Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 31, 2023 | May 05, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-39613 | |
Entity Registrant Name | ARRAY TECHNOLOGIES, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 83-2747826 | |
Entity Address, Address Line One | 3901 Midway Place NE | |
Entity Address, City or Town | Albuquerque | |
Entity Address, State or Province | NM | |
Entity Address, Postal Zip Code | 87109 | |
City Area Code | (505) | |
Local Phone Number | 881-7567 | |
Title of 12(b) Security | Common stock, $0.001 par value | |
Trading Symbol | ARRY | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock Shares Outstanding | 150,853,116 | |
Entity Central Index Key | 0001820721 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (unaudited) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Current assets | ||
Cash and cash equivalents | $ 147,756 | $ 133,901 |
Accounts receivable, net | 414,712 | 421,183 |
Inventories | 254,624 | 233,159 |
Income tax receivables | 3,163 | 3,532 |
Prepaid expenses and other | 46,381 | 39,434 |
Total current assets | 866,636 | 831,209 |
Property, plant and equipment, net | 25,864 | 23,174 |
Goodwill | 428,173 | 416,184 |
Other intangible assets, net | 379,374 | 386,364 |
Deferred income tax assets | 0 | 16,466 |
Derivative assets | 63,320 | 0 |
Other assets | 30,802 | 32,655 |
Total assets | 1,794,169 | 1,706,052 |
Current liabilities | ||
Accounts payable | 200,585 | 170,430 |
Accrued expenses and other | 58,795 | 54,895 |
Accrued warranty reserve | 1,443 | 3,690 |
Income tax payable | 11,833 | 6,881 |
Deferred revenue | 151,343 | 178,922 |
Current portion of contingent consideration | 1,811 | 1,200 |
Current portion of debt | 34,382 | 38,691 |
Other current liabilities | 10,393 | 10,553 |
Total current liabilities | 470,585 | 465,262 |
Deferred income tax liabilities | 73,051 | 72,606 |
Contingent consideration, net of current portion | 6,914 | 7,387 |
Other long-term liabilities | 13,939 | 14,808 |
Long-term warranty | 4,469 | 1,786 |
Long-term debt, net of current portion | 705,827 | 720,352 |
Total liabilities | 1,274,785 | 1,282,201 |
Commitments and contingencies (Note 12) | ||
Series A Redeemable Perpetual Preferred Stock of $0.001 par value - 500,000 authorized; 412,739 and 406,389 shares issued as of March 31, 2023 and December 31, 2022, respectively; liquidation preference of $412.7 million and $406.4 million at respective dates | 312,054 | 299,570 |
Stockholders’ equity | ||
Preferred stock of $0.001 par value - 4,500,000 shares authorized; none issued at respective dates | 0 | 0 |
Common stock of $0.001 par value - 1,000,000,000 shares authorized; 150,822,974 and 150,513,104 shares issued at respective dates | 150 | 150 |
Additional paid-in capital | 426,221 | 383,176 |
Accumulated deficit | (241,338) | (267,470) |
Accumulated other comprehensive income | 22,297 | 8,425 |
Total stockholders’ equity | 207,330 | 124,281 |
Total liabilities, redeemable perpetual preferred stock and stockholders’ equity | $ 1,794,169 | $ 1,706,052 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (unaudited) (Parenthetical) - USD ($) | Mar. 31, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Temporary equity, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Temporary equity, shares authorized (in shares) | 500,000 | 500,000 |
Temporary equity, shares issued (in shares) | 412,739 | 406,389 |
Temporary equity, liquidation preference | $ 412,700,000 | $ 406,400,000 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 4,500,000 | 4,500,000 |
Preferred Stock, shares issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued (in shares) | 150,822,974 | 150,513,104 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Income Statement [Abstract] | ||
Revenue | $ 376,773 | $ 300,586 |
Cost of revenue | 275,594 | 273,999 |
Gross profit | 101,179 | 26,587 |
Operating expenses | ||
General and administrative | 38,142 | 45,425 |
Change in fair value of contingent consideration | 1,338 | (3,731) |
Depreciation and amortization | 14,241 | 23,237 |
Total operating expenses | 53,721 | 64,931 |
Income (loss) from operations | 47,458 | (38,344) |
Other income (expense) | ||
Other income, net | 194 | 743 |
Foreign currency gain (loss) | (194) | 3,863 |
Change in fair value of derivative assets | (1,950) | 0 |
Interest expense | (9,500) | (6,942) |
Total other (expense) | (11,450) | (2,336) |
Income (loss) before income tax (benefit) expense | 36,008 | (40,680) |
Income tax (benefit) expense | 9,876 | (14,743) |
Net income (loss) | 26,132 | (25,937) |
Preferred dividends and accretion | 12,484 | 11,606 |
Net income (loss) to common shareholders | $ 13,648 | $ (37,543) |
Income (loss) per common share | ||
Basic (in dollars per share) | $ 0.09 | $ (0.25) |
Diluted (in dollars per share) | $ 0.09 | $ (0.25) |
Weighted average number of common shares outstanding | ||
Basic (in shares) | 150,607 | 148,288 |
Diluted (in shares) | 151,795 | 148,288 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (unaudited) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | ||
Statement of Comprehensive Income [Abstract] | |||
Net income (loss) | $ 26,132 | $ (25,937) | |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent [Abstract] | |||
Change in foreign currency translation adjustments | [1] | 13,872 | 56,675 |
Comprehensive income | $ 40,004 | $ 30,738 | |
[1]The tax effect on other comprehensive income is not significant. |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Changes in Redeemable Perpetual Preferred Stock and Stockholders’ Equity (unaudited) - USD ($) shares in Thousands, $ in Thousands | Total | Series A Preferred Stock | Common Stock | Common Stock Series A Preferred Stock | Additional Paid-In Capital | Additional Paid-In Capital Series A Preferred Stock | Accumulated Deficit | Accumulated Other Comprehensive Income |
Temporary equity, beginning balance (in shares) at Dec. 31, 2021 | 350 | |||||||
Temporary equity, beginning balance at Dec. 31, 2021 | $ 237,462 | |||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||
Issuance of Series A Redeemable Perpetual Preferred Stock, net of fees (in shares) | 50 | |||||||
Issuance of Series A Redeemable Perpetual Preferred Stock, net of fees | $ 32,724 | |||||||
Preferred cumulative dividends plus accretion | $ 11,606 | |||||||
Temporary equity, ending balance (in shares) at Mar. 31, 2022 | 400 | |||||||
Temporary equity, ending balance at Mar. 31, 2022 | $ 281,792 | |||||||
Stockholders' equity, beginning balance (in shares) at Dec. 31, 2021 | 135,027 | |||||||
Stockholders' equity, beginning balance at Dec. 31, 2021 | (69,205) | $ 135 | $ 202,562 | $ (271,902) | $ 0 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Equity-based compensation | 4,413 | 4,413 | ||||||
Issuance of stock, net (in shares) | 15,147 | |||||||
Issuance of stock, net | $ 215,878 | $ 15 | $ 215,863 | |||||
Preferred cumulative dividends plus accretion | (11,606) | (11,606) | ||||||
Net income (loss) | (25,937) | (25,937) | ||||||
Other comprehensive income | 56,675 | 56,675 | ||||||
Stockholders' equity, ending balance (in shares) at Mar. 31, 2022 | 150,174 | |||||||
Stockholders' equity, ending balance at Mar. 31, 2022 | $ 170,218 | $ 150 | 411,232 | (297,839) | 56,675 | |||
Temporary equity, beginning balance (in shares) at Dec. 31, 2022 | 406 | |||||||
Temporary equity, beginning balance at Dec. 31, 2022 | $ 299,570 | |||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||
Preferred cumulative dividends plus accretion (in shares) | 7 | |||||||
Preferred cumulative dividends plus accretion | $ 12,484 | |||||||
Temporary equity, ending balance (in shares) at Mar. 31, 2023 | 413 | |||||||
Temporary equity, ending balance at Mar. 31, 2023 | $ 312,054 | |||||||
Stockholders' equity, beginning balance (in shares) at Dec. 31, 2022 | 150,513 | |||||||
Stockholders' equity, beginning balance at Dec. 31, 2022 | 124,281 | $ 150 | 383,176 | (267,470) | 8,425 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Equity-based compensation (in shares) | 310 | |||||||
Equity-based compensation | 3,366 | 3,366 | ||||||
Correction of the Capped Call and Put Option errors | $ 52,914 | $ 52,914 | ||||||
Preferred cumulative dividends plus accretion | (13,235) | (13,235) | ||||||
Net income (loss) | 26,132 | 26,132 | ||||||
Other comprehensive income | 13,872 | 13,872 | ||||||
Stockholders' equity, ending balance (in shares) at Mar. 31, 2023 | 150,823 | |||||||
Stockholders' equity, ending balance at Mar. 31, 2023 | $ 207,330 | $ 150 | $ 426,221 | $ (241,338) | $ 22,297 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Operating activities: | ||
Net income (loss) | $ 26,132 | $ (25,937) |
Adjustments to net income (loss): | ||
Provision for bad debts | 233 | 145 |
Deferred tax expense | 4,555 | 4,349 |
Depreciation and amortization | 14,533 | 23,608 |
Amortization of debt discount and issuance costs | 2,826 | 1,710 |
Equity-based compensation | 3,366 | 4,508 |
Contingent consideration | 1,338 | (3,731) |
Warranty provision | 436 | 594 |
Write-down of inventories | 1,847 | 409 |
Change in fair value of derivative assets | 1,950 | 0 |
Changes in operating assets and liabilities, net of business acquisition | ||
Accounts receivable | 6,238 | (44,268) |
Inventories | (23,312) | (46,250) |
Income tax receivables | 369 | (21,924) |
Prepaid expenses and other | (6,947) | 11,558 |
Accounts payable | 30,155 | 59,419 |
Accrued expenses and other | 3,900 | 7,027 |
Income tax payable | 4,952 | (8,760) |
Lease liabilities | 824 | 6,085 |
Deferred revenue | (27,579) | (18,639) |
Net cash provided by (used in) operating activities | 45,816 | (50,097) |
Investing activities: | ||
Purchase of property, plant and equipment | (3,883) | (2,357) |
Acquisition of STI, net of cash acquired | 0 | (373,816) |
Net cash used in investing activities | (3,883) | (376,173) |
Financing activities: | ||
Proceeds from Series A issuance | 0 | 33,098 |
Proceeds from common stock issuance | 0 | 15,885 |
Series A equity issuance costs | (750) | (175) |
Common stock issuance costs | 0 | (450) |
Proceeds from revolving credit facility | 0 | 52,000 |
Proceeds from issuance of other debt | 6,469 | 6,229 |
Principal payments on term loan facility | (11,075) | (4,368) |
Principal payments on other debt | (17,206) | 0 |
Contingent consideration payments | (1,200) | (1,483) |
Net cash provided by (used in) financing activities | (23,762) | 100,736 |
Effect of exchange rate changes on cash and cash equivalent balances | (4,316) | 7,355 |
Net change in cash and cash equivalents | 13,855 | (318,179) |
Cash and cash equivalents, beginning of period | 133,901 | 367,670 |
Cash and cash equivalents, end of period | 147,756 | 49,491 |
Supplemental Cash Flow Information | ||
Cash paid for interest | 7,980 | 3,039 |
Cash paid for income taxes | 2,522 | 0 |
Non-cash Investing and Financing Activities | ||
Dividends accrued on Series A Preferred | 6,350 | 6,189 |
Stock consideration paid for acquisition of STI | $ 0 | $ 200,224 |
Organization, Business and Out-
Organization, Business and Out-of-Period Adjustments | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Business and Out-of-Period Adjustments | Organization, Business and Out-of-Period Adjustments Array Technologies, Inc. (the “Company”), formerly ATI Intermediate Holdings, LLC, is a Delaware corporation formed in December 2018 as a wholly owned subsidiary of ATI Investment Parent, LLC (“Former Parent”). On October 14, 2020, the Company converted from a Delaware limited liability company to a Delaware corporation and changed the Company’s name to Array Technologies, Inc. The Company is headquartered in Albuquerque, New Mexico, and manufactures and supplies solar tracking systems and related products for customers across the United States and internationally. The Company, through its wholly-owned subsidiary, ATI Investment Sub, Inc. owns subsidiaries through which it conducts substantially all operations. Acquisition of STI Norland On January 11, 2022 (the “Acquisition Date”), the Company acquired 100% of the share capital of Soluciones Técnicas Integrales Norland, S.L.U., a Spanish private limited liability Company, and its subsidiaries (collectively, “STI”) with cash and common stock of the Company (the “STI Acquisition”). The STI Acquisition was accounted for as a business combination. Upon completion of the STI Acquisition, the Company began operating as two reportable operating segments: the Array legacy operating segment (the “Array Legacy Operations”) and the newly acquired operations (the “STI Operations”) pertaining to STI. Out-of-Period Adjustment for the Correction of Errors During the first quarter of fiscal year 2023, the Company identified certain errors in its previously issued financial statements that have been corrected through a cumulative out-of-period adjustment in the condensed consolidated financial statements as of and for the three months ended March 31, 2023. The Company has concluded that the errors are not material to the previously issued financial statements and the cumulative out-of-period adjustment for the correction of these errors is not material to the financial statements for the three months ended March 31, 2023. Below is a summary of each of the errors corrected and a summary of the cumulative impact. Capped Calls As discussed in Note 8 – Debt, of the Company’s consolidated financial statements for the fiscal year ended December 31, 2022 included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on March 22, 2023, in November 2021, the Company paid $52.9 million to enter into capped call option agreements (the “Capped Calls”) to reduce the potential dilution to holders of the Company’s common stock after a conversion of the Company’s Convertible Notes (as defined below). The Company originally concluded that the Capped Calls met the criteria for equity classification because the Capped Calls are indexed to the Company’s common stock, and the Company has discretion to settle the Capped Calls in shares or cash. As a result, the Company originally recorded the amount paid for the Capped Calls as a reduction to additional paid-in capital of $52.9 million, offset by $12.4 million of income taxes. When the Company entered into the Capped Calls, the Company executed certain side letters (the “Side Letters”) with the counterparties that replaced some of the terms described in the primary contract including the volatility inputs used to value the Capped Calls under certain circumstances. Upon further evaluation, the Company has concluded that the modification to the volatility inputs precludes the Capped Calls from being indexed to its own stock because there is the possibility that the Capped Calls will settle at an amount that exceeds fair value and, therefore, prevents the Capped Calls from being classified as equity. In addition, the Side Letters also provide for certain adjustments to settlement amounts on the basis of holder-specific taxes which are impermissible inputs to the valuation that also prevents the Capped Calls from being indexed to the Company’s own stock, and therefore, prevents the Capped Calls from being classified as equity. As a result, for the three months ended March 31, 2023, the Company has concluded that the cash paid for the Capped Calls should have been recorded as an asset of $52.9 million with the asset being subsequently marked to market at the end of each accounting period. Additional Closing Purchased Put Option As discussed in Note 9 – Redeemable Perpetual Preferred Stock, of the Company’s consolidated financial statements for the fiscal year ended December 31, 2022 included in the Company’s Annual Report on Form 10-K filed with the SEC on March 22, 2023, in August 2021, the Company entered into a Securities Purchase Agreement (the “SPA”) with certain Purchasers (as defined below), which gives the Company the option to require the Purchasers to purchase up to an additional 150,000 shares of Series A Shares (as defined below) and up to 3,375,000 shares of common stock for $148.0 million until June 30, 2023 (the “Put Option”). Upon issuance of the Put Option, the Company recorded a reduction to additional paid-in-capital of approximately $12.4 million because the Company originally concluded that the Put Option should be classified as equity. During the first quarter of 2023, the Company reconsidered the provisions of this option. Because the Series A Shares underlying the Put Option could potentially require redemption under the Certificate of Designations governing the Series A Shares, the Put Option should not have been equity classified. As a result, during the three months ended March 31, 2023, the Company has concluded that the value of the Put Option at inception should have been recorded as an asset of $12.4 million, with the asset being subsequently marked to market at the end of each accounting period. Correction of the Capped Calls and Put Option The adjustments to correct the Capped Calls and the Put Option at January 1, 2023 resulted in an increase in Derivative assets of $55.7 million, a decrease in Deferred income tax assets of $11.0 million, an increase in additional paid-in-capital of $52.9 million, and a decrease in net income of $8.1 million. Goodwill In connection with the acquisition of STI, the Company had understated goodwill by $2.0 million and overstated inventory by the same amount that was sold during fiscal 2022. The Company corrected the goodwill balance during the current period resulting in an increase in goodwill and a decrease in cost of goods sold. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Accounting and Presentation The accompanying unaudited condensed consolidated financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). The unaudited interim financial statements have been prepared on the same basis as the audited annual financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for the fair statement of results for the interim periods reported. The results for the three months ended March 31, 2023 are not necessarily indicative of results to be expected for the year ending December 31, 2023 or any other interim periods, or any future year or period. The balance sheet as of December 31, 2022 included herein was derived from the audited financial statements as of that date. Certain disclosures have been condensed or omitted from the interim financial statements. These financial statements should be read in conjunction with the Company’s audited financial statements included in the Company’s Annual Report on Form 10-K filed with the SEC on March 22, 2023, (the “2022 Annual Report”). Principles of Consolidation The condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated upon consolidation. Use of Estimates The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from previously estimated amounts, and such differences may be material to the condensed consolidated financial statements; however, management believes that these estimates and assumptions provide a reasonable basis for the fair presentation of the consolidated financial statements. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the period they occur. Impact of the Ongoing Conflict in Ukraine The ongoing conflict in Ukraine has reduced the availability of material that can be sourced in Europe and, as a result, increased logistics costs for the procurement of certain inputs and materials used in our products. We do not know ultimate severity or duration of the conflict in Ukraine, but we continue to monitor the situation and evaluate our procurement strategy and supply chain as to reduce any negative impact on our business, financial condition and results of operations. Inflation Inflationary pressures, while somewhat moderating recently, are expected to persist, at least in the near-term, and may negatively impact our results of operation. To mitigate the inflationary pressures on our business, we have implemented selective price increases in certain markets, accelerated productivity initiatives and expanded our supplier base, while continuing to execute on overhead cost containment practices. Business Combinations The Company accounts for its business acquisitions under the acquisition method of accounting in accordance with the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 805 Business Combinations (“ASC 805”). The excess of the purchase price over the estimated fair values of the net assets acquired is recorded as goodwill. Determining the fair value of assets acquired and liabilities assumed requires management’s judgment and often involves the use of significant estimates and assumptions, including assumptions with respect to future cash inflows and outflows, discount rates, asset lives, and market multiples, amongst other items. Foreign Currency Translation Exposure The functional currencies of certain of our foreign subsidiaries are their local currencies. Accordingly, we apply period-end exchange rates to translate their assets and liabilities and average exchange rates prevailing during the period to translate their revenues, expenses, gains, and losses into U.S. dollars. We include the associated translation adjustments as a separate component of “Accumulated other comprehensive income (loss)” within stockholders’ equity. Certain of our foreign subsidiaries have assets and liabilities (primarily cash, receivables, inventory, property, plant and equipment, intangible assets, trade payables, accrued expenses, operating lease liabilities, and long-term debt) that are denominated in currencies other than the subsidiaries’ functional currencies. Changes in the exchange rates between the functional currencies of our subsidiaries and the other currencies in which these assets and liabilities are denominated will create fluctuations in our reported condensed consolidated statements of operations and cash flows. Derivative Financial instruments Both the Capped Call and the Put Option are accounted for as an asset that is recorded at fair value within Derivative assets in the consolidated balance sheets. The changes in fair value to Derivative assets is recorded within Change in fair value of derivative assets in the Condensed Consolidated Statements of Operations. See Note 1 – Organization, Business and Out-of-Period Adjustments , for further information. Recent Accounting Pronouncements In March 2020, the FASB issued Accounting Standards Update (“ASU”) 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”). ASU 2020-04 contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts. The guidance in ASU 2020-04 is optional and may be elected over time as reference rate reform activities occur. In December 2022, the FASB issued ASU 2022-06, Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848 , to provide entities with relief during the transition period by deferring the effective date of reference rate reform from December 31, 2022 to December 31, 2024. ASU 2022-06 is effective upon issuance. During the three months ended March 31, 2023, the Company adopted ASU 2020-04 and ASU 2022-06. Simultaneously, the Company elected to apply the debt accounting optional expedient, under which the reporting entity will account for amendments to debt agreements, which sole intent are the replacement of a discontinued reference rate(s), as being not substantial and thus a continuation of the existing contract . There was no significant impact to the Company’s condensed consolidated financial statements related to the adoption of ASU 2020-04 and ASU 2022-06. The Company continues to evaluate the impact of the ASU 2020-04 guidance and may apply other elections as applicable as additional changes in the market occur. In March 2023, the Company amended an existing debt agreement to replace the London Interbank Offered Rate (“LIBOR”) interest rate provisions with interest rate provisions based on a forward-looking term rate based on the secured overnight funding rate (“SOFR”) (see Note 8 – Debt |
Accounts Receivable, Net
Accounts Receivable, Net | 3 Months Ended |
Mar. 31, 2023 | |
Receivables [Abstract] | |
Accounts Receivable, Net | Accounts Receivable, Net Accounts receivable consists of the following (in thousands): March 31, 2023 December 31, 2022 Accounts receivable $ 416,785 $ 423,071 Less: allowance for credit losses (2,073) (1,888) Accounts receivable, net $ 414,712 $ 421,183 |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2023 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consist of the following (in thousands): March 31, 2023 December 31, 2022 Raw materials $ 88,348 $ 66,574 Finished goods 166,276 166,585 Total $ 254,624 $ 233,159 |
Property, Plant and Equipment,
Property, Plant and Equipment, Net | 3 Months Ended |
Mar. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment, Net | Property, Plant and Equipment, Net Property, plant and equipment consist of the following (in thousands, except useful lives): Estimated Useful Lives (Years) March 31, 2023 December 31, 2022 Land N/A $ 1,587 $ 1,583 Buildings and land improvements 15-39 7,540 7,411 Manufacturing equipment 7 18,533 18,983 Furniture, fixtures and equipment 5-7 3,653 3,583 Vehicles 5 592 585 Hardware and software 3-5 3,831 3,706 Assets in progress N/A 8,229 5,142 Total 43,965 40,993 Less: accumulated depreciation (18,101) (17,819) Property, plant and equipment, net $ 25,864 $ 23,174 |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 3 Months Ended |
Mar. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Goodwill Changes in the carrying amount of goodwill by operating segment during the three months ended March 31, 2023 are shown below (in thousands): Array Legacy Operations (1) STI Operations Total Beginning balance $ 69,727 $ 346,457 $ 416,184 Correction to goodwill (see Note 1) — 2,000 2,000 Foreign currency translation — 9,989 9,989 Ending balance $ 69,727 $ 358,446 $ 428,173 (1) Goodwill attributable to Array Legacy Operations is net of accumulated impairment of $51.9 million. Each quarter the Company evaluates if facts and circumstances indicate that it is more-likely-than-not that the fair value of its reporting units is less than their carrying value, which would require the Company to perform an interim goodwill impairment test. During our most recent evaluation, we concluded there were no indicators of impairment as of March 31, 2023. Other Intangible Assets Other intangible assets consisted of the following (in thousands, except useful lives): Estimated Useful Lives (Years) March 31, 2023 December 31, 2022 Amortizable: Costs: Developed technology 14 $ 204,442 $ 203,800 Customer relationships 10 327,397 321,935 Backlog 1 52,545 51,015 Trade name 20 26,314 25,682 Total amortizable intangibles 610,698 602,432 Accumulated amortization: Developed technology 98,318 94,347 Customer relationships 89,155 81,268 Backlog 52,545 49,507 Trade name 1,606 1,246 Total accumulated amortization 241,624 226,368 Total amortizable intangibles, net 369,074 376,064 Non-amortizable costs: Trade name 10,300 10,300 Total other intangible assets, net $ 379,374 $ 386,364 Amortization expense related to intangible assets was $13.8 million and $22.0 million for the three months ended March 31, 2023 and 2022, respectively. Estimated future amortization expense of intangible assets as of March 31, is as follows (in thousands): Amount Remainder of 2023 $ 34,846 2024 46,970 2025 46,970 2026 42,664 2027 38,020 Thereafter 159,604 $ 369,074 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company follows guidance under ASC Topic 740-270 Income Taxes , which requires that an estimated annual effective tax rate is applied to year-to-date ordinary income (loss). At the end of each interim period, the Company estimates the effective tax rate expected to be applicable for the full fiscal year. The tax effect of discrete items is recorded in the quarter in which the discrete events occur. The Company recorded income tax expense of $9.9 million and a benefit of $14.7 million for the three months ended March 31, 2023 and 2022, respectively. The tax expense for the three months ended March 31, 2023 was unfavorably impacted by higher income reported in non-U.S. jurisdictions and an out of period increase in income tax expense of $1.4 million related to the Put Option (see Note 1 – Organization, Business and Out-of-Period Adjustments ), partially offset by benefits related to excess equity-based compensation deductions recorded discretely during the quarter. The tax benefit for the three months ended March 31, 2022 was favorably impacted by losses in non-U.S. jurisdictions which have higher tax rates than the U.S., partially offset by non-deductible expenses. For the three months ended March 31, 2023 and 2022, no reserves for uncertain tax positions have been recorded. The Company will continue to monitor this position each interim period. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Debt | Debt The following table summarizes the Company’s total debt (in thousands): March 31, 2023 December 31, 2022 Senior Secured Credit Facility Term loan facility $ 301,400 $ 312,475 Revolving credit facility — — 301,400 312,475 Unamortized discount and issuance costs (17,544) (19,135) Carrying amount 283,856 293,340 Convertible Debt 1% Senior Notes 425,000 425,000 Unamortized discount and issuance costs (10,785) (11,248) Carrying amount 414,215 413,752 Other Debt 42,138 51,951 Total Debt 768,538 789,426 Unamortized discount and issuance costs, total (28,329) (30,383) Carrying amount 740,209 759,043 Current portion of debt (34,382) (38,691) Total long-term debt, net of current portion $ 705,827 $ 720,352 Senior Secured Credit Facility On October 14, 2020, the Company entered into a senior secured credit facility (the “Credit Agreement”), which was amended on February 23, 2021 (the “First Amendment”), on February 26, 2021 (the “Second Amendment”) and again on March 2, 2023 (the “Third Amendment”). The senior secured facility consists of (i) a $575 million senior secured 7-year term loan facility (the “Term Loan Facility”) and (ii) a $200 million senior secured 5-year revolving credit facility (the “Revolving Credit Facility” and, together with the Term Loan Facility, the “Senior Secured Credit Facility”). The single purpose of the Third Amendment in March 2023 was to replace the former discontinued Senior Secured Credit Facility reference rate of LIBOR, with the comparable active reference rate, SOFR. There were no other changes as a result of the Third Amendment. Revolving Credit Facility Under the Revolving Credit Facility, the Company had no outstanding balance as of both March 31, 2023 and December 31, 2022, $40.4 million and $38.8 million in standby letters of credit at March 31, 2023 and December 31, 2022, respectively, and availability of $159.6 million and $161.2 million at March 31, 2023 and December 31, 2022, respectively. In accordance with the Third Amendment, the Revolving Credit Facility pays interest at the Company’s election, at either (x) for SOFR Loans at Adjusted Term SOFR plus 3.25% (as defined) or (y) for Base Rate Loans at the higher of the Prime Rate, 1/2 of 1% above the Federal Funds Rate or the Adjusted Term SOFR (as defined) for one month interest period, after giving effect to any floor plus 1%, plus 2.25%. Term Loan Facility The Term Loan Facility had a balance of $301.4 million and $312.5 million as of March 31, 2023 and December 31, 2022, respectively. The balance of the Term Loan Facility is presented in the accompanying condensed consolidated balance sheets, net of debt discount and issuance costs of $17.5 million and $19.1 million as of March 31, 2023 and December 31, 2022, respectively. In accordance with the Third Amendment, the Term Loan Facility pays interest at the Company’s election, at either (x) for SOFR Loans at Adjusted Term SOFR (subject to a floor of 0.50%) plus 3.25% (as defined) or (y) for Base Rate Loans at the higher of the Prime Rate, 1/2 of 1% above the Federal Funds Rate or the Adjusted Term SOFR (as defined) for one-month interest period, after giving effect to any floor plus 1%, plus 2.25%. The debt discount and issuance costs are being amortized using the effective interest method and the rate as of March 31, 2023 is 9.22%. The Term Loan Facility has an annual excess cash flow calculation, for which the prescribed formula did not result in requiring the Company to make an advance principal payment for the year ended December 31, 2022. Convertible Debt On December 3, 2021 and December 9, 2021, the Company completed a $425.0 million private offering ($375 million and $50 million, respectively), of its 1.00% Convertible Senior Notes due 2028 (the “Convertible Notes”), resulting in proceeds of $413.3 million ($364.7 million and $48.6 million, respectively), after deducting the original issue discount of 2.75%. The Convertible Notes were issued pursuant to an indenture, dated December 3, 2021, between the Company and U.S. Bank National Association, as trustee. The Convertible Notes are senior unsecured obligations of the Company and will mature on December 1, 2028, unless earlier converted, redeemed, or repurchased. The Convertible Notes bear interest at a rate of 1.00% per year, payable semiannually in arrears on June 1 and December 1 of each year, beginning on June 1, 2022. The conversion rate for the Notes was initially 41.9054 shares of the Company’s common stock per $1,000 principal amount of Notes, which was equivalent to an initial conversion price of approximately $23.86 per share of common stock or 10.1 million shares of common stock. The Convertible Notes were not convertible during the three months ended March 31, 2023 and none have been converted to date. Also, given that the average market price of the Company’s common stock has not exceeded the exercise price since inception, there was no dilutive impact for the three months ended March 31, 2023. Capped Calls In connection with the issuances of the Convertible Notes, the Company paid $52.9 million, in aggregate, to enter into capped call option agreements to reduce the potential dilution to holders of the Company’s common stock after a conversion of the Convertible Notes. Specifically, upon the exercise of the capped call instruments issued pursuant to the agreements (the “Capped Calls”), the Company would receive shares of its common stock equal to approximately 17.8 million shares (a) multiplied by (i) the lower of $36.0200 or the then-current market price of its common stock, less (ii) the applicable exercise price, $23.86, and (b) divided by the then-current market price of its common stock. The results of this formula are that the Company would receive more shares as the market price of its common stock exceeds the exercise price and approaches the cap, which was initially $36.0200 per share. Consequently, if the Convertible Notes are converted, then the number of shares to be issued by the Company would be effectively partially offset by the shares of common stock received by the Company under the Capped Calls as they are exercised. The formula above would be adjusted in the event of certain specified extraordinary events affecting the Company, including a merger; a tender offer; nationalization, insolvency or delisting of the Company’s common stock; changes in law; failure to deliver; insolvency filing; stock splits, combinations, dividends, repurchases or similar events; or an announcement of certain of the preceding actions. The Company can also elect to receive the equivalent value of cash in lieu of shares of common stock upon settlement, except in certain circumstances. The Capped Calls expire on December 1, 2028 and terminate upon the occurrence of certain extraordinary events such as a merger, tender offer, nationalization, insolvency, delisting, event of default, a change in law, failure to deliver, an announcement of certain of these events, or an early conversion of the Convertible Notes. Although intended to reduce the net number of shares of common stock issued after a conversion of the Convertible Notes, the Capped Calls were separately negotiated transactions, are not a part of the terms of the Convertible Notes, and do not affect the rights of the holders of the Convertible Notes. See Note 2 – Summary of Significant Accounting Policies for information regarding the accounting for the Capped Calls Other Debt Other debt consists of the debt obligations of STI. Interest rates on other debt range from 0.55% to 4.52% annually. Of the $42.1 million other debt balance, approximately $32.6 million is denominated in Euros and $9.5 million denominated in Brazilian Real. |
Redeemable Perpetual Preferred
Redeemable Perpetual Preferred Stock | 3 Months Ended |
Mar. 31, 2023 | |
Temporary Equity Disclosure [Abstract] | |
Redeemable Perpetual Preferred Stock | Redeemable Perpetual Preferred Stock Series A Redeemable Perpetual Preferred Stock The Company entered into a Securities Purchase Agreement (the “SPA”) with certain investors (the “Purchasers”) pursuant to which, on August 11, 2021, the Company issued 350,000 shares of its newly designated Series A Redeemable Perpetual Preferred Stock (the “Series A Shares”) and 7,098,765 shares of the Company’s common stock for an aggregate purchase price of $346.0 million (the “Initial Closing”). Further, pursuant to the SPA, on September 27, 2021, the Company issued and sold to the Purchasers 776,235 shares of common stock for an aggregate purchase price of $0.01 million (the “Prepaid Forward Contract”). The Company used the net proceeds from the initial Closing to repay the $102.0 million outstanding balance under its existing Revolving Credit Facility and prepay $100.0 million of the Company’s Term Loan Facility. The Series A Shares have no maturity date. The SPA gives the Company the option to require the Purchasers to purchase, up to an additional 150,000 shares of Series A Shares until June 30, 2023 and up to 3,375,000 shares of common stock (or up to 6,100,000 shares of common stock in the event of certain price-related adjustments), subject to certain equitable adjustments pursuant to any stock dividend, stock split, stock combination, reclassification or similar transaction, for an aggregate purchase price up to $148.0 million (the “Delayed Draw Commitment” or the “Put Option”). The Company may terminate some or all of the Delayed Draw Commitment, from time to time, at its sole discretion. On January 7, 2022, pursuant to the Delayed Draw Commitment, the Company issued and sold to the Purchasers, 50,000 shares of Series A Shares and 1,125,000 shares of the Company’s common stock in an additional closing for an aggregate purchase price of $49.4 million (the “Additional Closing”). The Company has classified the Series A Shares as temporary equity and is accreting the carrying amount to its full redemption amount from the date of issuance to the earliest redemption date using the effective interest method. Such accretion totaled $6.1 million and $5.4 million for the three months ended March 31, 2023 and 2022, respectively. Refer to Note 2 – Summary of Significant Accounting Policies for information regarding the accounting for the Put Option. Dividends On or prior to the fifth anniversary of the Initial Closing, the Company may pay dividends on the Series A Shares either in (i) cash at the then-applicable Cash Regular Dividend Rate (as defined below), (ii) through accrual to the Liquidation Preference at the Accrued Regular Dividend Rate of 6.25% (the “Permitted Accrued Dividends”), or (iii) a combination thereof. Following the fifth anniversary of the Initial Closing, dividends are payable only in cash. To the extent the Company does not declare such dividends and pay in cash following the fifth anniversary of the Initial Closing, the dividends accrue to the Liquidation Preference (“Default Accrued Dividends”) at the then-applicable Cash Regular Dividend Rate plus 200 basis points. In the event there are Default Accrued Dividends outstanding for six consecutive quarters, the Company, at the option of the holders of the Series A Shares, will pay 100% of the amount of Default Accrued Dividends by delivering to such holder a number of shares of the Company’s common stock equal to the quotient of (i) the amount of Default Accrued Dividends divided by (ii) 95% of the 30-day VWAP of the Company’s common stock (“Non-Cash Dividend”). The “Cash Regular Dividend Rate” of the Series A Shares means (i) initially, 5.75% per annum on the Liquidation Preference and (ii) increased by (a) 50 basis points on each of the fifth, sixth and seventh anniversaries of the Initial Closing and (b) 100 basis points on each of the eighth, ninth and tenth anniversaries of the Initial Closing. The “Accrued Regular Dividend Rate” on the Series A Shares means 6.25% per annum on the Liquidation Preference. As used herein, “Liquidation Preference” means, with respect to any shares of the Series A Shares, the initial liquidation preference of $1,000 per share plus any accrued dividends of such share as the time of the determination. During the three months ended March 31, 2023, the Company accrued dividends on the Series A Shares at the Accrued Regular Dividend rate of 6.25% totaling $6.3 million. As of March 31, 2023, the Company has accrued and unpaid dividends of $12.7 million. The Series A Shares have similar characteristics of an “Increasing Rate Security” as described by SEC Staff Accounting Bulletin Topic 5Q, Increasing Rate Preferred Stock . As a result, the discount on Series A Shares is considered an unstated dividend cost that is amortized over the period preceding commencement of the perpetual dividend using the effective interest method, by charging imputed dividend cost against retained earnings, or additional paid in capital in the absence of retained earnings, and increasing the carrying amount of the Series A Shares by a corresponding amount. Accordingly, the discount is amortized over five years using the effective yield method. Fees Until June 30, 2023, the Company will pay the Purchasers a cash commitment premium on the unpurchased portion of Delayed Draw Commitment as follows: a. 0% through the six-month anniversary of the Initial Closing; b. 1.5% from the six-month anniversary of the Initial Closing through the 12-month anniversary of the Initial Closing; and |
Revenue
Revenue | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue The Company disaggregates its revenue from contracts with customers by sales recorded over time and sales recorded at a point in time. The following table presents the Company’s disaggregated revenues (in thousands): Three Months Ended 2023 2022 Over time revenue $ 248,219 $ 208,071 Point in time revenue 128,554 92,515 Total revenue $ 376,773 $ 300,586 Contract Balances The timing of revenue recognition, billings and cash collections results in billed accounts receivable, unbilled receivables (contract assets), and deferred revenue (contract liabilities) on the condensed consolidated balance sheets. The majority of the Company’s contract amounts are billed as work progresses in accordance with agreed-upon contractual terms, which generally coincide with the shipment of one or more phases of the project. Billing sometimes occurs subsequent to revenue recognition, resulting in contract assets. The changes in contract assets (i.e., unbilled receivables) and the corresponding amounts recorded in revenue relate to fluctuations in the timing and volume of billings. Contract assets consisting of unbilled receivables are recorded within accounts receivable on the condensed consolidated balance sheets on a contract-by-contract basis at the end of the reporting period and consisted of the following (in thousands): March 31, 2023 December 31, 2022 Unbilled receivables $ 122,003 $ 101,513 The Company also receives advances or deposits from its customers, before revenue is recognized, resulting in contract liabilities. The changes in contract liabilities (i.e., deferred revenue) relate to advanced orders and payments received by the Company. Contract liabilities consisting of deferred revenue recorded on a contract-by-contract basis at the end of each reporting period were as follows (in thousands): March 31, 2023 December 31, 2022 Deferred revenue $ 151,343 $ 178,922 During the three months ended March 31, 2023, the Company converted $125.2 million in deferred revenue to revenue, which represented 70% of the prior year’s deferred revenue balance. Bill-and-Hold Arrangements Revenue recognized for the ITC-related contracts and standalone system component sales is recorded at a point in time and recognized when obligations under the terms of the contract with the Company’s customer are satisfied. Generally, this occurs with the transfer of control of the asset, which is typically upon delivery to the customer in line with shipping terms. In certain situations, the Company recognizes revenue under a bill-and-hold arrangement with its customers. When this occurs, the customers purchase material prior to the start of construction of a solar project in order to meet the Five Percent Safe Harbor test to qualify for the ITC. Because the customers lack sufficient storage capacity to accept a large amount of material prior to the start of construction, they request that the Company keep the product in its custody. The material is bundled or palletized in the Company’s warehouses, identified separately as belonging to the respective customer and is ready for immediate transport to the customer project upon customer request. Additionally, title and risk of loss has passed to the customer and the Company does not have the ability to use the product or direct it to another customer. During the three months ended March 31, 2023, the Company recognized $17.6 million in revenue from a single customer for the sale of goods and services that contained bill-and-hold obligations such as storage, handling and other custodial duties. Remaining Performance Obligations |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The following table sets forth the computation of basic and diluted income (loss) per share (in thousands, except per share amounts): Three Months Ended 2023 2022 Net income (loss) $ 26,132 $ (25,937) Preferred dividends and accretion 12,484 11,606 Net income (loss) to common shareholders $ 13,648 $ (37,543) Basic: Weighted average shares 150,607 148,288 Income (loss) per share $ 0.09 $ (0.25) Diluted: Effect of restricted stock and performance awards 1,188 — Weighted average shares 151,795 148,288 Income (loss) per share $ 0.09 $ (0.25) Potentially dilutive common shares issuable pursuant to equity-based awards of 654,277 were not included for the three months ended March 31, 2022, as their potential effect was anti-dilutive since the Company generated a net loss to common shareholders. There were no potentially dilutive common shares issuable pursuant to the Convertible Notes for the three months ended March 31, 2023 and 2022, as the par value of the Convertible Notes is required to be paid in cash upon conversion and the stock price has not exceeded the conversion price on the Convertible Notes. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Legal Proceedings The Company, in the normal course of business, is subject to claims and litigation. The Company reviews the status of each matter and assesses its potential financial exposure. If the potential loss from any claim or legal proceeding is considered probable and the amount can be reasonably estimated, the Company would accrue a liability for the estimated loss. On May 14, 2021, a putative class action was filed in the U.S. District Court for the Southern District of New York (the “Southern District of New York” or the “Court”) against the Company and certain officers and directors alleging violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5, promulgated thereunder, and Sections 11, 12(a)(2) and 15 of the Securities Exchange Act of 1933 (“Plymouth Action”). The Plymouth Action alleges misstatements and/or omissions in the Company’s registration statements and prospectuses related to the Company’s October 2020 initial public offering (“IPO”), the Company’s December 2020 offering (the “2020 Follow-On Offering”), and the Company’s March 2021 offering (the “2021 Follow-On Offering”) during the putative class period of October 14, 2020 through May 11, 2021. On June 30, 2021, a second putative class action was filed in the Southern District of New York against the Company and certain officers and directors alleging violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5, promulgated thereunder, and Sections 11 and 15 of the Securities Exchange Act of 1933 (“Keippel Action”). The Keippel Action similarly alleged misstatements and/or omissions in certain of the Company’s registration statements and prospectuses related to the Company’s IPO, the Company’s 2020 Follow-On Offering, and the Company’s 2021 Follow-On Offering during the putative class period of October 14, 2020 through May 11, 2021. On July 6, 2021, the Court entered an order that the Keippel Action was in all material respects substantially similar to the Plymouth Action that both actions arise out of the same or similar operative facts, and that the parties are substantially the same parties. The Court accordingly consolidated the Keippel Action with the Plymouth Action for all pretrial purposes and, ordered all filings to be made in the Plymouth Action. On July 16, 2021, a verified derivative complaint was filed in the Southern District of New York against certain officers and directors of the Company (“First SDNY Derivative Action”). The complaint alleges: (1) violations of Section 14(a) of the Securities Exchange Act of 1934 for misleading proxy statements, (2) breach of fiduciary duty, (3) unjust enrichment, (4) abuse of control, (5) gross mismanagement, (6) corporate waste, (7) aiding and abetting breach of fiduciary duty, and (8) contribution under sections 10(b) and 21D of the Securities Exchange Act of 1934. On July 30, 2021, a second and related verified derivative complaint was filed in the Southern District of New York against certain officers and directors of the Company (“Second SDNY Derivative Action”). The complaint alleges: (1) violations of Section 14(a) of the Securities Exchange Act of 1934 for causing the issuance of a false/misleading proxy statement, (2) breach of fiduciary duty, and (3) aiding and abetting breaches of fiduciary duty. On August 24, 2021, the Second SDNY Derivative Action was consolidated with the First SDNY Derivative Action, the Court appointed co-lead counsel, and the case was temporarily stayed pending the entry of an order on all motions to dismiss directed at the pleadings filed in the Plymouth Action. The stay shall remain in effect until the later of (a) the entry of an order on any motions to dismiss the Plymouth Action or, (b) to the extent the complaint in the Plymouth Action is amended, the entry of an order on any motions to dismiss any such amended complaints in the Plymouth Action. On September 21, 2021, the Court in the Plymouth Action appointed a group comprised of institutional investors Plymouth County Retirement Association and Carpenters Pension Trust Fund for Northern California as lead plaintiff. On December 7, 2021, an amended class action complaint was filed by lead plaintiff in the Plymouth Action against the Company and certain officers and directors alleging violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5, promulgated thereunder, and Sections 11, 12(a)(2), and 15 of the Securities Exchange Act of 1933, on behalf of a putative class of persons and entities that purchased or otherwise acquired the Company’s securities during the period from October 14, 2020 through May 11, 2021 (the “Consolidated Amended Complaint”). The Consolidated Amended Complaint alleges misstatements and/or omissions in: (1) certain of the Company’s registration statements and prospectuses related to the Company’s IPO, the Company’s 2020 Follow-On Offering, and the Company’s 2021 Follow-On Offering; (2) in the Company’s Annual Report on Form 10-K and associated press release announcing results for the fourth quarter and full fiscal year 2020; and (3) in the Company’s November 5, 2020 and March 9, 2021 earnings calls. On August 17, 2022, the Court in the Plymouth Action set a briefing schedule for any motion to dismiss with the opening motion and supporting memorandum to be filed on or before October 17, 2022, any opposition to be filed on or before December 16, 2022, and any reply in support of the motion to be filed on or before January 16, 2023. The Company and other defendants in the Plymouth Action filed a joint motion to dismiss (the “Motion to Dismiss”) the Consolidated Amended Complaint on October 17, 2022. The lead plaintiff filed a motion opposing the Motion to Dismiss on December 16, 2022, and the Company and other defendants filed a reply in support of the motion to dismiss on January 17, 2023. On August 3, 2022, a verified derivative complaint was filed in the Court of Chancery of the State of Delaware (the “Court of Chancery”) against certain officers and directors of the Company, asserting claims for: (1) breach of fiduciary duty and (2) unjust enrichment (“First Delaware Derivative Action”). On August 11, 2022, a second verified derivative complaint was filed against certain officers and directors of the Company Court of Chancery, asserting claims for: (1) breach of fiduciary duty; (2) aiding and abetting breaches of fiduciary duty; (3) waste of corporate assets; (4) unjust enrichment; (5) insider selling; and (6) aiding and abetting insider selling (“Second Delaware Derivative Action”). On September 2, 2022, the Second Delaware Derivative Action was consolidated with the First Delaware Derivative Action, the Court of Chancery appointed co-lead counsel, and the case was temporarily stayed pending the entry of an order on all motions to dismiss directed at the pleadings filed in the Plymouth Action. The stay shall remain in effect until the later of (a) the entry of an order on the pending motion to dismiss the Consolidated Amended Complaint in the Plymouth Action, (b) to the extent the Consolidated Amended Complaint in the Plymouth Action is further amended, the entry of an order on any motions to dismiss any such amended complaints in the Plymouth Action, or (c) the public announcement of a settlement of the Plymouth Action. At this time the Company believes that the likelihood of any material loss related to these matters is remote given the preliminary stage of the claims and strength of the Company’s defenses. The Company has not recorded any material loss contingency in the condensed consolidated balance sheets as of March 31, 2023. Contingent Consideration Tax Receivable Agreement Concurrent with the Former Parent’s acquisition of Array Technologies Patent Holdings Co., LLC on July 8, 2016, the Company’s operating subsidiary, Array Tech, Inc. (f/k/a Array Technologies, Inc.), entered into a Tax Receivable Agreement (the “TRA”) with the former majority shareholder of Array. The TRA is valued based on the future expected payments under the agreement. The TRA provides for the payment by Array Tech, Inc. to the former owners for certain federal, state, local and non-U.S. tax benefits deemed realized in post-closing taxable periods by Array Tech, Inc., from the use of certain deductions generated by the increase in the tax value of the developed technology. The TRA is accounted for as contingent consideration and subsequent changes in fair value of the contingent liability are recognized in contingent consideration in the condensed consolidated statements of operations. As of March 31, 2023 and December 31, 2022, the fair value of the TRA was $8.7 million and $8.6 million, respectively. Estimating the amount of payments that may be made under the TRA is by nature imprecise. The significant fair value inputs used to estimate the future expected TRA payments to the former owners include the timing of tax payments, a discount rate, book income projections, timing of expected adjustments to calculate taxable income and the projected rate of use for attributes defined in the TRA. Payments made under the TRA consider tax positions taken by the Company and are due within 125 days following the filing of the Company’s U.S. federal and state income tax returns under procedures described in the agreement. The current portion of the TRA liability is based on tax returns. The TRA will continue until all tax benefit payments have been made or the Company elects early termination under the terms described in the TRA. The following table summarizes the activity related to the estimated TRA liability (in thousands): Three Months Ended 2023 2022 Beginning balance $ 8,587 $ 14,577 Payments (1,200) (1,483) Fair value adjustment 1,338 (3,731) Ending balance $ 8,725 $ 9,363 The TRA liability requires significant judgment and is classified as Level 3 in the fair value hierarchy. Surety Bonds As of March 31, 2023, the Company posted surety bonds in the total amount of approximately $208.5 million. The Company is required to provide surety bonds to various parties as required for certain transactions initiated during the ordinary course of business to guarantee the Company’s performance in accordance with contractual or legal obligations. These off-balance sheet arrangements do not adversely impact the Company’s liquidity or capital resources. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying values and the estimated fair values of debt financial instruments were as follows (in thousands): March 31, 2023 December 31, 2022 Carrying Value Fair Value Carrying Value Fair Value Convertible Notes $ 414,215 $ 467,084 $ 413,752 $ 430,236 The fair value of the Convertible Notes is estimated using Level 2 inputs, as they are not registered securities nor listed on any securities exchange but may be traded by qualified institutional buyers. The Capped Call is valued using a Black-Sholes model, with the most judgmental non-observable input being the volatility measure. The value of the Capped Call is determined using unobservable inputs and is considered to be a Level 3 value in the fair value hierarchy. The fair value of the Capped Call was $59.5 million at March 31, 2023. The Put Option is exercisable into both Series A Stock and common stock. The value of the put option is based upon the expected future price of the Series A Stock and the company’s common stock, which is then discounted back to current present value. The present value of the Series A Stock is determined using a discounted cash flow method where the interest rate used for discounting is determined using a single-factor short-rate model. The value of the common stock is determined by using a Monte-Carlo simulation and is then discounted back to present value. The value of the Put Option is determined using unobservable inputs and is considered to be a Level 3 value in the fair value hierarchy. The fair value of the Put Option was $3.8 million at March 31, 2023. The fair value of the Term Loans and Other Debt is estimated using Level 2 inputs. The carrying values of the Term Loans outstanding under the Senior Secured Credit facility recorded in consolidated balance sheets approximate fair value due to the variable interest rate. Other Debt totaling $42.1 million, consists of $25.0 million variable rate obligations and $17.1 million fixed rate obligations. Of the $17.1 million fixed rate obligations, $11.7 million mature in 2023 and $5.4 million mature in 2024. Due to the relative short-term maturity of these obligations, the Company believes current carrying value approximates fair value. The carrying value of the $25.0 million variable rate obligations approximate fair value due to the variable nature of the interest rate. |
Equity-Based Compensation
Equity-Based Compensation | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Equity-Based Compensation | Equity-Based Compensation 2020 Equity Incentive Plan On October 14, 2020, the Company’s 2020 Equity Incentive Plan (the “2020 Plan”) became effective. The 2020 Plan authorized 6,683,919 new shares, subject to adjustments pursuant to the 2020 Plan. Restricted Stock Units Pursuant to the 2020 Plan, the Company grants restricted stock units (“RSUs”) to employees and board of director members. The fair value of the RSUs is determined using the market value of common stock on the grant date. RSU activity under the 2020 Plan during the three months ended March 31, 2023 was as follows: Number of Shares Weighted Average Grant Date Fair Value Outstanding non-vested, December 31, 2022 1,700,824 $ 13.81 Shares granted 757,334 17.26 Shares vested (306,245) 14.21 Shares forfeited (93,019) 15.61 Outstanding non-vested, March 31, 2023 2,058,894 $ 14.73 Performance Stock Units The Company has granted performance stock units (“PSUs”) to certain employees. The PSUs cliff vest after three years and upon meeting certain revenue and adjusted EPS targets. The PSUs also contain a modifier based on the total stock return (“TSR”) compared to a certain index which modifies the number of PSUs that vest. The PSUs were valued using a Monte-Carlo simulation method on the date of grant based on the U.S. Treasury Constant Maturity rates. The following assumptions were used in the Monte Carlo simulation for computing the grant date fair value of the PSUs issued during the three months ended March 31, 2023 and 2022: 2023 2022 Volatility 90 % 66 % Risk-free interest rate 3.74 % 0.28 % Dividend yield — % — % PSU activity under the 2020 Plan during the three months ended March 31, 2023 was as follows: Number of Shares Weighted Average Grant Date Fair Value Outstanding non-vested, December 31, 2022 464,393 $ 11.96 Shares granted 263,594 19.22 Shares vested — — Shares forfeited — — Outstanding non-vested, March 31, 2023 727,987 $ 14.59 For the three months ended March 31, 2023 and 2022, the Company recognized $3.3 million and $4.4 million, respectively, in equity-based compensation. At March 31, 2023, the Company had $32.8 million of unrecognized compensation costs related to RSUs and PSUs, which is expected to be recognized over approximately 2.4 years and 2.7 years, respectively. |
Segment Reporting
Segment Reporting | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Segment Reporting | Segment Reporting ASC 280 Segment Reporting establishes standards for reporting information about operating segments. Operating segments are defined 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. Historically, the Company managed its business on the basis of one operating and reportable segment. Concurrent with the acquisition of STI in January 2022, the Company began operating as two segments; Array Legacy Operations and STI Operations. The following table provides a reconciliation of certain financial information for the Company’s reportable segments to information presented in its condensed consolidated financial statements for the three months ended March 31, 2023 and 2022 (in thousands): Three Months Ended March 31, 2023 Three Months Ended March 31, 2022 Array Legacy Operations STI Operations Total Array Legacy Operations STI Operations Total Revenue $ 305,204 $ 71,569 $ 376,773 $ 250,652 $ 49,934 $ 300,586 Gross Profit $ 83,474 $ 17,705 $ 101,179 $ 21,268 $ 5,319 $ 26,587 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Accounting and Presentation | Basis of Accounting and Presentation The accompanying unaudited condensed consolidated financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). The unaudited interim financial statements have been prepared on the same basis as the audited annual financial statements and, in the opinion of management, reflect all adjustments, which include only |
Principles of Consolidation | Principles of Consolidation The condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated upon consolidation. |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from previously estimated amounts, and such differences may be material to the condensed consolidated financial statements; however, management believes that these estimates and assumptions provide a reasonable basis for the fair presentation of the consolidated financial statements. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the period they occur. |
Impact of the Ongoing Conflict in Ukraine | Impact of the Ongoing Conflict in Ukraine The ongoing conflict in Ukraine has reduced the availability of material that can be sourced in Europe and, as a result, increased logistics costs for the procurement of certain inputs and materials used in our products. We do not know ultimate severity or duration of the conflict in Ukraine, but we continue to monitor the situation and evaluate our procurement strategy and supply chain as to reduce any negative impact on our business, financial condition and results of operations. Inflation |
Business Combinations | Business Combinations The Company accounts for its business acquisitions under the acquisition method of accounting in accordance with the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 805 Business Combinations (“ASC 805”). The excess of the purchase price over the estimated fair values of the net assets acquired is recorded as goodwill. Determining the fair value of assets acquired and liabilities assumed requires management’s judgment and often involves the use of significant estimates and assumptions, including assumptions with respect to future cash inflows and outflows, discount rates, asset lives, and market multiples, amongst other items. |
Foreign Currency Translation Exposure | Foreign Currency Translation Exposure The functional currencies of certain of our foreign subsidiaries are their local currencies. Accordingly, we apply period-end exchange rates to translate their assets and liabilities and average exchange rates prevailing during the period to translate their revenues, expenses, gains, and losses into U.S. dollars. We include the associated translation adjustments as a separate component of “Accumulated other comprehensive income (loss)” within stockholders’ equity. Certain of our foreign subsidiaries have assets and liabilities (primarily cash, receivables, inventory, property, plant and equipment, intangible assets, trade payables, accrued expenses, operating lease liabilities, and long-term debt) that are denominated in currencies other than the subsidiaries’ functional currencies. Changes in the exchange rates between the functional currencies of our subsidiaries and the other currencies in which these assets and liabilities are denominated will create fluctuations in our reported condensed consolidated statements of operations and cash flows. |
Derivative Financial instruments | Derivative Financial instruments Both the Capped Call and the Put Option are accounted for as an asset that is recorded at fair value within Derivative assets in the consolidated balance sheets. The changes in fair value to Derivative assets is recorded within Change in fair value of derivative assets in the Condensed Consolidated Statements of Operations. See Note 1 – Organization, Business and Out-of-Period Adjustments , for further information. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In March 2020, the FASB issued Accounting Standards Update (“ASU”) 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”). ASU 2020-04 contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts. The guidance in ASU 2020-04 is optional and may be elected over time as reference rate reform activities occur. In December 2022, the FASB issued ASU 2022-06, Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848 , to provide entities with relief during the transition period by deferring the effective date of reference rate reform from December 31, 2022 to December 31, 2024. ASU 2022-06 is effective upon issuance. During the three months ended March 31, 2023, the Company adopted ASU 2020-04 and ASU 2022-06. Simultaneously, the Company elected to apply the debt accounting optional expedient, under which the reporting entity will account for amendments to debt agreements, which sole intent are the replacement of a discontinued reference rate(s), as being not substantial and thus a continuation of the existing contract . There was no significant impact to the Company’s condensed consolidated financial statements related to the adoption of ASU 2020-04 and ASU 2022-06. The Company continues to evaluate the impact of the ASU 2020-04 guidance and may apply other elections as applicable as additional changes in the market occur. In March 2023, the Company amended an existing debt agreement to replace the London Interbank Offered Rate (“LIBOR”) interest rate provisions with interest rate provisions based on a forward-looking term rate based on the secured overnight funding rate (“SOFR”) (see Note 8 – Debt |
Accounts Receivable, Net (Table
Accounts Receivable, Net (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Receivables [Abstract] | |
Schedule of account receivable, net | Accounts receivable consists of the following (in thousands): March 31, 2023 December 31, 2022 Accounts receivable $ 416,785 $ 423,071 Less: allowance for credit losses (2,073) (1,888) Accounts receivable, net $ 414,712 $ 421,183 |
Inventory (Tables)
Inventory (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Inventory Disclosure [Abstract] | |
Schedule of current inventory | Inventories consist of the following (in thousands): March 31, 2023 December 31, 2022 Raw materials $ 88,348 $ 66,574 Finished goods 166,276 166,585 Total $ 254,624 $ 233,159 |
Property, Plant and Equipment_2
Property, Plant and Equipment, Net (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Summary of property, plant and equipment, net | Property, plant and equipment consist of the following (in thousands, except useful lives): Estimated Useful Lives (Years) March 31, 2023 December 31, 2022 Land N/A $ 1,587 $ 1,583 Buildings and land improvements 15-39 7,540 7,411 Manufacturing equipment 7 18,533 18,983 Furniture, fixtures and equipment 5-7 3,653 3,583 Vehicles 5 592 585 Hardware and software 3-5 3,831 3,706 Assets in progress N/A 8,229 5,142 Total 43,965 40,993 Less: accumulated depreciation (18,101) (17,819) Property, plant and equipment, net $ 25,864 $ 23,174 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill | Changes in the carrying amount of goodwill by operating segment during the three months ended March 31, 2023 are shown below (in thousands): Array Legacy Operations (1) STI Operations Total Beginning balance $ 69,727 $ 346,457 $ 416,184 Correction to goodwill (see Note 1) — 2,000 2,000 Foreign currency translation — 9,989 9,989 Ending balance $ 69,727 $ 358,446 $ 428,173 (1) Goodwill attributable to Array Legacy Operations is net of accumulated impairment of $51.9 million. |
Schedule of finite-lived intangible assets | Other intangible assets consisted of the following (in thousands, except useful lives): Estimated Useful Lives (Years) March 31, 2023 December 31, 2022 Amortizable: Costs: Developed technology 14 $ 204,442 $ 203,800 Customer relationships 10 327,397 321,935 Backlog 1 52,545 51,015 Trade name 20 26,314 25,682 Total amortizable intangibles 610,698 602,432 Accumulated amortization: Developed technology 98,318 94,347 Customer relationships 89,155 81,268 Backlog 52,545 49,507 Trade name 1,606 1,246 Total accumulated amortization 241,624 226,368 Total amortizable intangibles, net 369,074 376,064 Non-amortizable costs: Trade name 10,300 10,300 Total other intangible assets, net $ 379,374 $ 386,364 |
Schedule of indefinite-lived intangible assets | Other intangible assets consisted of the following (in thousands, except useful lives): Estimated Useful Lives (Years) March 31, 2023 December 31, 2022 Amortizable: Costs: Developed technology 14 $ 204,442 $ 203,800 Customer relationships 10 327,397 321,935 Backlog 1 52,545 51,015 Trade name 20 26,314 25,682 Total amortizable intangibles 610,698 602,432 Accumulated amortization: Developed technology 98,318 94,347 Customer relationships 89,155 81,268 Backlog 52,545 49,507 Trade name 1,606 1,246 Total accumulated amortization 241,624 226,368 Total amortizable intangibles, net 369,074 376,064 Non-amortizable costs: Trade name 10,300 10,300 Total other intangible assets, net $ 379,374 $ 386,364 |
Schedule of future annual amortization expense of amortizable intangible assets | Estimated future amortization expense of intangible assets as of March 31, is as follows (in thousands): Amount Remainder of 2023 $ 34,846 2024 46,970 2025 46,970 2026 42,664 2027 38,020 Thereafter 159,604 $ 369,074 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of debt | The following table summarizes the Company’s total debt (in thousands): March 31, 2023 December 31, 2022 Senior Secured Credit Facility Term loan facility $ 301,400 $ 312,475 Revolving credit facility — — 301,400 312,475 Unamortized discount and issuance costs (17,544) (19,135) Carrying amount 283,856 293,340 Convertible Debt 1% Senior Notes 425,000 425,000 Unamortized discount and issuance costs (10,785) (11,248) Carrying amount 414,215 413,752 Other Debt 42,138 51,951 Total Debt 768,538 789,426 Unamortized discount and issuance costs, total (28,329) (30,383) Carrying amount 740,209 759,043 Current portion of debt (34,382) (38,691) Total long-term debt, net of current portion $ 705,827 $ 720,352 |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of revenue | The following table presents the Company’s disaggregated revenues (in thousands): Three Months Ended 2023 2022 Over time revenue $ 248,219 $ 208,071 Point in time revenue 128,554 92,515 Total revenue $ 376,773 $ 300,586 Contract assets consisting of unbilled receivables are recorded within accounts receivable on the condensed consolidated balance sheets on a contract-by-contract basis at the end of the reporting period and consisted of the following (in thousands): March 31, 2023 December 31, 2022 Unbilled receivables $ 122,003 $ 101,513 Contract liabilities consisting of deferred revenue recorded on a contract-by-contract basis at the end of each reporting period were as follows (in thousands): March 31, 2023 December 31, 2022 Deferred revenue $ 151,343 $ 178,922 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of earnings per share, basic and diluted | The following table sets forth the computation of basic and diluted income (loss) per share (in thousands, except per share amounts): Three Months Ended 2023 2022 Net income (loss) $ 26,132 $ (25,937) Preferred dividends and accretion 12,484 11,606 Net income (loss) to common shareholders $ 13,648 $ (37,543) Basic: Weighted average shares 150,607 148,288 Income (loss) per share $ 0.09 $ (0.25) Diluted: Effect of restricted stock and performance awards 1,188 — Weighted average shares 151,795 148,288 Income (loss) per share $ 0.09 $ (0.25) |
Commitment and Contingencies (T
Commitment and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Summary of liability related to estimated contingent consideration | The following table summarizes the activity related to the estimated TRA liability (in thousands): Three Months Ended 2023 2022 Beginning balance $ 8,587 $ 14,577 Payments (1,200) (1,483) Fair value adjustment 1,338 (3,731) Ending balance $ 8,725 $ 9,363 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of carrying values and estimated fair values of debt instruments | The carrying values and the estimated fair values of debt financial instruments were as follows (in thousands): March 31, 2023 December 31, 2022 Carrying Value Fair Value Carrying Value Fair Value Convertible Notes $ 414,215 $ 467,084 $ 413,752 $ 430,236 |
Equity-Based Compensation (Tabl
Equity-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Disclosure of share-based compensation arrangements by share-based payment award | RSU activity under the 2020 Plan during the three months ended March 31, 2023 was as follows: Number of Shares Weighted Average Grant Date Fair Value Outstanding non-vested, December 31, 2022 1,700,824 $ 13.81 Shares granted 757,334 17.26 Shares vested (306,245) 14.21 Shares forfeited (93,019) 15.61 Outstanding non-vested, March 31, 2023 2,058,894 $ 14.73 2023 2022 Volatility 90 % 66 % Risk-free interest rate 3.74 % 0.28 % Dividend yield — % — % PSU activity under the 2020 Plan during the three months ended March 31, 2023 was as follows: Number of Shares Weighted Average Grant Date Fair Value Outstanding non-vested, December 31, 2022 464,393 $ 11.96 Shares granted 263,594 19.22 Shares vested — — Shares forfeited — — Outstanding non-vested, March 31, 2023 727,987 $ 14.59 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of segment reporting information, by segment | The following table provides a reconciliation of certain financial information for the Company’s reportable segments to information presented in its condensed consolidated financial statements for the three months ended March 31, 2023 and 2022 (in thousands): Three Months Ended March 31, 2023 Three Months Ended March 31, 2022 Array Legacy Operations STI Operations Total Array Legacy Operations STI Operations Total Revenue $ 305,204 $ 71,569 $ 376,773 $ 250,652 $ 49,934 $ 300,586 Gross Profit $ 83,474 $ 17,705 $ 101,179 $ 21,268 $ 5,319 $ 26,587 |
Organization, Business and Ou_2
Organization, Business and Out-of-Period Adjustments (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | 15 Months Ended | ||||||
Jan. 01, 2023 USD ($) | Jan. 07, 2022 shares | Aug. 11, 2021 shares | Jan. 31, 2022 segment | Mar. 31, 2023 USD ($) | Mar. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) segment shares | Mar. 31, 2023 USD ($) segment | Dec. 31, 2022 USD ($) | Jan. 11, 2022 | |
Business Acquisition, Contingent Consideration [Line Items] | ||||||||||
Number of operating segments | segment | 2 | 1 | 2 | |||||||
Additional paid-in capital | $ 426,221 | $ 426,221 | $ 383,176 | |||||||
Assets | 1,794,169 | 1,794,169 | 1,706,052 | |||||||
Common stock, value, issued | 150 | 150 | 150 | |||||||
Increase in derivative asset | 63,320 | 63,320 | 0 | |||||||
Decrease in deferred income tax assets | 0 | 0 | (16,466) | |||||||
Decrease in net income | (26,132) | $ 25,937 | ||||||||
Increase in goodwill | 428,173 | 428,173 | $ 416,184 | |||||||
Revision of Prior Period, Adjustment | ||||||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||||||
Increase in goodwill | 2,000 | 2,000 | ||||||||
Securities Purchase Agreement, Additional Closings | ||||||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||||||
Additional paid-in capital | $ 12,400 | |||||||||
Assets | 12,400 | 12,400 | ||||||||
Stock issued (in shares) | shares | 1,125,000 | |||||||||
Series A Redeemable Perpetual Preferred Shares | Securities Purchase Agreement, Additional Closings | ||||||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||||||
Stock issued (in shares) | shares | 150,000 | 150,000 | ||||||||
Common Stock | Securities Purchase Agreement, Additional Closings | ||||||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||||||
Stock issued (in shares) | shares | 3,375,000 | 3,375,000 | ||||||||
Common stock, value, issued | $ 148,000 | |||||||||
Convertible Debt | Capped Call | ||||||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||||||
Fees paid on issuance of convertible notes | $ 52,900 | |||||||||
Additional paid-in capital | 52,900 | 52,900 | ||||||||
Income taxes | 12,400 | |||||||||
Assets | 52,900 | 52,900 | ||||||||
Convertible Note Capped Call Transactions | ||||||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||||||
Fees paid on issuance of convertible notes | 52,900 | |||||||||
Convertible Note Capped Call Transactions | Convertible Debt | Revision of Prior Period, Adjustment | ||||||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||||||
Additional paid-in capital | $ 52,900 | |||||||||
Increase in derivative asset | 55,700 | |||||||||
Decrease in deferred income tax assets | 11,000 | |||||||||
Decrease in net income | $ 8,100 | |||||||||
STI | ||||||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||||||
Percentage of share capital acquired | 100% | |||||||||
STI | Revision of Prior Period, Adjustment | ||||||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||||||
Increase in goodwill | 2,000 | $ 2,000 | ||||||||
Decrease in cost of goods sold | $ 2,000 |
Accounts Receivable, Net (Detai
Accounts Receivable, Net (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Receivables [Abstract] | ||
Accounts receivable | $ 416,785 | $ 423,071 |
Less: allowance for credit losses | (2,073) | (1,888) |
Accounts receivable, net | $ 414,712 | $ 421,183 |
Inventory (Details)
Inventory (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 88,348 | $ 66,574 |
Finished goods | 166,276 | 166,585 |
Inventories | $ 254,624 | $ 233,159 |
Property, Plant and Equipment_3
Property, Plant and Equipment, Net - Summary of Property, Plant and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | |
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment, gross | $ 43,965 | $ 40,993 |
Less: accumulated depreciation | (18,101) | (17,819) |
Property, plant and equipment, net | 25,864 | 23,174 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment, gross | 1,587 | 1,583 |
Buildings and land improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment, gross | $ 7,540 | 7,411 |
Buildings and land improvements | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives (Years) | 15 years | |
Buildings and land improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives (Years) | 39 years | |
Manufacturing equipment | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives (Years) | 7 years | |
Property, plant, and equipment, gross | $ 18,533 | 18,983 |
Furniture, fixtures and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment, gross | $ 3,653 | 3,583 |
Furniture, fixtures and equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives (Years) | 5 years | |
Furniture, fixtures and equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives (Years) | 7 years | |
Vehicles | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives (Years) | 5 years | |
Property, plant, and equipment, gross | $ 592 | 585 |
Hardware and software | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment, gross | $ 3,831 | 3,706 |
Hardware and software | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives (Years) | 3 years | |
Hardware and software | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives (Years) | 5 years | |
Assets in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment, gross | $ 8,229 | $ 5,142 |
Property, Plant and Equipment_4
Property, Plant and Equipment, Net - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense | $ 0.7 | $ 0.6 |
Depreciation allocated to cost of revenue | 0.3 | 0.5 |
Depreciation included in depreciation and amortization | $ 0.4 | $ 0.1 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Schedule of Goodwill (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | $ 416,184 |
Foreign currency translation | 9,989 |
Goodwill, ending balance | 428,173 |
Revision of Prior Period, Adjustment | |
Goodwill [Roll Forward] | |
Goodwill, ending balance | 2,000 |
Array Legacy Operations | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 69,727 |
Foreign currency translation | 0 |
Goodwill, ending balance | 69,727 |
Accumulated impairment | 51,900 |
Array Legacy Operations | Revision of Prior Period, Adjustment | |
Goodwill [Roll Forward] | |
Goodwill, ending balance | 0 |
STI Operations | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 346,457 |
Foreign currency translation | 9,989 |
Goodwill, ending balance | 358,446 |
STI Operations | Revision of Prior Period, Adjustment | |
Goodwill [Roll Forward] | |
Goodwill, ending balance | $ 2,000 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Schedule of Other Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | |
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross | $ 610,698 | $ 602,432 |
Finite-lived intangible assets, accumulated amortization | 241,624 | 226,368 |
Total amortizable intangibles, net | 369,074 | 376,064 |
Total other intangible assets, net | 379,374 | 386,364 |
Trade name | ||
Finite-Lived Intangible Assets [Line Items] | ||
Non-amortizable costs: | $ 10,300 | 10,300 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, estimated useful lives (years) | 14 years | |
Finite-lived intangible assets, gross | $ 204,442 | 203,800 |
Finite-lived intangible assets, accumulated amortization | $ 98,318 | 94,347 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, estimated useful lives (years) | 10 years | |
Finite-lived intangible assets, gross | $ 327,397 | 321,935 |
Finite-lived intangible assets, accumulated amortization | $ 89,155 | 81,268 |
Backlog | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, estimated useful lives (years) | 1 year | |
Finite-lived intangible assets, gross | $ 52,545 | 51,015 |
Finite-lived intangible assets, accumulated amortization | $ 52,545 | 49,507 |
Trade name | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible asset, estimated useful lives (years) | 20 years | |
Indefinite-lived intangible assets, gross | $ 26,314 | 25,682 |
Indefinite-lived intangible assets, accumulated amortization | $ 1,606 | $ 1,246 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expense related to intangible assets | $ 13.8 | $ 22 |
Goodwill and Other Intangible_6
Goodwill and Other Intangible Assets - Schedule of Future Annual Amortization Expense of Amortizable Intangible Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Remainder of 2023 | $ 34,846 | |
2024 | 46,970 | |
2025 | 46,970 | |
2026 | 42,664 | |
2027 | 38,020 | |
Thereafter | 159,604 | |
Total amortizable intangibles, net | $ 369,074 | $ 376,064 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||
Income tax (benefit) expense | $ 9,876,000 | $ (14,743,000) |
Reserves for uncertain tax positions | 0 | $ 0 |
Revision of Prior Period, Adjustment | Put Option | ||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||
Income tax (benefit) expense | $ 1,400,000 |
Debt - Schedule of Debt (Detail
Debt - Schedule of Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Debt, balance | $ 768,538 | $ 789,426 |
Unamortized discount and issuance costs | (28,329) | (30,383) |
Carrying amount | 740,209 | 759,043 |
Other Debt | 42,138 | 51,951 |
Current portion of term loan facility | (34,382) | (38,691) |
Total long-term debt, net of current portion | 705,827 | 720,352 |
Senior secured credit facility | ||
Debt Instrument [Line Items] | ||
Debt, balance | 301,400 | 312,475 |
Unamortized discount and issuance costs | (17,544) | (19,135) |
Carrying amount | 283,856 | 293,340 |
Term loan facility | Senior secured credit facility | ||
Debt Instrument [Line Items] | ||
Debt, balance | 301,400 | 312,475 |
Revolving credit facility | Senior secured credit facility | ||
Debt Instrument [Line Items] | ||
Debt, balance | 0 | 0 |
Convertible Debt | ||
Debt Instrument [Line Items] | ||
Debt, balance | 425,000 | 425,000 |
Unamortized discount and issuance costs | (10,785) | (11,248) |
Carrying amount | $ 414,215 | $ 413,752 |
Stated interest rate | 1% |
Debt - Narrative (Details)
Debt - Narrative (Details) - USD ($) | 3 Months Ended | |||||
Dec. 09, 2021 | Dec. 09, 2021 | Dec. 03, 2021 | Oct. 14, 2020 | Mar. 31, 2023 | Dec. 31, 2022 | |
Short-Term Debt [Line Items] | ||||||
Debt, balance | $ 768,538,000 | $ 789,426,000 | ||||
Debt discount and issuance costs | 28,329,000 | 30,383,000 | ||||
Other Long-term debt | 42,138,000 | 51,951,000 | ||||
STI | ||||||
Short-Term Debt [Line Items] | ||||||
Other Long-term debt | 42,100,000 | |||||
STI | Euro | ||||||
Short-Term Debt [Line Items] | ||||||
Other Long-term debt | 32,600,000 | |||||
STI | Brazilian real | ||||||
Short-Term Debt [Line Items] | ||||||
Other Long-term debt | 9,500,000 | |||||
Convertible Debt | ||||||
Short-Term Debt [Line Items] | ||||||
Debt, balance | 425,000,000 | 425,000,000 | ||||
Debt discount and issuance costs | $ 10,785,000 | 11,248,000 | ||||
Stated interest rate | 1% | |||||
Minimum | Other Debt | STI | ||||||
Short-Term Debt [Line Items] | ||||||
Stated interest rate | 0.55% | |||||
Maximum | Other Debt | STI | ||||||
Short-Term Debt [Line Items] | ||||||
Stated interest rate | 4.52% | |||||
Convertible Senior Notes due 2028 | Convertible Debt | ||||||
Short-Term Debt [Line Items] | ||||||
Bridge loan facility aggregate principal amount | $ 425,000,000 | $ 425,000,000 | ||||
Stated interest rate | 1% | 1% | 1% | |||
Proceeds from convertible debt | $ 413,300,000 | $ 48,600,000 | $ 364,700,000 | |||
Debt instrument, interest rate, effective percentage discount | 2.75% | 2.75% | 2.75% | |||
Debt instrument, annual interest rate | 1% | |||||
Convertible Senior Notes due 2028 | Convertible Debt | Common Stock | ||||||
Short-Term Debt [Line Items] | ||||||
Conversion of stock, shares converted per dollar (in shares) | 41.9054 | |||||
Convertible notes payable | $ 1,000 | |||||
Convertible note, conversion price (in dollar per share) | $ 23.86 | |||||
Debt conversion, converted instrument, shares issued (in shares) | 10,100,000 | |||||
Convertible Senior Notes due 2028, $375 Million | Convertible Debt | ||||||
Short-Term Debt [Line Items] | ||||||
Bridge loan facility aggregate principal amount | $ 375,000,000 | |||||
Convertible Senior Notes due 2028, $50 Million | Convertible Debt | ||||||
Short-Term Debt [Line Items] | ||||||
Bridge loan facility aggregate principal amount | $ 50,000,000 | $ 50,000,000 | ||||
Convertible Note Capped Call Transactions | ||||||
Short-Term Debt [Line Items] | ||||||
Debt conversion, converted instrument, shares issued (in shares) | 17,800,000 | |||||
Fees paid on issuance of convertible notes | $ 52,900,000 | |||||
Derivatives, cap price (in dollars per share) | $ 36.02 | |||||
Derivatives, exercise price (in dollars per share) | $ 23.86 | |||||
Term loan facility | ||||||
Short-Term Debt [Line Items] | ||||||
Maximum borrowing capacity | $ 575,000,000 | |||||
Debt instrument term | 7 years | |||||
Debt, balance | $ 301,400,000 | 312,500,000 | ||||
Debt discount and issuance costs | $ 17,500,000 | 19,100,000 | ||||
Debt issuance costs and discounts, amortization rate | 9.22% | |||||
Term loan facility | Secured Overnight Financing Rate (SOFR) | ||||||
Short-Term Debt [Line Items] | ||||||
Revolving loan applicable margin | 3.25% | |||||
Revolving loan applicable margin, floor | 0.50% | |||||
Term loan facility | Secured Overnight Financing Rate (SOFR) Plus 1% | ||||||
Short-Term Debt [Line Items] | ||||||
Revolving loan applicable margin | 2.25% | |||||
Revolving loan applicable margin, floor | 1% | |||||
Term loan facility | Fed Funds Effective Rate | ||||||
Short-Term Debt [Line Items] | ||||||
Revolving loan applicable margin | 0.005% | |||||
Revolving credit facility | ||||||
Short-Term Debt [Line Items] | ||||||
Maximum borrowing capacity | $ 200,000,000 | |||||
Debt instrument term | 5 years | |||||
Debt, balance | $ 0 | 0 | ||||
Available borrowing capacity | $ 159,600,000 | 161,200,000 | ||||
Revolving credit facility | Secured Overnight Financing Rate (SOFR) | ||||||
Short-Term Debt [Line Items] | ||||||
Revolving loan applicable margin | 3.25% | |||||
Revolving credit facility | Secured Overnight Financing Rate (SOFR) Plus 1% | ||||||
Short-Term Debt [Line Items] | ||||||
Revolving loan applicable margin | 2.25% | |||||
Revolving loan applicable margin, floor | 1% | |||||
Revolving credit facility | Fed Funds Effective Rate | ||||||
Short-Term Debt [Line Items] | ||||||
Revolving loan applicable margin | 0.005% | |||||
Standby letters of credit | ||||||
Short-Term Debt [Line Items] | ||||||
Letters of credit outstanding | $ 40,400,000 | $ 38,800,000 |
Redeemable Perpetual Preferre_2
Redeemable Perpetual Preferred Stock (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||
Jan. 07, 2022 | Sep. 27, 2021 | Aug. 11, 2021 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | |
Class of Stock [Line Items] | |||||||
Temporary equity, shares issued (in shares) | 412,739 | 406,389 | |||||
Principal payments on term loan facility | $ 11,075 | $ 4,368 | |||||
Percentage of variable weighted average price of temporary equity | 95% | ||||||
Anniversary Date One | |||||||
Class of Stock [Line Items] | |||||||
Purchase commitment, percentage | 0% | ||||||
Purchase commitment, period | 6 months | ||||||
Anniversary Date Two | |||||||
Class of Stock [Line Items] | |||||||
Purchase commitment, percentage | 1.50% | ||||||
Anniversary Date Three | |||||||
Class of Stock [Line Items] | |||||||
Purchase commitment, percentage | 3% | ||||||
Purchase commitment, period | 12 months | ||||||
Series A Redeemable Perpetual Preferred Shares | |||||||
Class of Stock [Line Items] | |||||||
Temporary equity, accretion of interest | $ 6,100 | $ 5,400 | |||||
Initial liquidation preference (in dollars per share) | $ 1,000 | ||||||
Dividend rate, percentage | 6.25% | ||||||
Payments of dividends | $ 6,300 | ||||||
Dividends payable | $ 12,700 | ||||||
Temporary equity, amortization of discount, period | 5 years | ||||||
Series A Redeemable Perpetual Preferred Shares | Accrued Regular Dividend Rate | |||||||
Class of Stock [Line Items] | |||||||
Dividend rate, percentage | 6.25% | ||||||
Series A Redeemable Perpetual Preferred Shares | Cash Regular Dividend Rate | |||||||
Class of Stock [Line Items] | |||||||
Dividend rate, percentage | 5.75% | ||||||
Temporary equity dividend rate spread | 2% | ||||||
Percent of the amount of default accrued dividends to be paid | 100% | ||||||
Series A Redeemable Perpetual Preferred Shares | Cash Regular Dividend Rate | Fifth, Sixth, and Seventh Anniversaries | |||||||
Class of Stock [Line Items] | |||||||
Temporary equity dividend rate spread | 0.50% | ||||||
Series A Redeemable Perpetual Preferred Shares | Cash Regular Dividend Rate | Eighth, Ninth, and Tenth Anniversaries | |||||||
Class of Stock [Line Items] | |||||||
Temporary equity dividend rate spread | 1% | ||||||
Securities Purchase Agreement | |||||||
Class of Stock [Line Items] | |||||||
Net proceeds from sale of series A perpetual preferred stock | $ 346,000 | ||||||
Principal payments on term loan facility | $ 100,000 | ||||||
Securities Purchase Agreement | Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Stock issued (in shares) | 7,098,765 | ||||||
Securities Purchase Agreement | Series A Redeemable Perpetual Preferred Shares | |||||||
Class of Stock [Line Items] | |||||||
Temporary equity, shares issued (in shares) | 350,000 | ||||||
Principal payments on term loan facility | $ 102,000 | ||||||
Securities Purchase Agreement, Expiry or Termination | Common Stock | BCP Helios Aggregator L.P. | |||||||
Class of Stock [Line Items] | |||||||
Stock issued (in shares) | 776,235 | ||||||
Net proceeds from sale of series A perpetual preferred stock | $ 10 | ||||||
Securities Purchase Agreement, Additional Closings | |||||||
Class of Stock [Line Items] | |||||||
Stock issued (in shares) | 1,125,000 | ||||||
Net proceeds from sale of series A perpetual preferred stock | $ 49,400 | $ 148,000 | |||||
Issuance of common stock, net (in shares) | 50,000 | ||||||
Securities Purchase Agreement, Additional Closings | Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Stock issued (in shares) | 3,375,000 | 3,375,000 | |||||
Securities Purchase Agreement, Additional Closings | Series A Redeemable Perpetual Preferred Shares | |||||||
Class of Stock [Line Items] | |||||||
Stock issued (in shares) | 150,000 | 150,000 | |||||
Securities Purchase Agreement, Additional Closings, Certain Pricing Adjustments | Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Stock issued (in shares) | 6,100,000 | ||||||
Minimum | Anniversary Date Two | |||||||
Class of Stock [Line Items] | |||||||
Purchase commitment, period | 6 months | ||||||
Maximum | Anniversary Date Two | |||||||
Class of Stock [Line Items] | |||||||
Purchase commitment, period | 12 months |
Revenue (Details)
Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 376,773 | $ 300,586 | |
Unbilled receivables | 122,003 | $ 101,513 | |
Deferred revenue | 151,343 | $ 178,922 | |
Deferred revenue recognized | $ 125,200 | ||
Percentage of deferred revenue recognized | 70% | ||
Revenue, bill and hold performance obligation, amount | $ 17,600 | ||
Remaining performance obligation | $ 571,500 | ||
Percentage of performance obligation to be recognized | 100% | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-04-01 | |||
Disaggregation of Revenue [Line Items] | |||
Remaining performance obligation, period | 12 months | ||
Over time revenue | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 248,219 | 208,071 | |
Point in time revenue | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 128,554 | $ 92,515 |
Earnings Per Share - Schedule o
Earnings Per Share - Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Earnings Per Share [Abstract] | ||
Net income (loss) | $ 26,132 | $ (25,937) |
Preferred dividends and accretion | 12,484 | 11,606 |
Net income (loss) to common shareholders | $ 13,648 | $ (37,543) |
Basic: | ||
Weighted average shares (in shares) | 150,607 | 148,288 |
Income (loss) per share (in dollars per share) | $ 0.09 | $ (0.25) |
Diluted: | ||
Effect of restricted stock and performance awards (in shares) | 1,188 | 0 |
Weighted average shares (in shares) | 151,795 | 148,288 |
Income (loss) per share (in dollars per share) | $ 0.09 | $ (0.25) |
Earnings Per Share - Narrative
Earnings Per Share - Narrative (Details) | 3 Months Ended |
Mar. 31, 2022 shares | |
Earnings Per Share [Abstract] | |
Equity compensation anti-dilutive securities (in shares) | 654,277 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | |
Surety Bond | ||||
Business Acquisition, Contingent Consideration [Line Items] | ||||
Contractual obligation | $ 208,500 | |||
Array | Tax Receivable Agreement | ||||
Business Acquisition, Contingent Consideration [Line Items] | ||||
Contingent consideration | $ 8,725 | $ 8,587 | $ 9,363 | $ 14,577 |
Tax receivable agreement, payment term | 125 days |
Commitments and Contingencies_2
Commitments and Contingencies - Summary of Liability Related To Estimated Contingent Consideration (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Business Combination, Contingent Consideration Arrangements, Change In Amount Of Contingent Consideration [Roll Forward] | ||
Payments | $ (1,200) | $ (1,483) |
Fair value adjustment | 1,338 | (3,731) |
Array | Tax Receivable Agreement | ||
Business Combination, Contingent Consideration Arrangements, Change In Amount Of Contingent Consideration [Roll Forward] | ||
Beginning balance | 8,587 | 14,577 |
Payments | (1,200) | (1,483) |
Fair value adjustment | 1,338 | (3,731) |
Ending balance | $ 8,725 | $ 9,363 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Schedule of carrying values and estimated fair values of debt instruments (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Fair Value, Concentration of Risk, Financial Statement Captions [Line Items] | ||
Convertible senior notes, carrying value | $ 740,209 | $ 759,043 |
Convertible Debt | ||
Fair Value, Concentration of Risk, Financial Statement Captions [Line Items] | ||
Convertible senior notes, carrying value | 414,215 | 413,752 |
Convertible senior notes, fair value | $ 467,084 | $ 430,236 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Narrative (Details) $ in Millions | Mar. 31, 2023 USD ($) |
Fair Value, Concentration of Risk, Financial Statement Captions [Line Items] | |
Other debt | $ 42.1 |
Fair Value, Inputs, Level 3 | Capped Call | |
Fair Value, Concentration of Risk, Financial Statement Captions [Line Items] | |
Derivative, fair value | 59.5 |
Fair Value, Inputs, Level 3 | Put Option | |
Fair Value, Concentration of Risk, Financial Statement Captions [Line Items] | |
Derivative, fair value | 3.8 |
Variable Interest | |
Fair Value, Concentration of Risk, Financial Statement Captions [Line Items] | |
Other debt | 25 |
Fixed Interest | |
Fair Value, Concentration of Risk, Financial Statement Captions [Line Items] | |
Other debt | 17.1 |
Debt maturing in 2023 | 11.7 |
Debt maturing in 2024 | $ 5.4 |
Equity-Based Compensation - Nar
Equity-Based Compensation - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Oct. 14, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Equity based compensation | $ 3.3 | $ 4.4 | |
Unrecognized compensation costs | $ 32.8 | ||
PSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Unrecognized compensation costs, period of recognition | 2 years 8 months 12 days | ||
RSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Unrecognized compensation costs, period of recognition | 2 years 4 months 24 days | ||
2020 Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Authorized shares (in shares) | 6,683,919 |
Equity-Based Compensation - Sch
Equity-Based Compensation - Schedule of RSU/PSU Activity (Details) | 3 Months Ended |
Mar. 31, 2023 $ / shares shares | |
RSUs | |
Number of Shares | |
Outstanding non-vested, beginning balance (in shares) | shares | 1,700,824 |
Shares granted (in shares) | shares | 757,334 |
Shares vested (in shares) | shares | (306,245) |
Shares forfeited (in shares) | shares | (93,019) |
Outstanding non-vested, ending balance (in shares) | shares | 2,058,894 |
Weighted Average Grant Date Fair Value | |
Outstanding non-vested, weighted average grant date fair value, beginning balance (in dollars per share) | $ / shares | $ 13.81 |
Shares granted, weighted average grand date fair value (in dollars per share) | $ / shares | 17.26 |
Shares vested, weighted average grand date fair value (in dollars per share) | $ / shares | 14.21 |
Shares forfeited, weighted average grand date fair value (in dollars per share) | $ / shares | 15.61 |
Outstanding non-vested, weighted average grant date fair value, ending balance (in dollars per share) | $ / shares | $ 14.73 |
PSUs | |
Number of Shares | |
Outstanding non-vested, beginning balance (in shares) | shares | 464,393 |
Shares granted (in shares) | shares | 263,594 |
Shares vested (in shares) | shares | 0 |
Shares forfeited (in shares) | shares | 0 |
Outstanding non-vested, ending balance (in shares) | shares | 727,987 |
Weighted Average Grant Date Fair Value | |
Outstanding non-vested, weighted average grant date fair value, beginning balance (in dollars per share) | $ / shares | $ 11.96 |
Shares granted, weighted average grand date fair value (in dollars per share) | $ / shares | 19.22 |
Shares vested, weighted average grand date fair value (in dollars per share) | $ / shares | 0 |
Shares forfeited, weighted average grand date fair value (in dollars per share) | $ / shares | 0 |
Outstanding non-vested, weighted average grant date fair value, ending balance (in dollars per share) | $ / shares | $ 14.59 |
Equity-Based Compensation - S_2
Equity-Based Compensation - Schedule of Assumptions (Details) - PSUs | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Volatility | 90% | 66% |
Risk-free interest rate | 3.74% | 0.28% |
Dividend yield | 0% | 0% |
Segment Reporting - Narrative (
Segment Reporting - Narrative (Details) - segment | 1 Months Ended | 12 Months Ended | 15 Months Ended |
Jan. 31, 2022 | Dec. 31, 2021 | Mar. 31, 2023 | |
Segment Reporting [Abstract] | |||
Number of operating segments | 2 | 1 | 2 |
Segment Reporting - Schedule of
Segment Reporting - Schedule of Segment Reporting Information, by Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Segment Reporting Information [Line Items] | ||
Revenue | $ 376,773 | $ 300,586 |
Gross Profit | 101,179 | 26,587 |
Array Legacy Operations | ||
Segment Reporting Information [Line Items] | ||
Revenue | 305,204 | 250,652 |
Gross Profit | 83,474 | 21,268 |
STI Operations | ||
Segment Reporting Information [Line Items] | ||
Revenue | 71,569 | 49,934 |
Gross Profit | $ 17,705 | $ 5,319 |