some historical deferred revenue, primarily from arrangements involving time-based licenses, will never be recognized as revenue and instead will be a cumulative effect adjustment within accumulated deficit. We expect a reduction of approximately $2.8 million to the deferred revenue balance as a cumulative effect adjustment as of January 1, 2019. • Contract Acquisition Costs. We expense all sales commissions as incurred under current guidance. The new guidance requires the deferral and amortization of certain incremental costs incurred to obtain a contract. This guidance will require us to capitalize and amortize certain sales commission costs over the remaining contractual term or over an expected period of benefit, which we have determined to be approximately six years . As part of the transition to the new guidance, we expect to recognize a contract asset of approximately $5.2 million as a cumulative effect adjustment as of January 1, 2019. • Other Items. The impact of the adoption of the new standard on income taxes will result in an increase of deferred income tax liabilities of approximately $1.7 million as of January 1, 2019. We do not expect that the adoption of this standard will impact our operating cash flows. We do not expect the changes described above to have a material impact on our quarterly or annual consolidated financial statements, however the exact impact of the new standard will be dependent on facts and circumstances that could vary from quarter to quarter. The quantitative amounts provided above are estimates of the expected effects of our adoption of the new standard. These amounts represent our best estimates of the effects of adopting the new standard at the time of the preparation of this Annual Report on Form 10-K. The actual impact of the new revenue standard is subject to change from these estimates and such change may be significant. In February 2016, FASB issued an accounting standard to provide updated guidance requiring the recognition of all lease assets and liabilities on the balance sheet. The accounting standard required the use of a modified retrospective transition method. In July 2018, FASB issued additional guidance that provides entities with an optional transition method in which an entity can apply the new standard at the adoption date and recognize a cumulative-effect adjustment to the opening balance retained earnings in the period of adoption. The updated accounting guidance is effective for non-public companies for fiscal years beginning after December 15, 2019 and interim periods beginning the following year. Early adoption is permitted and the standard provides for certain practical expedients. We expect to adopt the updated guidance in fiscal year 2020. Our evaluation of the new standard will extend into future periods and we will update our disclosures, including the expected impacts of the new standard, as we progress towards the required adoption date. In January 2017, FASB issued an accounting standard to simplify the accounting for goodwill impairment. The new guidance removes step two of the two-step quantitative goodwill impairment test, which requires a hypothetical purchase price allocation. The updated guidance is effective for non-public companies for fiscal years beginning after December 15, 2021 and may be adopted early for any interim or annual goodwill impairment tests performed after January 1, 2017. We expect to adopt the updated guidance in fiscal year 2022. We do not believe that this standard will have a material impact on our consolidated financial statements. |
Acquisitions | We account for acquired businesses, including the Take Private, using the acquisition method of accounting, which requires that the assets acquired, liabilities assumed, contractual contingencies and contingent consideration be recorded at the date of acquisition at their respective fair values. Goodwill represents the excess of the purchase price, including any contingent consideration, over the fair value of the net assets acquired. Goodwill is allocated to our reporting units expected to benefit from the business combination based on the relative fair value at the acquisition date. It further requires acquisition related costs to be recognized separately from the acquisition and expensed as incurred, restructuring costs to be expensed in periods subsequent to the acquisition date and changes in accounting for deferred tax asset valuation allowances and acquired income tax uncertainties after the measurement period to impact the provision for income taxes. The acquired developed product technologies recorded for each acquisition were feasible at the date of acquisition as they were being actively marketed and sold by the acquired company at the acquisition date. In addition to the acquired developed product technologies, we also recorded intangible assets for the acquired companies’ customer relationships, customer backlog, trademarks and tradenames, in process research and development and certain non-competition covenants. We include the operating results of acquisitions in our consolidated financial statements from the effective date of the acquisitions. Acquisition related costs are primarily included in general and administrative expenses in our consolidated statements of operations. The fair value of identifiable intangible assets is based on significant judgments made by management. We typically engage third party valuation appraisal firms to assist us in determining the fair values and useful lives of the assets acquired. Such valuations and useful life determinations require us to make significant estimates and assumptions. These estimates and assumptions are based on historical experience and information obtained from management, and also include, but are not limited to, future expected cash flows earned from the product technology and discount rates applied in determining the present value of those cash flows. Unanticipated events and circumstances may occur that could affect the accuracy or validity of such assumptions, estimates or actual results. Acquired identifiable intangible assets are amortized on the net cash flow method or straight-line method over their estimated economic lives, which are generally three to ten years for trademarks, customer relationships, customer backlog, non-competition covenants and acquired developed product technologies and ten years for intellectual property. We include amortization of acquired developed product technologies in cost of revenue and amortization of other acquired intangible assets in operating expenses in our consolidated statements of operations. We record acquired in process research and development as indefinite-lived intangible assets. On completion of the related development projects, the in process research and development assets are reclassified to developed technology and amortized over their estimated economic lives. |
Goodwill | We test goodwill for impairment annually, in the fourth quarter, or more frequently if impairment indicators arise. Goodwill is tested for impairment at the reporting unit level using a fair value approach. We first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value, a “Step 0” analysis. If, based on a review of qualitative factors, it is more likely than not that the fair value of a reporting unit is less than its carrying value we perform “Step 1” of the goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. If the carrying value exceeds the fair value, we measure the amount of impairment loss, if any, by comparing the implied fair value of the reporting unit goodwill with its carrying amount, the “Step 2” analysis. |
Indefinite-lived Intangible Assets | We review our indefinite-lived intangible assets for impairment annually, in the fourth quarter, or more frequently if a triggering event occurs. We first assess qualitative factors to determine whether it is more likely than not that an indefinite-lived intangible asset is impaired as a basis for determining whether it is necessary to perform the quantitative test. If necessary, the quantitative test is performed by comparing the fair value of indefinite lived intangible assets to the carrying value. In the event the carrying value exceeds the fair value of the assets, the assets are written down to their fair value. |
Long-lived Assets | We evaluate the recoverability of our long-lived assets, including finite-lived intangible assets and other assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. Events or changes in circumstances that could result in an impairment review include, but are not limited to, significant underperformance relative to historical or projected future operating results, significant changes in the manner of use of the acquired assets or the strategy for our overall business, and significant negative industry or economic trends. In the event that the net book value of our long-lived assets exceeds the future undiscounted net cash flows attributable to such assets, an impairment charge would be required. Impairment, if any, is recognized in the period of identification to the extent the carrying amount of an asset or asset group exceeds the fair value of such asset or asset group. |
Long-lived Assets | We evaluate the recoverability of our long-lived assets, including finite-lived intangible assets and other assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. Events or changes in circumstances that could result in an impairment review include, but are not limited to, significant underperformance relative to historical or projected future operating results, significant changes in the manner of use of the acquired assets or the strategy for our overall business, and significant negative industry or economic trends. In the event that the net book value of our long-lived assets exceeds the future undiscounted net cash flows attributable to such assets, an impairment charge would be required. Impairment, if any, is recognized in the period of identification to the extent the carrying amount of an asset or asset group exceeds the fair value of such asset or asset group. |
Fair Value Measurements | We apply the authoritative guidance on fair value measurements for financial assets and liabilities that are measured at fair value on a recurring basis and non-financial assets and liabilities, such as goodwill, intangible assets and property, plant and equipment that are measured at fair value on a non-recurring basis. The guidance establishes a three-tiered fair value hierarchy that prioritizes inputs to valuation techniques used in fair value calculations. The three levels of inputs are defined as follows: Level 1: Unadjusted quoted prices for identical assets or liabilities in active markets accessible by us. Level 2: Inputs that are observable in the marketplace other than those inputs classified as Level 1. Level 3: Inputs that are unobservable in the marketplace and significant to the valuation. See Note 6. Fair Value Measurements for a summary of our financial instruments accounted for at fair value on a recurring basis. The carrying amounts reported in our consolidated balance sheets for cash, accounts receivable, accounts payable and other accrued expenses approximate fair value due to relatively short periods to maturity. |
Accounts Receivable | Accounts receivable represent trade receivables from customers when we have sold subscriptions, perpetual licenses or related maintenance services and have not yet received payment. We present accounts receivable net of an allowance for doubtful accounts. We maintain an allowance for doubtful accounts for estimated losses resulting from the inability of customers to make required payments. In doing so, we consider the current financial condition of the customer, the specific details of the customer account, the age of the outstanding balance and the current economic environment. Any change in the assumptions used in analyzing a specific account receivable might result in an additional allowance for doubtful accounts being recognized in the period in which the change occurs. We have historically had insignificant write-offs related to bad debts. |
Deferred Offering Costs | Deferred offering costs, primarily consisting of legal, accounting, printer, and other direct fees and costs, related to our initial public offering were capitalized. The deferred offering costs of $3.7 million were offset against proceeds from our initial public offering during the year ended December 31, 2018. |
Property and Equipment | We record property and equipment at cost and depreciate them using the straight-line method over their estimated useful lives as follows: Useful Life Equipment, servers and computers 3 - 5 Furniture and fixtures 5 - 7 Software 3 - 5 Leasehold improvements Lesser of lease term or useful life Upon retirement or sale of property and equipment, we remove the cost of assets disposed of and any related accumulated depreciation from our accounts and credit or charge any resulting gain or loss to operating expense. We expense repairs and maintenance as they are incurred. |
Research and Development Costs | Research and development expenses primarily consist of personnel costs and contractor fees related to the development of new software products and enhancements to existing software products. Personnel costs include salaries, bonuses and stock-based compensation and related employer-paid payroll taxes, as well as an allocation of our facilities, depreciation, benefits and IT costs. Research and development costs are charged to operations as incurred with the exception of those software development costs that may qualify for capitalization. Software development costs incurred subsequent to establishing technological feasibility through the general release of the software products are capitalized. Our new software products and significant enhancements to our existing products are available for general release soon after technological feasibility has been established. |
Internal-Use Software and Website Development Costs | We capitalize costs related to developing new functionality for our suite of products that are hosted and accessed by our customers on a subscription basis. We also capitalize costs related to specific upgrades and enhancements when it is probable the expenditures will result in additional functionality. Costs incurred in the preliminary stages of development are expensed as incurred. Once an application has reached the development stage, internal and external costs, if direct and incremental, are capitalized until the software is substantially complete and ready for its intended use. Capitalized costs are recorded as part of other assets, net in our consolidated balance sheets. Maintenance and training costs are expensed as incurred. Internal-use software is amortized on a straight-line basis over its estimated useful life, generally three years , and included in cost of recurring revenue in the consolidated statements of operations. |
Debt Issuance Costs | Debt issuance costs for our credit facilities outstanding are presented as a deduction from the corresponding debt liability on our consolidated balance sheets and amortized on an effective interest rate method over the term of the associated debt as interest expense in our consolidated statements of operations. |
Contingencies | We account for claims and contingencies in accordance with authoritative guidance that requires we record an estimated loss from a claim or loss contingency when information available prior to issuance of our consolidated financial statements indicates a liability has been incurred at the date of our consolidated financial statements and the amount of the loss can be reasonably estimated. If we determine that it is reasonably possible but not probable that an asset has been impaired or a liability has been incurred, we disclose the amount or range of estimated loss if material or that the loss cannot be reasonably estimated. Accounting for claims and contingencies requires us to use our judgment. We consult with legal counsel on those issues related to litigation and seek input from other experts and advisors with respect to matters in the ordinary course of business. |
Revenue Recognition | We generate recurring revenue from fees received for subscriptions and from the sale of maintenance services associated with our perpetual license products and license revenue from the sale of perpetual license products. We recognize revenue when persuasive evidence of an arrangement exists, delivery has occurred, the sales price is fixed or determinable and collectability is reasonably assured. Our return policy generally does not allow our customers to return software products. We generally use a purchase order, an authorized credit card, an electronic or manually signed license agreement, or the receipt of a cash payment as evidence of an arrangement. We consider delivery to have occurred and recognize revenue when risk of loss transfers to the customer, reseller or distributor or the customer has access to their subscription which is generally upon electronic transfer of the license key or password that provides immediate availability of the product to the purchaser. We account for sales incentives to customers, resellers or distributors as a reduction of revenue at the time we recognize the revenue from the related product sale. We report revenue net of any sales tax collected. We sell our products through our direct sales force and through our distributors and resellers. Our distributors and resellers do not carry inventory of our software and we generally require them to specify the end user of the software at the time of the order. If the distributor or reseller does not provide end-user information, then we will generally not fulfill the order. Our distributors and resellers have no rights of return or exchange for software that they purchase from us and payment for these purchases is due to us without regard to whether the distributors or resellers collect payment from their customers. Sales through resellers and distributors are typically evidenced by a reseller or distributor agreement, together with purchase orders or authorized credit cards on a transaction-by-transaction basis. Recurring Revenue. Recurring revenue consists of subscription and maintenance revenue. • Subscription Revenue . We primarily derive subscription revenue from fees received for subscriptions to our software-as-a-service, or SaaS, products and our time-based license arrangements. We generally invoice subscription agreements monthly based on usage or monthly in advance over the subscription period. Subscription revenue is generally recognized ratably over the subscription term when all revenue recognition criteria have been met. We typically sell our subscription products separately from our perpetual license offerings. Our subscription revenue includes our cloud management and MSP products. • Maintenance Revenue . We derive maintenance revenue from the sale of maintenance services associated with our perpetual license products. We typically include one year of maintenance service as part of the initial purchase price of each perpetual software offering and then sell renewals of this maintenance agreement. We recognize maintenance revenue ratably on a daily basis over the contract period. Customers with maintenance agreements are entitled to receive unspecified upgrades or enhancements to new versions of their software products on a when-and-if-available basis. License Revenue . We use the residual method to recognize revenue when a license agreement includes one or more elements to be delivered and vendor-specific objective evidence, or VSOE, of fair value for all undelivered elements exists. Because our software is generally sold with maintenance services, we calculate the amount of revenue allocated to the software license by determining the fair value of the maintenance services and subtracting it from the total invoice or contract amount. We establish VSOE of the fair value of maintenance services by our standard maintenance renewal price list since we generally charge list price for our maintenance renewal agreements. If evidence of the fair value of one or more undelivered elements does not exist, all revenue is generally deferred and recognized when delivery of those elements occurs or when fair value can be established. When the undelivered element for which we do not have VSOE of fair value is maintenance services, revenue for the entire arrangement is recognized ratably over the contract period. |
Deferred Revenue | Deferred revenue primarily consists of billings or payments received in advance of revenue recognition from maintenance services associated with our perpetual license products. We generally bill maintenance agreements annually in advance for services to be performed over a 12 -month period. Customers have the option to purchase maintenance renewals for periods other than 12 months . We initially record the amounts to be paid under maintenance agreements as deferred revenue and recognize these amounts ratably on a daily basis over the term of the maintenance agreement. We record deferred revenue that will be recognized during the succeeding 12 -month period as current deferred revenue and the remaining portion is recorded as long-term deferred revenue. |
Cost of Revenue | Cost of recurring revenue. Cost of recurring revenue consists of technical support personnel costs which includes salaries, bonuses and stock-based compensation and related employer-paid payroll taxes for technical support personnel, as well as an allocation of overhead costs. Royalty fees and hosting and server fees related to our cloud management and MSP products are also included in cost of recurring revenue. Cost of license revenue is immaterial to our financial statements and is included in cost of recurring revenue in our consolidated statements of operations. |
Advertising | We expense advertising costs as incurred. Advertising expense is included in sales and marketing expenses in our consolidated statements of operations. |
Leases | We lease facilities worldwide and certain equipment under non-cancellable lease agreements. The terms of some of our lease agreements provide for rental payments on a graduated basis. We recognize rent expense on a straight-line basis over the lease period and accrue rent expense incurred but not paid. Cash or lease incentives, or tenant allowances, received pursuant to certain leases are recognized on a straight-line basis as a reduction to rent over the lease term. The unamortized portion of tenant allowances is included in accrued liabilities and other and other long-term liabilities. |
Income Taxes | We use the liability method of accounting for income taxes as set forth in the authoritative guidance for accounting for income taxes. Under this method, we recognize deferred tax liabilities and assets for the expected future tax consequences of temporary differences between the respective carrying amounts and tax basis of our assets and liabilities. The guidance on accounting for uncertainty in income taxes prescribes a recognition threshold and measurement attribute for financial statement disclosure of tax positions taken or expected to be taken on a tax return. We accrue interest and penalties related to unrecognized tax benefits as a component of income tax expense. At December 31, 2018 and 2017 , we had accrued interest and penalties related to unrecognized tax benefits of approximately $4.1 million and $3.0 million , respectively. We establish valuation allowances when necessary to reduce deferred tax assets to the amounts expected to be realized. On a quarterly basis, we evaluate the need for, and the adequacy of, valuation allowances based on the expected realization of our deferred tax assets. The factors used to assess the likelihood of realization include our latest forecast of future taxable income, available tax planning strategies that could be implemented, reversal of taxable temporary differences and carryback potential to realize the net deferred tax assets. As of December 31, 2018 and 2017 , we have recorded a valuation allowance of $1.8 million . The valuation allowance is all related to the deferred tax assets of a Canadian subsidiary. On December 22, 2017, the Tax Cuts and Jobs Act, or the Tax Act, was enacted into law which contains several key tax provisions that affected us, including a one-time mandatory transition tax on accumulated foreign earnings and a reduction of the corporate income tax rate to 21% effective January 1, 2018, among others. We were required to recognize the effect of the tax law changes in the period of enactment, such as determining the transition tax, re-measuring our U.S. deferred tax assets and liabilities as well as reassessing the net realization of our deferred tax assets and liabilities. In response to the Tax Act, the SEC staff issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (SAB 118) , which allows us to record provisional amounts during a measurement period not to extend beyond one year of the enactment date. Due to the timing of the enactment and the complexity involved in applying the provisions of the Tax Act, we made reasonable estimates of the effects and recorded provisional amounts in our consolidated financial statements for the year ended December 31, 2017. In the fourth quarter of 2018, we completed our analysis to determine the effect of the Tax Act and recorded immaterial adjustments as of December 31, 2018. For more information regarding the Tax Act impacts, see Note 15. Income Taxes . Effective January 1, 2018, we recognized the tax impact of including certain foreign earnings in U.S. taxable income as a period cost. We have not recognized deferred income taxes for local country income and withholding taxes that could be incurred on distributions of certain foreign earnings or for outside basis differences in our subsidiaries, because we plan to indefinitely reinvest such earnings and basis differences. |
Share-based Compensation | We have granted our employees and directors stock-based incentive awards. These awards are in the form of stock options and restricted stock units for Predecessor and stock options, restricted stock and restricted stock units for common stock shares of the Successor. All Predecessor awards were cancelled on the date of the Take Private. We measure stock-based compensation expense for all share-based awards granted based on the estimated fair value of those awards on the date of grant. The fair value of stock option awards is estimated using a Black-Scholes valuation model. The fair value of restricted stock unit awards and restricted stock is determined using the fair market value of the underlying common stock on the date of grant less any amount paid at the time of the grant, or intrinsic value. Our stock awards vest on service-based or performance-based vesting conditions. For our service-based awards, we recognize stock-based compensation expense on a straight-line basis over the service period of the award. For our performance-based awards, we recognize stock-based compensation expense on a graded-vesting basis over the service period of each separately vesting tranche of the award, if it is probable that the performance target will be achieved. We have not paid and do not anticipate paying cash dividends on our common stock; therefore, we assume the expected dividend yield to be zero . We estimate the expected volatility using the historical volatility of comparable public companies from a representative peer group for the Successor periods. We based the risk-free rate of return on the average U.S. treasury yield curve for five- and seven-year terms for the respective periods. As allowed under current guidance, we have elected to apply the “simplified method” in developing our estimate of expected life for “plain vanilla” stock options by using the midpoint between the vesting date and contractual termination date since we do not have sufficient historical exercise data to provide a reasonable basis upon which to estimate expected term. For all awards, we granted employees stock awards at exercise prices equal to the fair value of the underlying common stock on the date the award was approved. Performance-based awards are not considered granted under the applicable accounting guidance until the performance attainment targets for each applicable tranche have been defined. We recognize the impact of forfeitures in stock-based compensation expense when they occur. |
Net Income (Loss) Per Share | We calculate basic and diluted net income (loss) per share attributable to common stockholders in conformity with the two-class method required for companies with participating securities. Under the two-class method, basic and diluted net income (loss) per share is determined by calculating net income (loss) per share for common stock and participating securities based on participation rights in undistributed earnings. We computed basic net income (loss) per share available to common stockholders by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding during the reporting period. Redeemable convertible Class A Common Stock was not included in the basic or diluted net income (loss) per share calculations for the periods it was outstanding as it was contingently convertible upon a future event. Net income (loss) available to common stockholders is defined as net loss, less the accretion of dividends on our redeemable convertible Class A Common Stock plus the gain on conversion of our redeemable convertible Class A Common Stock at our IPO. Our unvested incentive restricted stock has the right to receive non-forfeitable dividends on an equal basis with common stock and therefore are considered participating securities that must be included in the calculation of net income per share using the two-class method. The holders of unvested incentive restricted stock do not have a contractual obligation to share in our losses. As such, in periods in which we had net losses available to common stockholders, our net losses were not allocated to these participating securities. We computed diluted net income (loss) per share similarly to basic net income (loss) per share except that it reflects the potential dilution that could occur if dilutive securities or other obligations to issue common stock were exercised or converted into common stock using the treasury stock method. |
Concentrations of Risk | Financial instruments that potentially subject us to concentrations of credit risk consist principally of cash and cash equivalents and accounts receivable. Our cash deposited with banks in demand deposit accounts may exceed the amount of insurance provided on these deposits. Our cash equivalents invested in money market funds are not insured and we are therefore at risk of losing our full investment. Generally, we may withdraw our cash deposits and redeem our invested cash equivalents upon demand. We strive to maintain our cash deposits and invest in money market funds with multiple financial institutions of reputable credit and therefore bear minimal credit risk. We provide credit to distributors, resellers and direct customers in the normal course of business. We generally extend credit to new customers based upon industry reputation and existing customers based upon prior payment history. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Schedule of property and equipment | We record property and equipment at cost and depreciate them using the straight-line method over their estimated useful lives as follows: Useful Life Equipment, servers and computers 3 - 5 Furniture and fixtures 5 - 7 Software 3 - 5 Leasehold improvements Lesser of lease term or useful life Property and equipment, including software, consisted of the following: December 31, 2018 2017 (in thousands) Equipment, servers and computers $ 32,081 $ 23,790 Furniture and fixtures 7,393 6,760 Software 2,475 3,143 Leasehold improvements 21,341 20,688 $ 63,290 $ 54,381 Less: Accumulated depreciation and amortization (27,426 ) (20,172 ) Property and equipment, net $ 35,864 $ 34,209 Depreciation and amortization expense on property and equipment was as follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Depreciation and amortization $ 13,007 $ 11,617 $ 9,071 $ 778 |
Changes in accumulated other comprehensive income (loss) by component | Changes in accumulated other comprehensive income (loss) by component are summarized below: Foreign Currency Translation Adjustments Accumulated Other Comprehensive Income (Loss) (in thousands) Balance at December 31, 2016 $ (66,047 ) $ (66,047 ) Other comprehensive gain (loss) before reclassification 141,341 141,341 Amount reclassified from accumulated other comprehensive income (loss) — — Net current period other comprehensive income (loss) 141,341 141,341 Balance at December 31, 2017 75,294 75,294 Other comprehensive gain (loss) before reclassification (58,251 ) (58,251 ) Amount reclassified from accumulated other comprehensive income (loss) — — Net current period other comprehensive income (loss) (58,251 ) (58,251 ) Balance at December 31, 2018 $ 17,043 $ 17,043 |
Amortization of acquired technologies | Amortization of acquired technologies. Amortization of acquired technologies included in cost of revenue relate to our licensed products and subscription products as follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Amortization of acquired license technologies $ 144,857 $ 142,417 $ 124,259 $ 1,455 Amortization of acquired subscription technologies 31,134 28,616 23,258 731 Total amortization of acquired technologies $ 175,991 $ 171,033 $ 147,517 $ 2,186 Intangible asset amortization expense was as follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Intangible asset amortization expense $ 242,849 $ 238,156 $ 206,086 $ 3,119 |
Schedule of advertising expense | Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Advertising expense $ 38,477 $ 38,213 $ 28,655 $ 2,293 |
Schedule of stock option valuation assumptions | We estimated the fair value for stock options at the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016* Expected dividend yield — % — % — % — % Volatility 40.2 % 41.9 % 43.1 % — % Risk-free rate of return 2.6 - 2.9% 1.9 - 2.2% 1.3 - 2.3% — Expected life 6.34 6.38 6.50 — ________________ * There were no grants of stock options made in the Predecessor period from January 1, 2016 through February 4, 2016. |
Schedule of share-based compensation expense | The impact to our income (loss) before income taxes due to stock-based compensation expense and the related income tax benefits were as follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Impact to income (loss) before income taxes due to stock-based compensation $ 5,833 $ 80 $ 17 $ 87,763 Income tax benefit related to stock-based compensation 1,054 — — 22,981 |
Schedule of cash and cash equivalents | We consider all highly liquid investments with original maturities of three months or less to be cash equivalents. Our cash and cash equivalents consisted of the following: December 31, 2018 2017 (in thousands) Demand deposit accounts $ 265,520 $ 210,616 Money market funds 117,100 67,100 Total cash and cash equivalents $ 382,620 $ 277,716 |
Take Private (Tables)
Take Private (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Business Combinations [Abstract] | |
Summary of consideration paid and amounts recognized for assets acquired and liabilities assumed | The following table summarizes the consideration paid and the amounts recognized for the assets acquired and liabilities assumed: Total Fair Value (in thousands) Current assets, including cash acquired of $248.3 million $ 351,721 Property and equipment 35,255 Other assets 12,964 Identifiable intangible assets 1,495,400 Goodwill 3,212,255 Current liabilities (87,459 ) Deferred tax liabilities (366,454 ) Deferred revenue (31,813 ) Other long-term liabilities (28,993 ) Total consideration $ 4,592,876 The following table summarizes the consideration paid and the amounts recognized for the assets acquired and liabilities assumed: Total Fair Value (in thousands) Current assets, including cash acquired $ 25,969 Property and equipment and other assets 5,848 Identifiable intangible assets 119,300 Goodwill 374,086 Current liabilities (14,785 ) Deferred tax liabilities (8,401 ) Deferred revenue (2,548 ) Total consideration $ 499,469 The following table summarizes the consideration paid and the amounts recognized for the assets acquired and liabilities assumed for our acquisitions completed in the year ended December 31, 2018 : Total Fair Value (in thousands) Current assets, including cash acquired $ 4,821 Deferred tax asset 1,550 Fixed assets 1,352 Identifiable intangible assets 18,412 Goodwill 43,746 Current liabilities (3,331 ) Deferred tax liabilities (666 ) Deferred revenue (2,944 ) Total consideration $ 62,940 |
Summary of fair value of acquired identifiable intangible assets and weighted-average useful life | The following table summarizes the fair value of the acquired identifiable intangible assets and weighted-average useful life: Fair Value Weighted-average useful life (in thousands) (in years) Developed product technologies $ 906,200 6 Customer relationships 450,100 10 Tradenames - indefinite-lived 82,300 — In process research and development 48,300 — Customer backlog 6,200 2 Trademarks 2,300 1 Total identifiable intangible assets $ 1,495,400 |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Business Combinations [Abstract] | |
Summary of consideration paid and amounts recognized for assets acquired and liabilities assumed | The following table summarizes the consideration paid and the amounts recognized for the assets acquired and liabilities assumed: Total Fair Value (in thousands) Current assets, including cash acquired of $248.3 million $ 351,721 Property and equipment 35,255 Other assets 12,964 Identifiable intangible assets 1,495,400 Goodwill 3,212,255 Current liabilities (87,459 ) Deferred tax liabilities (366,454 ) Deferred revenue (31,813 ) Other long-term liabilities (28,993 ) Total consideration $ 4,592,876 The following table summarizes the consideration paid and the amounts recognized for the assets acquired and liabilities assumed: Total Fair Value (in thousands) Current assets, including cash acquired $ 25,969 Property and equipment and other assets 5,848 Identifiable intangible assets 119,300 Goodwill 374,086 Current liabilities (14,785 ) Deferred tax liabilities (8,401 ) Deferred revenue (2,548 ) Total consideration $ 499,469 The following table summarizes the consideration paid and the amounts recognized for the assets acquired and liabilities assumed for our acquisitions completed in the year ended December 31, 2018 : Total Fair Value (in thousands) Current assets, including cash acquired $ 4,821 Deferred tax asset 1,550 Fixed assets 1,352 Identifiable intangible assets 18,412 Goodwill 43,746 Current liabilities (3,331 ) Deferred tax liabilities (666 ) Deferred revenue (2,944 ) Total consideration $ 62,940 |
Summary of fair value of acquired identifiable intangible assets and weighted-average useful life | The following table summarizes the fair value of the acquired identifiable intangible assets and weighted-average useful life: Fair Value Weighted-average useful life (in thousands) (in years) Developed product technologies $ 31,100 4 Customer relationships 87,000 5 Trademarks 1,200 1 Total identifiable intangible assets $ 119,300 The following table summarizes the fair value of the acquired identifiable intangible assets and weighted-average useful life: Fair Value Weighted-average useful life (in thousands) (in years) Developed product technologies $ 13,317 5 Customer relationships 4,805 4 Trademarks 290 3 Total identifiable intangible assets $ 18,412 |
Pro forma information | The following table presents our unaudited pro forma revenue and net loss for the year ended December 31, 2016 as if the LOGICnow acquisition had occurred on January 1, 2015. The pro forma financial information illustrates the measurable effects of a particular transaction, while excluding effects that rely on highly judgmental estimates of how operating decisions may or may not have changed as a result of that transaction. Accordingly, we adjusted the pro forma results for quantifiable items such as the amortization of acquired intangible assets, stock-based compensation, acquisition costs and the estimated income tax provision of the pro forma combined results. The acquisition pro forma results were not adjusted for post-acquisition decisions made by management such as changes in the product offerings, pricing and packaging of the products. We prepared the pro forma financial information for the combined entities for comparative purposes only, and it is not indicative of what actual results would have been if the acquisition had taken place on January 1, 2015, or of any future results. Year ended December 31, 2016 (in thousands) (unaudited) Revenue $ 507,981 Net loss (353,719 ) |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in goodwill | The following table reflects the changes in goodwill for the years ended December 31, 2018 and 2017 : (in thousands) Balance at December 31, 2016 $ 3,533,390 Acquisitions 17,121 Foreign currency translation and other adjustments 145,129 Balance at December 31, 2017 3,695,640 Acquisitions 43,746 Foreign currency translation and other adjustments (55,425 ) Balance at December 31, 2018 $ 3,683,961 |
Intangible assets | Intangible assets consisted of the following at December 31, 2018 and 2017 : December 31, 2018 December 31, 2017 Gross Carrying Amount Accumulated Net Gross Carrying Amount Accumulated Amortization Net (in thousands) Developed product technologies $ 1,006,999 $ (494,459 ) $ 512,540 $ 1,006,454 $ (324,196 ) $ 682,258 Customer relationships 541,717 (181,902 ) 359,815 546,207 (118,930 ) 427,277 Intellectual property 829 (129 ) 700 547 (59 ) 488 Trademarks 84,462 (1,256 ) 83,206 85,257 (1,075 ) 84,182 Customer backlog — — — 6,200 (5,906 ) 294 Total intangible assets $ 1,634,007 $ (677,746 ) $ 956,261 $ 1,644,665 $ (450,166 ) $ 1,194,499 |
Intangible asset amortization expense | Amortization of acquired technologies. Amortization of acquired technologies included in cost of revenue relate to our licensed products and subscription products as follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Amortization of acquired license technologies $ 144,857 $ 142,417 $ 124,259 $ 1,455 Amortization of acquired subscription technologies 31,134 28,616 23,258 731 Total amortization of acquired technologies $ 175,991 $ 171,033 $ 147,517 $ 2,186 Intangible asset amortization expense was as follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Intangible asset amortization expense $ 242,849 $ 238,156 $ 206,086 $ 3,119 |
Estimated intangible asset amortization expense | As of December 31, 2018, we estimate aggregate intangible asset amortization expense to be as follows: Estimated Amortization (in thousands) 2019 $ 237,461 2020 235,116 2021 205,196 2022 67,497 2023 42,694 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair value of financial assets measured on a recurring basis | The following table summarizes the fair value of our financial assets that were measured on a recurring basis as of December 31, 2018 and 2017 . There have been no transfers between fair value measurement levels during the year ended December 31, 2018 . Fair Value Measurements at December 31, 2018 Using Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total (in thousands) Money market funds $ 117,100 $ — $ — $ 117,100 Fair Value Measurements at December 31, 2017 Using Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total (in thousands) Money market funds $ 67,100 $ — $ — $ 67,100 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | We record property and equipment at cost and depreciate them using the straight-line method over their estimated useful lives as follows: Useful Life Equipment, servers and computers 3 - 5 Furniture and fixtures 5 - 7 Software 3 - 5 Leasehold improvements Lesser of lease term or useful life Property and equipment, including software, consisted of the following: December 31, 2018 2017 (in thousands) Equipment, servers and computers $ 32,081 $ 23,790 Furniture and fixtures 7,393 6,760 Software 2,475 3,143 Leasehold improvements 21,341 20,688 $ 63,290 $ 54,381 Less: Accumulated depreciation and amortization (27,426 ) (20,172 ) Property and equipment, net $ 35,864 $ 34,209 Depreciation and amortization expense on property and equipment was as follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Depreciation and amortization $ 13,007 $ 11,617 $ 9,071 $ 778 |
Accrued Liabilities and Other (
Accrued Liabilities and Other (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Payables and Accruals [Abstract] | |
Schedule of accrued liabilities and other current liabilities | Accrued liabilities and other current liabilities were as follows: December 31, 2018 2017 (in thousands) Payroll-related accruals $ 31,028 $ 24,995 Other accrued expenses and current liabilities 21,027 14,598 Total accrued liabilities and other $ 52,055 $ 39,593 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Summary of debt | The following table summarizes information relating to our debt: December 31, December 31, 2018 2017 Amount Effective Rate Amount Effective Rate (in thousands, except interest rates) Revolving credit facility $ — — % $ — — % First Lien Term Loan (as amended) due Feb 2024 1,970,100 5.27 % 1,678,050 5.07 % Second Lien Floating Rate Notes (as amended) due Feb 2024 — — % 680,000 10.14 % Total principal amount 1,970,100 2,358,050 Unamortized discount and debt issuance costs (46,128 ) (95,478 ) Total debt 1,923,972 2,262,572 Less: Current portion of long-term debt (19,900 ) (16,950 ) Total long-term debt $ 1,904,072 $ 2,245,622 |
Summary of future minimum principal payments of debt | The following table summarizes the future minimum principal payments under the First Lien Term Loan outstanding as of December 31, 2018 : As of December 31, 2018 (in thousands) 2019 $ 19,900 2020 19,900 2021 19,900 2022 19,900 2023 19,900 Thereafter 1,870,600 Total minimum principal payments $ 1,970,100 |
Stockholders_ Equity (Deficit_2
Stockholders’ Equity (Deficit) and Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Equity And Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Option grant activity | Option grant activity under the 2016 Plan was as follows: Number of Shares Outstanding Weighted- Average Exercise Price Aggregate Intrinsic Value (in thousands) Weighted- Average Remaining Contractual Term (in years) Outstanding balances at December 31, 2017 2,156,550 $ 0.45 Options granted 1,327,475 3.40 Options exercised (46,100 ) 0.36 Options forfeited (288,075 ) 1.38 Options expired (35,050 ) 0.36 Outstanding balances at December 31, 2018 3,114,800 $ 1.62 Options exercisable at December 31, 2018 659,950 $ 0.40 $ 8,865 7.92 Options vested and expected to vest at December 31, 2018 3,114,800 $ 1.62 $ 38,022 8.59 |
Schedule of intrinsic value | Additional information regarding options follows (in thousands except for per share amounts): Period From January 1 Through February 4, 2016 Weighted-average grant date fair value per share of options granted during the period $ — Aggregate intrinsic value of options exercised during the period 1,584 Aggregate fair value of options vested during the period 3,702 Additional information regarding options follows (in thousands except for per share amounts): Year Ended December 31, Year Ended December 31, Period From February 5 Through 2018 2017 2016 Weighted-average grant date fair value per share of options granted during the period $ 1.98 $ 0.28 $ 0.12 Aggregate intrinsic value of options exercised during the period 407 2 — Aggregate fair value of options vested during the period 109 35 — |
Schedule of grant date fair value | Additional information regarding options follows (in thousands except for per share amounts): Year Ended December 31, Year Ended December 31, Period From February 5 Through 2018 2017 2016 Weighted-average grant date fair value per share of options granted during the period $ 1.98 $ 0.28 $ 0.12 Aggregate intrinsic value of options exercised during the period 407 2 — Aggregate fair value of options vested during the period 109 35 — Additional information regarding options follows (in thousands except for per share amounts): Period From January 1 Through February 4, 2016 Weighted-average grant date fair value per share of options granted during the period $ — Aggregate intrinsic value of options exercised during the period 1,584 Aggregate fair value of options vested during the period 3,702 |
Summary of restricted stock activity | The following table summarizes information about restricted stock activity subject to vesting under the 2016 Plan: Number of Shares Outstanding Unvested balances at December 31, 2017 5,789,401 Restricted stock granted and issued 820,500 Restricted stock vested (1,407,834 ) Restricted stock repurchased - unvested shares (216,633 ) Unvested balances at December 31, 2018 4,985,434 |
Summary of restricted stock unit activity | The following table summarizes information about restricted stock unit activity under the 2018 Plan: Number of Units Outstanding Weighted-Average Grant Date Fair Value Per Share Aggregate Intrinsic Value (in thousands) Weighted-Average Remaining Contractual Term (in years) Unvested balances at December 31, 2017 — $ — Restricted stock units granted 6,283,232 14.21 Restricted stock units vested — — Restricted stock units forfeited (5,766 ) 14.21 Unvested balances at December 31, 2018 6,277,466 $ 14.21 $ 86,817 3.81 |
Summary of performance stock unit activity | The following table summarizes information about performance stock unit activity under the 2018 Plan: Number of Units Outstanding Weighted-Average Grant Date Fair Value Per Share Aggregate Intrinsic Value (in thousands) Weighted-Average Remaining Contractual Term (in years) Unvested balances at December 31, 2017 — $ — Performance stock units granted 970,922 14.21 Performance stock units vested — — Performance stock units forfeited — — Unvested balances at December 31, 2018 970,922 $ 14.21 $ 13,428 2.16 |
Net Income (Loss) Per Share (Ta
Net Income (Loss) Per Share (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Reconciliation of shares in basic and diluted loss per share calculation | A reconciliation of net income (loss) available to common stockholders and the number of shares in the calculation of basic and diluted income (loss) per share follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Basic net earnings (loss) per share Numerator: Net loss $ (102,066 ) $ (83,866 ) $ (262,594 ) $ (71,811 ) Accretion of dividends on Class A common stock (231,549 ) (268,007 ) (217,904 ) — Gain on conversion of Class A common stock 711,247 — — — Earnings allocated to unvested restricted stock (12,997 ) — — — Net income (loss) available to common stockholders $ 364,635 $ (351,873 ) $ (480,498 ) $ (71,811 ) Denominator: Weighted-average common shares outstanding used in computing basic net earnings (loss) per share 140,301 100,433 96,465 71,989 Diluted net earnings (loss) per share Numerator: Net income (loss) available to common stockholders $ 364,635 $ (351,873 ) $ (480,498 ) $ (71,811 ) Denominator: Weighted-average shares used in computing basic net earnings (loss) per share 140,301 100,433 96,465 71,989 Add stock-based incentive stock awards 2,240 — — — Weighted-average shares used in computing diluted net earnings (loss) per share 142,541 100,433 96,465 71,989 |
Weighted average shares excluded from loss per share computation | The following weighted-average outstanding shares of common stock equivalents were excluded from the computation of the diluted net income (loss) per share attributable to common stockholders for the periods presented because their effect would have been anti-dilutive or for which the performance condition had not been met at the end of the period: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Stock options to purchase common stock 524 1,635 493 659 Performance-based stock options to purchase common stock 119 105 5 — Non-vested restricted stock incentive awards 3,442 3,565 1,524 — Performance-based non-vested restricted stock incentive awards 1,559 2,527 965 — Restricted stock units 1,139 — — 16 Performance stock units 175 — — — Total anti-dilutive shares 6,958 7,832 2,987 675 |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Retirement Benefits [Abstract] | |
Schedule of costs of retirement plans | Employees are fully vested in all contributions to the plan. Our expense related to the plan was as follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Employee benefit plan expense $ 4,474 $ 4,299 $ 2,145 $ 1,866 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Management fees | The following table details the management fees for the respective periods: Year Ended December 31, Period From February 5 Through 2018 2017 2016 (in thousands) Silver Lake Management $ 4,063 $ 5,000 $ 4,519 Thoma Bravo 3,309 4,073 3,681 TB Partners 753 927 838 $ 8,125 $ 10,000 $ 9,038 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
U.S. and international components of loss before income taxes | U.S. and international components of loss before income taxes were as follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) U.S. $ (116,459 ) $ (13,857 ) $ (255,846 ) $ (107,749 ) International (5,251 ) (47,611 ) (103,399 ) (17,218 ) Loss before income taxes $ (121,710 ) $ (61,468 ) $ (359,245 ) $ (124,967 ) |
Schedule of income tax expense (benefit) | Income tax expense (benefit) was composed of the following: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Current: Federal $ (10,906 ) $ 118,909 $ 9,831 $ (33,958 ) State 2,191 455 579 — International 10,759 1,009 605 (1,343 ) 2,044 120,373 11,015 (35,301 ) Deferred: Federal (14,978 ) (90,498 ) (92,602 ) (11,155 ) State 670 79 (967 ) (2,771 ) International (7,380 ) (7,556 ) (14,097 ) (3,929 ) (21,688 ) (97,975 ) (107,666 ) (17,855 ) $ (19,644 ) $ 22,398 $ (96,651 ) $ (53,156 ) |
Schedule of effective income tax rate reconciliation | The difference between the income tax expense (benefit) derived by applying the federal statutory income tax rate to our income (loss) before income taxes and the amount recognized in our consolidated financial statements is as follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Expense (benefit) derived by applying the federal statutory income tax rate to income (loss) before income taxes $ (25,558 ) $ (21,514 ) $ (125,736 ) $ (43,739 ) State taxes, net of federal benefit 2,435 297 (241 ) (1,801 ) Permanent items 224 (613 ) 1,819 3,145 Impact of the Tax Act One-time transition tax 140 130,802 — — Rate change — (91,545 ) — — Domestic production activity benefit — (3,794 ) — (308 ) Research and experimentation tax credits (1,955 ) (270 ) 329 (2,199 ) Withholding tax 2,486 — 3,951 — Net operating loss carryback — — — 3,872 Stock-based compensation 238 — — (14,076 ) Effect of foreign operations 2,346 9,035 23,227 1,950 $ (19,644 ) $ 22,398 $ (96,651 ) $ (53,156 ) |
Schedule of deferred tax assets and liabilities | The components of the net deferred tax amounts recognized in the accompanying consolidated balance sheets were: December 31, 2018 2017 (in thousands) Deferred tax assets: Allowance for doubtful accounts $ 436 $ 201 Accrued expenses 3,133 4,323 Net operating loss 26,652 47,631 Research and experimentation credits 1,689 2,177 Stock-based compensation 1,090 — Interest 1,528 — Deferred revenue 1,164 — Other credits 790 2,920 Total deferred tax assets 36,482 57,252 Valuation allowance (1,775 ) (1,811 ) Deferred tax assets, net of valuation allowance 34,707 55,441 Deferred tax liabilities: Property and equipment 9,107 11,891 Prepaid expenses 1,805 1,230 Deferred revenue — 101 Debt costs 9,118 14,917 Foreign royalty 2,017 714 Intangibles 152,931 189,686 Total deferred tax liabilities 174,978 218,539 Net deferred tax liability $ 140,271 $ 163,098 |
Schedule of unrecognized tax benefits | The aggregate changes in the balance of our gross unrecognized tax benefits, excluding accrued interest, were as follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Balance, beginning of year $ 19,504 $ 22,888 $ 17,631 $ 16,370 Increases for tax positions related to the current year 59 502 4,421 1,335 Decreases for tax positions related to the current year — (715 ) — — Increases for tax positions related to prior years 146 — 836 230 Decreases for tax positions related to prior years — (3,171 ) — (304 ) Reductions due to lapsed statute of limitations — — — — Balance, end of year $ 19,709 $ 19,504 $ 22,888 $ 17,631 Gross unrecognized tax benefits, all of which, if recognized, would affect our effective tax rate were as follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Gross unrecognized tax benefits $ 19,709 $ 19,504 $ 22,888 $ 17,631 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of future minimum lease payments | At December 31, 2018, future minimum lease payments under non-cancellable operating leases were as follows: Minimum Lease Payments (in thousands) 2019 $ 15,287 2020 15,105 2021 14,138 2022 13,412 2023 12,340 Thereafter 53,734 Total minimum lease payments $ 124,016 |
Schedule of rent expense | Rent expense was as follows: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Rent expense $ 18,249 $ 16,298 $ 12,688 $ 1,088 |
Operating Segments and Geogra_2
Operating Segments and Geographic Information (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting [Abstract] | |
Revenue by geographic area | The following tables set forth revenue and net long-lived assets by geographic area: Successor Predecessor Year Ended December 31, Period From February 5 Through Period From January 1 Through 2018 2017 2016 2016 (in thousands) Revenue United States, country of domicile $ 505,304 $ 459,701 $ 268,426 $ 31,797 International 327,785 268,316 153,668 15,530 Total revenue $ 833,089 $ 728,017 $ 422,094 $ 47,327 |
Long-lived assets by geographic area | December 31, 2018 2017 (in thousands) Long-lived assets, net United States, country of domicile $ 22,953 $ 20,986 Switzerland 4,878 3,941 All other international 8,033 9,282 Total long-lived assets, net $ 35,864 $ 34,209 |
Quarterly Results of Operatio_2
Quarterly Results of Operations (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly financial information | The following quarterly financial data should be read in conjunction with our consolidated financial statements included elsewhere in this Annual Report on Form 10-K. Three months ended, Dec 31, Sep 30, June 30, 2018 Mar 31, 2018 Dec 31, 2017 Sep 30, 2017 June 30, 2017 Mar 31, 2017 (in thousands, except per share data) (unaudited) Revenue $ 221,181 $ 213,277 $ 201,718 $ 196,913 $ 198,339 $ 189,112 $ 175,441 $ 165,125 Gross profit 159,184 151,420 140,043 135,707 139,268 130,409 117,932 108,677 Loss before income taxes (14,342 ) (524 ) (38,577 ) (68,267 ) (4,894 ) (1,418 ) (2,375 ) (52,781 ) Net income (loss) (14,743 ) (398 ) (27,015 ) (59,910 ) (39,761 ) 1,637 (2,004 ) (43,738 ) Net income (loss) available to common stockholders 668,426 (75,006 ) (99,193 ) (129,745 ) (109,563 ) (66,627 ) (68,043 ) (107,640 ) Basic income (loss) per share $ 2.63 $ (0.73 ) $ (0.97 ) $ (1.28 ) $ (1.09 ) $ (0.66 ) $ (0.68 ) $ (1.08 ) Diluted income (loss) per share $ 2.60 $ (0.73 ) $ (0.97 ) $ (1.28 ) $ (1.09 ) $ (0.66 ) $ (0.68 ) $ (1.08 ) Shares used in computation of basic income (loss) per share 254,209 102,078 102,018 101,644 100,737 100,759 100,404 99,817 Shares used in computation of diluted income (loss) per share 256,711 102,078 102,018 101,644 100,737 100,759 100,404 99,817 |
Organization and Nature of Op_2
Organization and Nature of Operations (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Oct. 31, 2018 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Subsidiary, Sale of Stock [Line Items] | ||||
Proceeds from issuance, initial public offering | $ 0 | $ 357,188 | $ 0 | |
Conversion price (in dollars per share) | $ 19 | |||
Wilmington Trust | Second Lien Term Loan due Feb 2025 | Secured Debt | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Repayments of debt | $ 315,000 | |||
IPO | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Proceeds from issuance, initial public offering | 375,000 | |||
Proceeds from offering, net | 353,000 | |||
Underwriting discounts and commissions | 17,800 | |||
Offering-related expenses | $ 4,200 | |||
Common Stock | IPO | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Number of shares issued (in shares) | 25,000,000 | |||
Stock issue price (in dollars per share) | $ 15 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Foreign Currency Translation (Details) - USD ($) $ in Thousands | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Feb. 04, 2016 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Debt Instrument [Line Items] | ||||
Unrealized net transaction gains (losses) related to remeasurement | $ (34,500) | $ (14,900) | $ 54,000 | |
Foreign currency translation adjustment | $ (66,047) | (58,251) | $ 141,341 | |
Intercompany Loan | ||||
Debt Instrument [Line Items] | ||||
Foreign currency translation adjustment | $ 10,400 | |||
Predecessor | ||||
Debt Instrument [Line Items] | ||||
Unrealized net transaction gains (losses) related to remeasurement | $ 0 | |||
Foreign currency translation adjustment | $ 3,835 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Recent Accounting Pronouncements Not Yet Adopted (Details) - USD ($) $ in Thousands | Jan. 01, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Increase in deferred income tax liabilities | $ 147,144 | $ 167,523 | |
Accounting Standards Update 2014-09 [Member] | Subsequent Event | Forecast | |||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Amortization period | 6 years | ||
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Accounting Standards Update 2014-09 [Member] | Subsequent Event | Forecast | |||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Decrease in deferred revenue | $ 2,800 | ||
Contract asset recognized | 5,200 | ||
Increase in deferred income tax liabilities | $ 1,700 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Acquisitions (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Intellectual property | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Weighted-average useful life | 10 years |
Minimum | Trademarks | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Weighted-average useful life | 3 years |
Minimum | Customer relationships | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Weighted-average useful life | 3 years |
Minimum | Customer backlog | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Weighted-average useful life | 3 years |
Minimum | Non-Competition Covenants | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Weighted-average useful life | 3 years |
Minimum | Developed product technologies | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Weighted-average useful life | 3 years |
Maximum | Trademarks | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Weighted-average useful life | 10 years |
Maximum | Customer relationships | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Weighted-average useful life | 10 years |
Maximum | Customer backlog | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Weighted-average useful life | 10 years |
Maximum | Non-Competition Covenants | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Weighted-average useful life | 10 years |
Maximum | Developed product technologies | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Weighted-average useful life | 10 years |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Goodwill (Details) | Dec. 31, 2018USD ($) |
Accounting Policies [Abstract] | |
Goodwill, impaired, accumulated impairment loss | $ 0 |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Deferred Offering Costs (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Accounting Policies [Abstract] | ||
Deferred offering costs | $ 3,700,000 | $ 0 |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies - Property and Equipment (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Equipment, servers and computers | Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful life | 3 years |
Equipment, servers and computers | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful life | 5 years |
Furniture and fixtures | Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful life | 5 years |
Furniture and fixtures | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful life | 7 years |
Software | Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful life | 3 years |
Software | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful life | 5 years |
Summary of Significant Accou_10
Summary of Significant Accounting Policies - Research and Development Costs (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Feb. 04, 2016 |
Accounting Policies [Line Items] | ||||
Capitalized software development costs | $ 0 | $ 0 | $ 0 | |
Predecessor | ||||
Accounting Policies [Line Items] | ||||
Capitalized software development costs | $ 0 |
Summary of Significant Accou_11
Summary of Significant Accounting Policies - Internal-Use Software and Website Development Costs (Details) - USD ($) | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Feb. 04, 2016 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Accounting Policies [Line Items] | ||||
Impairments to internal-use software | $ 0 | $ 0 | $ 0 | |
Capitalized internal-use software, net | 5,000,000 | 4,700,000 | ||
Capitalized internal-use software and website development costs | $ 200,000 | $ 2,500,000 | $ 1,100,000 | |
Predecessor | ||||
Accounting Policies [Line Items] | ||||
Impairments to internal-use software | $ 0 | |||
Capitalized internal-use software and website development costs | $ 0 | |||
Computer Software | ||||
Accounting Policies [Line Items] | ||||
Estimated useful life | 3 years |
Summary of Significant Accou_12
Summary of Significant Accounting Policies - Debt Issuance Costs (Details) - USD ($) $ in Thousands | 11 Months Ended | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Accounting Policies [Abstract] | |||
Amortization of debt issuance costs | $ 18,766 | $ 11,675 | $ 18,859 |
Summary of Significant Accou_13
Summary of Significant Accounting Policies - Changes in Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 11 Months Ended | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Balance at beginning of period | $ 0 | $ (729,761) | $ (519,643) |
Other comprehensive gain (loss) before reclassification | (58,251) | 141,341 | |
Amount reclassified from accumulated other comprehensive income (loss) | 0 | 0 | |
Other comprehensive income (loss) | (66,047) | (58,251) | 141,341 |
Balance at end of period | (519,643) | 2,616,100 | (729,761) |
Foreign Currency Translation Adjustments | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Balance at beginning of period | 75,294 | (66,047) | |
Other comprehensive gain (loss) before reclassification | (58,251) | 141,341 | |
Amount reclassified from accumulated other comprehensive income (loss) | 0 | 0 | |
Other comprehensive income (loss) | (58,251) | 141,341 | |
Balance at end of period | (66,047) | 17,043 | 75,294 |
Accumulated Other Comprehensive Income (Loss) | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Balance at beginning of period | 0 | 75,294 | (66,047) |
Balance at end of period | $ (66,047) | $ 17,043 | $ 75,294 |
Summary of Significant Accou_14
Summary of Significant Accounting Policies - Revenue Recognition (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Maintenance service period | 1 year |
Summary of Significant Accou_15
Summary of Significant Accounting Policies - Deferred Revenue (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Revenue Recognition and Deferred Revenue [Abstract] | |
Revenue, advance billing period | 12 months |
Summary of Significant Accou_16
Summary of Significant Accounting Policies - Cost of Revenue (Details) - USD ($) $ in Thousands | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Feb. 04, 2016 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Product Information [Line Items] | ||||
Total amortization of acquired technologies | $ 147,517 | $ 175,991 | $ 171,033 | |
License | ||||
Product Information [Line Items] | ||||
Total amortization of acquired technologies | 124,259 | 144,857 | 142,417 | |
Subscription | ||||
Product Information [Line Items] | ||||
Total amortization of acquired technologies | $ 23,258 | $ 31,134 | $ 28,616 | |
Predecessor | ||||
Product Information [Line Items] | ||||
Total amortization of acquired technologies | $ 2,186 | |||
Predecessor | License | ||||
Product Information [Line Items] | ||||
Total amortization of acquired technologies | 1,455 | |||
Predecessor | Subscription | ||||
Product Information [Line Items] | ||||
Total amortization of acquired technologies | $ 731 |
Summary of Significant Accou_17
Summary of Significant Accounting Policies - Advertising (Details) - USD ($) $ in Thousands | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Feb. 04, 2016 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Accounting Policies [Line Items] | ||||
Advertising expense | $ 28,655 | $ 38,477 | $ 38,213 | |
Predecessor | ||||
Accounting Policies [Line Items] | ||||
Advertising expense | $ 2,293 |
Summary of Significant Accou_18
Summary of Significant Accounting Policies - Income Taxes (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Accounting Policies [Abstract] | ||
Unrecognized tax benefits, income tax penalties and interest accrued | $ 4,100 | $ 3,000 |
Valuation allowance | $ 1,775 | $ 1,811 |
Summary of Significant Accou_19
Summary of Significant Accounting Policies - Stock Option Fair Value Assumptions (Details) - shares | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Feb. 04, 2016 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options granted (in shares) | 1,327,475 | |||
Predecessor | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options granted (in shares) | 0 | |||
Stock Options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected dividend yield | 0.00% | 0.00% | 0.00% | |
Volatility | 43.10% | 40.20% | 41.90% | |
Risk-free rate of return, minimum | 1.30% | 2.60% | 1.90% | |
Risk-free rate of return, maximum | 2.30% | 2.90% | 2.20% | |
Expected life | 6 years 6 months | 6 years 4 months 2 days | 6 years 4 months 17 days | |
Stock Options | Predecessor | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected dividend yield | 0.00% | |||
Volatility | 0.00% | |||
Risk-free rate of return | 0.00% | |||
Expected life | 0 years |
Summary of Significant Accou_20
Summary of Significant Accounting Policies - Impact to Income (Loss) Before Income Taxes Due to Stock-based Compensation Expense (Details) - USD ($) $ in Thousands | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Feb. 04, 2016 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Impact to income (loss) before income taxes due to stock-based compensation | $ 17 | $ 5,833 | $ 80 | |
Income tax benefit related to stock-based compensation | $ 0 | $ 1,054 | $ 0 | |
Predecessor | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Impact to income (loss) before income taxes due to stock-based compensation | $ 87,763 | |||
Income tax benefit related to stock-based compensation | $ 22,981 |
Summary of Significant Accou_21
Summary of Significant Accounting Policies - Schedule of Cash and Cash Equivalents (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Feb. 04, 2016 |
Cash and Cash Equivalents [Line Items] | ||||
Total cash and cash equivalents | $ 382,620 | $ 277,716 | $ 101,643 | $ 0 |
Demand deposit accounts | ||||
Cash and Cash Equivalents [Line Items] | ||||
Total cash and cash equivalents | 265,520 | 210,616 | ||
Money market funds | ||||
Cash and Cash Equivalents [Line Items] | ||||
Total cash and cash equivalents | $ 117,100 | $ 67,100 |
Take Private - Additional Infor
Take Private - Additional Information (Details) - USD ($) | 1 Months Ended | 11 Months Ended | 12 Months Ended | ||
Feb. 29, 2016 | Feb. 04, 2016 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Business Acquisition [Line Items] | |||||
Stock-based compensation expense | $ 17,000 | $ 5,833,000 | $ 80,000 | ||
Predecessor | |||||
Business Acquisition [Line Items] | |||||
Stock-based compensation expense | $ 87,763,000 | ||||
SolarWinds, Inc. | |||||
Business Acquisition [Line Items] | |||||
Consideration transferred | $ 4,600,000,000 | ||||
Predecessor outstanding common stock | 4,300,000,000 | ||||
Settlement of outstanding stock-based awards | 173,100,000 | ||||
Predecessor outstanding debt | 90,000,000 | ||||
Predecessor management non-cash equity contribution | 9,400,000 | ||||
Purchase price, equity financing | 2,500,000,000 | ||||
Purchase price, debt financing | 2,000,000,000 | ||||
Goodwill expected to be deductible for tax purposes | $ 0 | ||||
Acquisition related costs | $ 2,500,000 | $ 1,200,000 | |||
SolarWinds, Inc. | Predecessor | |||||
Business Acquisition [Line Items] | |||||
Acquisition related costs | 133,100,000 | ||||
Stock-based compensation expense | $ 87,500,000 |
Take Private - Consideration Pa
Take Private - Consideration Paid and Amounts Recognized for Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Feb. 05, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Feb. 29, 2016 |
Business Acquisition [Line Items] | |||||
Goodwill | $ 3,683,961 | $ 3,695,640 | $ 3,533,390 | ||
SolarWinds, Inc. | |||||
Business Acquisition [Line Items] | |||||
Current assets, including cash acquired of $248.3 million | $ 351,721 | ||||
Property and equipment | 35,255 | ||||
Other assets | 12,964 | ||||
Identifiable intangible assets | 1,495,400 | ||||
Goodwill | 3,212,255 | ||||
Current liabilities | (87,459) | ||||
Deferred tax liabilities | (366,454) | ||||
Deferred revenue | (31,813) | ||||
Other long-term liabilities | (28,993) | ||||
Total consideration | $ 4,592,876 | ||||
Cash acquired from acquisition | $ 248,300 |
Take Private - Fair Value of Ac
Take Private - Fair Value of Acquired Identifiable Intangible Assets and Weighted-average Useful Life (Details) - SolarWinds, Inc. $ in Thousands | 1 Months Ended |
Feb. 29, 2016USD ($) | |
Fair Value | |
Total identifiable intangible assets | $ 1,495,400 |
Tradenames - indefinite-lived | |
Fair Value | |
Identifiable indefinite-lived intangible assets | 82,300 |
Developed product technologies | |
Fair Value | |
Identifiable finite-lived intangible assets | $ 906,200 |
Weighted-average useful life | |
Weighted-average useful life | 6 years |
Customer relationships | |
Fair Value | |
Identifiable finite-lived intangible assets | $ 450,100 |
Weighted-average useful life | |
Weighted-average useful life | 10 years |
In process research and development | |
Fair Value | |
Identifiable finite-lived intangible assets | $ 48,300 |
Customer backlog | |
Fair Value | |
Identifiable finite-lived intangible assets | $ 6,200 |
Weighted-average useful life | |
Weighted-average useful life | 2 years |
Trademarks | |
Fair Value | |
Identifiable finite-lived intangible assets | $ 2,300 |
Weighted-average useful life | |
Weighted-average useful life | 1 year |
Acquisitions - 2018 Acquisition
Acquisitions - 2018 Acquisitions, Additional Information (Details) - 2018 Acquisitions | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Business Acquisition [Line Items] | |
Combined purchase price | $ 62,900,000 |
Cash acquired from acquisitions | 2,400,000 |
Acquisition related costs | 1,200,000 |
Goodwill expected to be deductible for tax purposes | $ 0 |
Acquisitions - 2018 Acquisiti_2
Acquisitions - 2018 Acquisitions, Summary of Consideration Paid and Amounts Recognized (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Business Acquisition [Line Items] | |||
Goodwill | $ 3,683,961 | $ 3,695,640 | $ 3,533,390 |
2018 Acquisitions | |||
Business Acquisition [Line Items] | |||
Current assets, including cash acquired | 4,821 | ||
Deferred tax asset | 1,550 | ||
Fixed assets | 1,352 | ||
Identifiable intangible assets | 18,412 | ||
Goodwill | 43,746 | ||
Current liabilities | (3,331) | ||
Deferred tax liabilities | (666) | ||
Deferred revenue | (2,944) | ||
Total consideration | $ 62,940 |
Acquisitions - 2018 Acquisiti_3
Acquisitions - 2018 Acquisitions, Summary of Fair Value of Acquired Identifiable Intangible Assets and Weighted-Average Useful Life (Details) - 2018 Acquisitions $ in Thousands | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Fair Value | $ 18,412 |
Developed product technologies | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Fair Value | $ 13,317 |
Weighted-average useful life | 5 years |
Customer relationships | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Fair Value | $ 4,805 |
Weighted-average useful life | 4 years |
Trademarks | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Fair Value | $ 290 |
Weighted-average useful life | 3 years |
Acquisitions - LOGICnow Acquisi
Acquisitions - LOGICnow Acquisition, Additional Information (Details) - LOGICnow - USD ($) | 1 Months Ended | 11 Months Ended |
May 31, 2016 | Dec. 31, 2016 | |
Business Acquisition [Line Items] | ||
Purchase price | $ 499,500,000 | |
Cash acquired from acquisition | 6,900,000 | |
Purchase price, equity financing | 190,000,000 | |
Purchase price, debt financing | 253,800,000 | |
Acquisition related costs | $ 10,100,000 | |
Goodwill expected to be deductible for tax purposes | $ 0 | |
Pro forma information, revenue since acquisition date | 57,500,000 | |
Pro forma information, net loss since acquisition date | $ 10,700,000 |
Acquisitions - LOGICnow Acqui_2
Acquisitions - LOGICnow Acquisition, Summary of Consideration Paid and Amounts Recognized (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | May 31, 2016 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 3,683,961 | $ 3,695,640 | $ 3,533,390 | |
LOGICnow | ||||
Business Acquisition [Line Items] | ||||
Current assets, including cash acquired | $ 25,969 | |||
Fixed assets | 5,848 | |||
Identifiable intangible assets | 119,300 | |||
Goodwill | 374,086 | |||
Current liabilities | (14,785) | |||
Deferred tax liabilities | (8,401) | |||
Deferred revenue | (2,548) | |||
Total consideration | $ 499,469 |
Acquisitions - LOGICnow Acqui_3
Acquisitions - LOGICnow Acquisition, Summary of Fair Value of Acquired Identifiable Intangible Assets and Weighted-Average Useful Life (Details) - LOGICnow $ in Thousands | 1 Months Ended |
May 31, 2016USD ($) | |
Business Acquisition [Line Items] | |
Fair Value | $ 119,300 |
Developed product technologies | |
Business Acquisition [Line Items] | |
Fair Value | $ 31,100 |
Weighted-average useful life | 4 years |
Customer relationships | |
Business Acquisition [Line Items] | |
Fair Value | $ 87,000 |
Weighted-average useful life | 5 years |
Trademarks | |
Business Acquisition [Line Items] | |
Fair Value | $ 1,200 |
Weighted-average useful life | 1 year |
Acquisitions - LOGICnow Pro For
Acquisitions - LOGICnow Pro Forma Information (Details) - LOGICnow $ in Thousands | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Business Acquisition [Line Items] | |
Revenue | $ 507,981 |
Net loss | $ (353,719) |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Changes in Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Goodwill [Roll Forward] | ||
Balance at beginning of period | $ 3,695,640 | $ 3,533,390 |
Acquisitions | 43,746 | 17,121 |
Foreign currency translation and other adjustments | (55,425) | 145,129 |
Balance at end of period | $ 3,683,961 | $ 3,695,640 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 1,634,007 | $ 1,644,665 |
Accumulated Amortization | (677,746) | (450,166) |
Net | 956,261 | 1,194,499 |
Developed product technologies | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 1,006,999 | 1,006,454 |
Accumulated Amortization | (494,459) | (324,196) |
Net | 512,540 | 682,258 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 541,717 | 546,207 |
Accumulated Amortization | (181,902) | (118,930) |
Net | 359,815 | 427,277 |
Intellectual property | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 829 | 547 |
Accumulated Amortization | (129) | (59) |
Net | 700 | 488 |
Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 84,462 | 85,257 |
Accumulated Amortization | (1,256) | (1,075) |
Net | 83,206 | 84,182 |
Customer backlog | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 0 | 6,200 |
Accumulated Amortization | 0 | (5,906) |
Net | $ 0 | $ 294 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Intangible Assets Amortization Expense (Details) - USD ($) $ in Thousands | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Feb. 04, 2016 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Finite-Lived Intangible Assets [Line Items] | ||||
Intangible asset amortization expense | $ 206,086 | $ 242,849 | $ 238,156 | |
Predecessor | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Intangible asset amortization expense | $ 3,119 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Estimated Intangible Asset Amortization Expense (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Estimated Amortization | |
2,019 | $ 237,461 |
2,020 | 235,116 |
2,021 | 205,196 |
2,022 | 67,497 |
2,023 | $ 42,694 |
Goodwill and Intangible Asset_6
Goodwill and Intangible Assets - Additional Information (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Indefinite-lived trademarks | $ 82.8 | $ 83.8 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - Recurring - Money market funds - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, fair value | $ 117,100 | $ 67,100 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, fair value | 117,100 | 67,100 |
Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, fair value | 0 | 0 |
Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, fair value | $ 0 | $ 0 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 63,290 | $ 54,381 |
Less: Accumulated depreciation and amortization | (27,426) | (20,172) |
Property and equipment, net | 35,864 | 34,209 |
Equipment, servers and computers | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 32,081 | 23,790 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 7,393 | 6,760 |
Software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 2,475 | 3,143 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 21,341 | $ 20,688 |
Property and Equipment - Sche_2
Property and Equipment - Schedule of Depreciation and Amortization (Details) - USD ($) $ in Thousands | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Feb. 04, 2016 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Line Items] | ||||
Depreciation and amortization | $ 9,071 | $ 13,007 | $ 11,617 | |
Predecessor | ||||
Property, Plant and Equipment [Line Items] | ||||
Depreciation and amortization | $ 778 |
Accrued Liabilities and Other_2
Accrued Liabilities and Other (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Payables and Accruals [Abstract] | ||
Payroll-related accruals | $ 31,028 | $ 24,995 |
Other accrued expenses and current liabilities | 21,027 | 14,598 |
Total accrued liabilities and other | $ 52,055 | $ 39,593 |
Debt - Summary of Debt (Details
Debt - Summary of Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Amount | ||
Total principal amount | $ 1,970,100 | $ 2,358,050 |
Unamortized discount and debt issuance costs | (46,128) | (95,478) |
Total debt | 1,923,972 | 2,262,572 |
Less: Current portion of long-term debt | (19,900) | (16,950) |
Total long-term debt | 1,904,072 | 2,245,622 |
Line of Credit | Revolving Credit Facility | ||
Amount | ||
Total principal amount | $ 0 | $ 0 |
Effective Rate | 0.00% | 0.00% |
Secured Debt | First Lien Term Loan (as amended) due Feb 2024 | ||
Amount | ||
Total principal amount | $ 1,970,100 | $ 1,678,050 |
Effective Rate | 5.27% | 5.07% |
Secured Debt | Second Lien Floating Rate Notes (as amended) due Feb 2024 | ||
Amount | ||
Total principal amount | $ 0 | $ 680,000 |
Effective Rate | 0.00% | 10.14% |
Debt - Additional Information (
Debt - Additional Information (Details) | 1 Months Ended | 4 Months Ended | 11 Months Ended | 12 Months Ended | |||||||
Oct. 31, 2018USD ($) | May 31, 2016USD ($) | Feb. 29, 2016USD ($) | May 31, 2016USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Mar. 31, 2018USD ($) | Feb. 28, 2017USD ($) | Aug. 31, 2016USD ($) | Feb. 29, 2016EUR (€) | |
Debt Instrument [Line Items] | |||||||||||
Loss on extinguishment of debt | $ 22,767,000 | $ 80,137,000 | $ 18,559,000 | ||||||||
Long-term debt | 1,923,972,000 | 2,262,572,000 | |||||||||
Debt redemption premium | 0 | $ 36,900,000 | 0 | ||||||||
Secured Debt | Second Lien Floating Rate Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Face amount of debt | $ 100,000,000 | $ 580,000,000 | $ 100,000,000 | ||||||||
Secured Debt | Second Lien Floating Rate Notes | LIBOR | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Basis spread on variable rate | 8.75% | ||||||||||
Covenant, floor interest rate | 1.00% | 1.00% | |||||||||
Credit Suisse | Eurodollar | |||||||||||
Debt Instrument [Line Items] | |||||||||||
LIBOR floor | 0.00% | ||||||||||
Credit Suisse | Federal Funds Effective Rate | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Basis spread on variable rate | 0.50% | ||||||||||
Credit Suisse | LIBOR | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Basis spread on variable rate | 1.00% | ||||||||||
Credit Suisse | Secured Debt | First Lien Credit Agreement | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Face amount of debt | 1,650,000,000 | ||||||||||
Credit Suisse | Secured Debt | First Lien Credit Agreement | US Dollars | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Face amount of debt | 1,275,000,000 | $ 1,695,000,000 | $ 1,700,000,000 | ||||||||
Proceeds from issuance of debt | $ 160,000,000 | 1,500,000,000 | |||||||||
Loss on extinguishment of debt | $ 22,800,000 | $ 18,600,000 | |||||||||
Credit Suisse | Secured Debt | First Lien Credit Agreement | Euro | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Face amount of debt | € | € 230,000,000 | ||||||||||
Credit Suisse | Secured Debt | First Lien Term Loan | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Face amount of debt | $ 1,990,000,000 | $ 1,990,000,000 | |||||||||
Loss on extinguishment of debt | $ 21,400,000 | ||||||||||
Quarterly periodic payment, as a percentage of original principal | 0.25% | ||||||||||
Covenant, leverage ratio, maximum | 7.40 | ||||||||||
Long-term debt | $ 1,970,100,000 | ||||||||||
Credit Suisse | Secured Debt | First Lien Term Loan | Eurodollar | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Basis spread on variable rate | 3.00% | ||||||||||
Covenant, floor interest rate | 0.00% | ||||||||||
Credit Suisse | Secured Debt | First Lien Term Loan | Base Rate | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Basis spread on variable rate | 2.00% | ||||||||||
Credit Suisse | Secured Debt | First Lien Term Loan | Net Leverage Ratio Or IPO | Eurodollar | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Basis spread on variable rate | 2.75% | ||||||||||
Credit Suisse | Secured Debt | First Lien Term Loan | Net Leverage Ratio Or IPO | Base Rate | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Basis spread on variable rate | 1.75% | ||||||||||
Credit Suisse | Line of Credit | Revolving Credit Facility | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Maximum borrowing capacity | 125,000,000 | $ 125,000,000 | |||||||||
Proceeds from issuance of debt | 20,000,000 | ||||||||||
Commitment fee percentage | 0.50% | ||||||||||
Covenant, commitment fee percentage, net leverage ratio, reduction per annum | 0.375% | ||||||||||
Covenant, borrowing percentage of commitments, maximum | 35.00% | ||||||||||
Credit Suisse | Line of Credit | Revolving Credit Facility | Eurodollar | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Basis spread on variable rate | 3.00% | ||||||||||
Covenant, floor interest rate | 0.00% | ||||||||||
Credit Suisse | Line of Credit | Revolving Credit Facility | Base Rate | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Basis spread on variable rate | 2.00% | ||||||||||
Credit Suisse | Line of Credit | Revolving Credit Facility | Net Leverage Ratio Or IPO | Eurodollar | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Basis spread on variable rate | 2.50% | ||||||||||
Credit Suisse | Line of Credit | Revolving Credit Facility | Net Leverage Ratio Or IPO | Base Rate | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Basis spread on variable rate | 1.50% | ||||||||||
Credit Suisse | Line of Credit | Revolving Credit Facility | Multi-Currency Tranche | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Maximum borrowing capacity | 100,000,000 | $ 100,000,000 | |||||||||
Credit Suisse | Line of Credit | Revolving Credit Facility | Single Currency Tranche | US Dollars | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Maximum borrowing capacity | 25,000,000 | 25,000,000 | |||||||||
Credit Suisse | Line of Credit | Revolving Credit Facility | Single Currency Tranche, February 5, 2021 Maturity Date | US Dollars | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Maximum borrowing capacity | 7,500,000 | ||||||||||
Credit Suisse | Line of Credit | Revolving Credit Facility | Single Currency Tranche, February 5, 2022 Maturity Date | US Dollars | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Maximum borrowing capacity | 17,500,000 | ||||||||||
Credit Suisse | Line of Credit | Letter of Credit | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Maximum borrowing capacity | $ 35,000,000 | 35,000,000 | |||||||||
Wilmington Trust | Secured Debt | Second Lien Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Loss on extinguishment of debt | 39,200,000 | ||||||||||
Debt redemption premium | 22,700,000 | ||||||||||
Wilmington Trust | Secured Debt | Second Lien Floating Rate Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Long-term debt | 680,000,000 | ||||||||||
Wilmington Trust | Secured Debt | Second Lien Term Loan due Feb 2025 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Face amount of debt | $ 315,000,000 | ||||||||||
Loss on extinguishment of debt | 19,500,000 | ||||||||||
Debt redemption premium | $ 14,200,000 | ||||||||||
Repayments of debt | $ 315,000,000 |
Debt - Summary of Future Minimu
Debt - Summary of Future Minimum Principal Payments (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Long-term Debt, Fiscal Year Maturity [Abstract] | ||
Total debt | $ 1,923,972 | $ 2,262,572 |
Credit Suisse | First Lien Term Loan | Secured Debt | ||
Long-term Debt, Fiscal Year Maturity [Abstract] | ||
2,019 | 19,900 | |
2,020 | 19,900 | |
2,021 | 19,900 | |
2,022 | 19,900 | |
2,023 | 19,900 | |
Thereafter | 1,870,600 | |
Total debt | $ 1,970,100 |
Redeemable Convertible Class _2
Redeemable Convertible Class A Common Stock (Details) - USD ($) $ / shares in Units, $ in Thousands | Sep. 30, 2018 | Oct. 31, 2018 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 |
Temporary Equity Disclosure [Abstract] | |||||
Dividend rate | 9.00% | ||||
Liquidation preference (in dollars per share) | $ 1,000 | ||||
Subsidiary, Sale of Stock [Line Items] | |||||
Cumulative undeclared and unpaid dividends | $ 717,400 | $ 485,900 | |||
Conversion price (in dollars per share) | $ 19 | ||||
Gain on conversion of Class A common stock | $ 711,200 | $ 0 | $ 711,247 | $ 0 | |
Common Stock | |||||
Subsidiary, Sale of Stock [Line Items] | |||||
Conversion of Class A common stock into common stock (in shares) | 140,053,370 | 177,811,000 | |||
Conversion of accrued and unpaid dividends (in shares) | 37,758,109 |
Stockholders_ Equity (Deficit_3
Stockholders’ Equity (Deficit) and Stock-Based Compensation - Common Stock and Preferred Stock (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Oct. 31, 2018USD ($)vote$ / sharesshares | Dec. 31, 2016USD ($) | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares | |
Equity And Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||
Capital stock authorized (in shares) | shares | 238,755,000 | |||
Class A common stock, authorized (in shares) | shares | 0 | 5,755,000 | ||
Class A common stock, par value (in dollars per share) | $ / shares | $ 0 | $ 0.001 | ||
Class B common stock, authorized (in shares) | shares | 1,000,000,000 | 1,000,000,000 | 233,000,000 | |
Class B common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | |
Subsidiary, Sale of Stock [Line Items] | ||||
Proceeds from issuance, initial public offering | $ | $ 0 | $ 357,188 | $ 0 | |
Conversion price (in dollars per share) | $ / shares | $ 19 | |||
Shares issued upon conversion (in shares) | 1 | |||
Preferred stock, authorized (in shares) | shares | 50,000,000 | 50,000,000 | 0 | |
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0 | |
Number of votes per common share | vote | 1 | |||
IPO | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Proceeds from issuance, initial public offering | $ | $ 375,000 | |||
Proceeds from offering, net | $ | 353,000 | |||
Underwriting discounts and commissions | $ | 17,800 | |||
Offering-related expenses | $ | $ 4,200 | |||
IPO | Common Stock | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Number of shares issued (in shares) | shares | 25,000,000 | |||
Stock issue price (in dollars per share) | $ / shares | $ 15 |
Stockholders_ Equity (Deficit_4
Stockholders’ Equity (Deficit) and Stock-Based Compensation - 2016 Equity Plan (Details) - shares | 11 Months Ended | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock options outstanding (in shares) | 3,114,800 | 2,156,550 | |
Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Awards outstanding (in shares) | 4,985,434 | 5,789,401 | |
Common Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Repurchase of stock (in shares) | 57,000 | 95,000 | |
2016 Equity Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expiration period | 10 years | ||
Common stock-based incentive awards outstanding (in shares) | 8,115,334 | ||
Stock options outstanding (in shares) | 3,129,900 | ||
2016 Equity Plan | Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Awards outstanding (in shares) | 4,985,434 | ||
2016 Equity Plan | Common Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Repurchase of stock (in shares) | 14,000 | 272,133 | 640,454 |
Tranche 1 | 2016 Equity Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting percentage | 50.00% | ||
Tranche 2 | 2016 Equity Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting percentage | 50.00% | ||
Minimum | 2016 Equity Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 4 years | ||
Minimum | Tranche 1 | 2016 Equity Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 4 years | ||
Minimum | Tranche 2 | 2016 Equity Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 4 years | ||
Maximum | 2016 Equity Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 5 years | ||
Maximum | Tranche 1 | 2016 Equity Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 5 years | ||
Maximum | Tranche 2 | 2016 Equity Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 5 years |
Stockholders_ Equity (Deficit_5
Stockholders’ Equity (Deficit) and Stock-Based Compensation - 2018 Equity Incentive Plan (Details) - USD ($) $ in Thousands | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Oct. 31, 2018 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 17 | $ 5,833 | $ 80 | |
Restricted Stock Units (RSUs) | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Awards outstanding (in shares) | 6,277,466 | 0 | ||
Performance Stock Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Awards outstanding (in shares) | 970,922 | 0 | ||
2018 Equity Incentive Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expiration period | 10 years | |||
Stock reserved for future issuance (in shares) | 30,000,000 | 22,751,612 | ||
Awards outstanding (in shares) | 7,248,388 | |||
Stock-based compensation expense | $ 0 | $ 5,800 | $ 0 | |
2018 Equity Incentive Plan | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting percentage | 0.00% | |||
2018 Equity Incentive Plan | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting percentage | 150.00% | |||
2018 Equity Incentive Plan | Restricted Stock Units (RSUs) | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Awards outstanding (in shares) | 6,277,466 | |||
Vesting period | 4 years | |||
2018 Equity Incentive Plan | Performance Stock Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Awards outstanding (in shares) | 970,922 | |||
Vesting period | 3 years |
Stockholders_ Equity (Deficit_6
Stockholders’ Equity (Deficit) and Stock-Based Compensation - Stock Option Awards, Option Grant Activity (Details) $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2018USD ($)$ / sharesshares | |
Number of Shares Outstanding | |
Outstanding balances at beginning of period (in shares) | shares | 2,156,550 |
Options granted (in shares) | shares | 1,327,475 |
Options exercised (in shares) | shares | (46,100) |
Options forfeited (in shares) | shares | (288,075) |
Options expired (in shares) | shares | (35,050) |
Outstanding balances at end of period (in shares) | shares | 3,114,800 |
Options exercisable at end of period (in shares) | shares | 659,950 |
Options vested and expected to vest at end of period (in shares) | shares | 3,114,800 |
Weighted- Average Exercise Price | |
Outstanding balances at beginning of period (in dollars per share) | $ / shares | $ 0.45 |
Options granted (in dollars per share) | $ / shares | 3.40 |
Options exercised (in dollars per share) | $ / shares | 0.36 |
Options forfeited (in dollars per share) | $ / shares | 1.38 |
Options expired (in dollars per share) | $ / shares | 0.36 |
Outstanding balances at the end of period (in dollars per share) | $ / shares | 1.62 |
Options exercisable at end of period (in dollars per share) | $ / shares | 0.40 |
Options vested and expected to vest at end of period (in dollars per share) | $ / shares | $ 1.62 |
Aggregate Intrinsic Value (in thousands) | |
Options exercisable at December 31, 2018 | $ | $ 8,865 |
Options vested and expected to vest at December 31, 2018 | $ | $ 38,022 |
Weighted- Average Remaining Contractual Term (in years) | |
Options exercisable at December 31, 2018 | 7 years 11 months 2 days |
Options vested and expected to vest at December 31, 2018 | 8 years 7 months 3 days |
Stockholders_ Equity (Deficit_7
Stockholders’ Equity (Deficit) and Stock-Based Compensation - Stock Option Awards, Additional Information Regarding Options (Details) - USD ($) $ / shares in Units, $ in Thousands | 11 Months Ended | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Equity And Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Weighted-average grant date fair value per share of options granted during the period (in dollars per share) | $ 0.12 | $ 1.98 | $ 0.28 |
Aggregate intrinsic value of options exercised during the period | $ 0 | $ 407 | $ 2 |
Aggregate fair value of options vested during the period | $ 0 | $ 109 | $ 35 |
Stockholders_ Equity (Deficit_8
Stockholders’ Equity (Deficit) and Stock-Based Compensation - Stock Option Awards, Narrative (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock-based compensation expense subject to future recognition | $ 2.2 |
Stock Options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Weighted-average recognition period | 3 years 3 months 8 days |
Stockholders_ Equity (Deficit_9
Stockholders’ Equity (Deficit) and Stock-Based Compensation - Schedule of Restricted Stock (Details) - Restricted Stock | 12 Months Ended |
Dec. 31, 2018shares | |
Number of Shares Outstanding | |
Unvested balances at beginning of period (in shares) | 5,789,401 |
Restricted stock granted and issued (in shares) | 820,500 |
Restricted stock vested (in shares) | (1,407,834) |
Restricted stock repurchased - unvested shares (in shares) | (216,633) |
Unvested balances at end of period (in shares) | 4,985,434 |
Stockholders_ Equity (Defici_10
Stockholders’ Equity (Deficit) and Stock-Based Compensation - Restricted Stock, Narrative (Details) - USD ($) | 11 Months Ended | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 17,000 | $ 5,833,000 | $ 80,000 |
Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted average grant date fair value (in dollars per share) | $ 0.27 | $ 2.10 | $ 0.67 |
Intrinsic value of shares vested | $ 0 | $ 3,700,000 | $ 800,000 |
Stock-based compensation expense | 0 | ||
Share-based compensation, liability | $ 2,900,000 | $ 1,700,000 |
Stockholders_ Equity (Defici_11
Stockholders’ Equity (Deficit) and Stock-Based Compensation - Schedule of Restricted Stock Units (Details) - Restricted Stock Units (RSUs) $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2018USD ($)$ / sharesshares | |
Number of Units Outstanding | |
Unvested balances at beginning of period (in shares) | shares | 0 |
Stock units granted (in shares) | shares | 6,283,232 |
Stock units vested (in shares) | shares | 0 |
Stock units forfeited (in shares) | shares | (5,766) |
Unvested balances at end of period (in shares) | shares | 6,277,466 |
Weighted-Average Grant Date Fair Value Per Share | |
Unvested balances at beginning of period (in dollars per share) | $ / shares | $ 0 |
Stock units granted (in dollars per share) | $ / shares | 14.21 |
Stock units vested (in dollars per share) | $ / shares | 0 |
Stock units forfeited (in dollars per share) | $ / shares | 14.21 |
Unvested balances at end of period (in dollars per share) | $ / shares | $ 14.21 |
Aggregate Intrinsic Value (in thousands) | |
Unvested balances at end of period | $ | $ 86,817 |
Weighted-Average Remaining Contractual Term (in years) | |
Unvested balances at end of period | 3 years 9 months 22 days |
Stockholders_ Equity (Defici_12
Stockholders’ Equity (Deficit) and Stock-Based Compensation - Restricted Stock Units, Narrative (Details) - Restricted Stock Units (RSUs) $ in Millions | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Compensation expense not yet recognized | $ 85.1 |
Weighted-average recognition period | 3 years 9 months 22 days |
Stockholders_ Equity (Defici_13
Stockholders’ Equity (Deficit) and Stock-Based Compensation - Schedule of Performance Stock Units (Details) - Performance Stock Units $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2018USD ($)$ / sharesshares | |
Number of Units Outstanding | |
Unvested balances at beginning of period (in shares) | shares | 0 |
Stock units granted (in shares) | shares | 970,922 |
Stock units vested (in shares) | shares | 0 |
Stock units forfeited (in shares) | shares | 0 |
Unvested balances at end of period (in shares) | shares | 970,922 |
Weighted-Average Grant Date Fair Value Per Share | |
Unvested balances at beginning of period (in dollars per share) | $ / shares | $ 0 |
Stock units granted (in dollars per share) | $ / shares | 14.21 |
Stock units vested (in dollars per share) | $ / shares | 0 |
Stock units forfeited (in dollars per share) | $ / shares | 0 |
Unvested balances at end of period (in dollars per share) | $ / shares | $ 14.21 |
Aggregate Intrinsic Value (in thousands) | |
Unvested balances at end of period | $ | $ 13,428 |
Weighted-Average Remaining Contractual Term (in years) | |
Unvested balances at end of period | 2 years 1 month 29 days |
Stockholders_ Equity (Defici_14
Stockholders’ Equity (Deficit) and Stock-Based Compensation - Performance Stock Units, Narrative (Details) - Performance Stock Units $ in Millions | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Compensation expense not yet recognized | $ 12.6 |
Weighted-average recognition period | 2 years 1 month 29 days |
Stockholders_ Equity (Defici_15
Stockholders’ Equity (Deficit) and Stock-Based Compensation - Employee Stock Purchase Plan (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 11 Months Ended | 12 Months Ended | |
Oct. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock-based compensation expense | $ 17,000 | $ 5,833,000 | $ 80,000 | ||
ESPP | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock reserved for future issuance (in shares) | 3,750,000 | ||||
Maximum stock purchase, percentage of compensation | 20.00% | ||||
Offering period length | 6 months | ||||
Purchase price of common stock, percent of market value | 85.00% | ||||
Maximum value of common stock purchase, per year | $ 25,000 | ||||
Stock-based compensation expense | $ 0 |
Stockholders_ Equity (Defici_16
Stockholders’ Equity (Deficit) and Stock-Based Compensation - Predecessor Stock Plans, Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | Feb. 04, 2016 | Feb. 04, 2016 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Deferred compensation (in dollars per share) | $ 60.10 | ||||
Stock-based compensation expense | $ 17 | $ 5,833 | $ 80 | ||
Predecessor | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Deferred compensation (in dollars per share) | $ 60.10 | $ 60.10 | |||
Accelerated vesting percentage | 50.00% | ||||
Stock-based compensation expense | $ 87,763 | ||||
Share-based compensation related to accelerated vesting | 80,300 | ||||
Employee withholding tax obligations for share-based compensation | 2,333 | ||||
Predecessor | Additional Paid-in Capital | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Employee withholding tax obligations for share-based compensation | 2,333 | ||||
Predecessor | Restricted Stock Units (RSUs) | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Aggregate intrinsic value | $ 88,800 | ||||
Shares paid for tax withholding for share based compensation (in shares) | 40,000 | ||||
Predecessor | Restricted Stock Units (RSUs) | Additional Paid-in Capital | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Employee withholding tax obligations for share-based compensation | $ 2,300 |
Stockholders_ Equity (Defici_17
Stockholders’ Equity (Deficit) and Stock-Based Compensation - Schedule of Predecessor Stock Plans (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Feb. 04, 2016 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Weighted-average grant date fair value per share of options granted during the period (in dollars per share) | $ 0.12 | $ 1.98 | $ 0.28 | |
Aggregate intrinsic value of options exercised during the period | $ 0 | $ 407 | $ 2 | |
Aggregate fair value of options vested during the period | $ 0 | $ 109 | $ 35 | |
Predecessor | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Weighted-average grant date fair value per share of options granted during the period (in dollars per share) | $ 0 | |||
Aggregate intrinsic value of options exercised during the period | $ 1,584 | |||
Aggregate fair value of options vested during the period | $ 3,702 |
Net Income (Loss) Per Share - R
Net Income (Loss) Per Share - Reconciliation of Shares in the Calculation of Basic and Diluted Loss Per Share (Details) - USD ($) shares in Thousands, $ in Thousands | 1 Months Ended | 3 Months Ended | 11 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2018 | Feb. 04, 2016 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Numerator: | |||||||||||||
Net loss | $ (14,743) | $ (398) | $ (27,015) | $ (59,910) | $ (39,761) | $ 1,637 | $ (2,004) | $ (43,738) | $ (262,594) | $ (102,066) | $ (83,866) | ||
Accretion of dividends on Class A common stock | (217,904) | (231,549) | (268,007) | ||||||||||
Gain on conversion of Class A common stock | $ 711,200 | 0 | 711,247 | 0 | |||||||||
Earnings allocated to unvested restricted stock | 0 | (12,997) | 0 | ||||||||||
Net income (loss) available to common stockholders | $ 668,426 | $ (75,006) | $ (99,193) | $ (129,745) | $ (109,563) | $ (66,627) | $ (68,043) | $ (107,640) | $ (480,498) | $ 364,635 | $ (351,873) | ||
Weighted-average common shares outstanding used in computing basic net earnings (loss) per share (in shares) | 254,209 | 102,078 | 102,018 | 101,644 | 100,737 | 100,759 | 100,404 | 99,817 | 96,465 | 140,301 | 100,433 | ||
Net income (loss) available to common stockholders | $ (480,498) | $ 364,635 | $ (351,873) | ||||||||||
Denominator: | |||||||||||||
Weighted-average common shares outstanding used in computing basic net earnings (loss) per share (in shares) | 254,209 | 102,078 | 102,018 | 101,644 | 100,737 | 100,759 | 100,404 | 99,817 | 96,465 | 140,301 | 100,433 | ||
Add stock-based incentive stock awards (in shares) | 0 | 2,240 | 0 | ||||||||||
Weighted-average shares used in computing diluted net earnings (loss) per share (in shares) | 256,711 | 102,078 | 102,018 | 101,644 | 100,737 | 100,759 | 100,404 | 99,817 | 96,465 | 142,541 | 100,433 | ||
Predecessor | |||||||||||||
Numerator: | |||||||||||||
Net loss | $ (71,811) | ||||||||||||
Accretion of dividends on Class A common stock | 0 | ||||||||||||
Gain on conversion of Class A common stock | 0 | ||||||||||||
Earnings allocated to unvested restricted stock | 0 | ||||||||||||
Net income (loss) available to common stockholders | $ (71,811) | ||||||||||||
Weighted-average common shares outstanding used in computing basic net earnings (loss) per share (in shares) | 71,989 | ||||||||||||
Net income (loss) available to common stockholders | $ (71,811) | ||||||||||||
Denominator: | |||||||||||||
Weighted-average common shares outstanding used in computing basic net earnings (loss) per share (in shares) | 71,989 | ||||||||||||
Add stock-based incentive stock awards (in shares) | 0 | ||||||||||||
Weighted-average shares used in computing diluted net earnings (loss) per share (in shares) | 71,989 |
Net Income (Loss) Per Share - W
Net Income (Loss) Per Share - Weighted Average Outstanding Shares of Common Stock Equivalents Excluded (Details) - shares shares in Thousands | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Feb. 04, 2016 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total anti-dilutive shares (in shares) | 2,987 | 6,958 | 7,832 | |
Stock options to purchase common stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total anti-dilutive shares (in shares) | 493 | 524 | 1,635 | |
Performance-based stock options to purchase common stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total anti-dilutive shares (in shares) | 5 | 119 | 105 | |
Non-vested restricted stock incentive awards | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total anti-dilutive shares (in shares) | 1,524 | 3,442 | 3,565 | |
Performance-based non-vested restricted stock incentive awards | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total anti-dilutive shares (in shares) | 965 | 1,559 | 2,527 | |
Restricted Stock Units (RSUs) | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total anti-dilutive shares (in shares) | 0 | 1,139 | 0 | |
Performance Stock Units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total anti-dilutive shares (in shares) | 0 | 175 | 0 | |
Predecessor | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total anti-dilutive shares (in shares) | 675 | |||
Predecessor | Stock options to purchase common stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total anti-dilutive shares (in shares) | 659 | |||
Predecessor | Performance-based stock options to purchase common stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total anti-dilutive shares (in shares) | 0 | |||
Predecessor | Non-vested restricted stock incentive awards | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total anti-dilutive shares (in shares) | 0 | |||
Predecessor | Performance-based non-vested restricted stock incentive awards | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total anti-dilutive shares (in shares) | 0 | |||
Predecessor | Restricted Stock Units (RSUs) | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total anti-dilutive shares (in shares) | 16 | |||
Predecessor | Performance Stock Units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total anti-dilutive shares (in shares) | 0 |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) - USD ($) $ in Thousands | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Feb. 04, 2016 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Defined Benefit Plan Disclosure [Line Items] | ||||
Employee benefit plan expense | $ 2,145 | $ 4,474 | $ 4,299 | |
Predecessor | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Employee benefit plan expense | $ 1,866 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - The Managers - Management Fee Agreement $ in Millions | Feb. 05, 2016USD ($) |
Related Party Transaction [Line Items] | |
Quarterly transaction amount | $ 2.5 |
Silver Lake Management | |
Related Party Transaction [Line Items] | |
Percent of transaction amount | 50.00% |
Thoma Bravo | |
Related Party Transaction [Line Items] | |
Percent of transaction amount | 40.73% |
TB Partners | |
Related Party Transaction [Line Items] | |
Percent of transaction amount | 9.27% |
Related Party Transactions - Ma
Related Party Transactions - Management Fees (Details) - Management Fee Agreement - USD ($) $ in Thousands | 11 Months Ended | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Related Party Transaction [Line Items] | |||
Management fees | $ 9,038 | $ 8,125 | $ 10,000 |
Silver Lake Management | |||
Related Party Transaction [Line Items] | |||
Management fees | 4,519 | 4,063 | 5,000 |
Thoma Bravo | |||
Related Party Transaction [Line Items] | |||
Management fees | 3,681 | 3,309 | 4,073 |
TB Partners | |||
Related Party Transaction [Line Items] | |||
Management fees | $ 838 | $ 753 | $ 927 |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components of Loss Before Income Taxes (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 11 Months Ended | 12 Months Ended | ||||||||
Feb. 04, 2016 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Schedule Of Income Taxes [Line Items] | ||||||||||||
U.S. | $ (255,846) | $ (116,459) | $ (13,857) | |||||||||
International | (103,399) | (5,251) | (47,611) | |||||||||
Loss before income taxes | $ 14,342 | $ 524 | $ 38,577 | $ 68,267 | $ 4,894 | $ 1,418 | $ 2,375 | $ 52,781 | $ (359,245) | $ (121,710) | $ (61,468) | |
Predecessor | ||||||||||||
Schedule Of Income Taxes [Line Items] | ||||||||||||
U.S. | $ (107,749) | |||||||||||
International | (17,218) | |||||||||||
Loss before income taxes | $ (124,967) |
Income Taxes - Schedule of Inco
Income Taxes - Schedule of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Feb. 04, 2016 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Current: | ||||
Federal | $ 9,831 | $ (10,906) | $ 118,909 | |
State | 579 | 2,191 | 455 | |
International | 605 | 10,759 | 1,009 | |
Total current income tax expense (benefit) | 11,015 | 2,044 | 120,373 | |
Deferred: | ||||
Federal | (92,602) | (14,978) | (90,498) | |
State | (967) | 670 | 79 | |
International | (14,097) | (7,380) | (7,556) | |
Total deferred income tax expense (benefit) | (107,666) | (21,688) | (97,975) | |
Total income tax expense (benefit) | $ (96,651) | $ (19,644) | $ 22,398 | |
Predecessor | ||||
Current: | ||||
Federal | $ (33,958) | |||
State | 0 | |||
International | (1,343) | |||
Total current income tax expense (benefit) | (35,301) | |||
Deferred: | ||||
Federal | (11,155) | |||
State | (2,771) | |||
International | (3,929) | |||
Total deferred income tax expense (benefit) | (17,855) | |||
Total income tax expense (benefit) | $ (53,156) |
Income Taxes - Schedule of Effe
Income Taxes - Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($) $ in Thousands | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Feb. 04, 2016 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Schedule Of Income Taxes [Line Items] | ||||
Expense (benefit) derived by applying the federal statutory income tax rate to income (loss) before income taxes | $ (125,736) | $ (25,558) | $ (21,514) | |
State taxes, net of federal benefit | (241) | 2,435 | 297 | |
Permanent items | 1,819 | 224 | (613) | |
Impact of the Tax Act | ||||
One-time transition tax | 0 | 140 | 130,802 | |
Rate change | 0 | 0 | (91,545) | |
Domestic production activity benefit | 0 | 0 | (3,794) | |
Research and experimentation tax credits | 329 | (1,955) | (270) | |
Withholding tax | 3,951 | 2,486 | 0 | |
Net operating loss carryback | 0 | 0 | 0 | |
Stock-based compensation | 0 | 238 | 0 | |
Effect of foreign operations | 23,227 | 2,346 | 9,035 | |
Total income tax expense (benefit) | $ (96,651) | $ (19,644) | $ 22,398 | |
Predecessor | ||||
Schedule Of Income Taxes [Line Items] | ||||
Expense (benefit) derived by applying the federal statutory income tax rate to income (loss) before income taxes | $ (43,739) | |||
State taxes, net of federal benefit | (1,801) | |||
Permanent items | 3,145 | |||
Impact of the Tax Act | ||||
One-time transition tax | 0 | |||
Rate change | 0 | |||
Domestic production activity benefit | (308) | |||
Research and experimentation tax credits | (2,199) | |||
Withholding tax | 0 | |||
Net operating loss carryback | 3,872 | |||
Stock-based compensation | (14,076) | |||
Effect of foreign operations | 1,950 | |||
Total income tax expense (benefit) | $ (53,156) |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 11 Months Ended | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
One-time transition tax | $ 0 | $ 140 | $ 130,802 |
Provisional transition tax liability | 120,800 | ||
Rate change | $ 0 | 0 | 91,545 |
Additional tax expense | 100 | ||
Measurement period adjustment, transition tax | 9,600 | ||
Transition tax liability | 111,200 | ||
Tax Credit Carryforward [Line Items] | |||
Valuation allowance | 1,775 | 1,811 | |
Unrecognized tax benefits, income tax penalties and interest accrued | 4,100 | 3,000 | |
Research Tax Credit Carryforward | |||
Tax Credit Carryforward [Line Items] | |||
Tax credit carryforward | 700 | 700 | |
Domestic Tax Authority | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | 12,200 | 91,500 | |
Operating loss carryforwards, subject to limitations | 12,200 | 4,300 | |
State and Local Jurisdiction | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | 106,700 | 103,700 | |
Foreign Tax Authority | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | $ 78,600 | $ 100,500 |
Income Taxes - Components of Ne
Income Taxes - Components of Net Deferred Tax Amounts (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Deferred tax assets: | ||
Allowance for doubtful accounts | $ 436 | $ 201 |
Accrued expenses | 3,133 | 4,323 |
Net operating loss | 26,652 | 47,631 |
Research and experimentation credits | 1,689 | 2,177 |
Stock-based compensation | 1,090 | 0 |
Interest | 1,528 | 0 |
Deferred revenue | 1,164 | 0 |
Other credits | 790 | 2,920 |
Total deferred tax assets | 36,482 | 57,252 |
Valuation allowance | (1,775) | (1,811) |
Deferred tax assets, net of valuation allowance | 34,707 | 55,441 |
Deferred tax liabilities: | ||
Property and equipment | 9,107 | 11,891 |
Prepaid expenses | 1,805 | 1,230 |
Deferred revenue | 0 | 101 |
Debt costs | 9,118 | 14,917 |
Foreign royalty | 2,017 | 714 |
Intangibles | 152,931 | 189,686 |
Total deferred tax liabilities | 174,978 | 218,539 |
Net deferred tax liability | $ 140,271 | $ 163,098 |
Income Taxes - Schedule of Gros
Income Taxes - Schedule of Gross Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Feb. 04, 2016 | Dec. 31, 2015 |
Income Tax Contingency [Line Items] | |||||
Gross unrecognized tax benefits | $ 19,709 | $ 19,504 | $ 22,888 | $ 17,631 | |
Predecessor | |||||
Income Tax Contingency [Line Items] | |||||
Gross unrecognized tax benefits | $ 17,631 | $ 16,370 |
Income Taxes - Schedule of Unre
Income Taxes - Schedule of Unrecognized Tax Benefits, Rollforward (Details) - USD ($) $ in Thousands | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Feb. 04, 2016 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ||||
Balance, beginning of year | $ 17,631 | $ 19,504 | $ 22,888 | |
Increases for tax positions related to the current year | 4,421 | 59 | 502 | |
Decreases for tax positions related to the current year | 0 | 0 | (715) | |
Increases for tax positions related to prior years | 836 | 146 | 0 | |
Decreases for tax positions related to prior years | 0 | 0 | (3,171) | |
Reductions due to lapsed statute of limitations | 0 | 0 | 0 | |
Balance, end of year | $ 17,631 | 22,888 | $ 19,709 | $ 19,504 |
Predecessor | ||||
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ||||
Balance, beginning of year | 16,370 | $ 17,631 | ||
Increases for tax positions related to the current year | 1,335 | |||
Decreases for tax positions related to the current year | 0 | |||
Increases for tax positions related to prior years | 230 | |||
Decreases for tax positions related to prior years | (304) | |||
Reductions due to lapsed statute of limitations | 0 | |||
Balance, end of year | $ 17,631 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) ft² in Thousands | Dec. 31, 2018ft² |
Building | |
Operating Leased Assets [Line Items] | |
Leased office space area (in sq ft) | 348 |
Commitments and Contingencies_2
Commitments and Contingencies - Schedule of Future Minimum Lease Payments (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Minimum Lease Payments | |
2,019 | $ 15,287 |
2,020 | 15,105 |
2,021 | 14,138 |
2,022 | 13,412 |
2,023 | 12,340 |
Thereafter | 53,734 |
Total minimum lease payments | $ 124,016 |
Commitments and Contingencies_3
Commitments and Contingencies - Schedule of Rent Expense (Details) - USD ($) $ in Thousands | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Feb. 04, 2016 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Operating Leased Assets [Line Items] | ||||
Rent expense | $ 12,688 | $ 18,249 | $ 16,298 | |
Predecessor | ||||
Operating Leased Assets [Line Items] | ||||
Rent expense | $ 1,088 |
Commitments and Contingencies_4
Commitments and Contingencies - Take Private Deferred Stock Payments (Details) $ / shares in Units, $ in Millions | 12 Months Ended |
Dec. 31, 2018USD ($)$ / shares | |
Commitments and Contingencies Disclosure [Abstract] | |
Deferred compensation (in dollars per share) | $ / shares | $ 60.10 |
Liability for stock payments | $ 1.6 |
Compensation expense | 3.2 |
Cash payments for deferred compensation | 4.4 |
Deferred compensation, expected future payments | $ 3.3 |
Operating Segments and Geogra_3
Operating Segments and Geographic Information - Additional Information (Details) | 12 Months Ended |
Dec. 31, 2018segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 1 |
Operating Segments and Geogra_4
Operating Segments and Geographic Information - Schedule of Revenue by Geographic Area (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 11 Months Ended | 12 Months Ended | ||||||||
Feb. 04, 2016 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||||||||||
Revenues | $ 221,181 | $ 213,277 | $ 201,718 | $ 196,913 | $ 198,339 | $ 189,112 | $ 175,441 | $ 165,125 | $ 422,094 | $ 833,089 | $ 728,017 | |
United States, country of domicile | ||||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||||||||||
Revenues | 268,426 | 505,304 | 459,701 | |||||||||
International | ||||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||||||||||
Revenues | $ 153,668 | $ 327,785 | $ 268,316 | |||||||||
Predecessor | ||||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||||||||||
Revenues | $ 47,327 | |||||||||||
Predecessor | United States, country of domicile | ||||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||||||||||
Revenues | 31,797 | |||||||||||
Predecessor | International | ||||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||||||||||
Revenues | $ 15,530 |
Operating Segments and Geogra_5
Operating Segments and Geographic Information - Schedule of Long-lived Assets by Geographic Area (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived assets, net | $ 35,864 | $ 34,209 |
United States, country of domicile | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived assets, net | 22,953 | 20,986 |
Switzerland | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived assets, net | 4,878 | 3,941 |
All other international | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived assets, net | $ 8,033 | $ 9,282 |
Quarterly Results of Operatio_3
Quarterly Results of Operations (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 11 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenue | $ 221,181 | $ 213,277 | $ 201,718 | $ 196,913 | $ 198,339 | $ 189,112 | $ 175,441 | $ 165,125 | $ 422,094 | $ 833,089 | $ 728,017 |
Gross profit | 159,184 | 151,420 | 140,043 | 135,707 | 139,268 | 130,409 | 117,932 | 108,677 | 228,339 | 586,354 | 496,286 |
Loss before income taxes | (14,342) | (524) | (38,577) | (68,267) | (4,894) | (1,418) | (2,375) | (52,781) | 359,245 | 121,710 | 61,468 |
Net income (loss) | (14,743) | (398) | (27,015) | (59,910) | (39,761) | 1,637 | (2,004) | (43,738) | (262,594) | (102,066) | (83,866) |
Net income (loss) available to common stockholders | $ 668,426 | $ (75,006) | $ (99,193) | $ (129,745) | $ (109,563) | $ (66,627) | $ (68,043) | $ (107,640) | $ (480,498) | $ 364,635 | $ (351,873) |
Basic income (loss) per share (in dollars per share) | $ 2.63 | $ (0.73) | $ (0.97) | $ (1.28) | $ (1.09) | $ (0.66) | $ (0.68) | $ (1.08) | $ (4.98) | $ 2.60 | $ (3.50) |
Diluted income (loss) per share (in dollars per share) | $ 2.60 | $ (0.73) | $ (0.97) | $ (1.28) | $ (1.09) | $ (0.66) | $ (0.68) | $ (1.08) | $ (4.98) | $ 2.56 | $ (3.50) |
Shares used in computation of basic income (loss) per share (in shares) | 254,209 | 102,078 | 102,018 | 101,644 | 100,737 | 100,759 | 100,404 | 99,817 | 96,465 | 140,301 | 100,433 |
Shares used in computation of diluted income (loss) per share (in shares) | 256,711 | 102,078 | 102,018 | 101,644 | 100,737 | 100,759 | 100,404 | 99,817 | 96,465 | 142,541 | 100,433 |
SCHEDULE II - VALUATION AND Q_2
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS (Details) - USD ($) $ in Thousands | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Feb. 04, 2016 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Allowance for doubtful accounts, customers and other | ||||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | ||||
Beginning Balance | $ 0 | $ 2,065 | $ 1,002 | |
Additions (Charge to Expense) | 1,713 | 2,498 | 2,489 | |
Deductions (Write-offs, net of Recoveries) | 711 | 1,367 | 1,426 | |
Ending Balance | $ 0 | 1,002 | 3,196 | 2,065 |
Allowance for doubtful accounts, customers and other | Predecessor | ||||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | ||||
Beginning Balance | 649 | 668 | ||
Additions (Charge to Expense) | 64 | |||
Deductions (Write-offs, net of Recoveries) | 45 | |||
Ending Balance | 668 | |||
Tax valuation allowances | ||||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | ||||
Beginning Balance | 0 | 1,811 | 0 | |
Additions (Charge to Expense) | 0 | 0 | 1,811 | |
Deductions (Write-offs, net of Recoveries) | 0 | 36 | 0 | |
Ending Balance | 0 | 0 | $ 1,775 | $ 1,811 |
Tax valuation allowances | Predecessor | ||||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | ||||
Beginning Balance | 0 | $ 0 | ||
Additions (Charge to Expense) | 0 | |||
Deductions (Write-offs, net of Recoveries) | 0 | |||
Ending Balance | $ 0 |