| The Company and a Summary of Its Significant Accounting Policies (Policies) | 12 Months Ended |
| Mar. 31, 2016 |
| Accounting Policies [Abstract] | |
| Principles of consolidation | The
Company’s consolidated financial statements include the
assets, liabilities and results of operations of ViaSat, its wholly
owned subsidiaries and TrellisWare Technologies, Inc.
(TrellisWare), a majority-owned subsidiary. All significant
intercompany amounts have been eliminated. |
| Fiscal period | On May 4,
2015, the Company’s Board of Directors approved a change in
the Company’s fiscal year from a 52 or 53 week fiscal year
ending on the Friday closest to March 31 to a fiscal year
ending on March 31 of each year, effective with the fiscal
year commencing April 4, 2015. Beginning April 4, 2015,
the Company’s fiscal quarters end on
June 30, September 30, December 31, and
March 31 of each year. Fiscal year 2014 was a 53 week year,
compared to a 52 week year in fiscal year 2015. Fiscal year 2016
was slightly shorter than 52 weeks due to the change in fiscal year
beginning April 4, 2015. The Company does not believe that these
differences in length of year had any material impact on its
financial results. |
| Management estimates and assumptions | Management estimates and assumptions
The preparation
of financial statements in conformity with accounting principles
generally accepted in the United States of America (GAAP) requires
management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial
statements, and reported amounts of revenues and expenses during
the reporting period. Estimates have been prepared on the basis of
the most current and best available information and actual results
could differ from those estimates. Significant estimates made by
management include revenue recognition, stock-based compensation,
self-insurance reserves, allowance for doubtful accounts, warranty
accruals, valuation of goodwill and other intangible assets,
patents, orbital slots and other licenses, software development,
property, equipment and satellites, long-lived assets, derivatives,
contingencies and income taxes including the valuation allowance on
deferred tax assets. |
| Cash equivalents | Cash
equivalents
Cash
equivalents consist of highly liquid investments with original
maturities of three months or less at the date of
purchase. |
| Accounts receivable and allowance for doubtful accounts | Accounts receivable, unbilled accounts receivable and
allowance for doubtful accounts
The Company
records receivables at net realizable value including an allowance
for estimated uncollectible accounts. The allowance for doubtful
accounts is based on the Company’s assessment of the
collectability of customer accounts. The Company regularly reviews
the allowance by considering factors such as historical experience,
credit quality, the age of accounts receivable balances and current
economic conditions that may affect a customer’s ability to
pay. Amounts determined to be uncollectible are charged or written
off against the reserve. Historically, the Company’s
allowance for doubtful accounts has been minimal primarily because
a significant portion of its sales has been to the
U.S. government or with respect to its satellite services
commercial business, the Company bills and collects in
advance. |
| Unbilled accounts receivable | Unbilled
accounts receivables consist of costs and fees earned and billable
on contract completion or other specified events. Unbilled accounts
receivables are generally expected to be billed and collected
within one year. |
| Concentration of risk | Concentration of risk
Financial
instruments that potentially subject the Company to significant
concentrations of credit risk consist primarily of cash equivalents
and accounts receivable which are generally not collateralized. The
Company limits its exposure to credit loss by placing its cash
equivalents with high credit quality financial institutions and
investing in high quality short-term debt instruments. The Company
establishes customer credit policies related to its accounts
receivable based on historical collection experiences within the
various markets in which the Company operates, historical past due
amounts and any specific information that the Company becomes aware
of such as bankruptcy or liquidity issues of customers.
Revenues from
the U.S. government as an individual customer comprised
approximately 23.7%, 22.8% and 21.2% of total revenues for fiscal
years 2016, 2015 and 2014, respectively. Billed accounts receivable
to the U.S. government as of March 31, 2016 and
April 3, 2015 were approximately 22.8% and 30.6%,
respectively, of total billed receivables. In addition, none of the
Company’s commercial customers comprised 10.0% or more of
total revenues for fiscal years 2016, 2015 and 2014. The
Company’s five largest contracts generated approximately
19.4%, 21.1% and 26.4% of the Company’s total revenues for
the fiscal years ended March 31, 2016, April 3, 2015 and
April 4, 2014, respectively.
The Company
relies on a limited number of contract manufacturers to produce its
products. |
| Inventory | Inventory
Inventory is
valued at the lower of cost or market, cost being determined by the
weighted average cost method. |
| Property, equipment and satellites | Property, equipment and satellites
Satellites
and other property and equipment are recorded at cost or, in the
case of certain satellites and other property acquired, the fair
value at the date of acquisition, net of accumulated depreciation.
Capitalized satellite costs consist primarily of the costs of
satellite construction and launch, including launch insurance and
insurance during the period of in-orbit testing, the net present
value of performance incentives expected to be payable to satellite
manufacturers (dependent on the continued satisfactory performance
of the satellites), costs directly associated with the monitoring
and support of satellite construction, and interest costs incurred
during the period of satellite construction. The Company also
constructs earth stations, network operations systems and other
assets to support its satellites, and those construction costs,
including interest, are capitalized as incurred. At the time
satellites are placed in service, the Company estimates the useful
life of its satellites for depreciation purposes based upon an
analysis of each satellite’s performance against the original
manufacturer’s orbital design life, estimated fuel levels and
related consumption rates, as well as historical satellite
operating trends. The Company computes depreciation using the
straight-line method over the estimated useful lives of the assets
ranging from two to twenty-four years. Leasehold improvements are
capitalized and amortized using the straight-line method over the
shorter of the lease term or the life of the improvement. Costs
incurred for additions to property, equipment and satellites,
together with major renewals and betterments, are capitalized and
depreciated over the remaining life of the underlying asset. Costs
incurred for maintenance, repairs and minor renewals and
betterments are charged to expense as incurred. When assets are
sold or otherwise disposed of, the cost and related accumulated
depreciation or amortization are removed from the accounts and any
resulting gain or loss is recognized in operations, which for the
periods presented, primarily related to losses incurred for
unreturned customer premise equipment (CPE).
Interest
expense is capitalized on the carrying value of assets under
construction, in accordance with the authoritative guidance for the
capitalization of interest (Accounting Standards Codification (ASC)
835-20). With respect to assets under construction, including the
ViaSat-2 satellite which commenced construction during the first
quarter of fiscal year 2014, the Company capitalized $30.1 million,
$16.2 million, and $8.1 million of interest expense during the
fiscal years ended March 31, 2016, April 3, 2015 and
April 4, 2014, respectively.
The Company
owns two satellites: ViaSat-1 (its first-generation high-capacity
Ka-band spot-beam satellite, which was placed into service in
January 2012) and WildBlue-1 (which was placed into service in
March 2007). During the first quarter of fiscal year 2014, the
Company entered into a satellite construction contract for its
ViaSat-2 satellite, its second-generation high-capacity Ka-band
satellite design. In addition, construction has commenced on two
ViaSat-3 class satellites, the Company’s third-generation
high-capacity Ka-band satellite design, pursuant to a limited
authorization to proceed. The Company also has an exclusive prepaid
lifetime capital lease of Ka-band capacity over the contiguous
United States on Telesat Canada’s Anik F2 satellite (which
was placed into service in April 2005) and owns related earth
stations and networking equipment for all of its satellites. The
Company periodically reviews the remaining estimated useful life of
its satellites to determine if revisions to estimated lives are
necessary. The Company procures indoor and outdoor CPE units leased
to subscribers under a retail leasing program as part of the
Company’s satellite services segment, which are reflected in
investing activities and property and equipment in the accompanying
consolidated financial statements. The Company depreciates the
satellites, earth stations and networking equipment, CPE units and
related installation costs over their estimated useful lives. The
total cost and accumulated depreciation of CPE units included in
property and equipment, net, as of March 31, 2016 were
$260.4 million and $136.4 million, respectively. The
total cost and accumulated depreciation of CPE units included in
property and equipment, net, as of April 3, 2015 were
$250.3 million and $107.8 million,
respectively.
Occasionally,
the Company may enter into capital lease arrangements for various
machinery, equipment, computer-related equipment, software,
furniture or fixtures. The Company records amortization of assets
leased under capital lease arrangements within depreciation
expense. |
| Capitalized interest policy | Interest
expense is capitalized on the carrying value of assets under
construction, in accordance with the authoritative guidance for the
capitalization of interest (Accounting Standards Codification (ASC)
835-20). |
| Goodwill and intangible assets | Goodwill and intangible assets
The
authoritative guidance for business combinations (ASC
805) requires that all business combinations be accounted for
using the purchase method. The authoritative guidance for business
combinations also specifies criteria for recognizing and reporting
intangible assets apart from goodwill; however, acquired workforce
must be recognized and reported in goodwill. The authoritative
guidance for goodwill and other intangible assets (ASC
350) requires that intangible assets with an indefinite life
should not be amortized until their life is determined to be
finite. All other intangible assets must be amortized over their
useful life. The authoritative guidance for goodwill and other
intangible assets prohibits the amortization of goodwill and
indefinite-lived intangible assets, but instead requires these
assets to be tested for impairment at least annually and more
frequently upon the occurrence of specified events. In addition,
all goodwill must be assigned to reporting units for purposes of
impairment testing. |
| Patents, orbital slots and other licenses | Patents, orbital slots and other
licenses
The Company
capitalizes the costs of obtaining or acquiring patents, orbital
slots and other licenses. Amortization of intangible assets that
have finite lives is provided for by the straight-line method over
the shorter of the legal or estimated economic life. Total
capitalized costs of $3.2 million related to patents were
included in other assets as of March 31, 2016 and
April 3, 2015. The Company capitalized costs of $15.4 million
and $15.1 million related to acquiring and obtaining orbital slots
and other licenses included in other assets as of March 31,
2016 and April 3, 2015, respectively. Accumulated amortization
related to these assets was $1.7 million and $1.4 million as
of March 31, 2016 and April 3, 2015, respectively.
Amortization expense related to these assets was an insignificant
amount for the fiscal years ended March 31, 2016,
April 3, 2015 and April 4, 2014. If a patent, orbital
slot or orbital license is rejected, abandoned or otherwise
invalidated, the unamortized cost is expensed in that period.
During fiscal years 2016, 2015 and 2014, the Company did not write
off any significant costs due to abandonment or
impairment. |
| Debt issuance costs | Debt
issuance costs
Debt issuance
costs are amortized and recognized as interest expense using the
effective interest rate method, or, when the results are not
materially different, on a straight-line basis over the expected
term of the related debt. During fiscal year 2016, the Company
capitalized an insignificant amount of debt issuance costs. During
fiscal years 2015 and 2014, the Company capitalized
$3.5 million and $2.5 million, respectively, of debt
issuance costs. Unamortized debt issuance costs related to
extinguished debt are expensed at the time the debt is extinguished
and recorded in loss on extinguishment of debt in the consolidated
statements of operations and comprehensive income (loss). Other
unamortized debt issuance costs are recorded in prepaid expenses
and other current assets and in other long-term assets in the
consolidated balance sheets, depending on the amounts expected to
be amortized to interest expense within the next twelve
months. |
| Software development | Software
development
Costs of
developing software for sale are charged to research and
development expense when incurred, until technological feasibility
has been established. Software development costs incurred from the
time technological feasibility is reached until the product is
available for general release to customers are capitalized and
reported at the lower of unamortized cost or net realizable value.
Once the product is available for general release, the software
development costs are amortized based on the ratio of current to
future revenue for each product with an annual minimum equal to
straight-line amortization over the remaining estimated economic
life of the product, generally within five years. Capitalized
costs, net, of $163.1 million and $119.9 million related to
software developed for resale were included in other assets as of
March 31, 2016 and April 3, 2015, respectively. The
Company capitalized $75.4 million and $52.4 million of
costs related to software developed for resale for fiscal years
ended March 31, 2016 and April 3, 2015, respectively.
Amortization expense for software development costs was $32.2
million, $23.5 million and $11.1 million during fiscal years 2016,
2015 and 2014, respectively. |
| Impairment of long-lived and other long-term assets (property, equipment, and satellites, and other assets, including goodwill) | Impairment of long-lived and other long-term assets
(property, equipment, and satellites, and other assets, including
goodwill)
In accordance
with the authoritative guidance for impairment or disposal of
long-lived assets (ASC 360), the Company assesses potential
impairments to long-lived assets, including property, equipment and
satellites, and other assets, when there is evidence that events or
changes in circumstances indicate that the carrying value may not
be recoverable. An impairment loss is recognized when the
undiscounted cash flows expected to be generated by an asset (or
group of assets) are less than the asset’s carrying value.
Any required impairment loss would be measured as the amount by
which the asset’s carrying value exceeds its fair value, and
would be recorded as a reduction in the carrying value of the
related asset and charged to results of operations. No material
impairments were recorded by the Company for fiscal years 2016,
2015 and 2014.
The Company
accounts for its goodwill under the authoritative guidance for
goodwill and other intangible assets (ASC 350) and the provisions
of Accounting Standards Update (ASU) 2011-08, Intangibles —
Goodwill and Other (ASC 350): Testing Goodwill for Impairment,
which simplifies how the Company tests goodwill for impairment.
Current authoritative guidance allows the Company to first assess
qualitative factors to determine whether it is necessary to perform
the two-step quantitative goodwill impairment test. If, after
completing the qualitative assessment, the Company determines that
it is more likely than not that the estimated fair value is greater
than the carrying value, the Company concludes that no impairment
exists. If it is more likely than not that the carrying value of
the reporting unit exceeds its estimated fair value, the Company
compares the fair value of the reporting unit to its carrying
value. If the estimated fair value of the reporting unit is less
than the carrying value, a second step is performed in which the
implied fair value of goodwill is compared to its carrying value.
If the implied fair value of goodwill is less than its carrying
value, goodwill must be written down to its implied fair value,
resulting in goodwill impairment. The Company tests goodwill for
impairment during the fourth quarter every fiscal year and when an
event occurs or circumstances change such that it is reasonably
possible that an impairment may exist.
The
qualitative analysis includes assessing the impact of changes in
certain factors including (1) changes in forecasted operating
results and comparing actual results to projections,
(2) changes in the industry or its competitive environment
since the acquisition date, (3) changes in the overall
economy, its market share and market interest rates since the
acquisition date, (4) trends in the stock price and related
market capitalization and enterprise values, (5) trends in
peer companies total enterprise value metrics, and
(6) additional factors such as management turnover, changes in
regulation and changes in litigation matters.
Based on the
Company’s qualitative assessment performed during the fourth
quarter of fiscal year 2016, the Company concluded that it was more
likely than not that the estimated fair value of the
Company’s reporting units exceeded their carrying value as of
March 31, 2016, and therefore, determined it was not necessary
to perform the two-step goodwill impairment test. No impairments
were recorded by the Company related to goodwill and other
intangible assets for fiscal years 2016, 2015 and 2014. |
| Warranty reserves | Warranty
reserves
The Company
provides limited warranties on its products for periods of up to
five years. The Company records a liability for its warranty
obligations when products are shipped or they are included in
long-term construction contracts based upon an estimate of expected
warranty costs. Amounts expected to be incurred within twelve
months are classified as accrued liabilities and amounts expected
to be incurred beyond twelve months are classified as other
liabilities in the consolidated financial statements. For mature
products, the warranty cost estimates are based on historical
experience with the particular product. For newer products that do
not have a history of warranty costs, the Company bases its
estimates on its experience with the technology involved and the
types of failures that may occur. It is possible that the
Company’s underlying assumptions will not reflect the actual
experience and in that case, future adjustments will be made to the
recorded warranty obligation (see Note 13). |
| Self-insurance liabilities | Self-insurance liabilities
The Company has
self-insurance plans to retain a portion of the exposure for losses
related to employee medical benefits and workers’
compensation. The self-insurance plans include policies which
provide for both specific and aggregate stop-loss limits. The
Company utilizes internal actuarial methods as well as other
historical information for the purpose of estimating ultimate costs
for a particular plan year. Based on these actuarial methods, along
with currently available information and insurance industry
statistics, the Company has recorded self-insurance liability for
its plans of $3.8 million and $3.9 million as of
March 31, 2016 and April 3, 2015, respectively. The
Company’s estimate, which is subject to inherent variability,
is based on average claims experience in the Company’s
industry and its own experience in terms of frequency and severity
of claims, including asserted and unasserted claims incurred but
not reported, with no explicit provision for adverse fluctuation
from year to year. This variability may lead to ultimate payments
being either greater or less than the amounts presented above.
Self-insurance liabilities have been classified as a current
liability in accrued liabilities in accordance with the estimated
timing of the projected payments. |
| Indemnification provisions | Indemnification provisions
In the ordinary
course of business, the Company includes indemnification provisions
in certain of its contracts, generally relating to parties with
which the Company has commercial relations. Pursuant to these
agreements, the Company will indemnify, hold harmless and agree to
reimburse the indemnified party for losses suffered or incurred by
the indemnified party, including but not limited to losses relating
to third-party intellectual property claims. To date, there have
not been any material costs incurred in connection with such
indemnification clauses. The Company’s insurance policies do
not necessarily cover the cost of defending indemnification claims
or providing indemnification, so if a claim was filed against the
Company by any party that the Company has agreed to indemnify, the
Company could incur substantial legal costs and damages. A claim
would be accrued when a loss is considered probable and the amount
can be reasonably estimated. At March 31, 2016 and
April 3, 2015, no such amounts were accrued related to the
aforementioned provisions. |
| Noncontrolling interest | Noncontrolling interest
A
noncontrolling interest represents the equity interest in a
subsidiary that is not attributable, either directly or indirectly,
to the Company and is reported as equity of the Company, separately
from the Company’s controlling interest. Revenues, expenses,
gains, losses, net income (loss) and other comprehensive income
(loss) are reported in the consolidated financial statements at the
consolidated amounts, which include the amounts attributable to
both the controlling and noncontrolling interest. |
| Derivatives | Derivatives
The Company
enters into foreign currency forward and option contracts from time
to time to hedge certain forecasted foreign currency transactions.
Gains and losses arising from foreign currency forward and option
contracts not designated as hedging instruments are recorded in
other income (expense) as gains (losses) on derivative instruments.
Gains and losses arising from the effective portion of foreign
currency forward and option contracts which are designated as
cash-flow hedging instruments are recorded in accumulated other
comprehensive income (loss) as unrealized gains (losses) on
derivative instruments until the underlying transaction affects the
Company’s earnings, at which time they are then recorded in
the same income statement line as the underlying
transaction. |
| Foreign currency | Foreign
currency
In general,
the functional currency of a foreign operation is deemed to be the
local country’s currency. Consequently, assets and
liabilities of operations outside the United States are generally
translated into U.S. dollars, and the effects of foreign
currency translation adjustments are included as a component of
accumulated other comprehensive income (loss) within ViaSat, Inc.
stockholders’ equity. |
| Revenue recognition percentage of completion method | Revenue
recognition
A substantial
portion of the Company’s revenues is derived from long-term
contracts requiring development and delivery of complex equipment
built to customer specifications. Sales related to long-term
contracts are accounted for under the authoritative guidance for
the percentage-of-completion method of accounting (ASC 605-35).
Sales and earnings under these contracts are recorded either based
on the ratio of actual costs incurred to date to total estimated
costs expected to be incurred related to the contract, or as
products are shipped under the units-of-delivery method.
Anticipated losses on contracts are recognized in full in the
period in which losses become probable and estimable. Changes in
estimates of profit or loss on contracts are included in earnings
on a cumulative basis in the period the estimate is changed. During
fiscal years 2016, 2015 and 2014, the Company recorded losses of
approximately $5.1 million, $0.6 million and
$3.3 million, respectively, related to loss
contracts. |
| Revenue recognition sale of goods and services | The Company
also derives a substantial portion of its revenues from contracts
and purchase orders where revenue is recorded on delivery of
products or performance of services in accordance with the
authoritative guidance for revenue recognition (ASC 605). Under
this standard, the Company recognizes revenue when an arrangement
exists, prices are determinable, collectability is reasonably
assured and the goods or services have been delivered. |
| Revenue recognition leases | The Company
also enters into certain leasing arrangements with customers and
evaluates the contracts in accordance with the authoritative
guidance for leases (ASC 840). The Company’s accounting for
equipment leases involves specific determinations under the
authoritative guidance for leases, which often involve complex
provisions and significant judgments. In accordance with the
authoritative guidance for leases, the Company classifies the
transactions as sales type or operating leases based on:
(1) review for transfers of ownership of the equipment to the
lessee by the end of the lease term, (2) review of the lease
terms to determine if it contains an option to purchase the leased
equipment for a price which is sufficiently lower than the expected
fair value of the equipment at the date of the option,
(3) review of the lease term to determine if it is equal to or
greater than 75% of the economic life of the equipment, and
(4) review of the present value of the minimum lease payments
to determine if they are equal to or greater than 90% of the fair
market value of the equipment at the inception of the lease.
Additionally, the Company considers the cancelability of the
contract and any related uncertainty of collections or risk in
recoverability of the lease investment at lease inception. Revenue
from sales type leases is recognized at the inception of the lease
or when the equipment has been delivered and installed at the
customer site, if installation is required. Revenues from equipment
rentals under operating leases are recognized as earned over the
lease term, which is generally on a straight-line basis. |
| Revenue recognition multiple element arrangements | In accordance
with the authoritative guidance for revenue recognition for
multiple element arrangements, ASU 2009-13, Revenue Recognition
(ASC 605) Multiple-Deliverable Revenue Arrangements, which updates
ASC 605-25, Revenue Recognition-Multiple element arrangements, of
the Financial Accounting Standards Board (FASB) codification, for
substantially all of the arrangements with multiple deliverables,
the Company allocates revenue to each element based on a selling
price hierarchy at the arrangement inception. The selling price for
each element is based upon the following selling price hierarchy:
vendor specific objective evidence (VSOE) if available, third-party
evidence (TPE) if VSOE is not available, or estimated selling price
(ESP) if neither VSOE nor TPE are available (a description as to
how the Company determines VSOE, TPE and ESP is provided below). If
a tangible hardware systems product includes software, the Company
determines whether the tangible hardware systems product and the
software work together to deliver the product’s essential
functionality and, if so, the entire product is treated as a
nonsoftware deliverable. The total arrangement consideration is
allocated to each separate unit of accounting for each of the
nonsoftware deliverables using the relative selling prices of each
unit based on the aforementioned selling price hierarchy. Revenue
for each separate unit of accounting is recognized when the
applicable revenue recognition criteria for each element have been
met.
To determine
the selling price in multiple-element arrangements, the Company
establishes VSOE of the selling price using the price charged for a
deliverable when sold separately. The Company also considers
specific renewal rates offered to customers for software license
updates, product support and hardware systems support, and other
services. For nonsoftware multiple-element arrangements, TPE is
established by evaluating similar and/or interchangeable competitor
products or services in standalone arrangements with similarly
situated customers and/or agreements. If the Company is unable to
determine the selling price because VSOE or TPE doesn’t
exist, the Company determines ESP for the purposes of allocating
the arrangement by reviewing historical transactions, including
transactions whereby the deliverable was sold on a standalone basis
and considers several other external and internal factors
including, but not limited to, pricing practices including
discounting, margin objectives, competition, the geographies in
which the Company offers its products and services, the type of
customer (i.e., distributor, value added reseller, government
agency or direct end user, among others), volume commitments and
the stage of the product lifecycle. The determination of ESP
considers the Company’s pricing model and go-to-market
strategy. As the Company, or its competitors’, pricing and
go-to-market strategies evolve, the Company may modify its pricing
practices in the future, which could result in changes to its
determination of VSOE, TPE and ESP. As a result, the
Company’s future revenue recognition for multiple-element
arrangements could differ materially from those in the current
period. |
| Revenue recognition shipping and handling fees and costs | In accordance
with the authoritative guidance for shipping and handling fees and
costs (ASC 605-45), the Company records shipping and handling costs
billed to customers as a component of revenues, and shipping and
handling costs incurred by the Company for inbound and outbound
freight as a component of cost of revenues. |
| Revenue recognition collections in excess of revenues and deferred revenues | Collections in
excess of revenues and deferred revenues represent cash collected
from customers in advance of revenue recognition and are recorded
in accrued liabilities for obligations within the next twelve
months. Amounts for obligations extending beyond twelve months are
recorded within other liabilities in the consolidated financial
statements. |
| Advertising costs | Advertising costs
In accordance
with the authoritative guidance for advertising costs (ASC 720-35),
advertising costs are expensed as incurred and included in selling,
general and administrative (SG&A) expenses. Advertising
expenses for fiscal years 2016, 2015 and 2014 were $12.2 million,
$17.0 million and $18.9 million, respectively. |
| Commissions | Commissions
The Company
compensates third parties based on specific commission programs
directly related to certain product and service sales, and these
commissions costs are expensed as incurred. |
| Stock-based compensation | Stock-based compensation
In accordance
with the authoritative guidance for share-based payments (ASC 718),
the Company measures stock-based compensation cost at the grant
date, based on the estimated fair value of the award, and
recognizes expense on a straight-line basis over the
employee’s requisite service period. Stock-based compensation
expense is recognized in the consolidated statements of operations
and comprehensive income (loss) for fiscal years 2016, 2015 and
2014 only for those awards ultimately expected to vest, with
forfeitures estimated at the date of grant. The authoritative
guidance for share-based payments requires forfeitures to be
estimated at the time of grant and revised, if necessary, in
subsequent periods if actual forfeitures differ from those
estimates. |
| Independent research and development | Independent research and development
Independent
research and development (IR&D), which is not directly funded
by a third party, is expensed as incurred. IR&D expenses
consist primarily of salaries and other personnel-related expenses,
supplies, prototype materials and other expenses related to
research and development programs. |
| Rent expense, deferred rent obligations and deferred lease incentives | Rent
expense, deferred rent obligations and deferred lease
incentives
The Company
leases all of its facilities under operating leases. Some of these
lease agreements contain tenant improvement allowances funded by
landlord incentives, rent holidays and rent escalation clauses. The
authoritative guidance for leases (ASC 840) requires rent expense
to be recognized on a straight-line basis over the lease term. The
difference between the rent due under the stated periods of the
lease compared to that of the straight-line basis is recorded as
deferred rent within other long-term liabilities in the
consolidated balance sheets.
For purposes
of recognizing landlord incentives and minimum rental expenses on a
straight-line basis over the terms of the leases, the Company uses
the date that it obtains the legal right to use and control the
leased space to begin recording rent expense, which is generally
when the Company enters the space and begins to make improvements
in preparation of occupying new space. For tenant improvement
allowances funded by landlord incentives and rent holidays, the
Company records a deferred lease incentive liability in accrued and
other long-term liabilities on the consolidated balance sheets and
amortizes the deferred liability as a reduction to rent expense on
the consolidated statements of operations and comprehensive income
(loss) over the term of the lease.
Certain lease
agreements contain rent escalation clauses which provide for
scheduled rent increases during the lease term or for rental
payments commencing at a date other than the date of initial
occupancy. Such increasing rent expense is recorded in the
consolidated statements of operations and comprehensive income
(loss) on a straight-line basis over the lease term. |
| Income taxes | Income
taxes
Accruals for
uncertain tax positions are provided for in accordance with the
authoritative guidance for accounting for uncertainty in income
taxes (ASC 740). The Company may recognize the tax benefit from an
uncertain tax position only if it is more likely than not that the
tax position will be sustained on examination by the taxing
authorities, based on the technical merits of the position. The tax
benefits recognized in the financial statements from such a
position should be measured based on the largest benefit that has a
greater than 50% likelihood of being realized upon ultimate
settlement. The authoritative guidance for accounting for
uncertainty in income taxes also provides guidance on derecognition
of income tax assets and liabilities, classification of deferred
income tax assets and liabilities, accounting for interest and
penalties associated with tax positions, and income tax
disclosures. The Company’s policy is to recognize interest
expense and penalties related to income tax matters as a component
of income tax expense.
A deferred income tax asset or liability is established
for the expected future tax consequences resulting from differences
in the financial reporting and tax bases of assets and liabilities
and for the expected future tax benefit to be derived from tax
credit and loss carryforwards. Deferred tax assets are reduced by a
valuation allowance when, in the opinion of management, it is more
likely than not that some portion or all of the deferred tax assets
will not be realized. |
| Earnings per share | Earnings per share
Basic
earnings per share is computed based upon the weighted average
number of common shares outstanding during the period. Diluted
earnings per share is based upon the weighted average number of
common shares outstanding and potential common stock, if dilutive
during the period. Potential common stock includes options granted
and restricted stock units awarded under the Company’s equity
compensation plan which are included in the earnings per share
calculations using the treasury stock method, common shares
expected to be issued under the Company’s employee stock
purchase plan, and shares potentially issuable under the ViaSat
401(k) Profit Sharing Plan in connection with the Company’s
decision to pay a discretionary match in common stock or cash. The
weighted average number of shares used to calculate basic and
diluted net income (loss) per share attributable to ViaSat, Inc.
common stockholders is the same for the fiscal year ended
April 4, 2014, as the Company incurred a net loss for fiscal
year 2014 and inclusion of potential common stock would be
antidilutive. |
| Segment reporting | Segment
reporting
The
Company’s reporting segments, namely its satellite services,
commercial networks and government systems segments, are primarily
distinguished by the type of customer and the related contractual
requirements. The Company’s satellite services segment
provides satellite-based broadband services to customers,
enterprises, commercial airlines and mobile broadband customers
primarily in the United States. The Company’s commercial
networks segment develops and offers advanced end-to-end satellite
and wireless communication systems, ground networking equipment and
space-to-earth connectivity systems, some of which are ultimately
used by the Company’s satellite services segment. The
Company’s government systems segment develops and offers
network-centric, Internet Protocol (IP)-based fixed and mobile
secure government communications systems, products, services and
solutions and provides global mobile broadband service and product
offerings. The more regulated government environment is subject to
unique contractual requirements and possesses economic
characteristics which differ from the satellite services and
commercial networks segments. The Company’s segments are
determined consistent with the way management currently organizes
and evaluates financial information internally for making operating
decisions and assessing performance (see Note 14). |
| Recent authoritative guidance | Recent
authoritative guidance
In April
2014, the FASB issued ASU 2014-08, Presentation of Financial
Statements and Property, Plant, and Equipment: Reporting
Discontinued Operations and Disclosures of Disposals of Components
of an Entity. ASU 2014-08 limits the requirement to report
discontinued operations to disposals of components of an entity
that represent strategic shifts that have (or will have) a major
effect on an entity’s operations and financial results. The
amendments also require expanded disclosures concerning
discontinued operations and disclosures of certain financial
results attributable to a disposal of a significant component of an
entity that does not qualify for discontinued operations reporting.
This guidance became effective for the Company beginning in the
first quarter of fiscal year 2016 and the guidance did not have a
material impact on the Company’s consolidated financial
statements and disclosures.
In May 2014,
the FASB issued ASU 2014-09, Revenue from Contracts with Customers.
ASU 2014-09 requires an entity to recognize the amount of revenue
to which it expects to be entitled for the transfer of promised
goods or services to a customer. This guidance will replace most
existing revenue recognition guidance and will be effective for the
Company beginning in fiscal year 2019, including interim periods
within that reporting period, based on the FASB decision in July
2015 (ASU 2015-14, Revenue from Contract with Customers —
Deferral of the Effective Date) to delay the effective date of the
new revenue recognition standard by one year, but providing
entities a choice to adopt the standard as of the original
effective date. In March 2016, the FASB issued ASU 2016-08,
Principal vs Agent Considerations (Reporting Revenue Gross versus
Net), which clarifies the implementation guidance on principal
versus agent considerations. In April 2016, the FASB issued ASU
2016-10, Identifying Performance Obligations and Licensing, which
clarifies the implementation guidance on identifying performance
obligations and the licensing implementation guidance. In May 2016,
the FASB issued ASU 2016-12, Narrow-Scope Improvements and
Practical Expedients, which provides practical expedient for
contract modifications and clarification on assessing the
collectability criterion, presentation of sales taxes, measurement
date for noncash consideration and completed contracts at
transition. These standards permit the use of either the
retrospective or cumulative effect transition method. The Company
has not selected a transition method and is currently evaluating
the impact these standards will have on its consolidated financial
statements and disclosures.
In February
2015, the FASB issued ASU 2015-02, Consolidation (ASC 810):
Amendments to the Consolidation Analysis. ASU 2015-02 amended the
process that a reporting entity must perform to determine whether
it should consolidate certain types of legal entities. This
guidance will become effective for the Company in fiscal year 2017,
with early adoption permitted. The adoption of this standard is not
expected to have a material impact on the Company’s
consolidated financial statements and disclosures.
In April
2015, the FASB issued ASU 2015-03, Interest — Imputation of
Interest (ASC 835-30): Simplifying the Presentation of Debt
Issuance Costs. ASU 2015-03 requires that debt issuance costs
related to a recognized debt liability be presented in the balance
sheet as a direct deduction from the carrying amount of that debt
liability, consistent with debt discounts. In August 2015, the FASB
issued ASU 2015-15, Interest — Imputation of Interest
(Subtopic 835-30): Presentation and Subsequent Measurement of Debt
Issuance Costs Associated with Line-of-Credit Arrangements. ASU
2015-15 provides additional guidance to ASU 2015-03, which did not
address presentation or subsequent measurement of debt issuance
costs related to line-of-credit arrangements. ASU 2015-15 noted
that staff of the Securities and Exchange Commission (the SEC)
would not object to an entity deferring and presenting debt
issuance costs as an asset and subsequently amortizing the deferred
debt issuance costs ratably over the term of the line-of-credit
arrangement, regardless of whether there are any outstanding
borrowings on the line-of-credit arrangement. This new guidance
will be effective for the Company in fiscal year 2017, with early
adoption permitted. The new guidance shall be applied on a
retrospective basis, wherein the balance sheet of each individual
period presented should be adjusted to reflect the period-specific
effects of applying the new guidance. The adoption of this standard
is not expected to have a material impact on the Company’s
consolidated financial statements and disclosures.
In April
2015, the FASB issued ASU 2015-05, Intangibles — Goodwill and
Other — Internal-Use Software (Subtopic 350-40):
Customer’s Accounting for Fees Paid in a Cloud Computing
Arrangement. ASU 2015-05 provides guidance to customers about
whether a cloud computing arrangement includes a software license.
If a cloud computing arrangement includes a software license, the
customer should account for the software license element of the
arrangement consistent with the acquisition of other software
licenses. If a cloud computing arrangement does not include a
software license, the customer should account for the arrangement
as a service contract. The new guidance does not change the
accounting for a customer’s accounting for service contracts.
ASU 2015-05 is effective for the Company in fiscal year 2017 with
early adoption permitted using either of two methods: (i)
prospectively to all arrangements entered into or materially
modified after the effective date and represent a change in
accounting principle; or (ii) retrospectively. The Company is
currently evaluating the impact of this standard on its
consolidated financial statements and disclosures.
In July 2015,
the FASB issued ASU 2015-11, Inventory (Topic 330): Simplifying the
Measurement of Inventory. ASU 2015-11 simplifies the guidance on
the subsequent measurement of inventory, excluding inventory
measured using last-in, first out or the retail inventory method.
Under the new standard, in scope inventory should be measured at
the lower of cost and net realizable value. The new standard should
be applied prospectively and will become effective for the Company
in fiscal year 2018, with early adoption permitted. The Company is
currently evaluating the impact of this standard on its
consolidated financial statements and disclosures.
In September
2015, the FASB issued ASU 2015-16, Business Combinations (Topic
805): Simplifying the Accounting for Measurement-Period
Adjustments. ASU 2015-16 requires that an acquirer recognize
adjustments to provisional amounts that are identified during the
measurement period in the reporting period in which the adjustment
amounts are determined. Under current GAAP, the acquirer is
required to retrospectively apply adjustments made to provisional
amounts recognized in a business combination. The new standard
should be applied prospectively and will become effective for the
Company in fiscal year 2017, with early adoption permitted. The
adoption of this standard is not expected to have a material impact
on the Company’s consolidated financial statements and
disclosures.
In November
2015, the FASB issued ASU 2015-17, Balance Sheet Classification of
Deferred Income Taxes (ASU 2015-17), which requires entities to
classify deferred tax liabilities and assets as non-current in a
classified balance sheet. The new guidance can be applied either
prospectively to all deferred tax liabilities and assets or
retrospectively to all periods presented. ASU 2015-17 will become
effective for the Company in fiscal year 2018, with early adoption
permitted. The Company early adopted this standard retrospectively
and reclassified all of its current deferred tax assets to
non-current deferred tax assets on its consolidated balance sheets
for all periods presented.
In January
2016, the FASB issued ASU 2016-01, Recognition and Measurement of
Financial Assets and Financial Liabilities (Subtopic 825-10). ASU
2016-01 requires that most equity investments (except those
accounted for under the equity method for accounting or those that
result in consolidation of the investee) be measured at fair value,
with subsequent changes in fair value recognized in net income. The
new guidance also impacts financial liabilities under the fair
value option and the presentation and disclosure requirements for
financial instruments. The new guidance should be applied by means
of a cumulative-effect adjustment to the balance sheet as of the
beginning of the fiscal year of adoption. ASU 2016-01 will become
effective for the Company in fiscal year 2019, with early adoption
permitted with certain stipulations. The Company is currently
evaluating the impact of this standard on its consolidated
financial statements and disclosures.
In February
2016, the FASB issued ASU 2016-02, Leases (Topic 842). ASU 2016-02
requires lessees to recognize most leases on their balance sheets
as lease liabilities with corresponding right-of-use assets and
eliminates certain real estate-specific provisions. The new
guidance will become effective for the Company beginning in the
first quarter of fiscal year 2020, with early adoption permitted.
ASU 2016-02 will be adopted on a modified retrospective transition
basis for leases existing at, or entered into after, the beginning
of the earliest comparative period presented in the financial
statements. The Company is currently evaluating the impact of this
standard on its consolidated financial statements and
disclosures.
In March
2016, the FASB issued ASU 2016-05, Derivatives and Hedging (Topic
815). ASU 2016-05 clarifies that a change in the counterparty to a
derivative instrument, in and of itself, does not require
dedesignation of a hedging relationship. The new guidance will
become effective for the Company beginning in the first quarter of
fiscal year 2018, with early adoption permitted. The Company is
currently evaluating the impact of this standard on its
consolidated financial statements and disclosures.
In March
2016, the FASB issued ASU 2016-06, Derivatives and Hedging (Topic
815). ASU 2016-06 clarifies the requirements for assessing whether
contingent put or call option in a debt instrument qualifies as a
separate derivative. The new guidance is required to be applied on
a modified retrospective basis to all existing and future debt
instruments of the fiscal year for which the amendments are
effective. ASU 2016-06 will become effective for the Company
beginning in the first quarter of fiscal year 2018, with early
adoption permitted. The Company is currently evaluating the impact
of this standard on its consolidated financial statements and
disclosures.
In March
2016, the FASB issued ASU 2016-07, Investment — Equity Method
and Joint Ventures (Topic 323). ASU 2016-07 eliminates the
requirement to apply the equity method of accounting
retrospectively when a reporting entity obtains significant
influence over a previously held investment. ASU 2016-07 will
become effective for the Company beginning in the first quarter of
fiscal year 2018, with early adoption permitted. The Company is
currently evaluating the impact of this standard on its
consolidated financial statements and disclosures.
In March
2016, the FASB issued ASU 2016-09, Compensation — Stock
Compensation (Topic 718). ASU 2016-09 simplifies various aspects
related to how share-based payments are accounted for and presented
in the financial statements. The new guidance we become effective
for the Company beginning in fiscal year 2018, with early adoption
permitted. The Company is currently evaluating the impact of this
standard on its consolidated financial statements and
disclosures. |
| Fair value measurements | In accordance
with the authoritative guidance for financial assets and
liabilities measured at fair value on a recurring basis (ASC 820),
the Company prioritizes the inputs used to measure fair value from
market-based assumptions to entity specific assumptions:
•
Level 1 — Inputs based on quoted market prices for
identical assets or liabilities in active markets at the
measurement date.
•
Level 2 — Observable inputs other than quoted prices
included in Level 1, such as quoted prices for similar assets
and liabilities in active markets; quoted prices for identical or
similar assets and liabilities in markets that are not active; or
other inputs that are observable or can be corroborated by
observable market data.
•
Level 3 — Inputs which reflect management’s
best estimate of what market participants would use in pricing the
asset or liability at the measurement date. The inputs are
unobservable in the market and significant to the instruments
valuation.
The following
tables present the Company’s hierarchy for its assets
measured at fair value on a recurring basis as of March 31,
2016 and April 3, 2015:
Fair Value as of Level 1 Level 2 Level 3
(In
thousands)
Assets:
Cash equivalents $ 2,003 $ 2,003 $ — $ —
Foreign currency forward
contracts 196 — 196 —
Total assets measured at
fair value on a recurring basis $ 2,199 $ 2,003 $ 196 $ —
Fair Value as of Level 1 Level 2 Level 3
(In
thousands)
Assets:
Cash equivalents $ 2,033 $ 2,033 $ — $ —
Total assets measured at
fair value on a recurring basis $ 2,033 $ 2,033 $ — $ —
The following
section describes the valuation methodologies the Company uses to
measure financial instruments at fair value:
Cash
equivalents
Foreign
currency forward contracts
Long-term
debt
Satellite
performance incentives obligation |
| Other acquired intangible assets | Other acquired
intangible assets are amortized using the straight-line method over
their estimated useful lives of two to ten years. |
| Acquisition | The Company
accounts for business combinations pursuant to the authoritative
guidance for business combinations (ASC 805). Accordingly, the
Company allocated the purchase price of the acquired company to the
net tangible assets and intangible assets acquired based upon their
estimated fair values. Under the authoritative guidance for
business combinations, acquisition-related transaction costs and
acquisition-related restructuring charges are not included as
components of consideration transferred but are accounted for as
expenses in the period in which the costs are incurred.
Merger-related transaction costs incurred by the Company during the
first quarter of fiscal year 2015 were approximately $0.4 million,
which were recorded in SG&A expenses.
The intangible
assets acquired in the NetNearU business combination were
determined, in accordance with the authoritative guidance for
business combinations, based on the estimated fair values using
valuation techniques consistent with the market approach and/or
income approach to measure fair value. The remaining useful lives
were estimated based on the underlying agreements and/or the future
economic benefit expected to be received from the
assets. |
| Operating leases | The Company
leases office and other facilities under non-cancelable operating
leases with initial terms ranging from one to fifteen years which
expire between fiscal year 2017 and fiscal year 2027 and provide
for pre-negotiated fixed rental rates during the terms of the
lease. Certain of the Company’s facilities leases contain
option provisions which allow for extension of the lease
terms.
For operating
leases, minimum lease payments, including minimum scheduled rent
increases, are recognized as rent expense on a straight-line basis
over the lease term as that term is defined in the authoritative
guidance for leases including any option periods considered in
the lease term and any periods during which the Company has use of
the property but is not charged rent by a landlord (“rent
holiday”). Leasehold improvement incentives paid to the
Company by a landlord are recorded as a liability and amortized as
a reduction of rent expense over the lease term. Total rent expense
was $27.7 million, $24.5 million and $22.3 million
in fiscal years 2016, 2015 and 2014, respectively. |
