Cover Page
Cover Page - shares | 6 Months Ended | |
Jun. 30, 2020 | Aug. 01, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2020 | |
Document Transition Report | false | |
Entity File Number | 1-09720 | |
Entity Registrant Name | PAR TECHNOLOGY CORP | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 16-1434688 | |
Entity Address, Address Line One | PAR Technology Park | |
Entity Address, Address Line Two | 8383 Seneca Turnpike | |
Entity Address, City or Town | New Hartford | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 13413-4991 | |
City Area Code | 315 | |
Local Phone Number | 738-0600 | |
Title of 12(b) Security | Common Stock | |
Trading Symbol | PAR | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 18,250,625 | |
Entity Central Index Key | 0000708821 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 58,775 | $ 28,036 |
Accounts receivable – net | 38,236 | 41,774 |
Inventories – net | 25,992 | 19,326 |
Other current assets | 4,167 | 4,427 |
Total current assets | 127,170 | 93,563 |
Property, plant and equipment – net | 13,503 | 14,351 |
Goodwill | 41,214 | 41,386 |
Intangible assets – net | 34,305 | 32,948 |
Lease right-of-use assets | 2,445 | 3,017 |
Other assets | 4,249 | 4,347 |
Total Assets | 222,886 | 189,612 |
Current liabilities: | ||
Current portion of long-term debt | 647 | 630 |
Accounts payable | 15,699 | 16,385 |
Accrued salaries and benefits | 7,538 | 7,769 |
Accrued expenses | 2,523 | 3,176 |
Lease liabilities - current portion | 1,295 | 2,060 |
Customer deposits and deferred service revenue | 9,625 | 12,084 |
Total current liabilities | 37,327 | 42,104 |
Lease liabilities - net of current portion | 1,235 | 1,021 |
Deferred service revenue – non current | 3,937 | 3,916 |
Long-term debt | 103,849 | 62,414 |
Other long-term liabilities | 7,928 | 7,310 |
Total liabilities | 154,276 | 116,765 |
Commitments and contingencies | ||
Shareholders’ Equity: | ||
Preferred stock, $.02 par value, 1,000,000 shares authorized | 0 | 0 |
Common Stock, Value, Issued | 386 | 367 |
Additional paid in capital | 107,540 | 94,372 |
Accumulated deficit | (30,030) | (10,144) |
Accumulated other comprehensive loss | (5,009) | (5,368) |
Treasury Stock, Value | (4,277) | (6,380) |
Total shareholders’ equity | 68,610 | 72,847 |
Total Liabilities and Shareholders’ Equity | $ 222,886 | $ 189,612 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2020 | Dec. 31, 2019 |
Shareholders’ Equity: | ||
Preferred stock, par value (in dollars per share) | $ 0.02 | $ 0.02 |
Preferred stock authorized (in shares) | 1,000,000 | 1,000,000 |
Common stock per value (in dollars per share) | $ 0.02 | $ 0.02 |
Common stock authorized (in shares) | 58,000,000 | 58,000,000 |
Common stock issued (in shares) | 19,295,313 | 18,360,205 |
Common stock outstanding (in shares) | 18,245,225 | 16,629,177 |
Treasury stock at cost (in shares) | 1,050,088 | 1,731,028 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Revenue | $ 45,691 | $ 44,247 | $ 100,423 | $ 88,929 |
Costs of sales: | ||||
Cost of sales | 36,612 | 35,916 | 80,297 | 71,074 |
Gross margin | 9,079 | 8,331 | 20,126 | 17,855 |
Operating expenses: | ||||
Selling, general and administrative | 10,049 | 9,059 | 21,476 | 17,623 |
Research and development | 4,538 | 2,725 | 9,403 | 5,786 |
Amortization of identifiable intangible assets | 210 | 0 | 420 | 0 |
Operating expenses | 14,797 | 11,784 | 31,299 | 23,409 |
Operating loss | (5,718) | (3,453) | (11,173) | (5,554) |
Other expense, net | (139) | (374) | (764) | (804) |
Interest expense, net | (2,111) | (1,244) | (4,083) | (1,390) |
Loss on extinguishment of debt | 0 | 0 | (8,123) | 0 |
Loss before benefit from (provision for) income taxes | (7,968) | (5,071) | (24,143) | (7,748) |
(Provision for) benefit from income taxes | (1,008) | 3,962 | 4,257 | 3,910 |
Net loss | $ (8,976) | $ (1,109) | $ (19,886) | $ (3,838) |
Basic Earnings per Share: | ||||
Net loss (in dollars per share) | $ (0.49) | $ (0.07) | $ (1.10) | $ (0.24) |
Diluted Earnings per Share: | ||||
Net loss (in dollars per share) | $ (0.49) | $ (0.07) | $ (1.10) | $ (0.24) |
Weighted average shares outstanding: | ||||
Basic (in shares) | 18,244 | 16,290 | 18,092 | 16,085 |
Diluted (in shares) | 18,244 | 16,290 | 18,092 | 16,085 |
Product | ||||
Revenue | $ 12,333 | $ 14,728 | $ 30,967 | $ 30,245 |
Costs of sales: | ||||
Cost of sales | 9,982 | 11,412 | 24,887 | 22,653 |
Service | ||||
Revenue | 15,300 | 13,534 | 34,075 | 27,577 |
Costs of sales: | ||||
Cost of sales | 9,912 | 10,118 | 22,558 | 20,385 |
Contract | ||||
Revenue | 18,058 | 15,985 | 35,381 | 31,107 |
Costs of sales: | ||||
Cost of sales | $ 16,718 | $ 14,386 | $ 32,852 | $ 28,036 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (8,976) | $ (1,109) | $ (19,886) | $ (3,838) |
Other comprehensive income, net of applicable tax: | ||||
Foreign currency translation adjustments | 158 | 131 | 359 | 121 |
Comprehensive loss | $ (8,818) | $ (978) | $ (19,527) | $ (3,717) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional Paid in Capital | Accumulated deficit | Accumulated Other Comprehensive Loss | Treasury Stock |
Balance (in shares) at Dec. 31, 2018 | 17,878,000 | 1,708,000 | ||||
Balance at Dec. 31, 2018 | $ 45,946 | $ 357 | $ 50,251 | $ 5,427 | $ (4,253) | $ (5,836) |
Net loss | (2,729) | (2,729) | ||||
Issuance of common stock upon the exercise of stock options (in shares) | 78,000 | |||||
Issuance of common stock upon the exercise of stock options | 30 | 30 | ||||
Stock-based compensation | 248 | 248 | ||||
Foreign currency translation adjustments | (10) | (10) | ||||
Balance (in shares) at Mar. 31, 2019 | 17,956,000 | 1,708,000 | ||||
Balance at Mar. 31, 2019 | 43,485 | $ 357 | 50,529 | 2,698 | (4,263) | $ (5,836) |
Balance (in shares) at Dec. 31, 2018 | 17,878,000 | 1,708,000 | ||||
Balance at Dec. 31, 2018 | 45,946 | $ 357 | 50,251 | 5,427 | (4,253) | $ (5,836) |
Net loss | (3,838) | |||||
Foreign currency translation adjustments | 121 | |||||
Balance (in shares) at Jun. 30, 2019 | 18,035,000 | 1,708,000 | ||||
Balance at Jun. 30, 2019 | 55,787 | $ 360 | 63,806 | 1,589 | (4,132) | $ (5,836) |
Balance (in shares) at Mar. 31, 2019 | 17,956,000 | 1,708,000 | ||||
Balance at Mar. 31, 2019 | 43,485 | $ 357 | 50,529 | 2,698 | (4,263) | $ (5,836) |
Net loss | (1,109) | (1,109) | ||||
Issuance of common stock upon the exercise of stock options (in shares) | 79,000 | |||||
Issuance of common stock upon the exercise of stock options | 213 | $ 3 | 210 | |||
Stock-based compensation | 602 | 602 | ||||
Foreign currency translation adjustments | 131 | 131 | ||||
Convertible notes conversion discount | 12,465 | 12,465 | ||||
Balance (in shares) at Jun. 30, 2019 | 18,035,000 | 1,708,000 | ||||
Balance at Jun. 30, 2019 | $ 55,787 | $ 360 | 63,806 | 1,589 | (4,132) | $ (5,836) |
Balance (in shares) at Dec. 31, 2019 | 16,629,177 | 18,360,000 | 1,731,000 | |||
Balance at Dec. 31, 2019 | $ 72,847 | $ 367 | 94,372 | (10,144) | (5,368) | $ (6,380) |
Net loss | (10,910) | (10,910) | ||||
Issuance of common stock upon the exercise of stock options (in shares) | 2,000 | |||||
Issuance of common stock upon the exercise of stock options | 30 | 30 | ||||
Net issuance of restricted stock awards (in shares) | 21,000 | |||||
Net issuance of restricted stock awards | 0 | |||||
Treasury stock acquired from employees upon vesting or forfeiture of restricted stock (in shares) | 38,000 | |||||
Treasury stock acquired from employees upon vesting or forfeiture of restricted stock | (524) | $ (524) | ||||
Acquisition consideration (in shares) | 908,000 | |||||
Issuance of restricted stock for acquisition | 19 | $ 19 | ||||
Equity component of redeemed 2024 convertible notes, net of deferred taxes and issuance costs | (5,553) | (7,988) | $ 2,435 | |||
Equity component of issued 2026 convertible notes, net of deferred taxes and issuance costs shares (in shares) | (722,000) | |||||
Equity component of issued 2026 convertible notes, net of deferred taxes and issuance costs | 19,097 | 19,097 | ||||
Stock-based compensation | 1,089 | 1,089 | ||||
Foreign currency translation adjustments | 201 | 201 | ||||
Balance (in shares) at Mar. 31, 2020 | 19,291,000 | 1,047,000 | ||||
Balance at Mar. 31, 2020 | $ 76,296 | $ 386 | 106,600 | (21,054) | (5,167) | $ (4,469) |
Balance (in shares) at Dec. 31, 2019 | 16,629,177 | 18,360,000 | 1,731,000 | |||
Balance at Dec. 31, 2019 | $ 72,847 | $ 367 | 94,372 | (10,144) | (5,368) | $ (6,380) |
Net loss | $ (19,886) | |||||
Issuance of common stock upon the exercise of stock options (in shares) | 6,000 | |||||
Foreign currency translation adjustments | $ 359 | |||||
Balance (in shares) at Jun. 30, 2020 | 18,245,225 | 19,295,000 | 1,050,000 | |||
Balance at Jun. 30, 2020 | $ 68,610 | $ 386 | 107,540 | (30,030) | (5,009) | $ (4,277) |
Balance (in shares) at Mar. 31, 2020 | 19,291,000 | 1,047,000 | ||||
Balance at Mar. 31, 2020 | 76,296 | $ 386 | 106,600 | (21,054) | (5,167) | $ (4,469) |
Net loss | (8,976) | (8,976) | ||||
Issuance of common stock upon the exercise of stock options (in shares) | 4,000 | |||||
Issuance of common stock upon the exercise of stock options | 12 | 12 | ||||
Treasury stock acquired from employees upon vesting or forfeiture of restricted stock (in shares) | 3,000 | |||||
Treasury stock acquired from employees upon vesting or forfeiture of restricted stock | (3) | (195) | $ 192 | |||
Stock-based compensation | 1,123 | 1,123 | ||||
Foreign currency translation adjustments | $ 158 | 158 | ||||
Balance (in shares) at Jun. 30, 2020 | 18,245,225 | 19,295,000 | 1,050,000 | |||
Balance at Jun. 30, 2020 | $ 68,610 | $ 386 | $ 107,540 | $ (30,030) | $ (5,009) | $ (4,277) |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Parenthetical) $ in Millions | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Statement of Stockholders' Equity [Abstract] | |
Convertible notes conversion discount, taxes | $ 4.1 |
Issuance cost, equity component | $ 1.1 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Cash flows from operating activities: | ||
Net loss | $ (19,886) | $ (3,838) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation, amortization and accretion | 6,700 | 3,121 |
Current expected credit losses | 978 | 397 |
Provision for obsolete inventory | 1,439 | (522) |
Stock-based compensation | 2,212 | 850 |
Loss on debt extinguishment | 8,123 | 0 |
Deferred income tax | (4,408) | (4,065) |
Changes in operating assets and liabilities: | ||
Accounts receivable | 2,560 | (284) |
Inventories | (8,105) | 1,876 |
Other current assets | 260 | (3,406) |
Other assets | 119 | 150 |
Accounts payable | (931) | (2,208) |
Accrued salaries and benefits | (231) | (240) |
Accrued expenses | (652) | 2,840 |
Customer deposits and deferred service revenue | (2,438) | 1,548 |
Other long-term liabilities | 618 | (2,760) |
Net cash used in operating activities | (13,642) | (6,541) |
Cash flows from investing activities: | ||
Settlement of working capital for acquisitions | 172 | 0 |
Capital expenditures | (188) | (1,693) |
Capitalization of software costs | (4,613) | (1,624) |
Net cash used in investing activities | (4,629) | (3,317) |
Cash flows from financing activities: | ||
Payments of long-term debt | (313) | 0 |
Payment of contingent consideration | 0 | (2,550) |
Payments of bank borrowings | 0 | (17,459) |
Proceeds from bank borrowings | 0 | 9,640 |
Payments for the extinguishment of notes payable | (66,250) | 0 |
Proceeds from notes payable, net of issuance costs | 115,916 | 75,039 |
Treasury stock acquired from employees upon vesting or forfeiture of restricted stock | (332) | 0 |
Proceeds from exercise of stock options | 42 | 243 |
Net cash provided by financing activities | 49,063 | 64,913 |
Effect of exchange rate changes on cash and cash equivalents | (53) | 121 |
Net increase in cash and cash equivalents | 30,739 | 55,176 |
Cash and cash equivalents at beginning of period | 28,036 | 3,485 |
Cash and equivalents at end of period | 58,775 | 58,661 |
Supplemental disclosures of cash flow information: | ||
Cash paid for interest | 1,262 | 153 |
Income taxes, net of refunds | 10 | 125 |
Capitalized software recorded in accounts payable | $ 245 | $ 0 |
Basis of presentation
Basis of presentation | 6 Months Ended |
Jun. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of presentation | Basis of presentation The accompanying unaudited interim condensed consolidated financial statements ("financial statements") of PAR Technology Corporation and its consolidated subsidiaries (the “Company”, “PAR”, "we", "us", "our") have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial statements and the instructions to Form 10-Q and Regulation S-X pertaining to interim financial statements. In the opinion of management, the Company's financial statements include all normal and recurring adjustments necessary in order to make the financial statements not misleading and to provide a fair presentation of the results for the interim period included in this Quarterly Report on Form 10-Q (“Quarterly Report”). Interim results are not necessarily indicative of results for the full year or any future periods. The information included in this Quarterly Report should be read in conjunction with the Company's audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019, filed with the Securities and Exchange Commission (“SEC”) on March 16, 2020. The preparation of the financial statements requires management of the Company to make a number of estimates and assumptions relating to the reported amount of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Significant items subject to such estimates and assumptions include revenue recognition, stock-based compensation, the recognition and measurement of assets acquired and liabilities assumed in business combinations at fair value, the carrying amount of property, plant and equipment including right-to-use assets and liabilities, identifiable intangible assets and goodwill, the measurement of liabilities and equity recognized for outstanding convertible notes, valuation allowances for receivables, inventories, and measurement of contingent consideration at fair value. Actual results could differ from those estimates. The Company operates in two distinct reporting segments, Restaurant/Retail and Government. The Company’s chief operating decision maker is the Company’s Chief Executive Officer. The Restaurant/Retail reporting segment provides point-of-sale (POS) software and hardware, back-office software, and integrated technical solutions to the restaurant and retail industries. The Government reporting segment provides intelligence, surveillance, and reconnaissance solutions and mission systems support to the United States Department of Defense and other Federal agencies. In addition, the financial statements include corporate and eliminations, which is comprised of enterprise-wide functional departments. Additionally, the Company has reclassified certain costs and expenses in the condensed consolidated statement of operations for the three and six months ended June 30, 2020, amounting to $0.2 million and $0.5 million, respectively, from amortization of intangible assets to cost of service to cost of service to conform to current period presentation. These reclassifications had no effect on previously reported total costs and operating expenses and net loss. Use of Estimates Preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Recently Adopted Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (the FASB) issued Accounting Standards Update ("ASU") 2016-13, "Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments." ASU 2016-13 requires the measurement of all expected credit losses for financial assets held at the reporting date, based on historical experience, current conditions, and reasonable and supportable forecasts. In addition, ASU 2016-13 amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. The Company adopted ASU 2016-13 effective January 1, 2020, and the application of the standard had no material impact on the Company's financial statements for the three and six months ended June 30, 2020. In January 2017, the FASB issued ASU 2017-04, “Intangibles - Goodwill and Other (Topic 350) - Simplifying the Test for Goodwill Impairment.” ASU 2017-04 eliminates Step 2 from the goodwill impairment test which required entities to compute the implied fair value of goodwill. Under ASU 2017-04, an entity should perform its annual or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The Company adopted ASU 2017-04 effective January 1, 2020, and the application of the standard had no material impact on the Company's financial statements for the three and six months ended June 30, 2020. In August 2018, the FASB issued ASU 2018-13, “Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement.” ASU 2018-13 modifies the fair value measurement disclosures with the primary focus to improve effectiveness of disclosures in the notes to the financial statements that is most important to the users. ASU 2018-13 modifies the required disclosures related to the valuation techniques and inputs used, uncertainty in measurement, and changes in measurements applied. The Company adopted ASU 2018-13 effective January 1, 2020, and the application of the standard had no material impact on the Company's financial statements for the three and six months ended June 30, 2020. In August 2018, the FASB issued ASU 2018-15, “Intangibles – Goodwill and Other (Topic 350) - Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract.” ASU 2018-15 provides guidance on the measurement of costs for internal-use software during the design, development, and implementation stages for customers in a cloud hosting arrangement. ASU 2018-15 also requires the capitalized costs associated with the design, development and implementation of cloud hosted arrangements to be amortized over the term of the hosting arrangement. The Company adopted ASU 2018-15 effective January 1, 2020, and the application of the standard had no material impact on the Company's financial statements for the three and six months ended June 30, 2020. Recently Issued Accounting Pronouncements Not Yet Adopted In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): "Simplifying the Accounting for Income Taxes", which is intended to simplify various requirements related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and clarifies and amends existing guidance to improve consistent application. ASU 2019-12 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020, with early adoption permitted. The Company is currently assessing the impact of this standard on its financial statements. With the exception of the new standards discussed above, there were no other recent accounting pronouncements or changes in accounting pronouncements during the three and six months ended June 30, 2020 that are of significance or potential significance to the Company, as compared to the recent accounting pronouncements described in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2019. |
Revenue Recognition
Revenue Recognition | 6 Months Ended |
Jun. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition Our revenue is derived from Software as a Service (SaaS), hardware and software sales, software activation, hardware support, installations, maintenance and professional services. Accounting Standards Codification ("ASC") 606: "Revenue from Contracts with Customers" requires us to distinguish and measure performance obligations under customer contracts. Contract consideration is allocated to all performance obligations within the arrangement or contract. Performance obligations that are determined not to be distinct are combined with other performance obligations until the combined unit is determined to be distinct and that combined unit is then recognized as revenue over time or at a point in time depending on when control is transferred. We evaluated the potential performance obligations within our Restaurant/Retail reporting segment and evaluated whether each performance obligation met the ASC 606 criteria to be considered distinct performance obligations. Revenue in the Restaurant/Retail reporting segment is recognized at a point in time for software, hardware and installations. Revenue on these items are recognized when the customer obtains control of the asset. This generally occurs upon delivery and acceptance by the customer or upon installation or delivery to a third party carrier for onward delivery to customer. Additionally, revenue in the Restaurant/Retail reporting segment relating to SaaS, our hardware Advanced Exchange, on-site support and other services is recognized over time as the customer simultaneously receives and consumes the benefits of the Company’s performance obligations. Our support services are stand-ready obligations that are provided over the life of the contract, generally 12 months. We offer installation services to our customers for hardware and software for which we primarily hire third-party contractors to install the equipment on our behalf. We pay third-party contractors installation service fees at mutually agreed rates. When third-party installers are used, we determine whether the nature of our performance obligations is to provide the specified goods or services ourselves (principal) or to arrange for a third-party to provide the goods or services (agent). In direct customer arrangements, we have discretion over our pricing; we are primarily responsible for providing a good or service; and we have inventory risk before the good or service is transferred to the customer. As a result, we have concluded that we are the principal in the arrangement and record installation revenue on a gross basis. Our contracts typically require payment within 30 to 90 days from the shipping date or installation date. The primary method used to estimate stand-alone selling price, is by referring to the price that we charge for that good or service when we sell it separately under similar circumstances to similar customers. The Company determines stand-alone selling price as follows: hardware, software (on-premises and SaaS) and software activation (which is a one-time fee charged at the initial offering of software) performance obligations are recognized at a stand-alone selling price based on the price at which the Company sells the particular good or service separately in similar circumstances and to similar customers. The stand-alone selling price for all other performance obligations, including: pass-through hardware, such as terminals, printers, or card readers; hardware support, including Advanced Exchange, installation and maintenance; software upgrades; and professional services, including project management, is recognized by using an expected cost plus margin. Our revenue in the Government reporting segment is generally recognized over time as control of products or services is generally transferred continuously to our customers. While revenue generated by the Government reporting segment is predominantly related to services, we do generate revenue from sales of materials, software, hardware, and maintenance. For the Government reporting segment, cost plus fixed fee contract portfolio revenue is recognized over time using costs incurred as of a determination date, to measure progress toward satisfying our performance obligations. Incurred costs represent work performed, which corresponds with, and thereby best depicts, the transfer of control to the customer. Contract costs include labor, material, overhead, and general and administrative expenses. Profit is recognized on the fixed fee portion of the contract as costs are incurred and invoiced. Long-term fixed price contracts and programs involve the use of various techniques to estimate total contract revenue and costs. For long-term fixed price contracts, we estimate the profit, as the difference between the total estimated revenue and expected costs to complete a contract, and recognize it over the life of the contract. Contract estimates are based on various assumptions to project the outcome of future events. These assumptions include: labor productivity and availability; the complexity of the work to be performed; the cost and availability of materials; and the performance of subcontractors. Revenue and profit in future periods of contract performance are recognized using the same assumptions, adjusted for estimated costs to complete a contract. Once the services provided are determined to be distinct or not distinct, we evaluate how to allocate the transaction price. Generally, the Government reporting segment does not sell the same good or service to similar customers and the contract performance obligations are unique to each government contract. The performance obligations are typically not distinct; however, in cases where there are distinct performance obligations, the transaction price is allocated to each performance obligation ratably, based upon the stand-alone selling price of each performance obligation. Cost plus margin is used for the cost plus fixed fee contract portfolios as well as the fixed price and time and materials contracts portfolios to determine the stand-alone selling price. In determining when to recognize revenue, we analyze whether our performance obligations in our Government contracts are satisfied over a period of time or at a point in time. In general, our performance obligations are satisfied over a period of time. However, there may be circumstances where the latter or both scenarios could apply to a contract. We generally anticipate receipt of payment within 30 to 90 days from the date of service. None of our contracts as of December 31, 2019 or June 30, 2020 contained a significant financing component. Performance Obligations Outstanding The Company's performance obligations outstanding represent the transaction price of firm, non-cancellable orders, with expected delivery dates to customers subsequent to June 30, 2020 and June 30, 2019, respectively, for work that has not yet been performed. The activity of outstanding performance obligations as is relates to customer deposits and deferred service revenue is as follows: (in thousands) 2020 2019 Beginning balance - January 1 $ 16,000 $ 14,134 Change in deferred revenue (430) (327) Changes in customer deposits (2,008) 1,272 Ending balance - June 30 $ 13,562 $ 15,079 In the Restaurant/Retail reporting segment most performance obligations over one year are related to service and support contracts, approximately 73% of which we expect to fulfill within the one-year period and 100% within 60 months. At June 30, 2020 and December 31, 2019, transaction prices allocated to future performance obligations were $10.5 million and $10.9 million, respectively. During the three months ended June 30, 2020 and June 30, 2019, we recognized revenue of $3.6 million and $3.9 million, respectively, included in the contract liabilities at the beginning of the respective period. During the six months ended June 30, 2020 and June 30, 2019, we recognized revenue of $7.7 million and $9.0 million, respectively, included in the contract liabilities at the beginning of the respective period. The value of existing contracts in the Government reporting segment at June 30, 2020, net of amounts relating to work performed to that date, was approximately $129.6 million, of which $35.5 million was funded, and at December 31, 2019, net of amounts relating to work performed to that date, was approximately $148.7 million, of which $32.8 million was funded. The value of existing contracts, net of amounts relating to work performed to that date are expected to be recognized as revenue over time as follows (in thousands): Next 12 Months $ 56,458 Months 13-24 32,644 Months 25-36 24,821 Thereafter 15,690 TOTAL $ 129,613 Disaggregated Revenue The Company disaggregates revenue from customer contracts by major product group for each reporting segment. The Company believes this method best depicts how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. Disaggregation of revenue for the three and six months ended June 30, 2020 and June 30, 2019 is as follows: (in thousands) Three months ended June 30, 2020 Restaurant/Retail - Point in Time Restaurant/Retail - Over Time Government - Over Time Restaurant/Retail $ 19,820 $ 7,813 $ — Mission Systems $ — $ — $ 8,087 ISR Solutions $ — $ — $ 9,971 TOTAL $ 19,820 $ 7,813 $ 18,058 (in thousands) Three months ended June 30, 2019 Restaurant/Retail - Point in Time Restaurant/Retail - Over Time Government - Over Time Restaurant/Retail $ 21,503 $ 5,829 $ — Grocery 283 647 — Mission Systems — — 8,192 ISR Solutions — — 7,793 TOTAL $ 21,786 $ 6,476 $ 15,985 (in thousands) Six months ended June 30, 2020 Restaurant/Retail - Point in Time Restaurant/Retail - Over Time Government - Over Time Restaurant/Retail $ 47,635 $ 17,407 $ — Mission Systems — — 16,535 ISR Solutions — — 18,846 TOTAL $ 47,635 $ 17,407 $ 35,381 (in thousands) Six months ended June 30, 2019 Restaurant/Retail - Point in Time Restaurant/Retail - Over Time Government - Over Time Restaurant/Retail $ 43,880 $ 11,579 $ — Grocery 732 1,631 — Mission Systems — — 16,738 ISR Solutions — — 14,369 TOTAL $ 44,612 $ 13,210 $ 31,107 Practical Expedients and Exemptions The Company generally expenses sales commissions when incurred because the amortization period is less than one year or the total amount of commissions is immaterial. We record these expenses in selling, general and administrative in the condensed consolidated statements of operations. We elected to exclude from the transaction price measurement, all taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by the Company from a customer (for example, sales, use, value added, and some excise taxes). |
Acquisitions
Acquisitions | 6 Months Ended |
Jun. 30, 2020 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions Drive-Thru Acquisition Effective September 30, 2019, the Company, through its wholly-owned subsidiary ParTech, Inc. ("ParTech"), acquired assets of 3M Company's Drive-Thru Communications Systems business, including the XT-1 and G5 headset systems, contracts and intellectual property associated with the business, for a purchase price of $8.4 million (total fair value of assets were $8.4 million including $1.2 million in developed technology, $3.6 million of customer relationships, and $2.4 million of goodwill, net of warranty liability of $1.4 million, resulting in cash paid of $7.0 million) (the "Drive-Thru Acquisition"). Restaurant Magic Acquisition Effective December 18, 2019, the Company, through ParTech, acquired 100% of the limited liability company interests of AccSys LLC (f/k/a AccSys, Inc., and otherwise known as Restaurant Magic) in base consideration of approximately $42.8 million, of which approximately $12.8 million was paid in cash, which reflects a $0.2 million favorable working capital adjustment finalized in the second quarter of 2020, $27.5 million was paid in restricted shares of Company common stock (issued in January 2020) and $2.0 million was paid by delivery of a subordinated promissory note (the "Restaurant Magic Acquisition"). The sellers have the opportunity through 2022 to earn additional purchase price consideration subject to the achievement of certain post-closing revenue focused milestones (“Earn-Out”). As of December 31, 2019 and June 30, 2020, the value of the Earn-Out based on a Monte Carlo simulation was $3.3 million. The Earn-Out, if any, will be payable 50% in cash or subordinated promissory notes, or a combination of both, at the Company's election, and 50% in restricted shares of Company common stock. This Earn-out has no maximum payment. The Company issued restricted stock units in connection with its assumption of awards granted by Restaurant Magic to its employees and contractors prior to the closing of the acquisition. The fair values assigned to the acquired assets and assumed liabilities presented in the table below are based on our best estimates and assumptions as of the reporting date: (in thousands) Purchase price allocation Developed technology $ 16,400 Customer relationships 1,100 Trade name 900 Tangible assets 1,344 Goodwill 27,773 Total assets 47,517 Accounts payable and accrued expenses 629 Deferred revenue 715 Earn out liability 3,340 Consideration paid $ 42,833 Unaudited Pro Forma Financial Information For the three months ended June 30, 2020, the Drive-Thru Acquisition and Restaurant Magic Acquisition resulted in additional revenues of $4.0 million and $1.8 million, respectively. For the six months ended June 30, 2020, the Drive-Thru Acquisition and Restaurant Magic Acquisition resulted in additional revenues of $7.5 million and $4.0 million, respectively. The Company has determined it is impractical to report the amounts of net loss for the Drive-Thru and Restaurant Magic acquisition for each entity for the three and six months ended June 30, 2020. The following unaudited pro forma financial information presents our results as if the Drive-Thru Acquisition and Restaurant Magic Acquisition had occurred January 1, 2019: (in thousands) Three months ended June 30, 2019 Six months ended June 30, 2019 Total revenue $ 50,921 $ 102,274 Net income $ 1,044 $ 781 |
Divestiture
Divestiture | 6 Months Ended |
Jun. 30, 2020 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Divestiture | DivestitureSale of SureCheckDuring the second quarter of 2019, ParTech entered into an asset purchase agreement to sell substantially all of the assets relating to the SureCheck product group within the Company's Restaurant/Retail reporting segment. The sale does not qualify for treatment as a discontinued operation, and therefore, the SureCheck product group is included in the Company’s continuing operations for all periods presented. |
Accounts Receivable, Net
Accounts Receivable, Net | 6 Months Ended |
Jun. 30, 2020 | |
Receivables [Abstract] | |
Accounts Receivable, Net | Accounts Receivable, Net The Company’s accounts receivable, net, consists of: (in thousands) June 30, 2020 December 31, 2019 Government reporting segment: Billed $ 9,091 $ 11,608 Advanced billings (491) (608) 8,600 11,000 Restaurant/Retail reporting segment: 29,636 30,774 Accounts receivable - net $ 38,236 $ 41,774 At June 30, 2020 and December 31, 2019, the Company's expected credit loss was $2.0 million and $1.8 million, respectively, against the accounts receivable for the Restaurant/Retail reporting segment. The changes in the current, expected credit loss during the six months ended June 30, 2020 were as follows: (in thousands) 2020 2019 Beginning balance - January 1 $ 1,849 $ 1,351 Provisions 972 477 Write-offs (773) (120) Recoveries $ — $ — Ending balance - June 30 $ 2,048 $ 1,708 Receivables recorded as of June 30, 2020 and December 31, 2019 all represent unconditional rights to payments from customers. |
Inventories
Inventories | 6 Months Ended |
Jun. 30, 2020 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories are primarily used in the manufacture, maintenance and service of products within the Restaurant/Retail reporting segment. The components of inventories, net, consist of the following: (in thousands) June 30, 2020 December 31, 2019 Finished goods $ 13,495 $ 8,320 Component parts 7,672 6,768 Service parts 4,825 4,238 $ 25,992 $ 19,326 At June 30, 2020 and December 31, 2019, the Company had inventory reserves of $11.7 million and $9.6 million, respectively, against inventories used in the Restaurant/Retail reporting segment, which relate primarily to service parts. |
Identifiable Intangible Assets
Identifiable Intangible Assets and Goodwill | 3 Months Ended |
Jun. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Identifiable Intangible Assets and Goodwill | Identifiable Intangible Assets and Goodwill Identifiable intangible assets represent intangible assets acquired by the Company in connection with its acquisition of Brink Software Inc. ("Brink Acquisition"), the Drive-Thru Acquisition and the Restaurant Magic Acquisition, and software development costs. The Company capitalizes certain software development costs for software used in its Restaurant/Retail reporting segment. Software development costs incurred prior to establishing technological feasibility are charged to operations and included in research and development costs. The technological feasibility of a software product is established when the Company has completed all planning, designing, coding, and testing activities necessary to establish that the software product meets its design specifications, including functionality, features, and technical performance requirements. Software development costs incurred after establishing technological feasibility of software sold as a perpetual license, as defined within ASC 985-20, "Software – Costs of Software to be sold, Leased, or Marketed", are capitalized and amortized on a product-by-product basis when the software product is available for general release to customers. Included in "Acquired and internally developed software costs" in the table below are approximately $3.5 million and $2.5 million of costs related to software products that have not satisfied the general release threshold as of June 30, 2020 and December 31, 2019, respectively. These software products are expected to satisfy the general release threshold within the next 12 months. Software development costs are also capitalized in accordance with ASC 350-40, “Intangibles - Goodwill and Other - Internal - Use Software,” and are amortized over the expected benefit period, which generally ranges from three Annual amortization, charged to cost of sales is computed using the straight-line method over the remaining estimated economic life of software products, generally three For the three month period ended June 30, 2020, $0.8 million and $0.2 million were recorded in cost of service and amortization of intangible assets, respectively, compared to $0.2 million in cost of service for the three months ended June 30, 2019. For the six month period ended June 30, 2020, $1.7 million and $0.4 million were recorded in cost of service and amortization of intangible assets, respectively, compared to $0.4 million in cost of service for the six months ended June 30, 2019. The components of identifiable intangible assets are: (in thousands) June 30, 2020 December 31, 2019 Estimated Acquired and internally developed software costs $ 39,961 $ 36,137 3 - 5 years Customer relationships 4,860 4,860 7 years Non-competition agreements 30 30 1 year 44,851 41,027 Less accumulated amortization (15,948) (12,389) $ 28,903 $ 28,638 Internally developed software costs not meeting general release threshold 3,592 2,500 Trademarks, trade names (non-amortizable) 1,810 1,810 $ 34,305 $ 32,948 The expected future amortization of intangible assets, assuming straight-line amortization of capitalized software development costs and acquisition related intangibles and excluding software costs not meeting the general release threshold, is as follows (in thousands): 2020, remaining $ 3,623 2021 6,872 2022 5,539 2023 3,581 2024 3,186 Thereafter 6,102 Total $ 28,903 |
Debt
Debt | 6 Months Ended |
Jun. 30, 2020 | |
Debt Disclosure [Abstract] | |
Debt | Debt On April 15, 2019, the Company sold $80.0 million in aggregate principal amount of 4.500% Convertible Senior Notes due 2024 (the "2024 Notes"). The 2024 Notes were sold pursuant to an indenture, dated April 15, 2019 (the "2024 Indenture"), between the Company and The Bank of New York Mellon Trust Company, N.A., as Trustee. The 2024 Notes pay interest at a rate equal to 4.500% per year, payable semiannually in arrears on April 15 and October 15 of each year, beginning October 15, 2019. Interest accrues on the 2024 Notes from the last date to which interest has been paid or duly provided for or, if no interest has been paid or duly provided for, from April 15, 2019. Unless earlier converted, redeemed or repurchased, the 2024 Notes mature on April 15, 2024. On February 10, 2020, the Company sold $120.0 million in aggregate principal amount of 2.875% Convertible Senior Notes due 2026 (the "2026 Notes" and, together with the 2024 Notes, the "Notes"). The 2026 Notes were sold pursuant to an indenture, dated February 10, 2020 (the "2026 Indenture" and, together with the 2024 Indenture, the "Indentures"), between the Company and The Bank of New York Mellon Trust Company, N.A., as Trustee. The 2026 Notes pay interest at a rate equal to 2.875% per year, payable semiannually in arrears on April 15 and October 15 of each year, beginning October 15, 2020. Interest accrues on the 2026 Notes from the last date to which interest has been paid or duly provided for or, if no interest has been paid or duly provided for, from April 15, 2020. Unless earlier converted, redeemed or repurchased, the 2026 Notes mature on April 15, 2026. The Company used approximately $66.3 million (excluding cash payments relating to accrued interest and fractional shares) from its sale of the 2026 Notes and issued 722,423 shares of common shares at $32.43 per share out of treasury stock with an average cost basis of $3.37 per share to repurchase approximately $66.3 million in aggregate principal amount of the 2024 Notes through individually negotiated transactions. Of the total price paid for the 2024 Notes, $59.0 million was allocated to the 2024 Notes settlement, $30.8 million was allocated to the equity component, and $1.0 million was used to pay off accrued interest on the 2024 Notes. The consideration transferred was allocated to the liability and equity components of the 2024 Notes using the equivalent rate that reflected the borrowing rate for a similar non-convertible debt instrument immediately prior to settlement. The transaction resulted in a loss on settlement of convertible notes of $8.1 million, which is recorded as a Loss on extinguishment of debt in the Company’s unaudited condensed consolidated statement of operations. The loss represents the difference between (i) the fair value of the liability component and (ii) the sum of the carrying value of the debt component and any unamortized debt issuance costs at the time of settlement. The implied estimated effective rate of the liability component of the 2024 Notes and 2026 Notes is 10.24% and 7.33%, respectively. The Notes are senior, unsecured obligations of the Company. The 2024 Notes and the 2026 Notes are convertible, in whole or in part, at the option of the holder, upon the occurrence of specified events or certain fundamental changes set forth in the Indentures prior to the close of business on the business day immediately preceding October 15, 2023 and October 15, 2025, respectively; and, thereafter, at any time until the close of business on the second business day immediately preceding maturity. The 2024 Notes are convertible into Company common stock at an initial conversion rate of 35.0217 shares per $1,000 principal amount and the 2026 Notes are convertible into Company common stock at an initial conversion rate of 23.2722 shares per $1,000 principal amount. Upon conversion, the Company may elect to settle by paying or delivering either solely cash, shares of Company common stock or a combination of cash and shares of common stock. In accordance with ASC 470-20 "Debt with Conversion and Other Options — Beneficial Conversion Features", the initial measurement of the 2024 Notes at fair value resulted in a liability of $62.4 million, as such, the calculated discount resulted in an implied value of the convertible feature recognized in Additional Paid in Capital of $17.6 million. In accordance with ASC 470-20, the initial measurement of the 2026 Notes at fair value resulted in a liability of $93.8 million, as such, the calculated discount resulted in an implied value of the convertible feature recognized in Additional Paid in Capital of $26.2 million. Issuance costs for the transactions amounted to $4.9 million and $4.2 million for the 2024 Notes and 2026 Notes, respectively. These costs were allocated to debt and equity components on a ratable basis. For the 2024 Notes this amounted to $3.8 million and $1.1 million to the debt and equity components, respectively. For the 2026 Notes this amounted to $3.1 million and $1.1 million to the debt to equity components, respectively. The Indentures contain covenants that, among other things, restrict the Company’s ability to merge, consolidate or sell, or otherwise dispose of, substantially all of its assets and customary Events of Default (as defined in the Indentures). In connection with the sale of the 2026 Notes, the Company recorded an income tax benefit of $4.4 million in the first six months of 2020 as a result of the creation of a deferred tax liability associated with the portion of the 2026 Notes that was classified within stockholders' equity. While GAAP requires the offset of the deferred tax liability to be recorded in additional paid-in capital, consistent with the equity portion of the 2026 Notes, the creation of the deferred tax liability produced evidence of recoverability of the Company's net deferred tax assets which resulted in the release of a valuation allowance, totaling $4.4 million, reflected as an income tax benefit in the first six months of 2020. The following table summarizes information about the net carrying amounts of the 2024 Notes and 2026 Notes as of June 30, 2020: (in thousands) 2024 Notes 2026 Notes Principal amount of 2024 Notes outstanding $ 13,750 $ 120,000 Unamortized discount (including unamortized debt issuance cost) (3,055) (27,884) Total long-term portion of notes payable $ 10,695 $ 92,116 The following table summarizes interest expense recognized on the 2024 Notes and 2026 Notes: (in thousands) Three Months Ended June 30, 2020 2020 2019 Contractual interest expense $ 1,000 $ 498 Amortization of debt issuance costs and discount 1,102 746 Total interest expense $ 2,102 $ 1,244 (in thousands) Six Months Ended June 30, 2020 2019 Contractual interest expense $ 2,015 $ 644 Amortization of debt issuance costs and discount 2,059 746 Total interest expense $ 4,074 $ 1,390 The following table summarizes the future principal payments for the 2024 Notes and 2026 Notes (in thousands): 2020, remaining $ — 2021 — 2022 — 2023 — 2024 13,750 Thereafter 120,000 $ 133,750 In connection with the Restaurant Magic Acquisition, see Note 3 - Acquisitions, $2.0 million was paid by delivery of a subordinated promissory note. The note bears interest at 4.5% per annum, with monthly payments of principal and interest in the amount of $60,391 payable beginning January 15, 2020 through maturity on December 15, 2022. As of June 30, 2020, the outstanding balance of the subordinated promissory note was $1.7 million of which $0.6 million was in the current portion of long-term debt. The Company's future minimum principal payments are $0.3 million, $0.7 million and $0.7 million for the remainder of 2020, 2021 and 2022, respectively. |
Stock Based Compensation
Stock Based Compensation | 6 Months Ended |
Jun. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock Based Compensation | Stock Based Compensation The Company applies the fair value recognition provisions of ASC Topic 718: "Stock Compensation". The Company recorded stock based compensation of $2.2 million and $0.9 million for the six month periods ended June 30, 2020 and June 30, 2019, respectively. The Company recorded stock based compensation of $1.1 million and $0.6 million for the three month periods ended June 30, 2020 and June 30, 2019, respectively. At June 30, 2020, the aggregate unrecognized compensation expense related to unvested equity awards was $8.9 million (net of estimated forfeitures), which is expected to be recognized as compensation expense in fiscal years 2020 through 2023. A summary of stock option activity for the six months ended June 30, 2020: (in thousands) Options Outstanding Weighted Outstanding at January 1, 2020 410 14.50 Granted 587 12.64 Exercised (6) 10.16 Forfeited and cancelled (63) 7.49 Outstanding at June 30, 2020 928 13.83 A summary of non-vested restricted stock activity for the six months ended June 30, 2020: (in thousands) Restricted Stock Awards Weighted Outstanding at Balance at January 1, 2020 171 23.53 Granted 21 29.19 Vested (122) 25.82 Forfeited and cancelled (40) 15.35 Outstanding at June 30, 2020 30 29.30 A summary of non-vested restricted stock units ("RSU") activity for the six months ended June 30, 2020: (in thousands) RSU Awards Weighted Outstanding at Balance at January 1, 2020 — — Granted 360 12.64 Vested — — Forfeited and cancelled — — Outstanding at June 30, 2020 360 12.64 |
Net loss per share
Net loss per share | 6 Months Ended |
Jun. 30, 2020 | |
Earnings Per Share [Abstract] | |
Net loss per share | Net loss per share Earnings per share are calculated in accordance with ASC Topic 260: "Earnings per Share", which specifies the computation, presentation and disclosure requirements for earnings per share (EPS). It requires the presentation of basic and diluted EPS. Basic EPS excludes all dilution and is based upon the weighted average number of shares of common stock outstanding during the period. Diluted EPS reflects the potential dilution that would occur if convertible securities or other contracts to issue common stock were exercised. For the six months ended June 30, 2020, there were 928,000 anti-dilutive stock options outstanding compared to 469,000 as of June 30, 2019. The potential dilutive effect of the 2024 Notes and the 2026 Notes conversion features (See Note 8 - Debt) were excluded from diluted net loss per share as of June 30, 2020 and June 30, 2019. Potential shares from the 2024 Notes and the 2026 Notes conversion features at their respective initial conversion prices of $28.55 per share and $42.97 per share are approximately 481,548 and 2,792,664, respectively. The following is a reconciliation of the weighted average of shares of common stock outstanding for the basic and diluted EPS computations: (in thousands, except per share data) Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Net loss $ (8,976) $ (1,109) $ (19,886) $ (3,838) Basic: Shares outstanding at beginning of period 18,244 16,044 16,629 16,041 Weighted average shares issued during the period, net — 246 1,463 44 Weighted average common shares, basic 18,244 16,290 18,092 16,085 Net loss per common share, basic $ (0.49) $ (0.07) $ (1.10) $ (0.24) Diluted: Weighted average common shares, basic 18,244 16,290 18,092 16,085 Weighted average common shares, diluted 18,244 16,290 18,092 16,085 Net loss per common share, diluted $ (0.49) $ (0.07) $ (1.10) $ (0.24) |
Contingencies
Contingencies | 6 Months Ended |
Jun. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | Contingencies From time to time, the Company is party to legal proceedings arising in the ordinary course of business. Additionally, U.S. Government contract costs are subject to periodic audit and adjustment. Based on information currently available, and based on its evaluation of such information, the Company believes the legal proceedings in which it is currently involved are not material or are not likely to result in a material adverse effect on the Company’s business, financial condition or results of operations, or cannot currently be estimated. The Company is a party to a proceeding filed by Kandice Neals on behalf of herself and others similarly situated (the "Neals Plaintiff") against the Company on March 21, 2019 in the Circuit Court of Cook County, Illinois County Department, Chancery Division. The complaint asserted that the Company violated the Illinois Biometric Information Privacy Act in the alleged collection, use, and storage of her and others' biometric data derived from fingerprint scans taken for authentication purposes on point-of-sale systems. The Neals lawsuit was removed to the Federal District Court for the Northern District of Illinois (the District Court") and was subsequently dismissed on December 19, 2019 without prejudice. On January 15, 2020, the Neals Plaintiff filed an amended complaint against ParTech, Inc. with the District Court. On January 29, 2020, ParTech, Inc. filed its answer and affirmative defenses to the amended complaint. The Company believes the Neals lawsuit is without merit. The Company does not currently believe an accrual is appropriate, but will continue to monitor the lawsuit to provide for probable and estimable losses. In 2016, the Company's Audit Committee commenced an internal investigation into conduct at the Company's China and Singapore offices and voluntarily notified the SEC and the U.S. Department of Justice ("DOJ") of the internal investigation. Following the conclusion of the Audit Committee's internal investigation, the Company voluntarily reported the relevant findings of the investigation to the China and Singapore authorities. In early April 2019, the SEC notified the Company that based on current information, it did not intend to recommend an enforcement action against the Company; shortly thereafter, the DOJ advised that it did not intend to separately proceed. Based on discussions with Singaporean authority, a penalty related to this matter is probable; the Company’s estimated liability for this penalty is not material and related contingencies are not expected to have a material effect on the Company’s financial statements. |
Segment and Related Information
Segment and Related Information | 6 Months Ended |
Jun. 30, 2020 | |
Segment Reporting [Abstract] | |
Segment and Related Information | Segment and Related Information The Company operates in two distinct reporting segments, Restaurant/Retail and Government. The Company’s chief operating decision maker is the Company’s Chief Executive Officer. The Restaurant/Retail segment provides point-of-sale (POS) software and hardware, back-office software, and integrated technical solutions to the restaurant and retail industries. The Government segment provides intelligence, surveillance, and reconnaissance solutions and mission systems support to the United States Department of Defense and other Federal agencies. In addition, the financial statements include corporate and eliminations, which is comprised of enterprise-wide functional departments. Information noted as “Other” primarily relates to the Company’s corporate, home office operations. Information as to the Company’s reporting segments is set forth below (in thousands). Three Months Six Months Ended 2020 2019 2020 2019 Revenues: Restaurant/Retail $ 27,633 $ 28,262 $ 65,042 $ 57,822 Government 18,058 15,985 35,381 31,107 Total $ 45,691 $ 44,247 $ 100,423 $ 88,929 Operating loss: Restaurant/Retail $ (7,697) $ (4,615) $ (13,767) $ (7,597) Government 1,349 1,518 2,528 2,881 Other 630 (356) 66 (838) Total (5,718) (3,453) (11,173) (5,554) Other expense (139) (374) (764) (804) Interest expense, net (2,111) (1,244) (4,083) (1,390) Loss on extinguishment of debt — — (8,123) — Loss before provision for income taxes $ (7,968) $ (5,071) $ (24,143) $ (7,748) Depreciation, amortization and accretion: Restaurant/Retail $ 1,951 $ 1,201 $ 3,806 $ 2,069 Government 40 18 56 37 Other 1,567 890 2,838 1,015 Total $ 3,558 $ 2,109 $ 6,700 $ 3,121 Capital expenditures including software costs: Restaurant/Retail $ 2,783 $ 778 $ 4,490 $ 1,841 Government 223 — 434 176 Other — 616 122 1,300 Total $ 3,006 $ 1,394 $ 5,046 $ 3,317 Revenues by country: United States $ 44,626 $ 41,657 $ 97,257 $ 83,582 Other Countries 1,065 2,590 3,166 5,347 Total $ 45,691 $ 44,247 $ 100,423 $ 88,929 The following table represents identifiable long-lived assets by reporting segment (in thousands). June 30, 2020 December 31, 2019 Restaurant/Retail $ 1,776 $ 1,987 Government 241 272 Other 11,486 12,093 Total $ 13,503 $ 14,352 The following table represents identifiable long-lived assets by country based on the location of the assets (in thousands). June 30, 2020 December 31, 2019 United States $ 13,424 $ 14,260 Other Countries 79 92 Total $ 13,503 $ 14,352 The following table represents goodwill by reporting segment (in thousands). June 30, 2020 December 31, 2019 Restaurant/Retail $ 40,478 $ 40,650 Government 736 736 Total $ 41,214 $ 41,386 Customers comprising 10% or more of the Company’s total revenues by reporting segment are summarized as follows: Three Months Ended June 30, Six Months Ended 2020 2019 2020 2019 Restaurant/Retail reporting segment: McDonald’s Corporation 9 % 10 % 9 % 10 % Yum! Brands, Inc. 10 % 13 % 11 % 13 % Dairy Queen 11 % 7 % 14 % 7 % Government reporting segment: U.S. Department of Defense 40 % 36 % 35 % 35 % All Others 30 % 34 % 31 % 35 % 100 % 100 % 100 % 100 % No other customer within All Others represented 10% of more of the Company’s total revenue for the three and six months ended June 30, 2020 or 2019. The above table should be read in conjunction with the revised table presented in Note 12 of the Quarterly Report on Form 10-Q, filed with the SEC on May 11, 2020. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 6 Months Ended |
Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company’s financial instruments have been recorded at fair value using available market information and valuation techniques. The fair value hierarchy is based upon three levels of input, which are: Level 1 — quoted prices in active markets for identical assets or liabilities (observable) Level 2 — inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities, quoted prices in inactive markets, or other inputs that are observable market data for essentially the full term of the asset or liability (observable) Level 3 — unobservable inputs that are supported by little or no market activity, but are significant to determining the fair value of the asset or liability (unobservable) The Company’s financial instruments primarily consist of cash and cash equivalents, trade receivables, trade payables, debt instruments and deferred compensation assets and liabilities. The carrying amounts of cash and cash equivalents, trade receivables and trade payables as of June 30, 2020 and December 31, 2019 were considered representative of their fair values. The estimated fair value of the 2024 Notes and 2026 Notes was $15.0 million and $112.1 million, respectively, at June 30, 2020. The valuation techniques used to determine the fair value of 2024 Notes and 2026 Notes are classified within Level 2 of the fair value hierarchy. The deferred compensation assets and liabilities primarily relate to the Company’s deferred compensation plan, which allows for pre-tax salary deferrals for certain key employees. Changes in the fair value of the deferred compensation liabilities are derived using quoted prices in active markets of the asset selections made by the participants. The deferred compensation liabilities are classified within Level 2, the fair value classification as defined under FASB ASC 820: "Fair Value Measurements", because their inputs are derived principally from observable market data by correlation to the hypothetical investments. The Company holds insurance investments to partially offset the Company’s liabilities under its deferred compensation plan, which are recorded at fair value each period using the cash surrender value of the insurance investments. The amounts owed to employees participating in the deferred compensation plan at June 30, 2020 was $2.9 million compared to $3.2 million at December 31, 2019 and is included in other long-term liabilities on the balance sheets. As it relates to the contingent consideration associated with the Restaurant Magic Acquisition we may use various valuation techniques depending on the terms and conditions of the contingent consideration, including a Monte-Carlo simulation. This simulation uses probability distribution for each significant input to produce hundreds or thousands of possible outcomes and the results are analyzed to determine probabilities of different outcomes occurring, as such it is classified as Level 3. Significant increases or decreases to these inputs in isolation would result in a significantly higher or lower liability with a higher liability. Ultimately, the liability will be equivalent to the amount paid, and the difference between the fair value estimate and amount paid will be recorded in earnings. The amount paid that is less than or equal to the liability on the acquisition date is reflected as cash used in financing activities in our consolidated statements of cash flows. Any amount paid in excess of the liability on the acquisition date is reflected as cash used in operating activities. The Restaurant Magic Acquisition resulted in a liability for the contingent consideration being recorded in the amount of $3.3 million during 2019. The liability for the contingent consideration was established at the time of the acquisition and is evaluated quarterly based on additional information as it becomes available. Any change in the fair value adjustment is recorded in the earnings of that period. The following table presents a summary of changes in fair value of the Company’s Level 3 assets and liabilities that are measured at fair value on a recurring basis, and are recorded as a component of other long-term liabilities on the consolidated balance sheet (in thousands): (in thousands) Level 3 Inputs Liabilities Balance at December 31, 2019 $ 3,340 New level 3 liability — Total gains (losses) reported in earnings — Settlement of Level 3 liabilities — Balance at June 30, 2020 $ 3,340 |
Basis of presentation (Policies
Basis of presentation (Policies) | 6 Months Ended |
Jun. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of presentation | Basis of presentation The accompanying unaudited interim condensed consolidated financial statements ("financial statements") of PAR Technology Corporation and its consolidated subsidiaries (the “Company”, “PAR”, "we", "us", "our") have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial statements and the instructions to Form 10-Q and Regulation S-X pertaining to interim financial statements. In the opinion of management, the Company's financial statements include all normal and recurring adjustments necessary in order to make the financial statements not misleading and to provide a fair presentation of the results for the interim period included in this Quarterly Report on Form 10-Q (“Quarterly Report”). Interim results are not necessarily indicative of results for the full year or any future periods. The information included in this Quarterly Report should be read in conjunction with the Company's audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019, filed with the Securities and Exchange Commission (“SEC”) on March 16, 2020. The preparation of the financial statements requires management of the Company to make a number of estimates and assumptions relating to the reported amount of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Significant items subject to such estimates and assumptions include revenue recognition, stock-based compensation, the recognition and measurement of assets acquired and liabilities assumed in business combinations at fair value, the carrying amount of property, plant and equipment including right-to-use assets and liabilities, identifiable intangible assets and goodwill, the measurement of liabilities and equity recognized for outstanding convertible notes, valuation allowances for receivables, inventories, and measurement of contingent consideration at fair value. Actual results could differ from those estimates. |
Segment Reporting | The Company operates in two distinct reporting segments, Restaurant/Retail and Government. The Company’s chief operating decision maker is the Company’s Chief Executive Officer. The Restaurant/Retail reporting segment provides point-of-sale (POS) software and hardware, back-office software, and integrated technical solutions to the restaurant and retail industries. The Government reporting segment provides intelligence, surveillance, and reconnaissance solutions and mission systems support to the United States Department of Defense and other Federal agencies. In addition, the financial statements include corporate and eliminations, which is comprised of enterprise-wide functional departments. |
Reclassification | These reclassifications had no effect on previously reported total costs and operating expenses and net loss. |
Use of Estimates | Use of Estimates Preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. |
Recently Adopted Accounting Pronouncements and Recently Issued Accounting Pronouncements Not Yet Adopted | Recently Adopted Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (the FASB) issued Accounting Standards Update ("ASU") 2016-13, "Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments." ASU 2016-13 requires the measurement of all expected credit losses for financial assets held at the reporting date, based on historical experience, current conditions, and reasonable and supportable forecasts. In addition, ASU 2016-13 amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. The Company adopted ASU 2016-13 effective January 1, 2020, and the application of the standard had no material impact on the Company's financial statements for the three and six months ended June 30, 2020. In January 2017, the FASB issued ASU 2017-04, “Intangibles - Goodwill and Other (Topic 350) - Simplifying the Test for Goodwill Impairment.” ASU 2017-04 eliminates Step 2 from the goodwill impairment test which required entities to compute the implied fair value of goodwill. Under ASU 2017-04, an entity should perform its annual or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The Company adopted ASU 2017-04 effective January 1, 2020, and the application of the standard had no material impact on the Company's financial statements for the three and six months ended June 30, 2020. In August 2018, the FASB issued ASU 2018-13, “Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement.” ASU 2018-13 modifies the fair value measurement disclosures with the primary focus to improve effectiveness of disclosures in the notes to the financial statements that is most important to the users. ASU 2018-13 modifies the required disclosures related to the valuation techniques and inputs used, uncertainty in measurement, and changes in measurements applied. The Company adopted ASU 2018-13 effective January 1, 2020, and the application of the standard had no material impact on the Company's financial statements for the three and six months ended June 30, 2020. In August 2018, the FASB issued ASU 2018-15, “Intangibles – Goodwill and Other (Topic 350) - Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract.” ASU 2018-15 provides guidance on the measurement of costs for internal-use software during the design, development, and implementation stages for customers in a cloud hosting arrangement. ASU 2018-15 also requires the capitalized costs associated with the design, development and implementation of cloud hosted arrangements to be amortized over the term of the hosting arrangement. The Company adopted ASU 2018-15 effective January 1, 2020, and the application of the standard had no material impact on the Company's financial statements for the three and six months ended June 30, 2020. Recently Issued Accounting Pronouncements Not Yet Adopted In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): "Simplifying the Accounting for Income Taxes", which is intended to simplify various requirements related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and clarifies and amends existing guidance to improve consistent application. ASU 2019-12 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020, with early adoption permitted. The Company is currently assessing the impact of this standard on its financial statements. With the exception of the new standards discussed above, there were no other recent accounting pronouncements or changes in accounting pronouncements during the three and six months ended June 30, 2020 that are of significance or potential significance to the Company, as compared to the recent accounting pronouncements described in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2019. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Performance Obligations | The activity of outstanding performance obligations as is relates to customer deposits and deferred service revenue is as follows: (in thousands) 2020 2019 Beginning balance - January 1 $ 16,000 $ 14,134 Change in deferred revenue (430) (327) Changes in customer deposits (2,008) 1,272 Ending balance - June 30 $ 13,562 $ 15,079 Next 12 Months $ 56,458 Months 13-24 32,644 Months 25-36 24,821 Thereafter 15,690 TOTAL $ 129,613 |
Schedule of Disaggregated Revenue | Disaggregation of revenue for the three and six months ended June 30, 2020 and June 30, 2019 is as follows: (in thousands) Three months ended June 30, 2020 Restaurant/Retail - Point in Time Restaurant/Retail - Over Time Government - Over Time Restaurant/Retail $ 19,820 $ 7,813 $ — Mission Systems $ — $ — $ 8,087 ISR Solutions $ — $ — $ 9,971 TOTAL $ 19,820 $ 7,813 $ 18,058 (in thousands) Three months ended June 30, 2019 Restaurant/Retail - Point in Time Restaurant/Retail - Over Time Government - Over Time Restaurant/Retail $ 21,503 $ 5,829 $ — Grocery 283 647 — Mission Systems — — 8,192 ISR Solutions — — 7,793 TOTAL $ 21,786 $ 6,476 $ 15,985 (in thousands) Six months ended June 30, 2020 Restaurant/Retail - Point in Time Restaurant/Retail - Over Time Government - Over Time Restaurant/Retail $ 47,635 $ 17,407 $ — Mission Systems — — 16,535 ISR Solutions — — 18,846 TOTAL $ 47,635 $ 17,407 $ 35,381 (in thousands) Six months ended June 30, 2019 Restaurant/Retail - Point in Time Restaurant/Retail - Over Time Government - Over Time Restaurant/Retail $ 43,880 $ 11,579 $ — Grocery 732 1,631 — Mission Systems — — 16,738 ISR Solutions — — 14,369 TOTAL $ 44,612 $ 13,210 $ 31,107 |
Acquisitions (Tables)
Acquisitions (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Business Combinations [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The fair values assigned to the acquired assets and assumed liabilities presented in the table below are based on our best estimates and assumptions as of the reporting date: (in thousands) Purchase price allocation Developed technology $ 16,400 Customer relationships 1,100 Trade name 900 Tangible assets 1,344 Goodwill 27,773 Total assets 47,517 Accounts payable and accrued expenses 629 Deferred revenue 715 Earn out liability 3,340 Consideration paid $ 42,833 |
Schedule of Business Acquisition, Pro Forma Information | The following unaudited pro forma financial information presents our results as if the Drive-Thru Acquisition and Restaurant Magic Acquisition had occurred January 1, 2019: (in thousands) Three months ended June 30, 2019 Six months ended June 30, 2019 Total revenue $ 50,921 $ 102,274 Net income $ 1,044 $ 781 |
Accounts Receivable, Net (Table
Accounts Receivable, Net (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Receivables [Abstract] | |
Schedule of Accounts Receivable, Net | The Company’s accounts receivable, net, consists of: (in thousands) June 30, 2020 December 31, 2019 Government reporting segment: Billed $ 9,091 $ 11,608 Advanced billings (491) (608) 8,600 11,000 Restaurant/Retail reporting segment: 29,636 30,774 Accounts receivable - net $ 38,236 $ 41,774 |
Schedule of Accounts Receivable, Allowance for Credit Loss | At June 30, 2020 and December 31, 2019, the Company's expected credit loss was $2.0 million and $1.8 million, respectively, against the accounts receivable for the Restaurant/Retail reporting segment. The changes in the current, expected credit loss during the six months ended June 30, 2020 were as follows: (in thousands) 2020 2019 Beginning balance - January 1 $ 1,849 $ 1,351 Provisions 972 477 Write-offs (773) (120) Recoveries $ — $ — Ending balance - June 30 $ 2,048 $ 1,708 |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories are primarily used in the manufacture, maintenance and service of products within the Restaurant/Retail reporting segment. The components of inventories, net, consist of the following: (in thousands) June 30, 2020 December 31, 2019 Finished goods $ 13,495 $ 8,320 Component parts 7,672 6,768 Service parts 4,825 4,238 $ 25,992 $ 19,326 |
Identifiable Intangible Asset_2
Identifiable Intangible Assets and Goodwill (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of components of identifiable intangible assets, excluding discontinued operations | The components of identifiable intangible assets are: (in thousands) June 30, 2020 December 31, 2019 Estimated Acquired and internally developed software costs $ 39,961 $ 36,137 3 - 5 years Customer relationships 4,860 4,860 7 years Non-competition agreements 30 30 1 year 44,851 41,027 Less accumulated amortization (15,948) (12,389) $ 28,903 $ 28,638 Internally developed software costs not meeting general release threshold 3,592 2,500 Trademarks, trade names (non-amortizable) 1,810 1,810 $ 34,305 $ 32,948 |
Schedule of future amortization of intangible assets | The expected future amortization of intangible assets, assuming straight-line amortization of capitalized software development costs and acquisition related intangibles and excluding software costs not meeting the general release threshold, is as follows (in thousands): 2020, remaining $ 3,623 2021 6,872 2022 5,539 2023 3,581 2024 3,186 Thereafter 6,102 Total $ 28,903 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Debt Disclosure [Abstract] | |
Summary of Equity And Liability Components of the Notes | The following table summarizes information about the net carrying amounts of the 2024 Notes and 2026 Notes as of June 30, 2020: (in thousands) 2024 Notes 2026 Notes Principal amount of 2024 Notes outstanding $ 13,750 $ 120,000 Unamortized discount (including unamortized debt issuance cost) (3,055) (27,884) Total long-term portion of notes payable $ 10,695 $ 92,116 The following table summarizes interest expense recognized on the 2024 Notes and 2026 Notes: (in thousands) Three Months Ended June 30, 2020 2020 2019 Contractual interest expense $ 1,000 $ 498 Amortization of debt issuance costs and discount 1,102 746 Total interest expense $ 2,102 $ 1,244 (in thousands) Six Months Ended June 30, 2020 2019 Contractual interest expense $ 2,015 $ 644 Amortization of debt issuance costs and discount 2,059 746 Total interest expense $ 4,074 $ 1,390 |
Schedule of Maturities of Notes | The following table summarizes the future principal payments for the 2024 Notes and 2026 Notes (in thousands): 2020, remaining $ — 2021 — 2022 — 2023 — 2024 13,750 Thereafter 120,000 $ 133,750 |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Summary of Stock Option Activity | A summary of stock option activity for the six months ended June 30, 2020: (in thousands) Options Outstanding Weighted Outstanding at January 1, 2020 410 14.50 Granted 587 12.64 Exercised (6) 10.16 Forfeited and cancelled (63) 7.49 Outstanding at June 30, 2020 928 13.83 |
Summary of Restricted Stock and RSU Awards Activity | A summary of non-vested restricted stock activity for the six months ended June 30, 2020: (in thousands) Restricted Stock Awards Weighted Outstanding at Balance at January 1, 2020 171 23.53 Granted 21 29.19 Vested (122) 25.82 Forfeited and cancelled (40) 15.35 Outstanding at June 30, 2020 30 29.30 A summary of non-vested restricted stock units ("RSU") activity for the six months ended June 30, 2020: (in thousands) RSU Awards Weighted Outstanding at Balance at January 1, 2020 — — Granted 360 12.64 Vested — — Forfeited and cancelled — — Outstanding at June 30, 2020 360 12.64 |
Net loss per share (Tables)
Net loss per share (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Reconciliation of the Weighted Average Shares Outstanding for the Basic and Diluted EPS Computations | The following is a reconciliation of the weighted average of shares of common stock outstanding for the basic and diluted EPS computations: (in thousands, except per share data) Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Net loss $ (8,976) $ (1,109) $ (19,886) $ (3,838) Basic: Shares outstanding at beginning of period 18,244 16,044 16,629 16,041 Weighted average shares issued during the period, net — 246 1,463 44 Weighted average common shares, basic 18,244 16,290 18,092 16,085 Net loss per common share, basic $ (0.49) $ (0.07) $ (1.10) $ (0.24) Diluted: Weighted average common shares, basic 18,244 16,290 18,092 16,085 Weighted average common shares, diluted 18,244 16,290 18,092 16,085 Net loss per common share, diluted $ (0.49) $ (0.07) $ (1.10) $ (0.24) |
Segment and Related Informati_2
Segment and Related Information (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Segment Reporting [Abstract] | |
Schedule of information of the company's segments | Information as to the Company’s reporting segments is set forth below (in thousands). Three Months Six Months Ended 2020 2019 2020 2019 Revenues: Restaurant/Retail $ 27,633 $ 28,262 $ 65,042 $ 57,822 Government 18,058 15,985 35,381 31,107 Total $ 45,691 $ 44,247 $ 100,423 $ 88,929 Operating loss: Restaurant/Retail $ (7,697) $ (4,615) $ (13,767) $ (7,597) Government 1,349 1,518 2,528 2,881 Other 630 (356) 66 (838) Total (5,718) (3,453) (11,173) (5,554) Other expense (139) (374) (764) (804) Interest expense, net (2,111) (1,244) (4,083) (1,390) Loss on extinguishment of debt — — (8,123) — Loss before provision for income taxes $ (7,968) $ (5,071) $ (24,143) $ (7,748) Depreciation, amortization and accretion: Restaurant/Retail $ 1,951 $ 1,201 $ 3,806 $ 2,069 Government 40 18 56 37 Other 1,567 890 2,838 1,015 Total $ 3,558 $ 2,109 $ 6,700 $ 3,121 Capital expenditures including software costs: Restaurant/Retail $ 2,783 $ 778 $ 4,490 $ 1,841 Government 223 — 434 176 Other — 616 122 1,300 Total $ 3,006 $ 1,394 $ 5,046 $ 3,317 Revenues by country: United States $ 44,626 $ 41,657 $ 97,257 $ 83,582 Other Countries 1,065 2,590 3,166 5,347 Total $ 45,691 $ 44,247 $ 100,423 $ 88,929 |
Schedule of identifiable assets by reporting segment | The following table represents identifiable long-lived assets by reporting segment (in thousands). June 30, 2020 December 31, 2019 Restaurant/Retail $ 1,776 $ 1,987 Government 241 272 Other 11,486 12,093 Total $ 13,503 $ 14,352 |
Schedule of revenue by geographic area | The following table represents identifiable long-lived assets by country based on the location of the assets (in thousands). June 30, 2020 December 31, 2019 United States $ 13,424 $ 14,260 Other Countries 79 92 Total $ 13,503 $ 14,352 |
Schedule of goodwill by reporting segment | The following table represents goodwill by reporting segment (in thousands). June 30, 2020 December 31, 2019 Restaurant/Retail $ 40,478 $ 40,650 Government 736 736 Total $ 41,214 $ 41,386 |
Schedule of revenue by major customers | Customers comprising 10% or more of the Company’s total revenues by reporting segment are summarized as follows: Three Months Ended June 30, Six Months Ended 2020 2019 2020 2019 Restaurant/Retail reporting segment: McDonald’s Corporation 9 % 10 % 9 % 10 % Yum! Brands, Inc. 10 % 13 % 11 % 13 % Dairy Queen 11 % 7 % 14 % 7 % Government reporting segment: U.S. Department of Defense 40 % 36 % 35 % 35 % All Others 30 % 34 % 31 % 35 % 100 % 100 % 100 % 100 % No other customer within All Others represented 10% of more of the Company’s total revenue for the three and six months ended June 30, 2020 or 2019. The above table should be read in conjunction with the revised table presented in Note 12 of the Quarterly Report on Form 10-Q, filed with the SEC on May 11, 2020. |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Summary of changes in fair value of the company's Level 3 assets and liabilities that are measured at fair value on a recurring basis | The following table presents a summary of changes in fair value of the Company’s Level 3 assets and liabilities that are measured at fair value on a recurring basis, and are recorded as a component of other long-term liabilities on the consolidated balance sheet (in thousands): (in thousands) Level 3 Inputs Liabilities Balance at December 31, 2019 $ 3,340 New level 3 liability — Total gains (losses) reported in earnings — Settlement of Level 3 liabilities — Balance at June 30, 2020 $ 3,340 |
Basis of presentation (Details)
Basis of presentation (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2020USD ($)segment | Jun. 30, 2019USD ($) | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Number of operating segments | segment | 2 | |||
Number of reportable segments | segment | 2 | |||
Amortization of identifiable intangible assets | $ 210 | $ 0 | $ 420 | $ 0 |
Cost of sales | 36,612 | 35,916 | 80,297 | 71,074 |
Service | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Cost of sales | 9,912 | $ 10,118 | 22,558 | $ 20,385 |
Reclassification | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Amortization of identifiable intangible assets | (200) | (500) | ||
Cost of sales | $ 200 | $ 500 |
Revenue Recognition - Schedule
Revenue Recognition - Schedule of Performance Obligations (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Dec. 31, 2019 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||||
Support contract timing | 12 | |||||
Revenue, Remaining Performance Obligation [Roll Forward] | ||||||
Beginning balance | $ 16,000 | $ 14,134 | ||||
Change in deferred revenue | (430) | (327) | ||||
Changes in customer deposits | (2,008) | 1,272 | ||||
Ending balance | $ 13,562 | $ 15,079 | 13,562 | 15,079 | ||
Performance obligations | 13,562 | 15,079 | 13,562 | 15,079 | $ 13,562 | $ 16,000 |
Restaurant/Retail | ||||||
Revenue, Remaining Performance Obligation [Roll Forward] | ||||||
Beginning balance | 10,900 | |||||
Change in deferred revenue | (3,600) | $ (3,900) | (7,700) | $ (9,000) | ||
Ending balance | 10,500 | 10,500 | ||||
Performance obligations | 10,500 | 10,900 | 10,500 | 10,900 | ||
Government | ||||||
Revenue, Remaining Performance Obligation [Roll Forward] | ||||||
Beginning balance | 148,700 | |||||
Ending balance | 129,613 | 129,613 | ||||
Performance obligations | $ 129,613 | $ 129,613 | 129,613 | 148,700 | ||
Funded performance obligations | $ 35,500 | $ 32,800 | ||||
Minimum | ||||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||||
Payment period | 30 days | |||||
Maximum | ||||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||||
Payment period | 90 days |
Revenue Recognition - Remaining
Revenue Recognition - Remaining Performance Obligations (Details) | Jun. 30, 2020 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-07-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Performance obligations, period | 12 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-07-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Performance obligations, period | 12 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-07-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Performance obligations, period | |
Restaurant/Retail | Current - under one year | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-07-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Performance obligation, percentage | 100.00% |
Restaurant/Retail | Current - under one year | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-07-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Performance obligation, percentage | 73.00% |
Restaurant/Retail | Non-current - over one year | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-07-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Performance obligations, period | 60 months |
Revenue Recognition - Additiona
Revenue Recognition - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Disaggregation of Revenue [Line Items] | ||||
Recognition of revenue | $ 430 | $ 327 | ||
Restaurant/Retail | ||||
Disaggregation of Revenue [Line Items] | ||||
Recognition of revenue | $ 3,600 | $ 3,900 | $ 7,700 | $ 9,000 |
Revenue Recognition - Schedul_2
Revenue Recognition - Schedule of Disaggregated Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 45,691 | $ 44,247 | $ 100,423 | $ 88,929 |
Restaurant/Retail | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 27,633 | 28,262 | 65,042 | 57,822 |
Government | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 18,058 | 15,985 | 35,381 | 31,107 |
Billed | Restaurant/Retail | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 19,820 | 21,786 | 47,635 | 44,612 |
Billed | Restaurant/Retail | Restaurant/Retail | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 19,820 | 21,503 | 47,635 | 43,880 |
Billed | Restaurant/Retail | Grocery | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 283 | 732 | ||
Billed | Restaurant/Retail | Mission Systems | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
Billed | Restaurant/Retail | ISR Solutions | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
Advanced billings | Restaurant/Retail | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 7,813 | 6,476 | 17,407 | 13,210 |
Advanced billings | Restaurant/Retail | Restaurant/Retail | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 7,813 | 5,829 | 17,407 | 11,579 |
Advanced billings | Restaurant/Retail | Grocery | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 647 | 1,631 | ||
Advanced billings | Restaurant/Retail | Mission Systems | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
Advanced billings | Restaurant/Retail | ISR Solutions | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
Advanced billings | Government | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 18,058 | 15,985 | 35,381 | 31,107 |
Advanced billings | Government | Restaurant/Retail | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
Advanced billings | Government | Grocery | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 0 | 0 | ||
Advanced billings | Government | Mission Systems | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 8,087 | 8,192 | 16,535 | 16,738 |
Advanced billings | Government | ISR Solutions | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 9,971 | $ 7,793 | $ 18,846 | $ 14,369 |
Revenue Recognition - Performan
Revenue Recognition - Performance Obligations by Period (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 | Jun. 30, 2019 | Dec. 31, 2018 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Performance obligations | $ 13,562 | $ 16,000 | $ 15,079 | $ 14,134 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-07-01 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Performance obligations, period | 12 months | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-07-01 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Performance obligations, period | 12 months | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-07-01 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Performance obligations, period | 12 months | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-07-01 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Performance obligations, period | ||||
Government | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Performance obligations | $ 129,613 | $ 148,700 | ||
Government | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-07-01 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Performance obligations | 56,458 | |||
Government | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-07-01 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Performance obligations | 32,644 | |||
Government | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-07-01 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Performance obligations | 24,821 | |||
Government | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-07-01 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Performance obligations | $ 15,690 |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) - USD ($) $ in Thousands | Dec. 18, 2019 | Sep. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 |
Business Acquisition [Line Items] | ||||||
Working capital for acquisitions | $ 200 | $ 172 | $ 0 | |||
Goodwill | 41,214 | 41,214 | $ 41,386 | |||
3M's Drive-Thru Communications Systems | ||||||
Business Acquisition [Line Items] | ||||||
Business acquisition, purchase price | $ 8,400 | |||||
Fair value of assets acquired | 8,400 | |||||
Warranty liability assumed | 1,400 | |||||
Business acquisition, cash paid | 7,000 | |||||
Revenue of acquiree | 4,000 | 7,500 | ||||
Goodwill | 2,400 | |||||
3M's Drive-Thru Communications Systems | Developed technology | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible assets | 1,200 | |||||
3M's Drive-Thru Communications Systems | Customer relationships | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible assets | $ 3,600 | |||||
Restaurant Magic | ||||||
Business Acquisition [Line Items] | ||||||
Fair value of assets acquired | $ 47,517 | |||||
Business acquisition, cash paid | $ 12,800 | |||||
Percent acquired | 100.00% | |||||
Consideration | $ 42,833 | |||||
Equity issued | 27,500 | |||||
Contingent consideration liability | 3,300 | 3,300 | $ 3,300 | |||
Revenue of acquiree | $ 1,800 | $ 4,000 | ||||
Goodwill | 27,773 | |||||
Restaurant Magic | Developed technology | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible assets | 16,400 | |||||
Restaurant Magic | Customer relationships | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible assets | $ 1,100 | |||||
Restaurant Magic | Cash Or Subordinated Promissory Notes | ||||||
Business Acquisition [Line Items] | ||||||
Percent of contingent consideration | 50.00% | |||||
Restaurant Magic | Restricted Shares Of Common Stock | ||||||
Business Acquisition [Line Items] | ||||||
Percent of contingent consideration | 50.00% | |||||
Restaurant Magic | Subordinate Promissory Note | ||||||
Business Acquisition [Line Items] | ||||||
Warranty liability assumed | $ 2,000 |
Acquisitions - Schedule of Reco
Acquisitions - Schedule of Recognized Identified Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 | Dec. 18, 2019 |
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Goodwill | $ 41,214 | $ 41,386 | |
Restaurant Magic | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Tangible assets | $ 1,344 | ||
Goodwill | 27,773 | ||
Total assets | 47,517 | ||
Accounts payable and accrued expenses | 629 | ||
Deferred revenue | 715 | ||
Earn out liability | 3,340 | ||
Cash consideration | 42,833 | ||
Restaurant Magic | Developed technology | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived intangible assets | 16,400 | ||
Restaurant Magic | Customer relationships | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived intangible assets | 1,100 | ||
Restaurant Magic | Trade name | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived intangible assets | $ 900 |
Acquisitions - Pro Forma Inform
Acquisitions - Pro Forma Information (Details) - Drive-Thru And Restaurant Magic - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2019 | Jun. 30, 2019 | |
Business Acquisition [Line Items] | ||
Total revenue | $ 50,921 | $ 102,274 |
Net income | $ 1,044 | $ 781 |
Accounts Receivable, Net - Sche
Accounts Receivable, Net - Schedule of Accounts Receivable, Net (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 | Jun. 30, 2019 | Dec. 31, 2018 |
Accounts Receivable [Abstract] | ||||
Accounts receivable - net | $ 38,236 | $ 41,774 | ||
Government | ||||
Accounts Receivable [Abstract] | ||||
Accounts receivable - net | 8,600 | 11,000 | ||
Restaurant/Retail | ||||
Accounts Receivable [Abstract] | ||||
Accounts receivable - net | 29,636 | 30,774 | ||
Allowance for doubtful accounts | 2,048 | 1,849 | $ 1,708 | $ 1,351 |
Billed | Government | ||||
Accounts Receivable [Abstract] | ||||
Accounts receivable - net | 9,091 | 11,608 | ||
Advanced billings | Government | ||||
Accounts Receivable [Abstract] | ||||
Accounts receivable - net | $ (491) | $ (608) |
Accounts Receivable, Net - Acco
Accounts Receivable, Net - Accounts Receivable, Allowance for Credit Loss (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Provisions | $ 978 | $ 397 |
Restaurant/Retail | ||
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Beginning balance | 1,849 | 1,351 |
Provisions | 972 | 477 |
Write-offs | (773) | (120) |
Recoveries | 0 | 0 |
Ending balance | $ 2,048 | $ 1,708 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Inventory, Net, Items Net of Reserve Alternative [Abstract] | ||
Finished goods | $ 13,495 | $ 8,320 |
Component parts | 7,672 | 6,768 |
Service parts | 4,825 | 4,238 |
Inventories-net | 25,992 | 19,326 |
Inventory reserves | $ 11,700 | $ 9,600 |
Identifiable Intangible Asset_3
Identifiable Intangible Assets and Goodwill - Narrative (Details) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2020USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2020USD ($)segment | Jun. 30, 2019USD ($) | Dec. 31, 2019USD ($) | |
Finite-Lived Intangible Assets [Line Items] | |||||
Research and development | $ 4,538,000 | $ 2,725,000 | $ 9,403,000 | $ 5,786,000 | |
Capitalized software development costs | 2,600,000 | 600,000 | 4,300,000 | 1,600,000 | |
Amortization of capitalized software development costs | 1,500,000 | 700,000 | 3,100,000 | 1,500,000 | |
Cost of sales | 36,612,000 | 35,916,000 | 80,297,000 | 71,074,000 | |
Amortization of identifiable intangible assets | 210,000 | 0 | $ 420,000 | 0 | |
Number of operating segments | segment | 2 | ||||
Goodwill | 41,214,000 | $ 41,214,000 | $ 41,386,000 | ||
Settlement of working capital for acquisitions | 200,000 | 172,000 | 0 | ||
Goodwill impairment charge | 0 | 0 | 0 | 0 | |
Restaurant/Retail And Government Reporting Segments | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Goodwill | 41,200,000 | 41,200,000 | $ 41,400,000 | ||
Acquisitions | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Cost of sales | 800,000 | $ 200,000 | 1,700,000 | 400,000 | |
Amortization of identifiable intangible assets | $ 200,000 | $ 400,000 | |||
Minimum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Useful life | 3 years | ||||
Minimum | Internal use software | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Useful life | 3 years | ||||
Maximum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Useful life | 5 years | ||||
Maximum | Internal use software | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Useful life | 5 years | ||||
Internally developed software costs not meeting general release threshold | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Research and development | $ 3,500,000 | $ 2,500,000 |
Identifiable Intangible Asset_4
Identifiable Intangible Assets and Goodwill Components of Identifiable Intangible Assets (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Dec. 31, 2019 | |
Finite-Lived Intangible Assets, Net [Abstract] | ||
Finite-lived intangible assets, gross | $ 44,851 | $ 41,027 |
Less accumulated amortization | (15,948) | (12,389) |
Total | 28,903 | 28,638 |
Indefinite-lived Intangible Assets [Line Items] | ||
Intangible assets – net | 34,305 | 32,948 |
Acquired and internally developed software costs | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Finite-lived intangible assets, gross | 39,961 | 36,137 |
Customer relationships | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Finite-lived intangible assets, gross | $ 4,860 | 4,860 |
Useful life | 7 years | |
Non-competition agreements | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Finite-lived intangible assets, gross | $ 30 | 30 |
Useful life | 1 year | |
Minimum | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Useful life | 3 years | |
Minimum | Acquired and internally developed software costs | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Useful life | 3 years | |
Maximum | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Useful life | 5 years | |
Maximum | Acquired and internally developed software costs | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Useful life | 5 years | |
Internally developed software costs not meeting general release threshold | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets, gross | $ 3,592 | 2,500 |
Trademarks, trade names (non-amortizable) | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets, gross | $ 1,810 | $ 1,810 |
Identifiable Intangible Asset_5
Identifiable Intangible Assets and Goodwill - Expected Future Amortization (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||
2020, remaining | $ 3,623 | |
2021 | 6,872 | |
2022 | 5,539 | |
2023 | 3,581 | |
2024 | 3,186 | |
Thereafter | 6,102 | |
Total | $ 28,903 | $ 28,638 |
Debt - Narrative (Details)
Debt - Narrative (Details) | Feb. 10, 2020USD ($)$ / sharesshares | Dec. 18, 2019USD ($) | Apr. 15, 2019USD ($) | Jun. 30, 2020USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2020USD ($) | Jun. 30, 2019USD ($) | Dec. 31, 2019USD ($) |
Debt Instrument [Line Items] | ||||||||
Treasury stock reissued (in shares) | shares | 722,423 | |||||||
Shares issued price per share (in dollars per share) | $ / shares | $ 32.43 | |||||||
Treasury stock acquired average cost per share (in dollars per share) | $ / shares | $ 3.37 | |||||||
Loss on extinguishment of debt | $ 0 | $ 0 | $ (8,123,000) | $ 0 | ||||
Issuance cost, equity component | 1,100,000 | $ 1,100,000 | ||||||
Income tax benefit, equity transaction | $ (4,100,000) | |||||||
Current portion of long-term debt | 647,000 | 647,000 | $ 630,000 | |||||
Subordinate Promissory Note | Restaurant Magic | ||||||||
Debt Instrument [Line Items] | ||||||||
Stated interest rate | 4.50% | |||||||
Liability, debt | 1,700,000 | 1,700,000 | ||||||
Warranty liability assumed | $ 2,000,000 | |||||||
Monthly principal and interest payments | $ 60,391 | |||||||
Current portion of long-term debt | 600,000 | 600,000 | ||||||
2020, remaining | 300,000 | 300,000 | ||||||
2021 | 700,000 | 700,000 | ||||||
2022 | 700,000 | 700,000 | ||||||
Convertible Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Liability, debt | 133,750,000 | 133,750,000 | ||||||
2020, remaining | 0 | 0 | ||||||
2021 | 0 | 0 | ||||||
2022 | 0 | 0 | ||||||
Convertible Senior Notes due 2024 | Convertible Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt issued | $ 80,000,000 | 13,750,000 | 13,750,000 | |||||
Stated interest rate | 4.50% | |||||||
Debt Instrument, Repurchased Face Amount | $ 66,300,000 | |||||||
Debt settlement amount | 59,000,000 | |||||||
Settlement of equity component | 30,800,000 | |||||||
Debt Instrument Pay Off Accrued Interest | 1,000,000 | |||||||
Loss on extinguishment of debt | 8,100,000 | |||||||
Implied estimated effective rate | 10.24% | |||||||
Conversion ratio | 0.0350217 | |||||||
Liability, debt | $ 62,400,000 | |||||||
Equity component of notes | $ 17,600,000 | |||||||
Issuance costs | 4,900,000 | 4,900,000 | ||||||
Issuance costs, debt component | 3,800,000 | 3,800,000 | ||||||
Issuance cost, equity component | 1,100,000 | 1,100,000 | ||||||
Convertible Senior Notes Due 2026 | Convertible Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt issued | $ 120,000,000 | 120,000,000 | 120,000,000 | |||||
Stated interest rate | 2.875% | |||||||
Implied estimated effective rate | 7.33% | |||||||
Conversion ratio | 0.0232722 | |||||||
Liability, debt | $ 93,800,000 | |||||||
Equity component of notes | $ 26,200,000 | |||||||
Issuance costs | 4,200,000 | 4,200,000 | ||||||
Issuance costs, debt component | 3,100,000 | 3,100,000 | ||||||
Issuance cost, equity component | $ 1,100,000 | 1,100,000 | ||||||
Income tax benefit, equity transaction | $ 4,400,000 |
Debt - Summary of Information a
Debt - Summary of Information about the Equity and Liability Components of Notes (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Feb. 10, 2020 | Dec. 31, 2019 | Apr. 15, 2019 | |
Debt Instrument [Line Items] | |||||||
Total long-term portion of notes payable | $ 103,849,000 | $ 103,849,000 | $ 62,414,000 | ||||
Convertible Notes | |||||||
Debt Instrument [Line Items] | |||||||
Contractual interest expense | 1,000,000 | $ 498,000 | 2,015,000 | $ 644,000 | |||
Amortization of debt issuance costs and discount | 1,102,000 | 746,000 | 2,059,000 | 746,000 | |||
Total interest expense | 2,102,000 | $ 1,244,000 | 4,074,000 | $ 1,390,000 | |||
Convertible Notes | Convertible Senior Notes due 2024 | |||||||
Debt Instrument [Line Items] | |||||||
Principal amount of Notes outstanding | 13,750,000 | 13,750,000 | $ 80,000,000 | ||||
Unamortized discount (including unamortized debt issuance cost) | (3,055,000) | (3,055,000) | |||||
Total long-term portion of notes payable | 10,695,000 | 10,695,000 | |||||
Convertible Notes | Convertible Senior Notes Due 2026 | |||||||
Debt Instrument [Line Items] | |||||||
Principal amount of Notes outstanding | 120,000,000 | 120,000,000 | $ 120,000,000 | ||||
Unamortized discount (including unamortized debt issuance cost) | (27,884,000) | (27,884,000) | |||||
Total long-term portion of notes payable | $ 92,116,000 | $ 92,116,000 |
Debt - Schedule of Maturities o
Debt - Schedule of Maturities of Notes (Details) - Convertible Notes $ in Thousands | Jun. 30, 2020USD ($) |
Debt Instrument [Line Items] | |
2020, remaining | $ 0 |
2021 | 0 |
2022 | 0 |
2023 | 0 |
2024 | 13,750 |
Thereafter | 120,000 |
Liability, debt | $ 133,750 |
Stock Based Compensation - Narr
Stock Based Compensation - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | ||||
Stock based compensation | $ 1.1 | $ 0.6 | $ 2.2 | $ 0.9 |
Unrecognized compensation expense | $ 8.9 | $ 8.9 |
Stock Based Compensation - Shar
Stock Based Compensation - Share Based Compensation Activity (Details) shares in Thousands | 6 Months Ended |
Jun. 30, 2020$ / sharesshares | |
Options Outstanding | |
Beginning balance (in shares) | shares | 410 |
Granted (in shares) | shares | 587 |
Exercised (in shares) | shares | (6) |
Forfeited and cancelled (in shares) | shares | (63) |
Ending balance (in shares) | shares | 928 |
Weighted Average Exercise Price | |
Beginning balance (in dollars per share) | $ / shares | $ 14.50 |
Granted (in dollars per share) | $ / shares | 12.64 |
Exercised (in dollars per share) | $ / shares | 10.16 |
Forfeited and cancelled (in dollars per share) | $ / shares | 7.49 |
Ending balance (in dollars per share) | $ / shares | $ 13.83 |
Restricted Stock Awards | |
Restricted Stock and RSU Awards Outstanding | |
Beginning balance (in shares) | shares | 171 |
Granted (in shares) | shares | 21 |
Vested (in shares) | shares | (122) |
Forfeited and cancelled (in shares) | shares | (40) |
Beginning balance (in shares) | shares | 30 |
Weighted Average Award Value | |
Beginning balance (in dollars per share) | $ / shares | $ 23.53 |
Granted (in dollars per share) | $ / shares | 29.19 |
Vested (in dollars per share) | $ / shares | 25.82 |
Forfeited and canceled (in dollars per share) | $ / shares | 15.35 |
Ending balance (in dollars per share) | $ / shares | $ 29.30 |
RSU Awards | |
Restricted Stock and RSU Awards Outstanding | |
Beginning balance (in shares) | shares | 0 |
Granted (in shares) | shares | 360 |
Vested (in shares) | shares | 0 |
Forfeited and cancelled (in shares) | shares | 0 |
Beginning balance (in shares) | shares | 360 |
Weighted Average Award Value | |
Beginning balance (in dollars per share) | $ / shares | $ 0 |
Granted (in dollars per share) | $ / shares | 12.64 |
Vested (in dollars per share) | $ / shares | 0 |
Forfeited and canceled (in dollars per share) | $ / shares | 0 |
Ending balance (in dollars per share) | $ / shares | $ 12.64 |
Net loss per share (Details)
Net loss per share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||||
Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | |
Earnings Per Share Reconciliation [Abstract] | ||||||||
Net loss | $ (8,976) | $ (10,910) | $ (1,109) | $ (2,729) | $ (19,886) | $ (3,838) | ||
Basic: | ||||||||
Shares outstanding at beginning of period (in shares) | 18,244,000 | 16,044,000 | 16,629,000 | 16,041,000 | ||||
Weighted average shares issued during the period, net (in shares) | 0 | 246,000 | 1,463,000 | 44,000 | ||||
Weighted average common shares, basic (in shares) | 18,244,000 | 16,290,000 | 18,092,000 | 16,085,000 | ||||
Net loss per common share, basic (in dollars per shares) | $ (0.49) | $ (0.07) | $ (1.10) | $ (0.24) | ||||
Diluted: | ||||||||
Weighted average common shares, basic (in shares) | 18,244,000 | 16,290,000 | 18,092,000 | 16,085,000 | ||||
Weighted average common shares, diluted (in shares) | 18,244,000 | 16,290,000 | 18,092,000 | 16,085,000 | ||||
Net loss per common share, diluted (in dollars per share) | $ (0.49) | $ (0.07) | $ (1.10) | $ (0.24) | ||||
Convertible Notes | Convertible Senior Notes due 2024 | ||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||||
Initial conversion price (in dollars per share) | 28.55 | 28.55 | ||||||
Convertible Notes | Convertible Senior Notes Due 2026 | ||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||||
Initial conversion price (in dollars per share) | $ 42.97 | $ 42.97 | ||||||
Stock options | ||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||||
Anti-dilutive stock options outstanding (in shares) | 928,000 | 469,000 | ||||||
Convertible Debt Securities | Convertible Notes | Convertible Senior Notes due 2024 | ||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||||
Anti-dilutive stock options outstanding (in shares) | 481,548 | |||||||
Convertible Debt Securities | Convertible Notes | Convertible Senior Notes Due 2026 | ||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||||
Anti-dilutive stock options outstanding (in shares) | 2,792,664 |
Segment and Related Informati_3
Segment and Related Information - Summary of Segment Information (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2020USD ($)segment | Jun. 30, 2019USD ($) | |
Segment and Related Information [Abstract] | ||||
Number of operating segments | segment | 2 | |||
Number of reportable segments | segment | 2 | |||
Information as to the Company's segments [Abstract] | ||||
Revenue | $ 45,691 | $ 44,247 | $ 100,423 | $ 88,929 |
Operating loss | (5,718) | (3,453) | (11,173) | (5,554) |
Other expense | (139) | (374) | (764) | (804) |
Interest expense, net | (2,111) | (1,244) | (4,083) | (1,390) |
Loss on extinguishment of debt | 0 | 0 | (8,123) | 0 |
Loss before benefit from (provision for) income taxes | (7,968) | (5,071) | (24,143) | (7,748) |
Depreciation, amortization and accretion | 3,558 | 2,109 | 6,700 | 3,121 |
Capital expenditures including software costs | 3,006 | 1,394 | 5,046 | 3,317 |
United States | ||||
Information as to the Company's segments [Abstract] | ||||
Revenue | 44,626 | 41,657 | 97,257 | 83,582 |
Other Countries | ||||
Information as to the Company's segments [Abstract] | ||||
Revenue | 1,065 | 2,590 | 3,166 | 5,347 |
Restaurant/Retail | ||||
Information as to the Company's segments [Abstract] | ||||
Revenue | 27,633 | 28,262 | 65,042 | 57,822 |
Government | ||||
Information as to the Company's segments [Abstract] | ||||
Revenue | 18,058 | 15,985 | 35,381 | 31,107 |
Operating segments | Restaurant/Retail | ||||
Information as to the Company's segments [Abstract] | ||||
Operating loss | (7,697) | (4,615) | (13,767) | (7,597) |
Depreciation, amortization and accretion | 1,951 | 1,201 | 3,806 | 2,069 |
Capital expenditures including software costs | 2,783 | 778 | 4,490 | 1,841 |
Operating segments | Government | ||||
Information as to the Company's segments [Abstract] | ||||
Operating loss | 1,349 | 1,518 | 2,528 | 2,881 |
Depreciation, amortization and accretion | 40 | 18 | 56 | 37 |
Capital expenditures including software costs | 223 | 0 | 434 | 176 |
Other | ||||
Information as to the Company's segments [Abstract] | ||||
Operating loss | 630 | (356) | 66 | (838) |
Depreciation, amortization and accretion | 1,567 | 890 | 2,838 | 1,015 |
Capital expenditures including software costs | $ 0 | $ 616 | $ 122 | $ 1,300 |
Segment and Related Informati_4
Segment and Related Information - Reconciliation of Segment Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Identifiable assets by geographic area [Abstract] | ||
Long-Lived Assets | $ 13,503 | $ 14,352 |
Goodwill by business segment [Abstract] | ||
Goodwill | 41,214 | 41,386 |
United States | ||
Identifiable assets by geographic area [Abstract] | ||
Long-Lived Assets | 13,424 | 14,260 |
Other Countries | ||
Identifiable assets by geographic area [Abstract] | ||
Long-Lived Assets | 79 | 92 |
Restaurant/Retail | ||
Goodwill by business segment [Abstract] | ||
Goodwill | 40,478 | 40,650 |
Government | ||
Goodwill by business segment [Abstract] | ||
Goodwill | 736 | 736 |
Operating segments | Restaurant/Retail | ||
Identifiable assets by geographic area [Abstract] | ||
Long-Lived Assets | 1,776 | 1,987 |
Operating segments | Government | ||
Identifiable assets by geographic area [Abstract] | ||
Long-Lived Assets | 241 | 272 |
Other | ||
Identifiable assets by geographic area [Abstract] | ||
Long-Lived Assets | $ 11,486 | $ 12,093 |
Segment and Related Informati_5
Segment and Related Information - Revenue by Major Customers (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Revenue, Major Customer [Line Items] | ||||
Concentration risk, percentage | 100.00% | 100.00% | 100.00% | 100.00% |
Operating segments | Restaurant/Retail | McDonald’s Corporation | ||||
Revenue, Major Customer [Line Items] | ||||
Concentration risk, percentage | 9.00% | 10.00% | 9.00% | 10.00% |
Operating segments | Restaurant/Retail | Yum! Brands, Inc. | ||||
Revenue, Major Customer [Line Items] | ||||
Concentration risk, percentage | 10.00% | 13.00% | 11.00% | 13.00% |
Operating segments | Restaurant/Retail | Dairy Queen | ||||
Revenue, Major Customer [Line Items] | ||||
Concentration risk, percentage | 11.00% | 7.00% | 14.00% | 7.00% |
Operating segments | Government | U.S. Department of Defense | ||||
Revenue, Major Customer [Line Items] | ||||
Concentration risk, percentage | 40.00% | 36.00% | 35.00% | 35.00% |
Other | ||||
Revenue, Major Customer [Line Items] | ||||
Concentration risk, percentage | 30.00% | 34.00% | 31.00% | 35.00% |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Dec. 31, 2019 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Amounts owed to employees participating in the deferred compensation plan | $ 2,900 | $ 3,200 |
Obligations | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance at beginning of period | 3,340 | |
New level 3 liability | 0 | |
Total gains (losses) reported in earnings | 0 | |
Settlement of Level 3 liabilities | 0 | |
Balance at end of period | 3,340 | |
Restaurant Magic | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Contingent consideration liability | 3,300 | $ 3,300 |
Fair Value, Inputs, Level 2 | Convertible Notes | Convertible Senior Notes due 2024 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Fair value of debt | 15,000 | |
Fair Value, Inputs, Level 2 | Convertible Notes | Convertible Senior Notes Due 2026 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Fair value of debt | $ 112,100 |