Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Aug. 31, 2022 | Sep. 21, 2022 | |
Cover [Abstract] | ||
Entity Registrant Name | CalAmp Corp. | |
Entity Central Index Key | 0000730255 | |
Entity Filer Category | Accelerated Filer | |
Trading Symbol | CAMP | |
Current Fiscal Year End Date | --02-28 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Aug. 31, 2022 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2023 | |
Entity File Number | 0-12182 | |
Entity Tax Identification Number | 95-3647070 | |
Entity Address, Address Line One | 15635 Alton Parkway | |
Entity Address, Address Line Two | Suite 250 | |
Entity Address, City or Town | Irvine | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92618 | |
City Area Code | (949) | |
Local Phone Number | 600-5600 | |
Entity Current Reporting Status | Yes | |
Entity Shell Company | false | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 37,062,965 | |
Entity Incorporation, State or Country Code | DE | |
Security Exchange Name | NASDAQ | |
Title of 12(b) Security | Common stock, $0.01 per share | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Interactive Data Current | Yes |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Aug. 31, 2022 | Feb. 28, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 47,721 | $ 79,221 |
Accounts receivable, net | 74,802 | 61,544 |
Inventories | 22,145 | 18,269 |
Prepaid expenses and other current assets | 24,781 | 22,348 |
Total current assets | 169,449 | 181,382 |
Property and equipment, net | 34,621 | 37,674 |
Operating lease right-of-use assets | 10,367 | 12,327 |
Deferred income tax assets | 3,633 | 4,165 |
Goodwill | 93,377 | 94,436 |
Other intangible assets, net | 28,769 | 31,965 |
Other assets | 30,822 | 29,632 |
Total assets | 371,038 | 391,581 |
Current liabilities: | ||
Current portion of long-term debt | 1,828 | 2,585 |
Accounts payable | 39,863 | 31,815 |
Accrued payroll and employee benefits | 10,181 | 10,929 |
Deferred revenue | 23,378 | 26,174 |
Other current liabilities | 15,675 | 18,951 |
Total current liabilities | 90,925 | 90,454 |
Long-term debt, net of current portion | 226,892 | 189,703 |
Operating lease liabilities | 10,717 | 13,382 |
Other non-current liabilities | 20,684 | 22,640 |
Total liabilities | 349,218 | 316,179 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock, $.01 par value; 3,000 shares authorized; no shares issued or outstanding | ||
Common stock, $.01 par value; 80,000 shares authorized; 37,061 and 36,052 shares issued and outstanding at August 31, 2022 and February 28, 2022, respectively | 371 | 361 |
Additional paid-in capital | 180,463 | 242,386 |
Accumulated deficit | (155,993) | (165,965) |
Accumulated other comprehensive loss | (3,021) | (1,380) |
Total stockholders' equity | 21,820 | 75,402 |
Total liabilities and stockholders' equity | $ 371,038 | $ 391,581 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares | Aug. 31, 2022 | Feb. 28, 2022 |
Statement Of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 3,000,000 | 3,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 80,000,000 | 80,000,000 |
Common stock, shares issued | 37,061,000 | 36,052,000 |
Common stock, shares outstanding | 37,061,000 | 36,052,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Aug. 31, 2022 | Aug. 31, 2021 | Aug. 31, 2022 | Aug. 31, 2021 | |
Revenues: | ||||
Revenues | $ 72,828 | $ 79,011 | $ 137,554 | $ 158,685 |
Cost of revenues: | ||||
Cost of revenues | 43,816 | 45,641 | 82,895 | 92,868 |
Gross profit | 29,012 | 33,370 | 54,659 | 65,817 |
Operating expenses: | ||||
Research and development | 6,757 | 7,729 | 13,757 | 14,669 |
Selling and marketing | 12,734 | 12,047 | 24,212 | 24,509 |
General and administrative | 13,530 | 13,198 | 28,692 | 26,220 |
Intangible asset amortization | 1,330 | 1,394 | 2,672 | 2,647 |
Total operating expenses | 34,351 | 34,368 | 69,333 | 68,045 |
Operating loss | (5,339) | (998) | (14,674) | (2,228) |
Non-operating income (expense): | ||||
Investment income (loss) | (58) | 420 | (172) | 1,068 |
Interest expense | (1,464) | (3,804) | (2,997) | (7,653) |
Other expense, net | (507) | (710) | (1,449) | (1,986) |
Total non-operating expenses | (2,029) | (4,094) | (4,618) | (8,571) |
Loss from continuing operations before income taxes | (7,368) | (5,092) | (19,292) | (10,799) |
Income tax provision from continuing operations | (126) | (333) | (375) | (626) |
Net loss from continuing operations | (7,494) | (5,425) | (19,667) | (11,425) |
Net income from discontinued operations, net of tax | 4,052 | |||
Net loss | $ (7,494) | $ (5,425) | $ (19,667) | $ (7,373) |
Loss per share - continuing operations: | ||||
Basic | $ (0.21) | $ (0.15) | $ (0.55) | $ (0.33) |
Diluted | $ (0.21) | $ (0.15) | $ (0.55) | (0.33) |
Earnings per share - discontinued operations: | ||||
Basic | 0.12 | |||
Diluted | $ 0.12 | |||
Shares used in computing earnings (loss) per share: | ||||
Basic | 36,006 | 35,152 | 35,864 | 34,998 |
Diluted | 36,006 | 35,152 | 35,864 | 34,998 |
Comprehensive income (loss): | ||||
Net loss | $ (7,494) | $ (5,425) | $ (19,667) | $ (7,373) |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustments | (1,830) | (623) | (1,641) | 283 |
Total comprehensive loss | (9,324) | (6,048) | (21,308) | (7,090) |
Products [Member] | ||||
Revenues: | ||||
Revenues | 45,694 | 51,529 | 85,089 | 103,526 |
Cost of revenues: | ||||
Cost of revenues | 30,298 | 32,030 | 56,033 | 65,684 |
Application Subscriptions and Other Services [Member] | ||||
Revenues: | ||||
Revenues | 27,134 | 27,482 | 52,465 | 55,159 |
Cost of revenues: | ||||
Cost of revenues | $ 13,518 | $ 13,611 | $ 26,862 | $ 27,184 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Aug. 31, 2022 | Aug. 31, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (19,667) | $ (7,373) |
Less: Net income from discontinued operations, net of tax | 4,052 | |
Net loss from continuing operations | (19,667) | (11,425) |
Adjustments to reconcile net loss from continuing operations to net cash provided by (used in) operating activities: | ||
Depreciation expense | 8,215 | 8,472 |
Intangible asset amortization | 2,672 | 2,647 |
Stock-based compensation | 6,156 | 5,409 |
Amortization of debt issuance costs and discount | 594 | 5,191 |
Noncash operating lease cost | 1,756 | 1,691 |
Revenue assigned to factors | (1,524) | (2,601) |
Deferred tax assets, net | 129 | 250 |
Other | (67) | 200 |
Changes in operating assets and liabilities of continuing operations: | ||
Accounts receivable | (14,242) | 1,013 |
Inventories | (4,681) | 6,479 |
Prepaid expenses and other assets | (4,438) | 398 |
Accounts payable | 8,258 | (5,138) |
Accrued liabilities | (2,842) | 7,270 |
Deferred revenue | (3,093) | (6,656) |
Operating lease liabilities | (2,901) | (2,354) |
Net cash provided by (used in) operating activities - continuing operations | (25,675) | 10,846 |
Net cash used in operating activities - discontinued operations | (395) | |
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | (25,675) | 10,451 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Capital expenditures | (4,891) | (6,569) |
Net cash used in investing activities - continuing operations | (4,891) | (6,569) |
Net cash provided by investing activities - discontinued operations | 6,616 | |
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES | (4,891) | 47 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Taxes paid related to net share settlement of vested equity awards | (1,568) | (4,017) |
Proceeds from exercise of stock options and contributions to employee stock purchase plan | 502 | 900 |
NET CASH USED IN FINANCING ACTIVITIES | (1,066) | (3,117) |
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS | 132 | (954) |
Net change in cash and cash equivalents | (31,500) | 6,427 |
Cash and cash equivalents at beginning of period | 79,221 | 94,624 |
Cash and cash equivalents at end of period | $ 47,721 | $ 101,051 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock and Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Accumulated Other Comprehensive Income (Loss) [Member] |
Balances at Feb. 28, 2021 | $ 95,085 | $ 234,044 | $ (137,974) | $ (985) |
Stock-based compensation expense | 5,434 | |||
Shares issued on net share settlement of equity awards | (4,017) | |||
Exercise of stock options and contributions to employee stock purchase plan | 900 | |||
Net loss | (7,373) | (7,373) | ||
Foreign currency translation adjustments | 283 | |||
Balances at Aug. 31, 2021 | 90,312 | 236,361 | (145,347) | (702) |
Balances at May. 31, 2021 | 95,727 | 235,728 | (139,922) | (79) |
Stock-based compensation expense | 2,937 | |||
Shares issued on net share settlement of equity awards | (2,956) | |||
Exercise of stock options and contributions to employee stock purchase plan | 652 | |||
Net loss | (5,425) | (5,425) | ||
Foreign currency translation adjustments | (623) | |||
Balances at Aug. 31, 2021 | 90,312 | 236,361 | (145,347) | (702) |
Balances at Feb. 28, 2022 | 75,402 | 242,747 | (165,965) | (1,380) |
Balances (ASU 2020-06 [Member]) at Feb. 28, 2022 | (67,003) | 29,639 | ||
Stock-based compensation expense | 6,156 | |||
Shares issued on net share settlement of equity awards | (1,568) | |||
Exercise of stock options and contributions to employee stock purchase plan | 502 | |||
Net loss | (19,667) | (19,667) | ||
Foreign currency translation adjustments | (1,641) | |||
Balances at Aug. 31, 2022 | 21,820 | 180,834 | (155,993) | (3,021) |
Balances at May. 31, 2022 | 28,589 | 178,279 | (148,499) | (1,191) |
Stock-based compensation expense | 3,196 | |||
Shares issued on net share settlement of equity awards | (1,143) | |||
Exercise of stock options and contributions to employee stock purchase plan | 502 | |||
Net loss | (7,494) | (7,494) | ||
Foreign currency translation adjustments | (1,830) | |||
Balances at Aug. 31, 2022 | $ 21,820 | $ 180,834 | $ (155,993) | $ (3,021) |
DESCRIPTION OF BUSINESS, BASIS
DESCRIPTION OF BUSINESS, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Aug. 31, 2022 | |
Accounting Policies [Abstract] | |
DESCRIPTION OF BUSINESS, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1 - DESCRIPTION OF BUSINESS, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Description of Business CalAmp Corp. (including its subsidiaries unless the context otherwise requires, “CalAmp”, “the Company”, “we”, “our”, or “us”) is a connected intelligence company that leverages a data-driven solutions ecosystem to help people and organizations improve operational performance. We solve complex problems for customers within the market verticals of transportation and logistics, commercial and government fleets, industrial equipment, and consumer vehicles by providing solutions that track, monitor, and recover their vital assets. The data and insights enabled by CalAmp solutions provide real-time visibility into a user’s vehicles, assets, drivers, and cargo, giving organizations greater understanding and control of their operations. Ultimately, these insights drive operational visibility, safety, efficiency, maintenance, and sustainability for organizations around the world. We are a global organization that is headquartered in Irvine, California . Recent Events COVID-19 In March 2020, the World Health Organization declared COVID-19 (“COVID-19” or the “pandemic”) to be a public health pandemic of international concern, which has led to adverse impacts on the U.S. and global economies and continues to impact our supply chain and operations. More recently, we have experienced supply shortages as a result of global supply imbalances driven by component shortages, disruptions in accessible labor, other freight and logistical challenges and other related macro-economic factors. These supply imbalances negatively impacted all parts of our business during fiscal 2022 and have continued into fiscal 2023. It is difficult to predict the extent to which these factors will continue to impact our future business or operating results, which are highly dependent on uncertain future developments, including the severity of the continuing pandemic, the actions taken or to be taken by governments and private businesses in relation to the resolution of supply chain issues and component shortages. Because our business is dependent on telematics product sales, device installations and related subscription-based services, the ultimate effect of these factors may not be fully reflected in our operating results until future periods. Transition of MRM Telematics Customers to Subscription Arrangements In the second half of fiscal 2022, we prompted a strategic shift with customers who have historically purchased Mobile Resource Management (“MRM”) telematics devices from us. These customers are being transitioned to subscription-based arrangements by way of bundling services with telematics devices under multi-year (generally three years) subscription contracts. Our plan is to transition the MRM business to multi-year subscription contracts over the course of fiscal 2023. As a result, our financial results associated with such subscription arrangements will be reported within our Software & Subscription Services reporting segment prospectively from the effective date of such underlying contracts. In the short term, we expect that this will lead to significant growth in our Software & Subscription Services business with a corresponding decline in our Telematics Products business. Long term we believe this shift will allow us to drive revenue growth as we generate incremental revenue from our existing customer base as well as new customers through current and anticipated broader future subscription service offerings. Basis of Presentation In the opinion of our management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments (consisting of normal recurring adjustments) considered necessary to present fairly our financial position at August 31, 2022 and our results of operations for the three and six months ended August 31, 2022 and 2021. The results of operations for such periods are not necessarily indicative of results to be expected for the full fiscal year ending February 28, 2023. Certain notes and other information included in the audited financial statements in our Annual Report on Form 10-K for the fiscal year ended February 28, 2022 are condensed in or omitted from the interim financial statements presented in this Quarterly Report on Form 10-Q. Therefore, these financial statements should be read in conjunction with our 2022 Annual Report on Form 10-K as filed with the U.S. Securities and Exchange Commission (“SEC”) on April 28, 2022. All intercompany transactions and accounts have been eliminated in consolidation. The accompanying condensed consolidated financial statements have been prepared with the assumption that the Company will continue as a going concern. Based on our current and projected level of operations we believe that our future cash flows from operating activities, our existing cash and cash equivalents and our revolving credit facility will provide adequate funds for ongoing operations and working capital requirements for at least the next 12 months. However, our business is subject to various factors that could materially impact our assumptions leading to the consumption of our available cash before that time. Effective March 15, 2021, the Company and Spireon Holdings, L.P. (“Spireon”) entered into a purchase agreement pursuant to which we sold certain assets and transferred certain liabilities of the LoJack U.S. and Canadian stolen vehicle recovery business (“LoJack North America”) to Spireon for a purchase price of $8.0 million. Operations for LoJack North America are presented as discontinued operations accompanying condensed consolidated financial statements for the three and six months ended August 31, 2021. See Note 2, Discontinued Operations , for additional information. Estimates and Assumptions The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. We have considered all known and reasonably available information that existed throughout the three and six months ended and as of August 31, 2022 in making accounting judgements, estimates and disclosures. We are monitoring the potential effects of the health care related and economic conditions of COVID-19 in assessing certain matters including (but not limited to) supply chain disruptions, decreases in customer demand for our products and services, potential longer-term effects on our customer and distribution channels particularly in the U.S. and relevant end markets as well as other developments. If the impact results in longer term closures of businesses and economic recessionary conditions, we may recognize material asset impairments and charges for uncollectible accounts receivable in future periods. Revenue Recognition Revenues from subscription services are recognized ratably on a straight-line basis over the term of the subscription, which generally ranges from two to five years We recognize revenue from telematics product sales upon the transfer of control of promised products to customers in an amount that reflects the transaction price. Customers generally do not have a right of return except for defective products returned during the warranty period. We record estimated commitments related to customer incentive programs as reductions of revenues. From time to time, we provide various professional services to customers. These services include project management, engineering services and installation services, which are often distinct from other performance obligations and are recognized as the related services are performed. For certain professional service contracts, we recognize revenue based on the proportion of total costs incurred to-date over the estimated cost of the contract, which is an input method. In many customer arrangements, subscription services are bundled with the sale or lease of telematics devices within the same contractual arrangement. To determine the performance obligations under these arrangements, we assess the contractual elements and, in particular, whether the telematics products within the arrangement are distinct. This is an area of judgment that includes the consideration of all elements of the arrangement. Significant factors in determining whether telematics devices are distinct are whether such devices are sold separately, as well as the degree of integration and interdependency between the subscription elements of the arrangement and the associated telematics devices. If we conclude that the telematics devices within a customer arrangement are distinct and therefore represent a separate performance obligation, the total expected consideration associated with the contract is allocated between the performance obligations based upon the relative stand-alone selling price associated with each performance obligation. We base stand-alone selling prices on pricing for the same or similar items. For some customer arrangements, we have concluded that the subscription services and associated telematics devices are not distinct performance obligations and thus represent a single combined performance obligation. For certain other customer arrangements under which devices are leased in combination with subscription services, we consider the arrangement to be predominately a subscription service and thus a combined single performance obligation for purposes of revenue recognition. In both of these circumstances, we generally recognize the total expected consideration as revenue over the term of the subscription. Device related costs associated with arrangements in which title to the device is transferred to the customer under a single combined performance obligation are recorded as deferred costs on the balance sheet and are amortized into cost of revenues over the term of the subscription or the estimated in-service lives of the devices. In contractual arrangements under which we provide devices as part of the subscription contract but we retain ownership of the devices, the cost of the devices is capitalized as property and equipment and depreciated over the estimated useful life of three to five years As described above , We exclude from the measurement of the transaction price all taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by us from a customer. The timing of revenue recognition may differ from the timing on our invoicing to customers. Contract assets are comprised of unbilled amounts for which we have transferred products or provided services to our customers and are classified as accounts receivable. Contract liabilities (deferred revenues) are comprised of billings or payments received from our customers in advance of performance under the contract. During the fiscal quarter ended August 31, 2022, we recognized $ 10.8 million in revenue from the deferred revenue balance of $39.7 million as of February 28, 2022. Incremental costs of obtaining a contract with a customer consist of sales commissions, which are recognized on a straight-line basis over the life of the corresponding contracts. Prepaid sales commissions included in prepaid expenses and other current assets and other assets were $1.9 million and $2.8 million, respectively, as of August 31, 2022. We disaggregate revenue from contracts with customers into reportable segments, geography, type of goods and services and timing of revenue recognition. See Note 14, Segment Information and Geographic Data , for our revenue by segment and geography. The disaggregation of revenue by type of goods and services and by timing of revenue recognition is as follows (in thousands): Three Months Ended Six Months Ended August 31, August 31, 2022 2021 2022 2021 Revenue by type of goods and services: Telematics devices and accessories $ 45,694 $ 51,529 $ 85,089 $ 103,526 Rental income and other services 6,656 3,495 10,926 7,105 Recurring application subscriptions 20,478 23,987 41,539 48,054 Total $ 72,828 $ 79,011 $ 137,554 $ 158,685 Three Months Ended Six Months Ended August 31, August 31, 2022 2021 2022 2021 Revenue by timing of revenue recognition: Revenue recognized at a point in time $ 50,685 $ 53,419 $ 92,174 $ 108,123 Revenue recognized over time 22,143 25,592 45,380 50,562 Total $ 72,828 $ 79,011 $ 137,554 $ 158,685 Telematics devices and accessories revenues presented in the table above include devices sold in customer arrangements that include both device and subscription services. Revenues related to recurring application subscriptions include subscription revenues as well as amortization of deferred revenue for contractual arrangements under which the subscription services and associated telematics devices were determined to be a single combined performance obligation. Remaining performance obligations for Software & Subscription Services represents contracted revenue that has not yet been recognized, which includes deferred revenue on our consolidated balance sheets and unbilled amounts that will be recognized as revenue in future periods. As of August 31, 2022 and February 28, 2022, we have estimated remaining performance obligations for contractually committed revenues of $210.3 million and $202.0 million respectively. As of August 31, 2022, we expect to recognize approximately 27% of the revenue under these remaining performance obligations in fiscal 2023 and 33% in fiscal 2024. As of February 28, 2022, we expected to recognize approximately 47% of the then remaining performance obligations in fiscal 2023 and 24% in fiscal 2024. We exclude contracts that have original durations of less than one year from the aforementioned remaining performance obligation disclosure. Cash and Cash Equivalents We consider all highly liquid investments with maturities at date of purchase of three months or less to be cash equivalents. Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable consists of amounts due to us from sales arrangements executed in our normal business activities and are recorded at invoiced amounts or in some cases amounts expected to be invoiced. Our payment terms generally range between 30 to 60 days Due to the COVID-19 pandemic and other related macro-economic factors, there has been uncertainty and disruption in the global economy and financial markets. Except for the increase in expected credit losses, we are not aware of any specific event or circumstances that would require an update to our estimates or assumptions or a revision of the carrying value of our assets or liabilities as of the date of this quarterly report. These estimates and assumptions may change as new events occur and additional information is obtained. As a result, actual results could differ materially from these estimates and assumptions. We group all accounts receivables and lease receivables into a single portfolio and analyze the credit risk associated with our accounts receivables and lease receivables. Our historical loss rates have not shown any significant differences between customer industries or geographies. As disclosed in Note 1 4 , Segment Information and Geographic Data , we do not have significant international geographic concentrations of revenue, and, as a result, we do not have significant concentrations of accounts receivables or lease receivables in any single geography outside of the United States. The allowance for doubtful accounts totaled $2.1 million and $2.6 million as of August 31, 2022 and February 28, 2022, respectively. Goodwill and Other Long-Lived Assets Goodwill and long-lived assets to be held and used, including identifiable intangible assets, are reviewed for impairment annually in the fourth quarter or whenever events or changes in circumstances indicate that the carrying amount of an asset may not be fully recoverable. These events or changes in circumstances may include a significant deterioration of operating results, changes in business plans or changes in anticipated future cash flows. If an impairment indicator is present, we evaluate recoverability by a comparison of the carrying amount of the assets or reporting unit to the estimated fair value of those assets or reporting unit determined using either an income approach, a market approach, or a combination of both. If the assets are impaired, the impairment recognized is the amount by which the carrying amount exceeds the fair value of the assets. Fair Value Measurements We apply fair value accounting for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in our financial statements. We define fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly manner in an arm’s-length transaction between market participants at the measurement date. Fair value is estimated by using the following hierarchy: Level 1 – Quoted prices in active markets for identical assets or liabilities. Level 2 – Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 – Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability. Litigation and Other Contingencies We accrue for litigation and other contingencies whenever we determine that an unfavorable outcome is probable and a liability is reasonably estimable. The amount of the accrual is estimated based on a review of each claim, including the type and facts of the claim and our assessment of the merits of the claim. These accruals are reviewed at least on a quarterly basis and are adjusted to reflect the impact of recent negotiations, settlements, court rulings, advice from legal counsel and other events pertaining to the case. Such accruals, if any, are recorded as general and administrative expenses in our condensed consolidated statements of comprehensive loss. Although we take considerable measures to mitigate our exposure in these matters, litigation is unpredictable; however, we believe that we have valid defenses with respect to pending legal matters against us as well as adequate provisions for probable and estimable losses. All costs for legal services are expensed as incurred. Foreign Currency Translation We translate the assets and liabilities of our non-U.S. dollar functional currency subsidiaries into U.S. dollars using exchange rates in effect at the end of each period. Revenue and expenses for these subsidiaries are translated using rates that approximate those in effect during the period. Gains and losses from these translations are recognized in foreign currency translation included in accumulated other comprehensive income (loss) during the period. The aggregate foreign currency transaction exchange rate gain (loss) included in determining income (loss) before income taxes was ($0.3) million and ($0.6) million for the three and six months ended August 31, 2022, respectively. The aggregate foreign currency transaction exchange rate gain (loss) included in determining income (loss) before income taxes was ($14) thousand and $49 thousand for the three and six months ended August 31, 2021, respectively. Comprehensive Income (Loss) Comprehensive income (loss) consists of two components, net income (loss) and other comprehensive income (loss) (“OCI”). OCI refers to revenue, expenses and gains and losses that under GAAP are recorded as an element of stockholders’ equity and excluded from net income (loss). Our OCI consists of foreign currency translation adjustments from those subsidiaries not using the U.S. dollar as their functional currency. Recently Adopted Accounting Pronouncements In August 2020, the Financial Accounting Standards Board (“FASB”) issued ASU 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40) conversion feature or convertible instruments with a beneficial conversion feature. We adopted ASU 2020-06 effec t ive March 1, 2022, the beginning of fiscal 2023, utilizing the modified retrospective approach whereby the cumulative effect of the change in accounting was recognized as an adjustment to the opening balance of retained earnings (accumulated deficit) at the date of adoption . Comparative information has not been restated and continue s to be presented in accordance with accounting standards that were in effect for those periods. Prior to the adoption of ASU 2020-06, we allocated the gross proceeds of the Convertible Notes between the liability and equity components under the cash conversion feature model using the accounting rules in GAAP (ASC 470-20). The carrying amount of the liability component was calculated based on the fair value of a similar debt instrument excluding the embedded conversion option at the issuance date. The carrying amount of the equity component representing the conversion option was calculated by deducting the carrying value of the liability component from the principal amount of the notes as a whole. This difference represented a debt discount and was being amortized to interest expense over the term of the notes using the effective interest rate method. The equity component of the notes was included in stockholders’ equity and was not remeasured as long as it continued to meet the conditions for equity classification. Effective March 1, 2022, we no longer separately present in equity an embedded conversion feature of such debt. Instead, we account for a convertible debt instrument wholly as debt unless (i) the convertible debt instrument contains features that require bifurcation as a derivative or (ii) the convertible debt instrument was issued at a substantial premium. Prior to the adoption of ASU 2020-06, debt issuance costs attributable to the liability component were amortized to interest expense using the effective interest method and debt issuance costs attributable to the equity component were netted with the equity component in stockholders’ equity. Upon adoption, the entire amount of debt issuance costs is reflected as a contra-liability and amortized as interest expense using the effective interest method over the respective term of the notes. We account for the cost of the capped calls as a reduction to additional paid-in capital. After adopting the new guidance, the use of the if-converted method is required when calculating diluted earnings per share (“EPS”) for convertible instruments and The below adoption adjustments were calculated based on the carrying amount of the Convertible Notes as if it had always been treated as a liability only. Furthermore, these adjustments address the debt issuance costs contra-liability and equity (additional paid-in capital) components under the same premise (i.e., as if the total amount of debt issuance costs had always been treated as a contra-liability only). Lastly, we derecognized the deferred income taxes associated with the debt discount and adjusted deferred income taxes relative to unamortized debt issuance costs associated with the Convertible Notes. This resulted in a net increase in gross deferred tax assets of $9.4 million but no impact to the net deferred tax asset balance due to the valuation allowance recorded against our deferred tax assets. We expect lower interest expense related to the Convertible Notes to be recognized in future periods subsequent to adoption as a result of accounting for the Convertible Notes as a single liability measured at amortized cost. The following table summarizes the impact of the adoption of February 28, 2022 ASU 2020-06 March 1, 2022 As Reported Adoption Impact As Adjusted Deferred income tax assets, net $ 4,165 $ - 4,165 Total debt (1) 192,288 37,365 229,653 Additional paid-in-capital 242,386 (67,003 ) 175,383 Accumulated deficit $ (165,965 ) $ 29,639 $ (136,326 ) (1) Prior to adoption, the carrying value of convertible debt represented the principal amount less unamortized debt discount and unamortized debt issuance costs. After adoption, the carrying value of convertible debt represents the principal amount less unamortized debt issuance costs. Recently Issued Accounting Pronouncements, Not Yet Adopted There are currently no accounting standards that have been issued but not yet adopted that we believe will have a significant impact on our unaudited condensed consolidated financial position, results of operations or cash flows. |
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS | 6 Months Ended |
Aug. 31, 2022 | |
Discontinued Operations And Disposal Groups [Abstract] | |
DISCONTINUED OPERATIONS | NOTE 2 – DISCONTINUED OPERATIONS Effective March 15, 2021, a wholly owned subsidiary of the Company and Spireon entered into an agreement (“Sale Agreement”) pursuant to which we sold certain assets and transferred certain liabilities of the LoJack North America business (“LoJack Transaction”) for an upfront cash purchase price of approximately $8.0 million. We received net proceeds of $6.6 million, based on an estimate of certain adjustments to the gross purchase price as of the closing date. On November 9, 2021, the purchase price was reduced by $0.9 million, which was paid to Spireon, due to final working capital adjustments. We recognized a gain on the sale of the LoJack North America business of $ 4.1 million during the year ended February 28, 2022 . Concurrent with the closing of the transaction, we also entered into a Transition Services Agreement (the “TSA”) to provide support to Spireon in the transition of customers to its telematics solution and to provide recovery services to the existing installed base of LoJack North America customers, as an agent of Spireon, for a period of six months commencing March 15, 2021. Subsequently, the transition period was extended and then effectively terminated on March 31, 2022. As consideration for these services, Spireon reimbursed us for the direct and certain indirect costs, as well as certain overhead or administrative expenses related to operating the business. Additionally, we entered into a services agreement that commenced April 1, 2022 upon the expiration of the TSA, under which we will provide certain services related to the LoJack North America tower infrastructure for a period no longer than fifty-four months. As consideration for these services, Spireon will pay us a monthly service fee over the stipulated contract term. Further, we entered into a license agreement pursuant to which we license certain intellectual property rights related to the LoJack North America business in the U.S. and Canada to Spireon. In connection with the services provided to Spireon during the three and six months ended August 31, 2022, respectively, we incurred a total cost of $0.7 million and $2.0 million The operating results and cash flows related to the LoJack North America operations are reflected as discontinued operations in the unaudited condensed consolidated statements of comprehensive loss and the unaudited condensed consolidated statements of cash flows for the six months ended August 31, 2021. For the six months ended August 31, 2021, we have reported the operating results and cash flows related to the LoJack North America operations through March 14, 2021: The amounts in the statement of operations that are included in discontinued operations are summarized in the following table (in thousands): Six Months Ended August 31, 2021 Revenues $ 823 Cost of revenues 950 Gross profit (loss) (127 ) Operating expenses: Research and development 32 Selling and marketing 167 General and administrative 75 Intangible asset amortization 141 Restructuring 404 Impairment losses — Total operating expenses 819 Operating loss from discontinued operations (946 ) Gain on sale of discontinued operations 4,998 Net income from discontinued operations, net of tax $ 4,052 The amounts in the statement of cash flows that are included in discontinued operations are summarized in the following table (in thousands): Six Months Ended August 31, 2021 CASH FLOWS FROM OPERATING ACTIVITIES: Net income from discontinued operations, net of tax $ 4,052 Adjustments to reconcile net income from discontinued operations to net cash used in operating activities: Intangible asset amortization 141 Stock-based compensation 25 Gain on sale of discontinued operations (4,998 ) Changes in operating assets and liabilities: Accounts receivable 452 Inventories 425 Prepaid expenses and other current assets 4 Accounts payable (331 ) Accrued liabilities (135 ) Deferred revenue (30 ) NET CASH USED IN OPERATING ACTIVITIES OF DISCONTINUED OPERATIONS (395 ) CASH FLOWS FROM INVESTING ACTIVITIES: Net proceeds from sale of discontinued operations 6,616 NET CASH PROVIDED BY INVESTING ACTIVITIES OF DISCONTINUED OPERATIONS 6,616 Net change in cash and cash equivalents $ 6,221 |
CASH, CASH EQUIVALENTS AND INVE
CASH, CASH EQUIVALENTS AND INVESTMENTS | 6 Months Ended |
Aug. 31, 2022 | |
Cash And Cash Equivalents [Abstract] | |
CASH, CASH EQUIVALENTS AND INVESTMENTS | NOTE 3 – CASH, CASH EQUIVALENTS AND INVESTMENTS The following tables summarize our financial instrument assets (in thousands): As of August 31, 2022 Balance Sheet Classification of Fair Value Unrealized Cash and Gains Fair Cash Other Cost (Losses) Value Equivalents Assets Cash $ 26,767 $ — $ 26,767 $ 26,767 $ — Level 1: Money market funds 454 — 454 454 — Mutual funds (1) 1,156 (1 ) 1,155 — 1,155 Level 2: Repurchase agreements 20,500 — 20,500 20,500 — Total $ 48,877 $ (1 ) $ 48,876 $ 47,721 $ 1,155 As of February 28, 2022 Balance Sheet Classification of Fair Value Unrealized Cash and Gains Fair Cash Other Cost (Losses) Value Equivalents Assets Cash $ 28,394 $ — $ 28,394 $ 28,394 $ — Level 1: Money market funds 7,327 — 7,327 7,327 — Mutual funds (1) 851 107 958 — 958 Level 2: Repurchase agreements 43,500 — 43,500 43,500 — Total $ 80,072 $ 107 $ 80,179 $ 79,221 $ 958 (1) Amounts represent various equities, bond and money market mutual funds that are held in an irrevocable “Rabbi Trust” for payment obligations to non-qualified deferred compensation plan participants. In addition to the mutual funds above, our “Rabbi Trust” also included Corporate-Owned Life Insurance (COLI) starting in fiscal 2020. As of August 31, 2022, the cash surrender value of COLI was $5.5 million. |
INVENTORIES
INVENTORIES | 6 Months Ended |
Aug. 31, 2022 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | NOTE 4 - INVENTORIES Inventories consist of the following (in thousands): August 31, February 28, 2022 2022 Raw materials $ 8,447 $ 6,090 Finished goods 13,698 12,179 $ 22,145 $ 18,269 |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 6 Months Ended |
Aug. 31, 2022 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER INTANGIBLE ASSETS | NOTE 5 – GOODWILL AND OTHER INTANGIBLE ASSETS Other intangible assets consist of the following (in thousands): Gross (2) Accumulated Amortization (2) Net Useful Life Feb. 28, 2022 Additions & Adjustments, net (1) August 31, 2022 Feb. 28, 2022 Expense August 31, 2022 Feb. 28, 2022 August 31, 2022 Developed technology 4-6 years $ 26,958 (102 ) $ 26,856 $ 25,470 $ 632 $ 26,102 $ 1,488 $ 754 Tradenames 10 years 30,192 (205 ) 29,987 20,571 1,067 21,638 9,621 8,349 Customer relationships 10-15 years 35,404 (217 ) 35,187 14,883 969 15,852 20,521 19,335 Patents 5 years 589 — 589 254 4 258 335 331 $ 93,143 $ (524 ) $ 92,619 $ 61,178 $ 2,672 $ 63,850 $ 31,965 $ 28,769 (1) Amounts also include any net changes in intangible asset balances for the periods presented that resulted from foreign currency translations. (2) This table excludes the gross value of fully amortized intangible assets totaling $23.0 Intangible assets with finite lives are amortized on a straight-line basis over the expected period to be benefited by future cash flows. We monitor and assess these assets for impairment on a periodic basis. Our assessment includes various new product lines and services, which leverage the existing intangible assets as well as consideration of historical and projected revenues and cash flows. Amortization expense of intangible assets from continuing operations was $1.3 million and $2.7 million for the three and six months ended August 31, 2022, respectively. Amortization expense of intangible assets from continuing operations was $1.4 million and $2.6 million for the three and six months ended August 31, 2021, respectively. Estimated future amortization expense as of August 31, 2022 is as follows (in thousands): 2023 (remainder) $ 2,640 2024 4,440 2025 4,325 2026 4,056 2027 2,435 Thereafter 10,873 $ 28,769 Changes in goodwill are as follows (in thousands): Software & Subscription Services Telematics Products Total Balance as of February 28, 2022 $ 55,256 $ 39,180 $ 94,436 Effect of exchange rate change on goodwill (1,059 ) — (1,059 ) Balance as of August 31, 2022 $ 54,197 $ 39,180 $ 93,377 As further described in Note 1 under the caption Transition of MRM Telematics Customers to Subscription Arrangements |
OTHER ASSETS
OTHER ASSETS | 6 Months Ended |
Aug. 31, 2022 | |
Other Assets Noncurrent Disclosure [Abstract] | |
OTHER ASSETS | NOTE 6 – OTHER ASSETS Other assets consist of the following (in thousands): August 31, February 28, 2022 2022 Deferred product cost $ 1,135 $ 1,493 Deferred compensation plan assets 6,692 7,215 Lease receivables, non-current 17,161 15,118 Prepaid commissions 2,750 2,894 Other 3,084 2,912 $ 30,822 $ 29,632 |
FINANCING ARRANGEMENTS
FINANCING ARRANGEMENTS | 6 Months Ended |
Aug. 31, 2022 | |
Debt Disclosure [Abstract] | |
FINANCING ARRANGEMENTS | NOTE 7 – FINANCING ARRANGEMENTS The following table provides a summary of our debt as of August 31, 2022 and February 28, 2022 (in thousands): Maturity Effective August 31, February 28, Date Interest Rate 2022 2022 2025 Convertible Notes, 2.00% fixed rate (2) August 1, 2025 2.49 % 230,000 230,000 Due to factors under revenue assignments 2020 - 2024 4.70 % 2,305 3,829 Total term debt 232,305 233,829 Unamortized discount and issuance costs (1) (3,585 ) (41,541 ) Less: Current portion of long-term term debt (1,828 ) (2,585 ) Long-term debt, net of current portion $ 226,892 $ 189,703 (1) The debt discount associated with the Convertible Notes and related unamortized debt issuance costs as of August 31, 2022 reflects the adoption impact of ASU 2020-06 effective March 1, 2022. See Note 1, Significant Accounting Policies – Recent Accounting Pronouncements , for further information regarding the adoption of ASU 2020-06. (2) The effective interest rate was 7.56% prior to the adoption of ASU 2020-06. The effective interest rates for the convertible notes include the interest on the notes and amortization of the debt issuance costs. As of August 31, 2022 and February 28, 2022, the fair value of the 2025 Convertible Notes were $204 million and $209 million, respectively, based on Level 2 inputs. 2025 Convertible Notes In July 2018, we issued debt of $230.0 million aggregate principal amount of convertible senior unsecured notes due in 2025 (“2025 Convertible Notes”). These notes require semi-annual interest payments at an annual rate of 2.00% until maturity, conversion, redemption or repurchase, which will be no later than August 1, 2025. We may redeem the notes at our option at any time on or after August 6, 2022 at a cash redemption price equal to the principal amount plus accrued interest, but only if the last reported sale price per share of our stock exceeds 130% of the conversion price on (i) each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending on, and including, the trading day immediately before the date we send the related redemption notice; and (ii) the trading day immediately before the date we send such notice. The 2025 Convertible Notes are convertible into cash, shares of our common stock or a combination of both, at our election, based on an initial conversion price of $30.7450. Holders may convert their 2025 Convertible Notes at their option upon the occurrence of certain events, as defined in the 2025 Indenture. In accounting for the issuance of the 2025 Convertible Notes prior to the adoption of ASU 2020-06, we allocated the gross proceeds of the Notes between the liability and equity components under the cash conversion feature model using the accounting rules in GAAP (ASC 470-20). The carrying amount of the liability component was calculated by measuring the fair value of a similar debt instrument without the associated convertible feature. The carrying amount of the equity component, representing the conversion option, was determined by deducting the fair value of the liability component from the principal amount of the notes as a whole. The equity component was not re-measured as long as it continued to meet the conditions for equity classification. The excess of the principal amount of the liability component over its carrying amount (i.e., the debt discount) was amortized to interest expense using the effective interest method. Approximately $51.9 million, net of tax, was allocated to additional paid-in-capital upon issuance of these notes. Upon adoption of ASU 2020-06 on March 1, 2022, we reversed the separation of the debt and equity components and accounted for the Convertible Notes wholly as debt. We also reversed the amortization of the debt discount, with a cumulative effect adjustment to retained earnings (accumulated deficit) on the adoption date. Prior to the adoption of this pronouncement, debt issuance costs attributable to the liability component were being amortized to interest expense using the effective interest method and debt issuance costs attributable to the equity component were netted with the equity component in stockholders’ equity. Effective March 1, 2022, we reversed the debt issuance costs attributable to the equity component and account for the entire amount as debt issuance costs that will be amortized as interest expense using the effective interest method, with a cumulative effect adjustment to retained earnings (accumulated deficit) on the adoption date. See Note 1, Significant Accounting Policies – Recent Accounting Pronouncements Earnings Per Share In July 2018, in connection with the 2025 Convertible Notes, we entered into capped call transactions with certain option counterparties who were initial purchasers of the 2025 Convertible Notes. The capped call transactions are expected to reduce the potential dilution of earnings per share upon conversion of the 2025 Convertible Notes. Under the capped call transactions, we purchased options relating to 7.48 million shares of common stock underlying the notes, with a strike price equal to the conversion price of the notes and with a cap price equal to $41.3875. We paid $21.2 million for the note hedges and as a result, approximately $15.9 million, net of tax, was recorded as a reduction to additional paid-in capital within stockholders’ equity. Revolving Credit Facility On July 13, 2022, we replaced our revolving credit facility with JP Morgan Chase Bank, N.A. and we entered into a new revolving credit facility with PNC Bank, N.A., that provides for an asset-based senior secured revolving credit facility for borrowings up to an aggregate of $50.0 million, subject to certain conditions, including borrowing base provisions that limit borrowing capacity to 80% of eligible accounts receivable and 50% of eligible inventory. At our election, the borrowings under this revolving credit facility bear interest at either the Bloomberg short-term bank yield rate plus a margin of 2.50% per annum or an alternate base rate plus a margin of 1.50% per annum. We also pay an unused line fee ranging from 0.50% to 0.75% per annum, based on the level of borrowings, payable quarterly in arrears. Amounts owed under the revolving credit facility are guaranteed by the Company and certain of its subsidiaries. We have also granted security interests in substantially all of our respective assets to secure these obligations. The revolving credit facility will terminate, and all outstanding loans will become due and payable on the earlier of July 13, 2025 and the date that is ninety days prior to the maturity date of our 2025 Convertible notes. The proceeds available under the revolving credit facility could be used for working capital and general corporate purposes, which could include acquisitions. The revolving credit facility contains customary events of default, that upon our default may require us to pay all amounts outstanding and allow PNC Bank to foreclose on collateral. At August 31, 2022, there were no borrowings outstanding under this revolving credit facility and total borrowing availability was $34.0 million. The revolving credit facility contains certain negative and affirmative covenants, including financial covenants that require us to maintain a fixed charge coverage rate of not less than 1.10 to 1.00, measured as of the last day of each fiscal quarter if our liquidity position, consisting of specified cash balances plus unused availability on the revolving credit facility, falls below $40.0 million on such day. Additionally, the revolving credit facility contains a cash dominion trigger whereby PNC Bank may direct domestic cash balances and receipts to pay down borrowings under the revolving credit facility should our liquidity position, consisting of specified cash balances plus unused availability on the revolving credit facility, fall below $25.0 million at the end of any month. As of August 31, 2022, we were in compliance with our covenants under the revolving credit facility. |
LEASES
LEASES | 6 Months Ended |
Aug. 31, 2022 | |
Leases [Abstract] | |
LEASES | NOTE 8 – LEASES We have various non-cancelable operating leases for our offices in California, Texas, Massachusetts, Indiana, Minnesota and Virginia in the United States, and Italy, Mexico and the United Kingdom. We also have various non-cancelable operating leases for towers and vehicles throughout the United States, Italy and Mexico. These leases expire at various times through 2033. Certain lease agreements contain renewal options, rent abatement, and escalation clauses that are factored into our determination of lease payments when appropriate. The table below presents lease-related assets and liabilities recorded on the condensed consolidated balance sheet (in thousands): August 31, 2022 February 28, 2022 Assets Operating lease right-of-use assets $ 10,367 $ 12,327 Liabilities Operating lease liabilities (current) $ 5,038 $ 5,086 Operating lease liabilities (non-current) 10,717 13,382 Total lease liabilities $ 15,755 $ 18,468 Lease Costs The following lease costs were included in our condensed consolidated statements of comprehensive loss as follows (in thousands): Three months ended August 31, Six Months Ended August 31, 2022 2021 2022 2021 Operating lease cost $ 1,075 $ 1,157 $ 2,194 $ 2,288 Short-term lease cost 37 14 73 31 Variable lease cost 16 101 51 203 Total lease cost $ 1,128 $ 1,272 $ 2,318 $ 2,522 Supplemental Information The table below presents supplemental information related to operating leases (in thousands, except weighted-average information): Six Months Ended August 31, 2022 2021 Cash paid for amounts included in the measurement of operating lease liabilities $ 2,943 $ 2,835 Right-of-use assets obtained in exchange for new operating lease liabilities $ 34 $ 1,919 Weighted average remaining lease term 3.5 years 4.44 years Weighted average discount rate 5.16% 5.17 % Undiscounted Cash Flows The table below reconciles the undiscounted cash flows for each of the first five fiscal years and total of the remaining years to the operating lease liabilities recorded on the condensed consolidated balance sheet as of August 31, 2022 Remainder of 2023 $ 2,920 2024 5,539 2025 3,941 2026 3,077 2027 1,322 Thereafter 477 Total minimum lease payments 17,276 Less imputed interest (1,521 ) Present value of future minimum lease payments 15,755 Less current obligations under leases (5,038 ) Long-term lease obligations $ 10,717 |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Aug. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 9 - INCOME TAXES We use the assets and liabilities method when accounting for income taxes. Under this method, deferred income tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to the taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. We evaluate our estimated annual effective tax rate (“ETR”) on a quarterly basis based on current and forecasted operating results. The relationship between our income tax provision or benefit and our pretax book income or loss can vary significantly from period to period considering, among other factors, the overall level of pretax book income or loss and changes in the blend of jurisdictional income or loss that is taxed at different rates and changes in valuation allowances. The income tax expense of $0.1 million and $0.4 million for the three and six months ended August 31, 2022, respectively, was primarily attributable to one of our foreign subsidiaries. Any income tax benefit associated with the pre-tax loss for the quarter ended August 31, 2022, resulting primarily from the U.S. jurisdiction, is offset by a full valuation allowance. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 6 Months Ended |
Aug. 31, 2022 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | NOTE 10 - EARNINGS PER SHARE Basic earnings (loss) per share is computed by dividing net income (loss) for the period by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income for the period by the weighted average number of common shares outstanding during the period plus the dilutive effect of outstanding stock options and restricted stock-based awards using the treasury stock method. Three Months Ended Six Months Ended August 31, August 31, 2022 2021 2022 2021 Net loss from continuing operations $ (7,494 ) $ (5,425 ) (19,667 ) (11,425 ) Net income from discontinued operations, net of tax - - - 4,052 Net loss $ (7,494 ) $ (5,425 ) $ (19,667 ) $ (7,373 ) Basic weighted average number of common shares outstanding 36,006 35,152 35,864 34,998 Effect of stock options and restricted stock units computed on treasury stock method — — — — Diluted weighted average number of common shares outstanding 36,006 35,152 35,864 34,998 Basic net income (loss) per common share: Loss from continuing operations $ (0.21 ) $ (0.15 ) $ (0.55 ) $ (0.33 ) Income from discontinued operations $ - $ - $ - $ 0.12 Diluted net income (loss) per common share: Loss from continuing operations $ (0.21 ) $ (0.15 ) $ (0.55 ) $ (0.33 ) Income from discontinued operations $ - $ - $ - $ 0.12 All outstanding options and restricted stock units for the three and six months ended August 31, 2022 and 2021 were excluded from the computation of diluted loss per share because we reported a net loss for each of these periods and the effect of inclusion would be antidilutive. We adopted ASU 2020-06 on March 1, 2022 under the modified retrospective method and applied the new guidance to our 2025 Convertible Notes outstanding as of that date. We have not changed previously disclosed amounts or provided additional disclosures for comparative periods. ASU 2020-06 requires the if-converted method to be applied for all convertible instruments when calculating diluted earnings per share. Under the if-converted method, diluted earnings per share will be calculated assuming that all the Convertible Notes were converted solely into shares of common stock at the beginning of the reporting period, unless the result would be anti-dilutive. Since we had a net loss for the three and six months ended August 31, 2022, respectively, the 2025 Convertible Notes were determined to be anti-dilutive and therefore had no impact to basic or diluted net loss per share for the period as a result of adopting the new pronouncement. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 6 Months Ended |
Aug. 31, 2022 | |
Equity [Abstract] | |
STOCKHOLDERS' EQUITY | NOTE 11 – STOCKHOLDERS’ EQUITY Stock-based compensation expense is included in the following captions of the condensed consolidated statements of comprehensive loss (in thousands): Three Months Ended Six Months Ended August 31, August 31, 2022 2021 2022 2021 Cost of revenues $ 30 $ 795 $ 85 $ 789 Research and development 672 321 1,436 1,031 Selling and marketing 749 979 1,309 1,623 General and administrative 1,745 723 3,326 1,783 Other non-operating expense - 119 - 183 $ 3,196 $ 2,937 $ 6,156 $ 5,409 Changes in our outstanding stock options during the six months ended August 31, 2022 were as follows (options in thousands): Number of Options Weighted Average Exercise Price Weighted average remaining contractual life (years) Aggregate intrinsic value Outstanding at February 28, 2022 664 $ 16.38 5.4 Granted — — Exercised — — Forfeited or expired — — Outstanding at August 31, 2022 664 $ 16.38 4.9 $ - Exercisable at August 31, 2022 577 $ 15.94 4.8 $ - Changes in our outstanding restricted stock shares, performance stock units (“PSUs”) and restricted stock units (“RSUs”) during the six months ended August 31, 2022 were as follows (restricted shares, PSUs and RSUs in thousands): Number of Restricted Shares, PSUs and RSUs Weighted Average Grant Date Fair Value Shares Retained to Cover Statutory Withholding Taxes Outstanding at February 28, 2022 2,940 $ 10.39 Granted 2,237 4.65 Vested (857 ) 11.14 327 Forfeited (198 ) 11.13 Outstanding at August 31, 2022 4,122 $ 7.09 As of August 31, 2022, there was $24.0 million of total unrecognized stock-based compensation cost related to outstanding nonvested equity awards that is expected to be recognized as an expense over a weighted-average remaining vesting period of 2.3 years. |
CONCENTRATION OF RISK
CONCENTRATION OF RISK | 6 Months Ended |
Aug. 31, 2022 | |
Risks And Uncertainties [Abstract] | |
CONCENTRATION OF RISK | NOTE 12 - CONCENTRATION OF RISK Significant Customers We sell telematics products and services to large global enterprises in the industrial equipment, transportation and automotive market verticals. One customer in the industrial equipment industry accounted for 17% and 16% of our consolidated revenue for the three and six months ended August 31, 2022, respectively, and 18% and 20% of our consolidated revenue for the three and six months ended August 31, 2021, respectively. The same customer accounted for 14% and 12% of our consolidated accounts receivable at August 31, 2022 and February 28, 2022, respectively. Significant Suppliers We purchase a significant amount of our inventory from certain manufacturers or suppliers including components, assemblies and electronic manufacturing parts. These suppliers are located in Mexico and Asia, including China. The inventory is purchased under standard supply agreements that outline the terms of the product delivery. The title and risk of loss of the product generally pass to us upon shipment from the manufacturer’s plant or warehouse. Three Months Ended August 31, Six Months Ended August 31, 2022 2021 2022 2021 Inventory purchases: Supplier A 9 % 17 % 10 % 18 % Supplier B 14 % 9 % 13 % 11 % Supplier C 17 % 14 % 21 % 14 % Supplier D 11 % 10 % 11 % 12 % August 31, February 28, 2022 2022 Accounts payable: Supplier A 4 % 3 % Supplier B 16 % 15 % Supplier C 15 % 11 % Supplier D 9 % 7 % We are currently reliant upon these manufacturers and suppliers for products. Although we believe that we can obtain products from other sources, the loss of a significant manufacturer or supplier could have a material impact on our financial condition and results of operations as the products that are being purchased may not be available on similar terms from another |
OTHER FINANCIAL INFORMATION
OTHER FINANCIAL INFORMATION | 6 Months Ended |
Aug. 31, 2022 | |
Other Financial Information [Abstract] | |
OTHER FINANCIAL INFORMATION | NOTE 13 – OTHER FINANCIAL INFORMATION Supplemental Balance Sheet Information Other current liabilities consist of the following (in thousands): August 31, February 28, 2022 2022 Operating lease liabilities $ 5,038 $ 5,086 Warranty reserves 1,757 1,823 Customer deposits 2,217 2,586 Omega litigation reserve - 3,000 Other (1) 6,663 6,456 $ 15,675 $ 18,951 (1) Amount represents accruals for various operating expense such as professional fees, vendor incentives and other estimates that are expected to be paid within the next 12 months. Other non-current liabilities consist of the following (in thousands): August 31, February 28, 2022 2022 Deferred revenue $ 12,034 $ 13,496 Deferred compensation plan liability 6,343 6,800 Deferred tax liability 233 216 Other 2,074 2,128 $ 20,684 $ 22,640 Supplemental Statement of Comprehensive Loss Information Interest expense consists of the following (in thousands): Three Months Ended Six Months Ended August 31, August 31, 2022 2021 2022 2021 Interest expense on 2025 Convertible Notes: Stated interest at 2.00% per annum $ 1,150 1,150 $ 2,326 2,326 Amortization of discount and issue costs (1) 262 2,511 529 5,028 1,412 3,661 2,855 7,354 Other interest expense 52 143 142 299 Total interest expense $ 1,464 $ 3,804 $ 2,997 $ 7,653 (1) We adopted ASU 2020-06 during the first quarter of fiscal 2023 using the modified retrospective method. Accordingly, prior year reported amounts were not revised. Supplemental Cash Flow Information “Net cash provided by (used in) operating activities” includes cash payments for interest expense and income taxes as follows (in thousands): Six Months Ended August 31, 2022 2021 Interest expense paid $ 2,408 $ 2,400 Income tax paid, net of refunds $ 75 $ 356 |
SEGMENT INFORMATION AND GEOGRAP
SEGMENT INFORMATION AND GEOGRAPHIC DATA | 6 Months Ended |
Aug. 31, 2022 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION AND GEOGRAPHIC DATA | NOTE 14 - SEGMENT INFORMATION AND GEOGRAPHIC DATA We operate under two reportable segments: Software & Subscription Services and Telematics Products. Our organizational structure is based on a number of factors that our CEO, the Chief Operating Decision Maker (“CODM”), uses to evaluate and operate the business, which include customer base, homogeneity of products, and technology. Our Software & Subscription Services segment offers cloud-based, application enablement and telematics service platforms that facilitate integration of our own applications, as well as those of third parties, through open Application Programing Interfaces (“APIs”) to deliver full-featured IoT solutions to a wide range of customers and markets. Our scalable proprietary SaaS offerings enable rapid and cost-effective deployment of high-value solutions for customers all around the globe. Software & Subscription Services segment revenues include SaaS, professional services, devices sold with monitoring services and amortization of revenues and costs for customized devices functional only with application subscriptions that are not sold separately. Our Telematics Products segment offers a portfolio of wireless data communications products, which includes asset tracking units, mobile telematics devices, fixed and mobile wireless gateways and routers. These wireless networking devices underpin a wide range of our own and third party software and service solutions worldwide and are critical for applications demanding secure, reliable and business-critical communications. Telematics Products segment revenues consist primarily of distinct product sales. Segment information is as follows (in thousands): Three Months Ended August 31, 2022 Three Months Ended August 31, 2021 Reportable Segments Reportable Segments Software & Subscription Services Telematics Products Corporate Expenses Total Software & Subscription Services Telematics Products Corporate Expenses Total Revenues $ 44,511 $ 28,317 $ 72,828 $ 41,434 $ 37,577 $ 79,011 Gross profit $ 20,865 $ 8,147 $ 29,012 $ 21,332 $ 12,038 $ 33,370 Gross margin 47 % 29 % 40 % 51 % 32 % 42 % Adjusted EBITDA $ 6,623 $ (1,244 ) $ (613 ) $ 4,766 $ 9,638 $ (378 ) $ (959 ) $ 8,301 Six Months Ended August 31, 2022 Six Months Ended August 31, 2021 Reportable Segments Reportable Segments Software & Subscription Services Telematics Products Corporate Expenses Total Software & Subscription Services Telematics Products Corporate Expenses Total Revenues $ 84,068 $ 53,486 $ 137,554 $ 76,477 $ 82,208 $ 158,685 Gross profit $ 38,923 $ 15,736 $ 54,659 $ 38,154 $ 27,663 $ 65,817 Gross margin 46 % 29 % 40 % 50 % 34 % 41 % Adjusted EBITDA $ 10,578 $ (1,991 ) $ (1,965 ) $ 6,622 $ 15,532 $ 3,254 $ (2,100 ) $ 16,686 The amount shown for each period in the “Corporate Expenses” column above consists of expenses that are not allocated to the business segments. These non-allocated corporate expenses include salaries and benefits of certain corporate staff and expenses such as audit fees, investor relations, stock listing fees, director and officer liability insurance, and director fees and expenses. Our CODM evaluates each segment based primarily on revenue and Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”), and we therefore consider Adjusted EBITDA to be a primary measure of operating performance of our reportable segments. We define Adjusted EBITDA as earnings before investment income, interest expense, taxes, depreciation, amortization, stock-based compensation, impairment loss and other adjustments as identified below. The adjustments to our net income (losses) prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) to calculate Adjusted EBITDA are itemized below (in thousands): Three Months Ended August 31, Six Months Ended August 31, 2022 2021 2022 2021 Net loss $ (7,494 ) $ (5,425 ) $ (19,667 ) $ (7,373 ) Less: net income from discontinued operations - - $ - $ 4,052 Net loss from continuing operations $ (7,494 ) $ (5,425 ) $ (19,667 ) $ (11,425 ) Investment expense (income) 58 (420 ) 172 (1,068 ) Interest expense 1,464 3,804 2,997 7,653 Income tax provision 126 333 375 626 Depreciation 4,059 4,242 8,215 8,472 Amortization of intangible assets 1,330 1,394 2,672 2,647 Stock-based compensation 3,196 2,937 6,156 5,409 Non-recurring legal expenses 1,417 471 4,548 1,119 Costs incurred in transition of LoJack North America business to acquiror 233 482 985 1,715 Other 377 483 169 1,538 Adjusted EBITDA $ 4,766 $ 8,301 $ 6,622 $ 16,686 Our CODM does not obtain identifiable assets by segment because our businesses share resources, functions and facilities. We do not have significant long-lived assets outside the United States. Revenues by geographic area are as follows (in thousands): Three Months Ended Six Months Ended August 31, August 31, 2022 2021 2022 2021 United States $ 46,240 $ 54,320 $ 86,642 $ 105,520 EMEA 12,275 12,878 24,814 27,353 LATAM 8,189 7,625 14,166 14,150 APAC 5,590 2,794 10,809 8,195 All other 534 1,394 1,123 3,467 $ 72,828 $ 79,011 $ 137,554 $ 158,685 Revenues by geographic area are based upon the country of billing. The geographic location of distributors and OEM customers may be different from the geographic location of the ultimate end users of the products and services provided by us. No single non-U.S. country accounted for more than 10% of our revenue in the three and six months ended August 31, 2022 and 2021. |
LEGAL PROCEEDINGS
LEGAL PROCEEDINGS | 6 Months Ended |
Aug. 31, 2022 | |
Commitments And Contingencies Disclosure [Abstract] | |
LEGAL PROCEEDINGS | NOTE 15 – LEGAL PROCEEDINGS Omega patent infringement claim On April 28, 2022, we filed our Form 10-K for the fiscal year ended February 28, 2022 which disclosed the current status of the Omega Patents LLC (“Omega”) patent infringement claim. The parties commenced a mediation on April 12, 2022, and on May 17, 2022, CalAmp and Omega executed an agreement for a settlement and release and a covenant not to sue under certain patents. On June 1, 2022, we paid $4.9 million pursuant to this settlement agreement. The parties filed a Joint Stipulation of Dismissal With Prejudice on June 15, 2022, and on June 16, 2022, the court dismissed the case with prejudice. Philips patent infringement claim On December 17, 2020, Koninklijke Philips N.V. (“Philips”) filed four separate legal actions against us, and several other companies, accusing the companies of infringing Philips’s 3G and 4G wireless standard-essential patents: (1) first, in the U.S. District Court, District of Delaware, Philips v. Quectel Wireless Solutions Co. Ltd. (“Quectel”), CalAmp, Xirgo Technologies, LLC (“Xirgo”), and Laird Connectivity, Inc. (“Laird”), Philips alleges that our location monitoring units infringe certain claims of U.S. Patent No. 7,831,271 (“the ’271 patent”), U.S. Patent No. 8,199,711 (“the ’711 patent”), U.S. Patent No. 7,554,943 (“the ’943 patent”), and U.S. Patent No. 7,944,935 (“the ’935 patent”) (all four patents collectively, the “Patents”); (2) second, in the U.S. District Court, District of Delaware, Philips v. Telit Wireless Solutions, Inc., Telit Communications Plc, (collectively, “Telit”), and CalAmp, Philips alleges that our location monitoring units and certain modules therein infringe certain claims of the Patents; (3) third, in the U.S. District Court, District of Delaware, Philips v. Thales DIS AIS USA LLC (F/K/A Gemalto IoT LLC “Gemalto”) F/K/A Cinterion Wireless Modules NAFTA LLC (“Cinterion”), Thales DIS AIS Deutschland GmbH (F/K/A Gemalto M2M GmbH), Thales USA, Inc., Thales S.A., (collectively, “Thales”), CalAmp, Xirgo, and Laird, Philips alleges that our location monitoring units infringe certain claims of the Patents, and (4) fourth, before The International Trade Commission (“ITC”), Philips v. Quectel, CalAmp, Xirgo, Laird, Thales, Gemalto, Cinterion, and Telit, Philips alleges violations of section 337 of the U.S. Tariff Act based upon our importation into the United States, the sale for importation, and the sale within the United States after importation of certain UMTS (Universal Mobile Telecommunications System) and LTE (Long Term Evolution) cellular communication modules and products containing the same by reason of our location monitoring units that allegedly infringe on certain claims of the Patents, and seeks (a) an investigation and a hearing under the Tariff Act for unlawful importation of allegedly infringing product, (b) an exclusion order excluding entry into the U.S. of all allegedly infringing communication modules, and (c) a permanent cease and desist order barring the importation, marketing, advertising, and sale of allegedly infringing products in the U.S. On April 1, 2022, the administrative law judge (“ALJ”) at the ITC issued a Final Initial Determination on the question of violation of section 337 (19 U.S.C. § 1337). The ALJ determined that a violation of section 337 has not occurred with respect to any of the asserted patents. On July 6, 2022, the ITC affirmed the Final Initial Determination of no violation of Section 337 and terminated the investigation. The three district court cases are currently stayed. Considering the ITC’s determination of no infringement of any of the four patents asserted resulting from these proceedings paid by those suppliers, who are co-defendants in these proceedings, should the stays be removed in the three district court cases. the three district court cases Additionally, we believe the ultimate resolution of the proceedings, including indemnification and defense by our module suppliers, will not have a material adverse effect on our consolidated results of operations, financial condition, or cash flows. Other matters In addition to the foregoing matters, from time to time as a normal consequence of doing business, various claims and litigation may be asserted or commenced against us. In particular, we may receive claims concerning contract performance or claims that our products or services infringe the intellectual property of third parties which are in the ordinary course of business. While the outcome of any such claims or litigation cannot be predicted with certainty, management does not believe that the outcome of such matters existing at the present time would have a material adverse effect on our condensed consolidated results of operations, financial condition or cash flows. |
DESCRIPTION OF BUSINESS, BASI_2
DESCRIPTION OF BUSINESS, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Aug. 31, 2022 | |
Accounting Policies [Abstract] | |
Description of Business | Description of Business CalAmp Corp. (including its subsidiaries unless the context otherwise requires, “CalAmp”, “the Company”, “we”, “our”, or “us”) is a connected intelligence company that leverages a data-driven solutions ecosystem to help people and organizations improve operational performance. We solve complex problems for customers within the market verticals of transportation and logistics, commercial and government fleets, industrial equipment, and consumer vehicles by providing solutions that track, monitor, and recover their vital assets. The data and insights enabled by CalAmp solutions provide real-time visibility into a user’s vehicles, assets, drivers, and cargo, giving organizations greater understanding and control of their operations. Ultimately, these insights drive operational visibility, safety, efficiency, maintenance, and sustainability for organizations around the world. We are a global organization that is headquartered in Irvine, California . Recent Events COVID-19 In March 2020, the World Health Organization declared COVID-19 (“COVID-19” or the “pandemic”) to be a public health pandemic of international concern, which has led to adverse impacts on the U.S. and global economies and continues to impact our supply chain and operations. More recently, we have experienced supply shortages as a result of global supply imbalances driven by component shortages, disruptions in accessible labor, other freight and logistical challenges and other related macro-economic factors. These supply imbalances negatively impacted all parts of our business during fiscal 2022 and have continued into fiscal 2023. It is difficult to predict the extent to which these factors will continue to impact our future business or operating results, which are highly dependent on uncertain future developments, including the severity of the continuing pandemic, the actions taken or to be taken by governments and private businesses in relation to the resolution of supply chain issues and component shortages. Because our business is dependent on telematics product sales, device installations and related subscription-based services, the ultimate effect of these factors may not be fully reflected in our operating results until future periods. Transition of MRM Telematics Customers to Subscription Arrangements In the second half of fiscal 2022, we prompted a strategic shift with customers who have historically purchased Mobile Resource Management (“MRM”) telematics devices from us. These customers are being transitioned to subscription-based arrangements by way of bundling services with telematics devices under multi-year (generally three years) subscription contracts. Our plan is to transition the MRM business to multi-year subscription contracts over the course of fiscal 2023. As a result, our financial results associated with such subscription arrangements will be reported within our Software & Subscription Services reporting segment prospectively from the effective date of such underlying contracts. In the short term, we expect that this will lead to significant growth in our Software & Subscription Services business with a corresponding decline in our Telematics Products business. Long term we believe this shift will allow us to drive revenue growth as we generate incremental revenue from our existing customer base as well as new customers through current and anticipated broader future subscription service offerings. Basis of Presentation In the opinion of our management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments (consisting of normal recurring adjustments) considered necessary to present fairly our financial position at August 31, 2022 and our results of operations for the three and six months ended August 31, 2022 and 2021. The results of operations for such periods are not necessarily indicative of results to be expected for the full fiscal year ending February 28, 2023. Certain notes and other information included in the audited financial statements in our Annual Report on Form 10-K for the fiscal year ended February 28, 2022 are condensed in or omitted from the interim financial statements presented in this Quarterly Report on Form 10-Q. Therefore, these financial statements should be read in conjunction with our 2022 Annual Report on Form 10-K as filed with the U.S. Securities and Exchange Commission (“SEC”) on April 28, 2022. All intercompany transactions and accounts have been eliminated in consolidation. The accompanying condensed consolidated financial statements have been prepared with the assumption that the Company will continue as a going concern. Based on our current and projected level of operations we believe that our future cash flows from operating activities, our existing cash and cash equivalents and our revolving credit facility will provide adequate funds for ongoing operations and working capital requirements for at least the next 12 months. However, our business is subject to various factors that could materially impact our assumptions leading to the consumption of our available cash before that time. Effective March 15, 2021, the Company and Spireon Holdings, L.P. (“Spireon”) entered into a purchase agreement pursuant to which we sold certain assets and transferred certain liabilities of the LoJack U.S. and Canadian stolen vehicle recovery business (“LoJack North America”) to Spireon for a purchase price of $8.0 million. Operations for LoJack North America are presented as discontinued operations accompanying condensed consolidated financial statements for the three and six months ended August 31, 2021. See Note 2, Discontinued Operations , for additional information. Estimates and Assumptions The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. We have considered all known and reasonably available information that existed throughout the three and six months ended and as of August 31, 2022 in making accounting judgements, estimates and disclosures. We are monitoring the potential effects of the health care related and economic conditions of COVID-19 in assessing certain matters including (but not limited to) supply chain disruptions, decreases in customer demand for our products and services, potential longer-term effects on our customer and distribution channels particularly in the U.S. and relevant end markets as well as other developments. If the impact results in longer term closures of businesses and economic recessionary conditions, we may recognize material asset impairments and charges for uncollectible accounts receivable in future periods. |
Revenue Recognition | Revenue Recognition Revenues from subscription services are recognized ratably on a straight-line basis over the term of the subscription, which generally ranges from two to five years We recognize revenue from telematics product sales upon the transfer of control of promised products to customers in an amount that reflects the transaction price. Customers generally do not have a right of return except for defective products returned during the warranty period. We record estimated commitments related to customer incentive programs as reductions of revenues. From time to time, we provide various professional services to customers. These services include project management, engineering services and installation services, which are often distinct from other performance obligations and are recognized as the related services are performed. For certain professional service contracts, we recognize revenue based on the proportion of total costs incurred to-date over the estimated cost of the contract, which is an input method. In many customer arrangements, subscription services are bundled with the sale or lease of telematics devices within the same contractual arrangement. To determine the performance obligations under these arrangements, we assess the contractual elements and, in particular, whether the telematics products within the arrangement are distinct. This is an area of judgment that includes the consideration of all elements of the arrangement. Significant factors in determining whether telematics devices are distinct are whether such devices are sold separately, as well as the degree of integration and interdependency between the subscription elements of the arrangement and the associated telematics devices. If we conclude that the telematics devices within a customer arrangement are distinct and therefore represent a separate performance obligation, the total expected consideration associated with the contract is allocated between the performance obligations based upon the relative stand-alone selling price associated with each performance obligation. We base stand-alone selling prices on pricing for the same or similar items. For some customer arrangements, we have concluded that the subscription services and associated telematics devices are not distinct performance obligations and thus represent a single combined performance obligation. For certain other customer arrangements under which devices are leased in combination with subscription services, we consider the arrangement to be predominately a subscription service and thus a combined single performance obligation for purposes of revenue recognition. In both of these circumstances, we generally recognize the total expected consideration as revenue over the term of the subscription. Device related costs associated with arrangements in which title to the device is transferred to the customer under a single combined performance obligation are recorded as deferred costs on the balance sheet and are amortized into cost of revenues over the term of the subscription or the estimated in-service lives of the devices. In contractual arrangements under which we provide devices as part of the subscription contract but we retain ownership of the devices, the cost of the devices is capitalized as property and equipment and depreciated over the estimated useful life of three to five years As described above , We exclude from the measurement of the transaction price all taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by us from a customer. The timing of revenue recognition may differ from the timing on our invoicing to customers. Contract assets are comprised of unbilled amounts for which we have transferred products or provided services to our customers and are classified as accounts receivable. Contract liabilities (deferred revenues) are comprised of billings or payments received from our customers in advance of performance under the contract. During the fiscal quarter ended August 31, 2022, we recognized $ 10.8 million in revenue from the deferred revenue balance of $39.7 million as of February 28, 2022. Incremental costs of obtaining a contract with a customer consist of sales commissions, which are recognized on a straight-line basis over the life of the corresponding contracts. Prepaid sales commissions included in prepaid expenses and other current assets and other assets were $1.9 million and $2.8 million, respectively, as of August 31, 2022. We disaggregate revenue from contracts with customers into reportable segments, geography, type of goods and services and timing of revenue recognition. See Note 14, Segment Information and Geographic Data , for our revenue by segment and geography. The disaggregation of revenue by type of goods and services and by timing of revenue recognition is as follows (in thousands): Three Months Ended Six Months Ended August 31, August 31, 2022 2021 2022 2021 Revenue by type of goods and services: Telematics devices and accessories $ 45,694 $ 51,529 $ 85,089 $ 103,526 Rental income and other services 6,656 3,495 10,926 7,105 Recurring application subscriptions 20,478 23,987 41,539 48,054 Total $ 72,828 $ 79,011 $ 137,554 $ 158,685 Three Months Ended Six Months Ended August 31, August 31, 2022 2021 2022 2021 Revenue by timing of revenue recognition: Revenue recognized at a point in time $ 50,685 $ 53,419 $ 92,174 $ 108,123 Revenue recognized over time 22,143 25,592 45,380 50,562 Total $ 72,828 $ 79,011 $ 137,554 $ 158,685 Telematics devices and accessories revenues presented in the table above include devices sold in customer arrangements that include both device and subscription services. Revenues related to recurring application subscriptions include subscription revenues as well as amortization of deferred revenue for contractual arrangements under which the subscription services and associated telematics devices were determined to be a single combined performance obligation. Remaining performance obligations for Software & Subscription Services represents contracted revenue that has not yet been recognized, which includes deferred revenue on our consolidated balance sheets and unbilled amounts that will be recognized as revenue in future periods. As of August 31, 2022 and February 28, 2022, we have estimated remaining performance obligations for contractually committed revenues of $210.3 million and $202.0 million respectively. As of August 31, 2022, we expect to recognize approximately 27% of the revenue under these remaining performance obligations in fiscal 2023 and 33% in fiscal 2024. As of February 28, 2022, we expected to recognize approximately 47% of the then remaining performance obligations in fiscal 2023 and 24% in fiscal 2024. We exclude contracts that have original durations of less than one year from the aforementioned remaining performance obligation disclosure. |
Cash and Cash Equivalents | Cash and Cash Equivalents We consider all highly liquid investments with maturities at date of purchase of three months or less to be cash equivalents. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable consists of amounts due to us from sales arrangements executed in our normal business activities and are recorded at invoiced amounts or in some cases amounts expected to be invoiced. Our payment terms generally range between 30 to 60 days Due to the COVID-19 pandemic and other related macro-economic factors, there has been uncertainty and disruption in the global economy and financial markets. Except for the increase in expected credit losses, we are not aware of any specific event or circumstances that would require an update to our estimates or assumptions or a revision of the carrying value of our assets or liabilities as of the date of this quarterly report. These estimates and assumptions may change as new events occur and additional information is obtained. As a result, actual results could differ materially from these estimates and assumptions. We group all accounts receivables and lease receivables into a single portfolio and analyze the credit risk associated with our accounts receivables and lease receivables. Our historical loss rates have not shown any significant differences between customer industries or geographies. As disclosed in Note 1 4 , Segment Information and Geographic Data , we do not have significant international geographic concentrations of revenue, and, as a result, we do not have significant concentrations of accounts receivables or lease receivables in any single geography outside of the United States. The allowance for doubtful accounts totaled $2.1 million and $2.6 million as of August 31, 2022 and February 28, 2022, respectively. |
Goodwill and Other Long-Lived Assets | Goodwill and Other Long-Lived Assets Goodwill and long-lived assets to be held and used, including identifiable intangible assets, are reviewed for impairment annually in the fourth quarter or whenever events or changes in circumstances indicate that the carrying amount of an asset may not be fully recoverable. These events or changes in circumstances may include a significant deterioration of operating results, changes in business plans or changes in anticipated future cash flows. If an impairment indicator is present, we evaluate recoverability by a comparison of the carrying amount of the assets or reporting unit to the estimated fair value of those assets or reporting unit determined using either an income approach, a market approach, or a combination of both. If the assets are impaired, the impairment recognized is the amount by which the carrying amount exceeds the fair value of the assets. |
Fair Value Measurements | Fair Value Measurements We apply fair value accounting for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in our financial statements. We define fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly manner in an arm’s-length transaction between market participants at the measurement date. Fair value is estimated by using the following hierarchy: Level 1 – Quoted prices in active markets for identical assets or liabilities. Level 2 – Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 – Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability. |
Litigation and Other Contingencies | Litigation and Other Contingencies We accrue for litigation and other contingencies whenever we determine that an unfavorable outcome is probable and a liability is reasonably estimable. The amount of the accrual is estimated based on a review of each claim, including the type and facts of the claim and our assessment of the merits of the claim. These accruals are reviewed at least on a quarterly basis and are adjusted to reflect the impact of recent negotiations, settlements, court rulings, advice from legal counsel and other events pertaining to the case. Such accruals, if any, are recorded as general and administrative expenses in our condensed consolidated statements of comprehensive loss. Although we take considerable measures to mitigate our exposure in these matters, litigation is unpredictable; however, we believe that we have valid defenses with respect to pending legal matters against us as well as adequate provisions for probable and estimable losses. All costs for legal services are expensed as incurred. |
Foreign Currency Translation | Foreign Currency Translation We translate the assets and liabilities of our non-U.S. dollar functional currency subsidiaries into U.S. dollars using exchange rates in effect at the end of each period. Revenue and expenses for these subsidiaries are translated using rates that approximate those in effect during the period. Gains and losses from these translations are recognized in foreign currency translation included in accumulated other comprehensive income (loss) during the period. The aggregate foreign currency transaction exchange rate gain (loss) included in determining income (loss) before income taxes was ($0.3) million and ($0.6) million for the three and six months ended August 31, 2022, respectively. The aggregate foreign currency transaction exchange rate gain (loss) included in determining income (loss) before income taxes was ($14) thousand and $49 thousand for the three and six months ended August 31, 2021, respectively. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) Comprehensive income (loss) consists of two components, net income (loss) and other comprehensive income (loss) (“OCI”). OCI refers to revenue, expenses and gains and losses that under GAAP are recorded as an element of stockholders’ equity and excluded from net income (loss). Our OCI consists of foreign currency translation adjustments from those subsidiaries not using the U.S. dollar as their functional currency. |
Recently Adopted Accounting Pronouncements and Recently Issued Accounting Pronouncements, Not Yet Adopted | Recently Adopted Accounting Pronouncements In August 2020, the Financial Accounting Standards Board (“FASB”) issued ASU 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40) conversion feature or convertible instruments with a beneficial conversion feature. We adopted ASU 2020-06 effec t ive March 1, 2022, the beginning of fiscal 2023, utilizing the modified retrospective approach whereby the cumulative effect of the change in accounting was recognized as an adjustment to the opening balance of retained earnings (accumulated deficit) at the date of adoption . Comparative information has not been restated and continue s to be presented in accordance with accounting standards that were in effect for those periods. Prior to the adoption of ASU 2020-06, we allocated the gross proceeds of the Convertible Notes between the liability and equity components under the cash conversion feature model using the accounting rules in GAAP (ASC 470-20). The carrying amount of the liability component was calculated based on the fair value of a similar debt instrument excluding the embedded conversion option at the issuance date. The carrying amount of the equity component representing the conversion option was calculated by deducting the carrying value of the liability component from the principal amount of the notes as a whole. This difference represented a debt discount and was being amortized to interest expense over the term of the notes using the effective interest rate method. The equity component of the notes was included in stockholders’ equity and was not remeasured as long as it continued to meet the conditions for equity classification. Effective March 1, 2022, we no longer separately present in equity an embedded conversion feature of such debt. Instead, we account for a convertible debt instrument wholly as debt unless (i) the convertible debt instrument contains features that require bifurcation as a derivative or (ii) the convertible debt instrument was issued at a substantial premium. Prior to the adoption of ASU 2020-06, debt issuance costs attributable to the liability component were amortized to interest expense using the effective interest method and debt issuance costs attributable to the equity component were netted with the equity component in stockholders’ equity. Upon adoption, the entire amount of debt issuance costs is reflected as a contra-liability and amortized as interest expense using the effective interest method over the respective term of the notes. We account for the cost of the capped calls as a reduction to additional paid-in capital. After adopting the new guidance, the use of the if-converted method is required when calculating diluted earnings per share (“EPS”) for convertible instruments and The below adoption adjustments were calculated based on the carrying amount of the Convertible Notes as if it had always been treated as a liability only. Furthermore, these adjustments address the debt issuance costs contra-liability and equity (additional paid-in capital) components under the same premise (i.e., as if the total amount of debt issuance costs had always been treated as a contra-liability only). Lastly, we derecognized the deferred income taxes associated with the debt discount and adjusted deferred income taxes relative to unamortized debt issuance costs associated with the Convertible Notes. This resulted in a net increase in gross deferred tax assets of $9.4 million but no impact to the net deferred tax asset balance due to the valuation allowance recorded against our deferred tax assets. We expect lower interest expense related to the Convertible Notes to be recognized in future periods subsequent to adoption as a result of accounting for the Convertible Notes as a single liability measured at amortized cost. The following table summarizes the impact of the adoption of February 28, 2022 ASU 2020-06 March 1, 2022 As Reported Adoption Impact As Adjusted Deferred income tax assets, net $ 4,165 $ - 4,165 Total debt (1) 192,288 37,365 229,653 Additional paid-in-capital 242,386 (67,003 ) 175,383 Accumulated deficit $ (165,965 ) $ 29,639 $ (136,326 ) (1) Prior to adoption, the carrying value of convertible debt represented the principal amount less unamortized debt discount and unamortized debt issuance costs. After adoption, the carrying value of convertible debt represents the principal amount less unamortized debt issuance costs. Recently Issued Accounting Pronouncements, Not Yet Adopted There are currently no accounting standards that have been issued but not yet adopted that we believe will have a significant impact on our unaudited condensed consolidated financial position, results of operations or cash flows. |
DESCRIPTION OF BUSINESS, BASI_3
DESCRIPTION OF BUSINESS, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Aug. 31, 2022 | |
ASU 2014-09 [Member] | |
Disaggregation of Revenue by Type of Goods and Services and by Timing of Revenue Recognition which Reflect the Immaterial Adjustments | Three Months Ended Six Months Ended August 31, August 31, 2022 2021 2022 2021 Revenue by type of goods and services: Telematics devices and accessories $ 45,694 $ 51,529 $ 85,089 $ 103,526 Rental income and other services 6,656 3,495 10,926 7,105 Recurring application subscriptions 20,478 23,987 41,539 48,054 Total $ 72,828 $ 79,011 $ 137,554 $ 158,685 Three Months Ended Six Months Ended August 31, August 31, 2022 2021 2022 2021 Revenue by timing of revenue recognition: Revenue recognized at a point in time $ 50,685 $ 53,419 $ 92,174 $ 108,123 Revenue recognized over time 22,143 25,592 45,380 50,562 Total $ 72,828 $ 79,011 $ 137,554 $ 158,685 |
ASU 2020-06 [Member] | |
Summary of Impact of Adoption of ASU 2020-06 on Opening Consolidated Balance Sheet | The following table summarizes the impact of the adoption of February 28, 2022 ASU 2020-06 March 1, 2022 As Reported Adoption Impact As Adjusted Deferred income tax assets, net $ 4,165 $ - 4,165 Total debt (1) 192,288 37,365 229,653 Additional paid-in-capital 242,386 (67,003 ) 175,383 Accumulated deficit $ (165,965 ) $ 29,639 $ (136,326 ) (1) Prior to adoption, the carrying value of convertible debt represented the principal amount less unamortized debt discount and unamortized debt issuance costs. After adoption, the carrying value of convertible debt represents the principal amount less unamortized debt issuance costs. |
DISCONTINUED OPERATIONS (Tables
DISCONTINUED OPERATIONS (Tables) | 6 Months Ended |
Aug. 31, 2022 | |
Discontinued Operations And Disposal Groups [Abstract] | |
Summary of Financial Results of Discontinued Operations | The amounts in the statement of operations that are included in discontinued operations are summarized in the following table (in thousands): Six Months Ended August 31, 2021 Revenues $ 823 Cost of revenues 950 Gross profit (loss) (127 ) Operating expenses: Research and development 32 Selling and marketing 167 General and administrative 75 Intangible asset amortization 141 Restructuring 404 Impairment losses — Total operating expenses 819 Operating loss from discontinued operations (946 ) Gain on sale of discontinued operations 4,998 Net income from discontinued operations, net of tax $ 4,052 The amounts in the statement of cash flows that are included in discontinued operations are summarized in the following table (in thousands): Six Months Ended August 31, 2021 CASH FLOWS FROM OPERATING ACTIVITIES: Net income from discontinued operations, net of tax $ 4,052 Adjustments to reconcile net income from discontinued operations to net cash used in operating activities: Intangible asset amortization 141 Stock-based compensation 25 Gain on sale of discontinued operations (4,998 ) Changes in operating assets and liabilities: Accounts receivable 452 Inventories 425 Prepaid expenses and other current assets 4 Accounts payable (331 ) Accrued liabilities (135 ) Deferred revenue (30 ) NET CASH USED IN OPERATING ACTIVITIES OF DISCONTINUED OPERATIONS (395 ) CASH FLOWS FROM INVESTING ACTIVITIES: Net proceeds from sale of discontinued operations 6,616 NET CASH PROVIDED BY INVESTING ACTIVITIES OF DISCONTINUED OPERATIONS 6,616 Net change in cash and cash equivalents $ 6,221 |
CASH, CASH EQUIVALENTS AND IN_2
CASH, CASH EQUIVALENTS AND INVESTMENTS (Tables) | 6 Months Ended |
Aug. 31, 2022 | |
Cash And Cash Equivalents [Abstract] | |
Schedule of Cash and Marketable Securities | The following tables summarize our financial instrument assets (in thousands): As of August 31, 2022 Balance Sheet Classification of Fair Value Unrealized Cash and Gains Fair Cash Other Cost (Losses) Value Equivalents Assets Cash $ 26,767 $ — $ 26,767 $ 26,767 $ — Level 1: Money market funds 454 — 454 454 — Mutual funds (1) 1,156 (1 ) 1,155 — 1,155 Level 2: Repurchase agreements 20,500 — 20,500 20,500 — Total $ 48,877 $ (1 ) $ 48,876 $ 47,721 $ 1,155 As of February 28, 2022 Balance Sheet Classification of Fair Value Unrealized Cash and Gains Fair Cash Other Cost (Losses) Value Equivalents Assets Cash $ 28,394 $ — $ 28,394 $ 28,394 $ — Level 1: Money market funds 7,327 — 7,327 7,327 — Mutual funds (1) 851 107 958 — 958 Level 2: Repurchase agreements 43,500 — 43,500 43,500 — Total $ 80,072 $ 107 $ 80,179 $ 79,221 $ 958 (1) Amounts represent various equities, bond and money market mutual funds that are held in an irrevocable “Rabbi Trust” for payment obligations to non-qualified deferred compensation plan participants. In addition to the mutual funds above, our “Rabbi Trust” also included Corporate-Owned Life Insurance (COLI) starting in fiscal 2020. As of August 31, 2022, the cash surrender value of COLI was $5.5 million. |
INVENTORIES (Tables)
INVENTORIES (Tables) | 6 Months Ended |
Aug. 31, 2022 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories consist of the following (in thousands): August 31, February 28, 2022 2022 Raw materials $ 8,447 $ 6,090 Finished goods 13,698 12,179 $ 22,145 $ 18,269 |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 6 Months Ended |
Aug. 31, 2022 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Schedule of Other Intangible Assets | Other intangible assets consist of the following (in thousands): Gross (2) Accumulated Amortization (2) Net Useful Life Feb. 28, 2022 Additions & Adjustments, net (1) August 31, 2022 Feb. 28, 2022 Expense August 31, 2022 Feb. 28, 2022 August 31, 2022 Developed technology 4-6 years $ 26,958 (102 ) $ 26,856 $ 25,470 $ 632 $ 26,102 $ 1,488 $ 754 Tradenames 10 years 30,192 (205 ) 29,987 20,571 1,067 21,638 9,621 8,349 Customer relationships 10-15 years 35,404 (217 ) 35,187 14,883 969 15,852 20,521 19,335 Patents 5 years 589 — 589 254 4 258 335 331 $ 93,143 $ (524 ) $ 92,619 $ 61,178 $ 2,672 $ 63,850 $ 31,965 $ 28,769 (1) Amounts also include any net changes in intangible asset balances for the periods presented that resulted from foreign currency translations. (2) This table excludes the gross value of fully amortized intangible assets totaling $23.0 |
Schedule of Future Amortization Expense | Estimated future amortization expense as of August 31, 2022 is as follows (in thousands): 2023 (remainder) $ 2,640 2024 4,440 2025 4,325 2026 4,056 2027 2,435 Thereafter 10,873 $ 28,769 |
Schedule of Goodwill | Changes in goodwill are as follows (in thousands): Software & Subscription Services Telematics Products Total Balance as of February 28, 2022 $ 55,256 $ 39,180 $ 94,436 Effect of exchange rate change on goodwill (1,059 ) — (1,059 ) Balance as of August 31, 2022 $ 54,197 $ 39,180 $ 93,377 |
OTHER ASSETS (Tables)
OTHER ASSETS (Tables) | 6 Months Ended |
Aug. 31, 2022 | |
Other Assets Noncurrent Disclosure [Abstract] | |
Schedule of Other Assets | Other assets consist of the following (in thousands): August 31, February 28, 2022 2022 Deferred product cost $ 1,135 $ 1,493 Deferred compensation plan assets 6,692 7,215 Lease receivables, non-current 17,161 15,118 Prepaid commissions 2,750 2,894 Other 3,084 2,912 $ 30,822 $ 29,632 |
FINANCING ARRANGEMENTS (Tables)
FINANCING ARRANGEMENTS (Tables) | 6 Months Ended |
Aug. 31, 2022 | |
Debt Disclosure [Abstract] | |
Summary of Debt | The following table provides a summary of our debt as of August 31, 2022 and February 28, 2022 (in thousands): Maturity Effective August 31, February 28, Date Interest Rate 2022 2022 2025 Convertible Notes, 2.00% fixed rate (2) August 1, 2025 2.49 % 230,000 230,000 Due to factors under revenue assignments 2020 - 2024 4.70 % 2,305 3,829 Total term debt 232,305 233,829 Unamortized discount and issuance costs (1) (3,585 ) (41,541 ) Less: Current portion of long-term term debt (1,828 ) (2,585 ) Long-term debt, net of current portion $ 226,892 $ 189,703 (1) The debt discount associated with the Convertible Notes and related unamortized debt issuance costs as of August 31, 2022 reflects the adoption impact of ASU 2020-06 effective March 1, 2022. See Note 1, Significant Accounting Policies – Recent Accounting Pronouncements , for further information regarding the adoption of ASU 2020-06. (2) The effective interest rate was 7.56% prior to the adoption of ASU 2020-06. |
LEASES (Tables)
LEASES (Tables) | 6 Months Ended |
Aug. 31, 2022 | |
Leases [Abstract] | |
Summary of Lease-related Assets and Liabilities | The table below presents lease-related assets and liabilities recorded on the condensed consolidated balance sheet (in thousands): August 31, 2022 February 28, 2022 Assets Operating lease right-of-use assets $ 10,367 $ 12,327 Liabilities Operating lease liabilities (current) $ 5,038 $ 5,086 Operating lease liabilities (non-current) 10,717 13,382 Total lease liabilities $ 15,755 $ 18,468 |
Summary of Lease Costs Included in Condensed Consolidated Statements of Comprehensive Loss | The following lease costs were included in our condensed consolidated statements of comprehensive loss as follows (in thousands): Three months ended August 31, Six Months Ended August 31, 2022 2021 2022 2021 Operating lease cost $ 1,075 $ 1,157 $ 2,194 $ 2,288 Short-term lease cost 37 14 73 31 Variable lease cost 16 101 51 203 Total lease cost $ 1,128 $ 1,272 $ 2,318 $ 2,522 |
Schedule of Supplemental Information Related to Operating Leases | The table below presents supplemental information related to operating leases (in thousands, except weighted-average information): Six Months Ended August 31, 2022 2021 Cash paid for amounts included in the measurement of operating lease liabilities $ 2,943 $ 2,835 Right-of-use assets obtained in exchange for new operating lease liabilities $ 34 $ 1,919 Weighted average remaining lease term 3.5 years 4.44 years Weighted average discount rate 5.16% 5.17 % |
Schedule of Reconciles the Undiscounted Cash Flows for Operating Lease Liabilities | The table below reconciles the undiscounted cash flows for each of the first five fiscal years and total of the remaining years to the operating lease liabilities recorded on the condensed consolidated balance sheet as of August 31, 2022 Remainder of 2023 $ 2,920 2024 5,539 2025 3,941 2026 3,077 2027 1,322 Thereafter 477 Total minimum lease payments 17,276 Less imputed interest (1,521 ) Present value of future minimum lease payments 15,755 Less current obligations under leases (5,038 ) Long-term lease obligations $ 10,717 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 6 Months Ended |
Aug. 31, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of Weighted Average Number of Shares | The calculation of the basic and diluted loss per share of common stock is as follows (in thousands, except per share value): Three Months Ended Six Months Ended August 31, August 31, 2022 2021 2022 2021 Net loss from continuing operations $ (7,494 ) $ (5,425 ) (19,667 ) (11,425 ) Net income from discontinued operations, net of tax - - - 4,052 Net loss $ (7,494 ) $ (5,425 ) $ (19,667 ) $ (7,373 ) Basic weighted average number of common shares outstanding 36,006 35,152 35,864 34,998 Effect of stock options and restricted stock units computed on treasury stock method — — — — Diluted weighted average number of common shares outstanding 36,006 35,152 35,864 34,998 Basic net income (loss) per common share: Loss from continuing operations $ (0.21 ) $ (0.15 ) $ (0.55 ) $ (0.33 ) Income from discontinued operations $ - $ - $ - $ 0.12 Diluted net income (loss) per common share: Loss from continuing operations $ (0.21 ) $ (0.15 ) $ (0.55 ) $ (0.33 ) Income from discontinued operations $ - $ - $ - $ 0.12 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 6 Months Ended |
Aug. 31, 2022 | |
Equity [Abstract] | |
Schedule of Stock-based Compensation Expense | Stock-based compensation expense is included in the following captions of the condensed consolidated statements of comprehensive loss (in thousands): Three Months Ended Six Months Ended August 31, August 31, 2022 2021 2022 2021 Cost of revenues $ 30 $ 795 $ 85 $ 789 Research and development 672 321 1,436 1,031 Selling and marketing 749 979 1,309 1,623 General and administrative 1,745 723 3,326 1,783 Other non-operating expense - 119 - 183 $ 3,196 $ 2,937 $ 6,156 $ 5,409 |
Summary of Stock Option Activity | Changes in our outstanding stock options during the six months ended August 31, 2022 were as follows (options in thousands): Number of Options Weighted Average Exercise Price Weighted average remaining contractual life (years) Aggregate intrinsic value Outstanding at February 28, 2022 664 $ 16.38 5.4 Granted — — Exercised — — Forfeited or expired — — Outstanding at August 31, 2022 664 $ 16.38 4.9 $ - Exercisable at August 31, 2022 577 $ 15.94 4.8 $ - |
Summary of Restricted Stock Shares (RSU's), and Performance Stock Units (PSU's) Activity | Changes in our outstanding restricted stock shares, performance stock units (“PSUs”) and restricted stock units (“RSUs”) during the six months ended August 31, 2022 were as follows (restricted shares, PSUs and RSUs in thousands): Number of Restricted Shares, PSUs and RSUs Weighted Average Grant Date Fair Value Shares Retained to Cover Statutory Withholding Taxes Outstanding at February 28, 2022 2,940 $ 10.39 Granted 2,237 4.65 Vested (857 ) 11.14 327 Forfeited (198 ) 11.13 Outstanding at August 31, 2022 4,122 $ 7.09 |
CONCENTRATION OF RISK (Tables)
CONCENTRATION OF RISK (Tables) | 6 Months Ended |
Aug. 31, 2022 | |
Risks And Uncertainties [Abstract] | |
Schedule of Significant Customers and Significant Suppliers Concentration Risk Percentage | Some of these manufacturers accounted for more than 10% of our purchases and accounts payable as follows (rounded): Three Months Ended August 31, Six Months Ended August 31, 2022 2021 2022 2021 Inventory purchases: Supplier A 9 % 17 % 10 % 18 % Supplier B 14 % 9 % 13 % 11 % Supplier C 17 % 14 % 21 % 14 % Supplier D 11 % 10 % 11 % 12 % August 31, February 28, 2022 2022 Accounts payable: Supplier A 4 % 3 % Supplier B 16 % 15 % Supplier C 15 % 11 % Supplier D 9 % 7 % |
OTHER FINANCIAL INFORMATION (Ta
OTHER FINANCIAL INFORMATION (Tables) | 6 Months Ended |
Aug. 31, 2022 | |
Other Financial Information [Abstract] | |
Schedule of Supplemental Balance Sheet Information | Supplemental Balance Sheet Information Other current liabilities consist of the following (in thousands): August 31, February 28, 2022 2022 Operating lease liabilities $ 5,038 $ 5,086 Warranty reserves 1,757 1,823 Customer deposits 2,217 2,586 Omega litigation reserve - 3,000 Other (1) 6,663 6,456 $ 15,675 $ 18,951 (1) Amount represents accruals for various operating expense such as professional fees, vendor incentives and other estimates that are expected to be paid within the next 12 months. Other non-current liabilities consist of the following (in thousands): August 31, February 28, 2022 2022 Deferred revenue $ 12,034 $ 13,496 Deferred compensation plan liability 6,343 6,800 Deferred tax liability 233 216 Other 2,074 2,128 $ 20,684 $ 22,640 |
Schedule of Interest Expense | Supplemental Statement of Comprehensive Loss Information Interest expense consists of the following (in thousands): Three Months Ended Six Months Ended August 31, August 31, 2022 2021 2022 2021 Interest expense on 2025 Convertible Notes: Stated interest at 2.00% per annum $ 1,150 1,150 $ 2,326 2,326 Amortization of discount and issue costs (1) 262 2,511 529 5,028 1,412 3,661 2,855 7,354 Other interest expense 52 143 142 299 Total interest expense $ 1,464 $ 3,804 $ 2,997 $ 7,653 (1) We adopted ASU 2020-06 during the first quarter of fiscal 2023 using the modified retrospective method. Accordingly, prior year reported amounts were not revised. |
Schedule of Supplemental Cash Flow Information | “Net cash provided by (used in) operating activities” includes cash payments for interest expense and income taxes as follows (in thousands): Six Months Ended August 31, 2022 2021 Interest expense paid $ 2,408 $ 2,400 Income tax paid, net of refunds $ 75 $ 356 |
SEGMENT INFORMATION AND GEOGR_2
SEGMENT INFORMATION AND GEOGRAPHIC DATA (Tables) | 6 Months Ended |
Aug. 31, 2022 | |
Segment Reporting [Abstract] | |
Summary of Segment Information | Segment information is as follows (in thousands): Three Months Ended August 31, 2022 Three Months Ended August 31, 2021 Reportable Segments Reportable Segments Software & Subscription Services Telematics Products Corporate Expenses Total Software & Subscription Services Telematics Products Corporate Expenses Total Revenues $ 44,511 $ 28,317 $ 72,828 $ 41,434 $ 37,577 $ 79,011 Gross profit $ 20,865 $ 8,147 $ 29,012 $ 21,332 $ 12,038 $ 33,370 Gross margin 47 % 29 % 40 % 51 % 32 % 42 % Adjusted EBITDA $ 6,623 $ (1,244 ) $ (613 ) $ 4,766 $ 9,638 $ (378 ) $ (959 ) $ 8,301 Six Months Ended August 31, 2022 Six Months Ended August 31, 2021 Reportable Segments Reportable Segments Software & Subscription Services Telematics Products Corporate Expenses Total Software & Subscription Services Telematics Products Corporate Expenses Total Revenues $ 84,068 $ 53,486 $ 137,554 $ 76,477 $ 82,208 $ 158,685 Gross profit $ 38,923 $ 15,736 $ 54,659 $ 38,154 $ 27,663 $ 65,817 Gross margin 46 % 29 % 40 % 50 % 34 % 41 % Adjusted EBITDA $ 10,578 $ (1,991 ) $ (1,965 ) $ 6,622 $ 15,532 $ 3,254 $ (2,100 ) $ 16,686 |
Summary of Adjusted EBITDA | The adjustments to our net income (losses) prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) to calculate Adjusted EBITDA are itemized below (in thousands): Three Months Ended August 31, Six Months Ended August 31, 2022 2021 2022 2021 Net loss $ (7,494 ) $ (5,425 ) $ (19,667 ) $ (7,373 ) Less: net income from discontinued operations - - $ - $ 4,052 Net loss from continuing operations $ (7,494 ) $ (5,425 ) $ (19,667 ) $ (11,425 ) Investment expense (income) 58 (420 ) 172 (1,068 ) Interest expense 1,464 3,804 2,997 7,653 Income tax provision 126 333 375 626 Depreciation 4,059 4,242 8,215 8,472 Amortization of intangible assets 1,330 1,394 2,672 2,647 Stock-based compensation 3,196 2,937 6,156 5,409 Non-recurring legal expenses 1,417 471 4,548 1,119 Costs incurred in transition of LoJack North America business to acquiror 233 482 985 1,715 Other 377 483 169 1,538 Adjusted EBITDA $ 4,766 $ 8,301 $ 6,622 $ 16,686 |
Summary of Revenues by Geographic Area | Revenues by geographic area are as follows (in thousands): Three Months Ended Six Months Ended August 31, August 31, 2022 2021 2022 2021 United States $ 46,240 $ 54,320 $ 86,642 $ 105,520 EMEA 12,275 12,878 24,814 27,353 LATAM 8,189 7,625 14,166 14,150 APAC 5,590 2,794 10,809 8,195 All other 534 1,394 1,123 3,467 $ 72,828 $ 79,011 $ 137,554 $ 158,685 |
DESCRIPTION OF BUSINESS, BASI_4
DESCRIPTION OF BUSINESS, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Mar. 15, 2021 | Aug. 31, 2022 | Aug. 31, 2021 | Aug. 31, 2022 | Aug. 31, 2021 | Feb. 28, 2022 | |
Description Of Business Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | ||||||
Revenue recognized | $ 10,800 | |||||
Unearned revenue | $ 39,700 | |||||
Contracted not recognized revenue | 210,300 | $ 210,300 | 202,000 | |||
Allowance for doubtful accounts | 2,100 | 2,100 | $ 2,600 | |||
Foreign transaction exchange gain (loss) | (300) | $ (14) | (600) | $ 49 | ||
Dross deferred tax assets | 9,400 | 9,400 | ||||
Prepaid Expenses and Other Current Assets [Member] | ||||||
Description Of Business Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | ||||||
Prepaid sales commissions | 1,900 | 1,900 | ||||
Other Assets [Member] | ||||||
Description Of Business Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | ||||||
Prepaid sales commissions | $ 2,800 | $ 2,800 | ||||
Minimum [Member] | ||||||
Description Of Business Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | ||||||
Subscription services estimated useful life | 2 years | |||||
Accounts receivable payment period | 30 days | |||||
Minimum [Member] | Telematics Products [Member] | ||||||
Description Of Business Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | ||||||
Estimated useful life | 3 years | |||||
Maximum [Member] | ||||||
Description Of Business Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | ||||||
Subscription services estimated useful life | 5 years | |||||
Accounts receivable payment period | 60 days | |||||
Accounts receivable payment extended period | 90 days | |||||
Maximum [Member] | Telematics Products [Member] | ||||||
Description Of Business Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | ||||||
Estimated useful life | 5 years | |||||
Spireon Holdings, L.P. [Member] | ||||||
Description Of Business Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | ||||||
Purchase price | $ 8,000 |
DESCRIPTION OF BUSINESS, BASI_5
DESCRIPTION OF BUSINESS, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Disaggregation of Revenue by Type of Goods and Services and by Timing of Revenue Recognition which Reflect the Immaterial Adjustments) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Aug. 31, 2022 | Aug. 31, 2021 | Aug. 31, 2022 | Aug. 31, 2021 | |
Disaggregation Of Revenue [Line Items] | ||||
Revenues | $ 72,828 | $ 79,011 | $ 137,554 | $ 158,685 |
Telematics Devices and Accessories [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenues | 45,694 | 51,529 | 85,089 | 103,526 |
Rental Income and Other Services [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenues | 6,656 | 3,495 | 10,926 | 7,105 |
Recurring Application Subscriptions [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenues | 20,478 | 23,987 | 41,539 | 48,054 |
Revenue Recognized At Point In Time [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenues | 50,685 | 53,419 | 92,174 | 108,123 |
Revenue Recognized Over Time [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenues | $ 22,143 | $ 25,592 | $ 45,380 | $ 50,562 |
DESCRIPTION OF BUSINESS, BASI_6
DESCRIPTION OF BUSINESS, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Narrative 1) (Details) | Aug. 31, 2022 | Feb. 28, 2022 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2022-03-01 | ||
Description Of Business Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | ||
Revenue, remaining performance obligation expect to recognize in percentage | 47% | |
Revenue, remaining Performance obligation, expected timing of satisfaction, year | 2023 | |
Revenue, remaining Performance obligation, expected timing of satisfaction, period | 1 year | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2022-09-01 | ||
Description Of Business Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | ||
Revenue, remaining performance obligation expect to recognize in percentage | 27% | |
Revenue, remaining Performance obligation, expected timing of satisfaction, year | 2023 | |
Revenue, remaining Performance obligation, expected timing of satisfaction, period | 9 months | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2023-03-01 | ||
Description Of Business Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | ||
Revenue, remaining performance obligation expect to recognize in percentage | 33% | 24% |
Revenue, remaining Performance obligation, expected timing of satisfaction, year | 2024 | 2024 |
Revenue, remaining Performance obligation, expected timing of satisfaction, period | 1 year | 1 year |
DESCRIPTION OF BUSINESS, BASI_7
DESCRIPTION OF BUSINESS, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Summary of Impact of Adoption of ASU 2020-06 on Opening Consolidated Balance Sheet) (Details) - USD ($) $ in Thousands | Aug. 31, 2022 | Mar. 01, 2022 | Feb. 28, 2022 | |
New Accounting Pronouncements Or Change In Accounting Principle [Line Items] | ||||
Deferred income tax assets, net | $ 3,633 | $ 4,165 | $ 4,165 | |
Total debt | [1] | 229,653 | 192,288 | |
Additional paid-in-capital | 180,463 | 175,383 | 242,386 | |
Accumulated deficit | $ (155,993) | (136,326) | $ (165,965) | |
ASU 2020-06 [Member] | ||||
New Accounting Pronouncements Or Change In Accounting Principle [Line Items] | ||||
Total debt | [1] | 37,365 | ||
Additional paid-in-capital | (67,003) | |||
Accumulated deficit | $ 29,639 | |||
[1]Prior to adoption, the carrying value of convertible debt represented the principal amount less unamortized debt discount and unamortized debt issuance costs. After adoption, the carrying value of convertible debt represents the principal amount less unamortized debt issuance costs. |
DISCONTINUED OPERATIONS (Narrat
DISCONTINUED OPERATIONS (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Nov. 09, 2021 | Aug. 31, 2022 | Aug. 31, 2021 | Aug. 31, 2022 | Aug. 31, 2021 | Feb. 28, 2022 | Mar. 15, 2021 | |
Spireon Holdings, L.P. [Member] | |||||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||||||
Total cost | $ 0.7 | $ 1.2 | $ 2 | $ 3.3 | |||
Service [Member] | Spireon Holdings, L.P. [Member] | |||||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||||||
Total cost | 0.5 | 0.6 | 1 | 1.4 | |||
Other Expense [Member] | Spireon Holdings, L.P. [Member] | |||||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||||||
Total cost | $ 0.2 | $ 0.6 | 1 | $ 1.9 | |||
LoJack North America [Member] | |||||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||||||
Discontinued operation, upfront cash consideration | $ 8 | ||||||
Purchase price reduced | $ 0.9 | ||||||
Net proceeds received from licensing intellectual property rights | $ 6.6 | ||||||
Gain on the sale of business | $ 4.1 |
DISCONTINUED OPERATIONS (Summar
DISCONTINUED OPERATIONS (Summary of Statement of Operations Included in Discontinued Operations) (Details) - LoJack North America [Member] $ in Thousands | 6 Months Ended |
Aug. 31, 2021 USD ($) | |
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |
Revenues | $ 823 |
Cost of revenues | 950 |
Gross profit (loss) | (127) |
Operating expenses: | |
Research and development | 32 |
Selling and marketing | 167 |
General and administrative | 75 |
Intangible asset amortization | 141 |
Restructuring | 404 |
Total operating expenses | 819 |
Operating loss from discontinued operations | (946) |
Gain on sale of discontinued operations | 4,998 |
Net income from discontinued operations, net of tax | $ 4,052 |
DISCONTINUED OPERATIONS (Summ_2
DISCONTINUED OPERATIONS (Summary of Statement of Cash Flows That Are Included in Discontinued Operations) (Details) $ in Thousands | 6 Months Ended |
Aug. 31, 2021 USD ($) | |
Changes in operating assets and liabilities: | |
NET CASH USED IN OPERATING ACTIVITIES OF DISCONTINUED OPERATIONS | $ (395) |
CASH FLOWS FROM INVESTING ACTIVITIES: | |
NET CASH PROVIDED BY INVESTING ACTIVITIES OF DISCONTINUED OPERATIONS | 6,616 |
LoJack North America [Member] | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |
Net income from discontinued operations, net of tax | 4,052 |
Adjustments to reconcile net income from discontinued operations to net cash used in operating activities: | |
Intangible asset amortization | 141 |
Stock-based compensation | 25 |
Gain on sale of discontinued operations | (4,998) |
Changes in operating assets and liabilities: | |
Accounts receivable | 452 |
Inventories | 425 |
Prepaid expenses and other current assets | 4 |
Accounts payable | (331) |
Accrued liabilities | (135) |
Deferred revenue | (30) |
NET CASH USED IN OPERATING ACTIVITIES OF DISCONTINUED OPERATIONS | (395) |
CASH FLOWS FROM INVESTING ACTIVITIES: | |
Net proceeds from sale of discontinued operations | 6,616 |
NET CASH PROVIDED BY INVESTING ACTIVITIES OF DISCONTINUED OPERATIONS | 6,616 |
Net change in cash and cash equivalents | $ 6,221 |
CASH, CASH EQUIVALENTS AND IN_3
CASH, CASH EQUIVALENTS AND INVESTMENTS (Details) - USD ($) $ in Thousands | Aug. 31, 2022 | Feb. 28, 2022 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cost | $ 48,877 | $ 80,072 | |
Unrealized Gains (Losses) | (1) | 107 | |
Fair Value | 48,876 | 80,179 | |
Cash and Cash Equivalents [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair Value | 47,721 | 79,221 | |
Other Assets [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair Value | 1,155 | 958 | |
Cash [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cost | 26,767 | 28,394 | |
Unrealized Gains (Losses) | |||
Fair Value | 26,767 | 28,394 | |
Cash [Member] | Cash and Cash Equivalents [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair Value | 26,767 | 28,394 | |
Cash [Member] | Other Assets [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair Value | |||
Money Market Funds [Member] | Fair Value, Inputs, Level 1 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cost | 454 | 7,327 | |
Unrealized Gains (Losses) | |||
Fair Value | 454 | 7,327 | |
Money Market Funds [Member] | Fair Value, Inputs, Level 1 [Member] | Cash and Cash Equivalents [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair Value | 454 | 7,327 | |
Money Market Funds [Member] | Fair Value, Inputs, Level 1 [Member] | Other Assets [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair Value | |||
Mutual Fund [Member] | Fair Value, Inputs, Level 1 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cost | [1] | 1,156 | 851 |
Unrealized Gains (Losses) | [1] | (1) | 107 |
Fair Value | [1] | 1,155 | 958 |
Mutual Fund [Member] | Fair Value, Inputs, Level 1 [Member] | Cash and Cash Equivalents [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair Value | [1] | ||
Mutual Fund [Member] | Fair Value, Inputs, Level 1 [Member] | Other Assets [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair Value | [1] | 1,155 | 958 |
Repurchase Agreements [Member] | Fair Value, Inputs, Level 2 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cost | 20,500 | 43,500 | |
Unrealized Gains (Losses) | |||
Fair Value | 20,500 | 43,500 | |
Repurchase Agreements [Member] | Fair Value, Inputs, Level 2 [Member] | Cash and Cash Equivalents [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair Value | 20,500 | 43,500 | |
Repurchase Agreements [Member] | Fair Value, Inputs, Level 2 [Member] | Other Assets [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair Value | |||
[1]Amounts represent various equities, bond and money market mutual funds that are held in an irrevocable “Rabbi Trust” for payment obligations to non-qualified deferred compensation plan participants. In addition to the mutual funds above, our “Rabbi Trust” also included Corporate-Owned Life Insurance (COLI) starting in fiscal 2020. As of August 31, 2022, the cash surrender value of COLI was $5.5 million. |
CASH, CASH EQUIVALENTS AND IN_4
CASH, CASH EQUIVALENTS AND INVESTMENTS (Parenthetical) (Details) $ in Millions | Aug. 31, 2022 USD ($) |
Cash And Cash Equivalents [Abstract] | |
Cash surrender value of Corporate-Owned Life Insurance (COLI) | $ 5.5 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Aug. 31, 2022 | Feb. 28, 2022 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 8,447 | $ 6,090 |
Finished goods | 13,698 | 12,179 |
Inventories | $ 22,145 | $ 18,269 |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS (Schedule of Other Intangible Assets) (Details) $ in Thousands | 6 Months Ended | |
Aug. 31, 2022 USD ($) | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross, Beginning balance | $ 93,143 | [1] |
Additions & Adjustments, net | (524) | [1],[2] |
Gross, Ending balance | 92,619 | [1] |
Accumulated Amortization, Beginning balance | 61,178 | [1] |
Expense | 2,672 | [1] |
Accumulated Amortization, Ending balance | 63,850 | [1] |
Net beginning | 31,965 | |
Net ending | 28,769 | |
Developed Technology Rights [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross, Beginning balance | 26,958 | [1] |
Additions & Adjustments, net | (102) | [1],[2] |
Gross, Ending balance | 26,856 | [1] |
Accumulated Amortization, Beginning balance | 25,470 | [1] |
Expense | 632 | [1] |
Accumulated Amortization, Ending balance | 26,102 | [1] |
Net beginning | 1,488 | |
Net ending | $ 754 | |
Developed Technology Rights [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization period | 4 years | |
Developed Technology Rights [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization period | 6 years | |
Trade Names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization period | 10 years | |
Gross, Beginning balance | $ 30,192 | [1] |
Additions & Adjustments, net | (205) | [1],[2] |
Gross, Ending balance | 29,987 | [1] |
Accumulated Amortization, Beginning balance | 20,571 | [1] |
Expense | 1,067 | [1] |
Accumulated Amortization, Ending balance | 21,638 | [1] |
Net beginning | 9,621 | |
Net ending | 8,349 | |
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross, Beginning balance | 35,404 | [1] |
Additions & Adjustments, net | (217) | [1],[2] |
Gross, Ending balance | 35,187 | [1] |
Accumulated Amortization, Beginning balance | 14,883 | [1] |
Expense | 969 | [1] |
Accumulated Amortization, Ending balance | 15,852 | [1] |
Net beginning | 20,521 | |
Net ending | $ 19,335 | |
Customer Relationships [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization period | 10 years | |
Customer Relationships [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization period | 15 years | |
Patents [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization period | 5 years | |
Gross, Beginning balance | $ 589 | [1] |
Gross, Ending balance | 589 | [1] |
Accumulated Amortization, Beginning balance | 254 | [1] |
Expense | 4 | [1] |
Accumulated Amortization, Ending balance | 258 | [1] |
Net beginning | 335 | |
Net ending | $ 331 | |
[1] This table excludes the gross value of fully amortized intangible assets totaling $23.0 Amounts also include any net changes in intangible asset balances for the periods presented that resulted from foreign currency translations. |
GOODWILL AND OTHER INTANGIBLE_4
GOODWILL AND OTHER INTANGIBLE ASSETS (Schedule of Other Intangible Assets) (Parenthetical) (Details) - USD ($) $ in Millions | Aug. 31, 2022 | Feb. 28, 2022 |
Goodwill And Intangible Assets Disclosure [Abstract] | ||
Gross value of fully amortized intangible assets | $ 23 | $ 23 |
GOODWILL AND OTHER INTANGIBLE_5
GOODWILL AND OTHER INTANGIBLE ASSETS (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Aug. 31, 2022 | Aug. 31, 2021 | Aug. 31, 2022 | Aug. 31, 2021 | |
Goodwill And Intangible Assets Disclosure [Abstract] | ||||
Intangible asset amortization | $ 1,330 | $ 1,394 | $ 2,672 | $ 2,647 |
GOODWILL AND OTHER INTANGIBLE_6
GOODWILL AND OTHER INTANGIBLE ASSETS (Schedule of Future Amortization Expense) (Details) - USD ($) $ in Thousands | Aug. 31, 2022 | Feb. 28, 2022 |
Fiscal Year | ||
2023 (remainder) | $ 2,640 | |
2024 | 4,440 | |
2025 | 4,325 | |
2026 | 4,056 | |
2027 | 2,435 | |
Thereafter | 10,873 | |
Net | $ 28,769 | $ 31,965 |
GOODWILL AND OTHER INTANGIBLE_7
GOODWILL AND OTHER INTANGIBLE ASSETS (Schedule of Goodwill) (Details) $ in Thousands | 6 Months Ended |
Aug. 31, 2022 USD ($) | |
Goodwill [Line Items] | |
Balance as of February 28, 2022 | $ 94,436 |
Effect of exchange rate change on goodwill | (1,059) |
Balance as of August 31, 2022 | 93,377 |
Software & Subscription Services [Member] | |
Goodwill [Line Items] | |
Balance as of February 28, 2022 | 55,256 |
Effect of exchange rate change on goodwill | (1,059) |
Balance as of August 31, 2022 | 54,197 |
Telematics Products [Member] | |
Goodwill [Line Items] | |
Balance as of February 28, 2022 | 39,180 |
Balance as of August 31, 2022 | $ 39,180 |
OTHER ASSETS (Schedule of Other
OTHER ASSETS (Schedule of Other Assets) (Details) - USD ($) $ in Thousands | Aug. 31, 2022 | Feb. 28, 2022 |
Other Assets Noncurrent Disclosure [Abstract] | ||
Deferred product cost | $ 1,135 | $ 1,493 |
Deferred compensation plan assets | 6,692 | 7,215 |
Lease receivables, non-current | 17,161 | 15,118 |
Prepaid commissions | 2,750 | 2,894 |
Other | 3,084 | 2,912 |
Total | $ 30,822 | $ 29,632 |
FINANCING ARRANGEMENTS (Summary
FINANCING ARRANGEMENTS (Summary of Debt) (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Aug. 31, 2022 | Feb. 28, 2022 | ||
Debt Instrument [Line Items] | |||
Effective Interest Rate | 7.56% | 7.56% | |
Total term debt | $ 232,305 | $ 233,829 | |
Unamortized discount and issuance costs | [1] | (3,585) | (41,541) |
Less: Current portion of long-term term debt | (1,828) | (2,585) | |
Long-term debt, net of current portion | $ 226,892 | 189,703 | |
2025 Convertible Notes, 2.00% Fixed Rate [Member] | |||
Debt Instrument [Line Items] | |||
Maturity Date | [2] | Aug. 01, 2025 | |
Effective Interest Rate | [2] | 2.49% | |
Total term debt | [2] | $ 230,000 | 230,000 |
Due to Factors Under Revenue Assignment [Member] | |||
Debt Instrument [Line Items] | |||
Effective Interest Rate | 4.70% | ||
Maturity Date | 2020 2021 2022 2023 2024 | ||
Total term debt | $ 2,305 | $ 3,829 | |
[1] The debt discount associated with the Convertible Notes and related unamortized debt issuance costs as of August 31, 2022 reflects the adoption impact of ASU 2020-06 effective March 1, 2022. See Note 1, Significant Accounting Policies – Recent Accounting Pronouncements , for further information regarding the adoption of ASU 2020-06. |
FINANCING ARRANGEMENTS (Summa_2
FINANCING ARRANGEMENTS (Summary of Debt) (Parenthetical) (Details) | Aug. 31, 2022 | Feb. 28, 2022 | |
Debt Instrument [Line Items] | |||
Effective Interest Rate | 7.56% | 7.56% | |
2025 Convertible Notes, 2.00% Fixed Rate [Member] | |||
Debt Instrument [Line Items] | |||
Fixed interest rate | 2% | 2% | |
Effective Interest Rate | [1] | 2.49% | |
[1]The effective interest rate was 7.56% prior to the adoption of ASU 2020-06. |
FINANCING ARRANGEMENTS (Details
FINANCING ARRANGEMENTS (Details) | 1 Months Ended | 6 Months Ended | ||
Jul. 31, 2018 USD ($) $ / shares shares | Aug. 31, 2022 USD ($) | Jul. 13, 2022 USD ($) | Feb. 28, 2022 USD ($) | |
Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | $ 50,000,000 | |||
Maturity date | Jul. 13, 2025 | |||
Line of credit facility, borrowing capacity, description | On July 13, 2022, we replaced our revolving credit facility with JP Morgan Chase Bank, N.A. and we entered into a new revolving credit facility with PNC Bank, N.A., that provides for an asset-based senior secured revolving credit facility for borrowings up to an aggregate of $50.0 million, subject to certain conditions, including borrowing base provisions that limit borrowing capacity to 80% of eligible accounts receivable and 50% of eligible inventory. | |||
Borrowings outstanding | $ 0 | |||
Line of credit facility borrowing availability | 34,000,000 | |||
Unused availability of credit facility amount | 40,000,000 | |||
Revolving Credit Facility | PNC Bank [Member] | ||||
Debt Instrument [Line Items] | ||||
Unused availability of credit facility amount | $ 25,000,000 | |||
Revolving Credit Facility | Accounts Receivable [Member] | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility borrowing capacity eligible percentage | 80% | |||
Revolving Credit Facility | Inventory [Member] | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility borrowing capacity eligible percentage | 50% | |||
Revolving Credit Facility | Bloomberg Short-Term Bank Yield Rate [Member] | ||||
Debt Instrument [Line Items] | ||||
Variable interest rate | 2.50% | |||
Revolving Credit Facility | Base Rate [Member] | ||||
Debt Instrument [Line Items] | ||||
Variable interest rate | 1.50% | |||
Revolving Credit Facility | Minimum [Member] | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility, Unused fee percentage | 0.50% | |||
Line of credit, fixed charge coverage rate | 1.10% | |||
Revolving Credit Facility | Maximum [Member] | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility, Unused fee percentage | 0.75% | |||
Line of credit, fixed charge coverage rate | 1% | |||
2025 Convertible Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, face amount | $ 230,000,000 | |||
Maturity date | Aug. 01, 2025 | |||
Fixed interest rate | 2% | |||
Debt instrument, redemption, description | We may redeem the notes at our option at any time on or after August 6, 2022 at a cash redemption price equal to the principal amount plus accrued interest, but only if the last reported sale price per share of our stock exceeds 130% of the conversion price on (i) each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending on, and including, the trading day immediately before the date we send the related redemption notice; and (ii) the trading day immediately before the date we send such notice. | |||
Initial conversion price | $ / shares | $ 30.7450 | |||
Number of common stock with hedge transactions | shares | 7,480,000 | |||
Conversion rate of shares of common stock | 41.3875 | |||
Payments for notes hedges | $ 21,200,000 | |||
Purchase of note hedges, net of tax | 15,900,000 | |||
2025 Convertible Notes [Member] | Additional Paid-in Capital [Member] | ||||
Debt Instrument [Line Items] | ||||
Notes charge, equity component | $ 51,900,000 | |||
2025 Convertible Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Fair value of convertible notes | $ 204,000,000 | $ 209,000,000 |
LEASES (Summary of Lease-relate
LEASES (Summary of Lease-related Assets and Liabilities) (Details) - USD ($) $ in Thousands | Aug. 31, 2022 | Feb. 28, 2022 |
Schedule Of Lease Assets And Liabilities [Abstract] | ||
Operating lease right-of-use assets | $ 10,367 | $ 12,327 |
Operating lease liabilities (current) | $ 5,038 | $ 5,086 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Other current liabilities | Other current liabilities |
Operating lease liabilities (non-current) | $ 10,717 | $ 13,382 |
Total lease liabilities | $ 15,755 | $ 18,468 |
LEASES (Summary of Lease Costs
LEASES (Summary of Lease Costs Included in Condensed Consolidated Statements of Comprehensive Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Aug. 31, 2022 | Aug. 31, 2021 | Aug. 31, 2022 | Aug. 31, 2021 | |
Lease Cost [Abstract] | ||||
Operating lease cost | $ 1,075 | $ 1,157 | $ 2,194 | $ 2,288 |
Short-term lease cost | 37 | 14 | 73 | 31 |
Variable lease cost | 16 | 101 | 51 | 203 |
Total lease cost | $ 1,128 | $ 1,272 | $ 2,318 | $ 2,522 |
LEASES (Schedule of Supplementa
LEASES (Schedule of Supplemental Information Related to Operating Leases) (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Aug. 31, 2022 | Aug. 31, 2021 | |
Leases [Abstract] | ||
Cash paid for amounts included in the measurement of operating lease liabilities | $ 2,943 | $ 2,835 |
Right-of-use assets obtained in exchange for new operating lease liabilities | $ 34 | $ 1,919 |
Weighted average remaining lease term | 3 years 6 months | 4 years 5 months 8 days |
Weighted average discount rate | 5.16% | 5.17% |
LEASES (Schedule of Reconciles
LEASES (Schedule of Reconciles the Undiscounted Cash Flows for Operating Lease Liabilities) (Details) - USD ($) $ in Thousands | Aug. 31, 2022 | Feb. 28, 2022 |
Operating Lease Liabilities Payments Due [Abstract] | ||
Remainder of 2023 | $ 2,920 | |
2024 | 5,539 | |
2025 | 3,941 | |
2026 | 3,077 | |
2027 | 1,322 | |
Thereafter | 477 | |
Total minimum lease payments | 17,276 | |
Less imputed interest | (1,521) | |
Total lease liabilities | 15,755 | $ 18,468 |
Less current obligations under leases | (5,038) | (5,086) |
Long-term lease obligations | $ 10,717 | $ 13,382 |
INCOME TAXES (Narrative) (Detai
INCOME TAXES (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Aug. 31, 2022 | Aug. 31, 2021 | Aug. 31, 2022 | Aug. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||||
Income tax expense (benefit) | $ 126 | $ 333 | $ 375 | $ 626 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Aug. 31, 2022 | Aug. 31, 2021 | Aug. 31, 2022 | Aug. 31, 2021 | |
Earnings Per Share [Abstract] | ||||
Net loss from continuing operations | $ (7,494) | $ (5,425) | $ (19,667) | $ (11,425) |
Net income from discontinued operations, net of tax | 4,052 | |||
Net loss | $ (7,494) | $ (5,425) | $ (19,667) | $ (7,373) |
Basic weighted average number of common shares outstanding | 36,006 | 35,152 | 35,864 | 34,998 |
Diluted weighted average number of common shares outstanding | 36,006 | 35,152 | 35,864 | 34,998 |
Basic net income (loss) per common share: | ||||
Loss from continuing operations | $ (0.21) | $ (0.15) | $ (0.55) | $ (0.33) |
Income from discontinued operations | 0.12 | |||
Diluted net income (loss) per common share: | ||||
Loss from continuing operations | $ (0.21) | $ (0.15) | $ (0.55) | (0.33) |
Income from discontinued operations | $ 0.12 |
STOCKHOLDERS' EQUITY (Schedule
STOCKHOLDERS' EQUITY (Schedule of Stock-based Compensation Expense) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Aug. 31, 2022 | Aug. 31, 2021 | Aug. 31, 2022 | Aug. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | $ 3,196 | $ 2,937 | $ 6,156 | $ 5,409 |
Cost of Revenues [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | 30 | 795 | 85 | 789 |
Research and Development [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | 672 | 321 | 1,436 | 1,031 |
Selling and Marketing [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | 749 | 979 | 1,309 | 1,623 |
General and Administrative [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | $ 1,745 | 723 | $ 3,326 | 1,783 |
Other Non-Operating Expense [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | $ 119 | $ 183 |
STOCKHOLDERS' EQUITY (Summary o
STOCKHOLDERS' EQUITY (Summary of Stock Option Activity) (Details) - $ / shares shares in Thousands | 6 Months Ended | |
Feb. 28, 2022 | Aug. 31, 2022 | |
Number of Options | ||
Outstanding, beginning balance | 664 | |
Granted | ||
Exercised | ||
Forfeited or expired | ||
Outstanding, ending balance | 664 | 664 |
Exercisable | 577 | |
Weighted Average Exercise Price | ||
Outstanding, beginning balance | $ 16.38 | |
Granted | ||
Exercised | ||
Forfeited or expired | ||
Outstanding, ending balance | $ 16.38 | 16.38 |
Exercisable | $ 15.94 | |
Weighted average remaining contractual life, Outstanding | 5 years 4 months 24 days | 4 years 10 months 24 days |
Weighted average remaining contractual life, Exercisable | 4 years 9 months 18 days |
STOCKHOLDERS' EQUITY (Summary_2
STOCKHOLDERS' EQUITY (Summary of Restricted Stock Shares and RSUs Activity) (Details) shares in Thousands | 6 Months Ended |
Aug. 31, 2022 $ / shares shares | |
Number of Restricted Shares, PSUs and RSUs | |
Outstanding, beginning balance | 2,940 |
Granted | 2,237 |
Vested | (857) |
Forfeited | (198) |
Outstanding, ending balance | 4,122 |
Weighted Average Grant Date Fair Value | |
Outstanding, beginning balance | $ / shares | $ 10.39 |
Granted | $ / shares | 4.65 |
Vested | $ / shares | 11.14 |
Forfeited | $ / shares | 11.13 |
Outstanding, ending balance | $ / shares | $ 7.09 |
Vested, Shares Retained to Cover Statutory Withholding Taxes | 327 |
STOCKHOLDERS' EQUITY (Narrative
STOCKHOLDERS' EQUITY (Narrative) (Details) $ in Millions | 6 Months Ended |
Aug. 31, 2022 USD ($) | |
Equity [Abstract] | |
Unrecognized share-based compensation cost | $ 24 |
Unrecognized compensation cost, recognition period | 2 years 3 months 18 days |
CONCENTRATION OF RISK (Narrativ
CONCENTRATION OF RISK (Narrative) (Details) | 3 Months Ended | 6 Months Ended | 12 Months Ended |
Aug. 31, 2022 | Aug. 31, 2022 | Feb. 28, 2022 | |
Customer Concentration Risk [Member] | Major Customer One [Member] | Industrial Equipment Industry [Member] | Revenues [Member] | |||
Concentration Risk [Line Items] | |||
Concentration percentage | 17% | 16% | |
Customer Concentration Risk [Member] | Major Customer One [Member] | Industrial Equipment Industry [Member] | Accounts Receivable [Member] | |||
Concentration Risk [Line Items] | |||
Concentration percentage | 14% | 12% | |
Supplier Concentration Risk | Accounts Payable [Member] | Minimum [Member] | |||
Concentration Risk [Line Items] | |||
Concentration percentage | 10% |
CONCENTRATION OF RISK - Schedul
CONCENTRATION OF RISK - Schedule of Significant Customers and Significant Suppliers Concentration Risk Percentage (Details) - Supplier Concentration Risk | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Aug. 31, 2022 | Aug. 31, 2021 | Aug. 31, 2022 | Aug. 31, 2021 | Feb. 28, 2022 | |
Inventory Purchases [Member] | Supplier A [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration percentage | 9% | 17% | 10% | 18% | |
Inventory Purchases [Member] | Supplier B [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration percentage | 14% | 9% | 13% | 11% | |
Inventory Purchases [Member] | Supplier C [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration percentage | 17% | 14% | 21% | 14% | |
Inventory Purchases [Member] | Supplier D [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration percentage | 11% | 10% | 11% | 12% | |
Accounts Payable [Member] | Supplier A [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration percentage | 4% | 3% | |||
Accounts Payable [Member] | Supplier B [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration percentage | 16% | 15% | |||
Accounts Payable [Member] | Supplier C [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration percentage | 15% | 11% | |||
Accounts Payable [Member] | Supplier D [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration percentage | 9% | 7% |
OTHER FINANCIAL INFORMATION (Sc
OTHER FINANCIAL INFORMATION (Schedule of Other Current Liabilities) (Details) - USD ($) $ in Thousands | Aug. 31, 2022 | Feb. 28, 2022 | |
Other Financial Information Schedule Of Other Current Liabilities Details [Abstract] | |||
Operating lease liabilities | $ 5,038 | $ 5,086 | |
Warranty reserves | 1,757 | 1,823 | |
Customer deposits | 2,217 | 2,586 | |
Omega litigation reserve | 3,000 | ||
Other | [1] | 6,663 | 6,456 |
Total other current liabilities | $ 15,675 | $ 18,951 | |
[1] Amount represents accruals for various operating expense such as professional fees, vendor incentives and other estimates that are expected to be paid within the next 12 months. |
OTHER FINANCIAL INFORMATION (_2
OTHER FINANCIAL INFORMATION (Schedule of Other Non-Current Liabilities) (Details) - USD ($) $ in Thousands | Aug. 31, 2022 | Feb. 28, 2022 |
Other Financial Information [Abstract] | ||
Deferred revenue | $ 12,034 | $ 13,496 |
Deferred compensation plan liability | 6,343 | 6,800 |
Deferred tax liability | 233 | 216 |
Other | 2,074 | 2,128 |
Total other non-current liabilities | $ 20,684 | $ 22,640 |
OTHER FINANCIAL INFORMATION (_3
OTHER FINANCIAL INFORMATION (Schedule of Interest Expense) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Aug. 31, 2022 | Aug. 31, 2021 | Aug. 31, 2022 | Aug. 31, 2021 | ||
Condensed Income Statements, Captions [Line Items] | |||||
Amortization of discount and issue costs | $ 594 | $ 5,191 | |||
Other interest expense | $ 52 | $ 143 | 142 | 299 | |
Total interest expense | 1,464 | 3,804 | 2,997 | 7,653 | |
2025 Convertible Notes [Member] | |||||
Condensed Income Statements, Captions [Line Items] | |||||
Stated interest | 1,150 | 1,150 | 2,326 | 2,326 | |
Amortization of discount and issue costs | [1] | 262 | 2,511 | 529 | 5,028 |
Interest expense on convertible notes | $ 1,412 | $ 3,661 | $ 2,855 | $ 7,354 | |
[1]We adopted ASU 2020-06 during the first quarter of fiscal 2023 using the modified retrospective method. Accordingly, prior year reported amounts were not revised |
OTHER FINANCIAL INFORMATION (_4
OTHER FINANCIAL INFORMATION (Schedule of Interest Expense) (Parenthetical) (Details) | Aug. 31, 2022 | Aug. 31, 2021 |
2025 Convertible Notes [Member] | ||
Condensed Income Statements, Captions [Line Items] | ||
Interest rate (as a percent) | 2% | 2% |
OTHER FINANCIAL INFORMATION (_5
OTHER FINANCIAL INFORMATION (Schedule of Cash Payments for Interest and Income Taxes) (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Aug. 31, 2022 | Aug. 31, 2021 | |
Supplemental Cash Flow Information [Abstract] | ||
Interest expense paid | $ 2,408 | $ 2,400 |
Income tax paid, net of refunds | $ 75 | $ 356 |
SEGMENT INFORMATION AND GEOGR_3
SEGMENT INFORMATION AND GEOGRAPHIC DATA (Narrative) (Details) | 6 Months Ended |
Aug. 31, 2022 Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
SEGMENT INFORMATION AND GEOGR_4
SEGMENT INFORMATION AND GEOGRAPHIC DATA (Schedule of Segment Information) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Aug. 31, 2022 | Aug. 31, 2021 | Aug. 31, 2022 | Aug. 31, 2021 | |
Segment Reporting Information [Line Items] | ||||
Revenues | $ 72,828 | $ 79,011 | $ 137,554 | $ 158,685 |
Gross profit | $ 29,012 | $ 33,370 | $ 54,659 | $ 65,817 |
Gross margin | 40% | 42% | 40% | 41% |
Adjusted EBITDA | $ 4,766 | $ 8,301 | $ 6,622 | $ 16,686 |
Operating Segments [Member] | Software & Subscription Services [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 44,511 | 41,434 | 84,068 | 76,477 |
Gross profit | $ 20,865 | $ 21,332 | $ 38,923 | $ 38,154 |
Gross margin | 47% | 51% | 46% | 50% |
Adjusted EBITDA | $ 6,623 | $ 9,638 | $ 10,578 | $ 15,532 |
Operating Segments [Member] | Telematics Products [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 28,317 | 37,577 | 53,486 | 82,208 |
Gross profit | $ 8,147 | $ 12,038 | $ 15,736 | $ 27,663 |
Gross margin | 29% | 32% | 29% | 34% |
Adjusted EBITDA | $ (1,244) | $ (378) | $ (1,991) | $ 3,254 |
Corporate Expenses [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Adjusted EBITDA | $ (613) | $ (959) | $ (1,965) | $ (2,100) |
SEGMENT INFORMATION AND GEOGR_5
SEGMENT INFORMATION AND GEOGRAPHIC DATA (Summary of Adjusted EBITDA) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Aug. 31, 2022 | Aug. 31, 2021 | Aug. 31, 2022 | Aug. 31, 2021 | |
Segment Information Summary Of Adjustments Results Of Ebitda Details [Abstract] | ||||
Net loss | $ (7,494) | $ (5,425) | $ (19,667) | $ (7,373) |
Less: Net income from discontinued operations, net of tax | 4,052 | |||
Net loss from continuing operations | (7,494) | (5,425) | (19,667) | (11,425) |
Investment expense (income) | 58 | (420) | 172 | (1,068) |
Interest expense | 1,464 | 3,804 | 2,997 | 7,653 |
Income tax expense (benefit) | 126 | 333 | 375 | 626 |
Depreciation | 4,059 | 4,242 | 8,215 | 8,472 |
Intangible asset amortization | 1,330 | 1,394 | 2,672 | 2,647 |
Stock-based compensation | 3,196 | 2,937 | 6,156 | 5,409 |
Non-recurring legal expenses | 1,417 | 471 | 4,548 | 1,119 |
Costs incurred in transition of LoJack North America business to acquiror | 233 | 482 | 985 | 1,715 |
Other | 377 | 483 | 169 | 1,538 |
Adjusted EBITDA | $ 4,766 | $ 8,301 | $ 6,622 | $ 16,686 |
SEGMENT INFORMATION AND GEOGR_6
SEGMENT INFORMATION AND GEOGRAPHIC DATA (Summary of Revenues by Geographic Area) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Aug. 31, 2022 | Aug. 31, 2021 | Aug. 31, 2022 | Aug. 31, 2021 | |
Segment Reporting Information [Line Items] | ||||
Revenues | $ 72,828 | $ 79,011 | $ 137,554 | $ 158,685 |
United States [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 46,240 | 54,320 | 86,642 | 105,520 |
EMEA [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 12,275 | 12,878 | 24,814 | 27,353 |
LATAM [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 8,189 | 7,625 | 14,166 | 14,150 |
APAC [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 5,590 | 2,794 | 10,809 | 8,195 |
All other [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | $ 534 | $ 1,394 | $ 1,123 | $ 3,467 |
LEGAL PROCEEDINGS (Legal Procee
LEGAL PROCEEDINGS (Legal Proceedings) (Details) $ in Millions | Jun. 01, 2022 USD ($) | Dec. 17, 2020 Legalaction Patent |
Commitments And Contingencies Disclosure [Abstract] | ||
Litigation settlement payment | $ | $ 4.9 | |
Number of legal actions filed | Legalaction | 4 | |
Number of patents, not infringed | Patent | 4 |