Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2017 | May 01, 2017 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | BIOL | |
Entity Registrant Name | BIOLASE, INC | |
Entity Central Index Key | 811,240 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 67,660,712 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 3,576 | $ 8,924 |
Restricted cash equivalent | 251 | 251 |
Accounts receivable, less allowance of $1,219 in 2017 and $1,209 in 2016 | 9,220 | 9,784 |
Inventory, net | 14,693 | 13,523 |
Prepaid expenses and other current assets | 1,576 | 1,505 |
Total current assets | 29,316 | 33,987 |
Property, plant, and equipment, net | 4,465 | 4,478 |
Goodwill | 2,926 | 2,926 |
Other assets | 333 | 550 |
Total assets | 37,040 | 41,941 |
Current liabilities: | ||
Accounts payable | 9,183 | 9,125 |
Accrued liabilities | 5,163 | 5,778 |
Customer deposits | 94 | 101 |
Deferred revenue, current portion | 2,666 | 3,010 |
Total current liabilities | 17,106 | 18,014 |
Deferred income taxes, net | 813 | 798 |
Deferred revenue, long-term | 20 | 23 |
Warranty accrual, long-term | 487 | 773 |
Other liabilities, long-term | 248 | 268 |
Total liabilities | 18,674 | 19,876 |
Commitments, contingencies, and subsequent event (Notes 8 and 12) | ||
Stockholders' equity: | ||
Preferred stock, par value $0.001 per share; 1,000,000 shares authorized; 88,494 shares issued in 2017 and 2016, respectively; no shares outstanding in 2017 and 2016, respectively | ||
Common stock, par value $0.001 per share; 100,000,000 shares authorized; 67,660,712 and 67,565,951 shares issued and outstanding in 2017 and 2016, respectively | 68 | 68 |
Additional paid-in-capital | 201,577 | 201,198 |
Accumulated other comprehensive loss | (846) | (876) |
Accumulated deficit | (182,433) | (178,325) |
Total stockholders' equity | 18,366 | 22,065 |
Total liabilities and stockholders' equity | $ 37,040 | $ 41,941 |
Consolidated Balance Sheets (U3
Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Statement Of Financial Position [Abstract] | ||
Allowance for accounts receivable | $ 1,219 | $ 1,209 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 88,494 | 88,494 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 67,660,712 | 67,565,951 |
Common stock, shares outstanding | 67,660,712 | 67,565,951 |
Consolidated Statements Of Oper
Consolidated Statements Of Operations And Comprehensive Loss (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Income Statement [Abstract] | ||
Products and services revenue | $ 10,842 | $ 10,979 |
License fees and royalty revenue | 32 | 31 |
Net revenue | 10,874 | 11,010 |
Cost of revenue | 6,921 | 7,366 |
Gross profit | 3,953 | 3,644 |
Operating expenses: | ||
Sales and marketing | 4,184 | 3,804 |
General and administrative | 2,416 | 2,267 |
Engineering and development | 1,429 | 1,886 |
Total operating expenses | 8,029 | 7,957 |
Loss from operations | (4,076) | (4,313) |
(Loss) gain on foreign currency transactions | (1) | 71 |
Interest income, net | 9 | 17 |
Non-operating income, net | 8 | 88 |
Loss before income tax provision | (4,068) | (4,225) |
Income tax provision | 40 | 40 |
Net loss | (4,108) | (4,265) |
Other comprehensive income items: | ||
Foreign currency translation adjustment | 30 | 99 |
Comprehensive loss | $ (4,078) | $ (4,166) |
Net loss per share: | ||
Basic | $ (0.06) | $ (0.07) |
Diluted | $ (0.06) | $ (0.07) |
Shares used in the calculation of net loss per share: | ||
Basic | 67,583 | 58,228 |
Diluted | 67,583 | 58,228 |
Consolidated Statements Of Cash
Consolidated Statements Of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Cash Flows from Operating Activities: | ||
Net loss | $ (4,108) | $ (4,265) |
Adjustments to reconcile net loss to net cash and cash equivalents used in operating activities: | ||
Depreciation and amortization | 290 | 212 |
Provision (recovery) for bad debts, net | 10 | (15) |
Provision for inventory excess and obsolescence | 225 | |
Stock-based compensation | 379 | 834 |
Deferred income taxes | 15 | 15 |
Earned interest income, net | (9) | (16) |
Changes in operating assets and liabilities: | ||
Accounts receivable | 564 | (1,126) |
Inventory | (1,395) | (1) |
Prepaid expenses and other current assets | 146 | (31) |
Customer deposits | (7) | 46 |
Accounts payable and accrued liabilities | (885) | (155) |
Deferred revenue | (347) | (270) |
Net cash and cash equivalents used in operating activities | (5,122) | (4,772) |
Cash Flows from Investing Activities: | ||
Purchases of property, plant, and equipment | (208) | (343) |
Net cash and cash equivalents used in investing activities | (208) | (343) |
Cash Flows from Financing Activities: | ||
Principal payments under capital lease obligation | (43) | (43) |
Net cash and cash equivalents used in financing activities | (43) | (43) |
Effect of exchange rate changes | 25 | 86 |
Decrease in cash and cash equivalents | (5,348) | (5,072) |
Cash and cash equivalents, beginning of period | 8,924 | 11,699 |
Cash and cash equivalents, end of period | 3,576 | 6,627 |
Supplemental cash flow disclosure - Cash Paid: | ||
Interest paid | 1 | 1 |
Income taxes paid | 7 | 33 |
Supplemental cash flow disclosure - Non-cash: | ||
Accrued capital expenditures and tenant improvement allowance | $ 174 | $ 70 |
Description of Business and Bas
Description of Business and Basis of Presentation | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Description of Business and Basis of Presentation | NOTE 1—DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION The Company BIOLASE, Inc. (“BIOLASE” and, together with its consolidated subsidiaries, the “Company”), incorporated in Delaware in 1987, is a medical device company that develops, manufactures, markets, and sells laser systems in dentistry and medicine and also markets, sells, and distributes dental imaging equipment, including cone beam digital x-rays and three-dimensional CAD/CAM intra-oral scanners. Basis of Presentation The unaudited consolidated financial statements include the accounts of BIOLASE and its wholly-owned subsidiaries and have been prepared on a basis consistent with the December 31, 2016 audited consolidated financial statements and include all material adjustments, consisting of normal recurring adjustments and the elimination of all material intercompany transactions and balances, necessary to fairly present the information set forth therein. These unaudited, interim, consolidated financial statements do not include all the footnotes, presentations, and disclosures normally required by accounting principles generally accepted in the United States of America (“GAAP”) for complete consolidated financial statements. Certain amounts have been reclassified to conform to current period presentations. The consolidated results of operations for the three months ended March 31, 2017 are not necessarily indicative of the results for the full year. The accompanying consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the year ended December 31, 2016, included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016 filed with the Securities and Exchange Commission (the “SEC”) on March 10, 2017 (the “2016 Form 10-K”). Liquidity and Management’s Plans The Company incurred a loss from operations, incurred a net loss, and used cash in operating activities for the three months ended March 31, 2017. The Company has also suffered recurring losses from operations during the three years ended December 31, 2016. The Company’s recurring losses, level of cash used in operations, and potential need for additional capital, and the uncertainties surrounding the Company’s ability to raise additional capital, raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. On April 18, 2017, the Company completed a private placement with several institutional and individual investors, and certain of its directors and officers, under which the Company sold an aggregate of 80,644 shares of BIOLASE Series D Participating Convertible Preferred Stock, par value $0.001 per share (“Preferred Stock”), and warrants (the “Warrants”) to purchase up to an aggregate of 3,925,871 unregistered shares of BIOLASE common stock at an exercise price of $1.80 per share (the “Exercise Price”), subject to customary anti-dilution adjustments. Each share of Preferred Stock converts automatically into shares of BIOLASE common stock upon receipt of stockholder approval and was initially convertible into 100 shares of common stock, reflecting a conversion price equal to $1.24 per share, which is the closing price of BIOLASE common stock quoted on the NASDAQ Capital Market on April 10, 2017. The shares of Preferred Stock have no other conversion rights. The Warrants become exercisable on October 18, 2017 and expire five years after the date of issuance or, if earlier, five business days after the Company delivers notice that the closing price per share of BIOLASE common stock exceeded the Exercise Price for 20 consecutive trading days during the exercise period. Gross proceeds from the sale were approximately $10.5 million. As of March 31, 2017, the Company had working capital of approximately $12.2 million. The Company’s principal sources of liquidity as of March 31, 2017 consisted of approximately $3.8 million in cash, cash equivalents and restricted cash and $9.2 million of net accounts receivable. In order for the Company to continue operations beyond the next 12 months and be able to discharge its liabilities and commitments in the normal course of business, the Company must increase sales of its products directly to end-users and through distributors, establish profitable operations through the combination of increased sales and decreased expenses, generate cash from operations or obtain additional funds when needed. The Company intends to improve its financial condition and ultimately improve its financial results by increasing revenues through expansion of its product offerings, continuing to expand and develop its field sales force and distributor relationships, both domestically and internationally, forming strategic arrangements within the dental and medical industries, educating dental and medical patients as to the benefits of its advanced medical technologies, and reducing expenses. Additional capital requirements may depend on many factors, including, among other things, continued losses, the rate at which the Company’s business grows, demands for working capital, manufacturing capacity, and any acquisitions that the Company may pursue. From time to time, the Company could be required, or may otherwise attempt, to raise capital, through either equity or debt offerings, or enter into a line of credit facility. The Company cannot provide assurances that it will be able to successfully consummate any such equity or debt financings, or enter into any such line of credit facility, in the future or that the required capital would be available on acceptable terms, if at all, or that any such financing activity would not be dilutive to its stockholders. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use of Estimates The preparation of these consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“U. S. GAAP”) requires the Company to make estimates and assumptions that affect amounts reported in the consolidated financial statements and the accompanying notes. Significant estimates in these consolidated financial statements include allowances on accounts receivable, inventory, and deferred taxes, as well as estimates for accrued warranty expenses, goodwill and the ability of goodwill to be realized, revenue deferrals, effects of stock-based compensation and warrants, contingent liabilities, and the provision or benefit for income taxes. Due to the inherent uncertainty involved in making estimates, actual results reported in future periods may differ materially from those estimates. Critical Accounting Policies Information with respect to the Company’s critical accounting policies, which management believes could have the most significant effect on the Company’s reported results and require subjective or complex judgments by management is contained in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” of the 2016 Form 10-K. Management believes that there have been no significant changes during the three months ended March 31, 2017 in the Company’s critical accounting policies from those disclosed in Item 7 of the 2016 Form 10-K. Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants in the principal market (or, if none exists, the most advantageous market) for the specific asset or liability at the measurement date (referred to as the “exit price”). The fair value is based on assumptions that market participants would use, including a consideration of nonperformance risk. Under the accounting guidance for fair value hierarchy there are three levels of measurement inputs. Level 1 inputs are quoted prices in active markets for identical assets or liabilities. Level 2 inputs reflect input other than quoted prices included in Level 1 that are observable, either directly or through collaboration with observable market data, other than Level 1. Level 3 inputs are unobservable due to little or no corroborating market data. The Company’s financial instruments, consisting of cash and cash equivalents, accounts receivable, accounts payable, and accrued liabilities, approximate fair value because of the short maturity of these items. Recent Accounting Pronouncements Changes to U.S. GAAP are established by the Financial Accounting Standards Board (“FASB”) in the form of accounting standards updates (“ASUs”) to the FASB’s Accounting Standards Codification (“ASC”). The Company considers the applicability and impact of all ASUs. ASUs not listed below were assessed and determined not to be applicable or are expected to have minimal impact on the Company’s consolidated financial position and results of operations. Adopted Accounting Pronouncements In July 2015, the FASB issued ASU No. 2015-11, Simplifying the Measurement of Inventory (“ASU 2015-11”), as part of its simplification initiative. The standard requires inventory within the scope of ASU 2015-11 to be measured using the lower of cost and net realizable value. The changes apply to all types of inventory, except those measured using the-last-in-first-out method or the retail inventory method. ASU 2015-11 applies to all entities and is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2016, with early adoption permitted. The Company adopted ASU 2015-11 as of January 1, 2017. The adoption of ASU 2015-11 did not have a material effect on the Company’s consolidated financial statements. In November 2015, FASB issued ASU 2015-17, Income Taxes (Topic 740) (“ASC 2015-17”). Current GAAP requires an entity to separate deferred income tax liabilities and assets into current and noncurrent amounts in a classified statement of financial position. To simplify the presentation of deferred income taxes, the amendments in this ASU require that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. The amendments in this ASU apply to all entities that present a classified statement of financial position. The new standard is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years with early adoption permitted. The Company adopted ASU 2015-17 as of January 1, 2017. The adoption of ASU 2015-17 did not have a material effect on the Company’s consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, Compensation – Stock Compensation (Topic 718) (“ASU 2016-09”). The updated standard simplifies several aspects of the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. The standard requires the recognition of the income tax effects of awards in the income statement when the awards vest or are settled, thus eliminating additional paid in capital pools . Recently Issued Accounting Standards In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”), which supersedes nearly all existing revenue recognition guidance under U.S. GAAP. The core principle of ASU 2014-09 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services. ASU 2014-09 defines a five-step process to achieve this core principle, and, in doing so, more judgment and estimates may be required within the revenue recognition process than are required under existing U.S. GAAP. The standard is effective for annual periods beginning after December 15, 2017, and interim periods therein, using either of the following transition methods: (i) a full retrospective approach reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients or (ii) a retrospective approach with the cumulative effect of initially adopting ASU 2014-09 recognized at the date of adoption (which includes additional footnote disclosures). The Company will adopt the standard during the year ending December 31, 2018. The expected adoption method and implementation analysis of ASU 2014-09 is in the early stages and the Company expects to have further information following the second quarter of 2017. The FASB has issued and may issue in the future, interpretive guidance, which may impact the Company’s implementation analysis. In February 2016, FASB issued ASU 2016-02, Leases. The new standard establishes a right-of-use (“ROU”) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is currently evaluating the impact of its pending adoption of the new standard on its consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230) (“ASU 2016-15”). The updated standard addresses eight specific cash flow issues with the objective of reducing diversity in practice. ASU 2016-15 is effective for public business entities for annual reporting periods beginning after December 15, 2017, including interim periods within those annual reporting periods. Early adoption is permitted. The Company is assessing the impact of the adoption of ASU 2016-15 on the Company's consolidated financial statements. |
Stock-Based Awards and Per Shar
Stock-Based Awards and Per Share Information | 3 Months Ended |
Mar. 31, 2017 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock-Based Awards and Per Share Information | NOTE 3—STOCK-BASED AWARDS AND PER SHARE INFORMATION Stock-Based Compensation The Company currently has one stock-based compensation plan, the 2002 Stock Incentive Plan (as amended effective as of May 26, 2004, November 15, 2005, May 16, 2007, May 5, 2011, June 6, 2013, October 30, 2014, April 27, 2015, and May 6, 2016) (the “2002 Plan”), which will expire on May 5, 2019. Persons eligible to receive awards under the 2002 Plan include officers, employees, and directors of the Company, as well as consultants. As of March 31, 2017, a total of 15,550,000 shares of BIOLASE common stock have been authorized for issuance under the 2002 Plan, of which 3,651,829 shares of BIOLASE common stock have been issued pursuant to options that were exercised and restricted stock units (“RSUs”) that were settled in common stock, 8,420,559 shares of BIOLASE common stock have been reserved for outstanding options and unvested RSUs, and 3,477,612 shares of BIOLASE common stock remain available for future grants. The Company recognized stock-based compensation expense of $379,000 and $834,000, for the three months ended March 31, 2017 and 2016, respectively, based on the grant-date fair value. Stock-based compensation expense for the three months ended March 31, 2017 includes the reversal of $428,000 resulting from the reassessment of certain performance based equity awards. The net impact to earnings was $(0.01), and $(0.01) per basic and diluted share for the three months ended March 31, 2017 and 2016, respectively. At March 31, 2017, the Company had approximately $5.3 million of total unrecognized compensation cost, net of estimated forfeitures, related to unvested share-based compensation arrangements. The Company expects that cost to be recognized over a weighted-average period of 2.4 years. The following table summarizes the income statement classification of compensation expense associated with share-based payments (in thousands): Three Months Ended March 31, 2017 2016 Cost of revenue $ 40 $ 70 Sales and marketing 73 134 General and administrative 193 551 Engineering and development 73 79 $ 379 $ 834 The stock option fair values, under the 2002 Plan, were estimated using the Black-Scholes option-pricing model with the following assumptions: Three Months Ended March 31, 2017 2016 Expected term 5.8 years 6.3 years Volatility 79.43 % 86.30 % Annual dividend per share $ — $ — Risk-free interest rate 1.98 % 1.42 % A summary of option activity under the 2002 Plan for the three months ended March 31, 2017 is as follows (in thousands, except per share data) Weighted Average Weighted Remaining Aggregate Average Contractual Intrinsic Shares Exercise Price Term (Years) Value(1) Options outstanding, December 31, 2016 6,612 $ 2.06 7.70 $ 178 Granted at fair market value 611 $ 1.55 Exercised — Forfeited, cancelled, or expired (206 ) $ 2.14 Options outstanding at March 31, 2017 7,017 $ 2.02 7.72 $ 160 Options exercisable at March 31, 2017 3,582 $ 2.42 6.29 $ 71 Vested options expired during the quarter ended March 31, 2017 63 $ 2.91 (1) The intrinsic value calculation does not include negative values. This can occur when the fair market value on the reporting date is less than the exercise price of the grant. A summary of unvested stock option activity under the 2002 Plan for the three months ended March 31, 2017 is as follows (in thousands, except per share data): Weighted Average Grant Shares Date Fair Value Unvested options at December 31, 2016 3,259 $ 1.16 Granted 611 $ 1.05 Vested (304 ) $ 1.10 Forfeited or cancelled (131 ) $ 1.23 Unvested options at March 31, 2017 3,435 $ 1.15 Cash proceeds, along with fair value disclosures related to grants, exercises, and vested options under the 2002 Plan are as follows for the three months ended March 31 (in thousands, except per share amounts): Three Months Ended March 31, 2017 2016 Proceeds from stock options exercised $ — $ — Tax benefit related to stock options exercised (1) N/A N/A Intrinsic value of stock options exercised (2) $ — $ — Weighted-average fair value of options granted during period $ 1.05 $ 0.67 Total fair value of shares vested during the period $ 334 $ 708 (1) Excess tax benefits received related to stock option exercises are presented as financing cash inflows. The Company currently does not receive a tax benefit related to the exercise of stock options due to the Company’s net operating losses. (2) The intrinsic value of stock options exercised is the amount by which the market price of the stock on the date of exercise exceeded the market price of the stock on the date of grant. Effective February 6, 2017, the Compensation Committee of the BIOLASE board of directors (the “Board”) issued 611,000 non-qualified stock options to purchase shares of BIOLASE common stock to certain employees of the Company. These awards were issued at $1.55 per share, the closing market price of BIOLASE common stock on the grant date, and expire 10 years from the grant date. Vesting periods for options are as follows: (i) for the 586,000 options awarded to existing employees, one-half vest on the first anniversary of award date and one-half vest on the second anniversary of the award date and (ii) for the 25,000 options awarded to new employees, 25% vest on February 6, 2018 and the remainder vest ratably over the 36-month period, commencing on March 6, 2018. Inducement Stock-Based Awards On March 13, 2017, and as amended on April 19, 2017, in connection with the hiring of a new Vice President of Sales, the Compensation Committee of the Board awarded non-qualified stock options to purchase 400,000 shares of BIOLASE common stock. This award was issued at $1.17 per share, the closing market price of BIOLASE common stock on the grant date, and expires 10 years from the grant date. Vesting periods for the options are as follows: (i) two-fifths of the total grant is subject to time vesting with 25% vesting as of March 13, 2018 and the remaining 75% vesting ratably monthly over a 36-month period commencing on March 13, 2018, and (ii) three-fifths of the total grant is subject to specific 2017 and 2018 performance criteria, On March 27, 2017, in connection with the hiring of a new Senior Vice President and Chief Financial Officer, the Compensation Committee of the Board awarded non-qualified stock options to purchase 600,000 shares of BIOLASE common stock. This award was issued at $1.28 per share, the closing market price of BIOLASE common stock on the grant date, and expires 10 years from the grant date. Vesting periods for the options are as follows: (i) two-thirds of the total grant is subject to time vesting with 25% vesting as of March 27, 2018 and the remaining 75% vesting ratably monthly over a 36-month period commencing on March 27, 2018, and (ii) one-third of the total grant is subject to specific 2017 and 2018 performance criteria, Restricted Stock Units Effective February 6, 2017, the Compensation Committee of the Board approved the grant of the following awards: 80,000 RSUs were awarded to an employee of the Company as part of the employee’s 2017 compensation. These awards were valued at $1.55 per share, the closing market price of BIOLASE common stock on the grant date, and vest as follows: (i) 30,000 of the RSUs vest on March 14, 2017, (ii) 20,000 of the RSUs vest on September 14, 2017, and (iii) 30,000 of the RSUs vest on May 10, 2018. 1,000,000 stock-settled RSUs were awarded to the Company’s President and Chief Executive Officer as part of his 2017 compensation. These RSUs were valued at $1.55 per share, A summary of unvested RSU activity under the 2002 Plan for the three months ended March 31, 2017 is as follows: Weighted Average Grant Shares Date Fair Value Unvested restricted stock units at December 31, 2016 418,511 $ 1.23 Granted 1,080,000 $ 1.55 Vested (94,761 ) $ 1.13 Forfeited or cancelled — $ — Unvested restricted stock units at March 31, 2017 1,403,750 $ 1.48 Warrants The Company issues warrants to acquire shares of BIOLASE common stock as approved by the Board. A summary of warrant activity for the three months ended March 31, 2017 is as follows: Weighted Average Shares Exercise Price Warrants outstanding, December 31, 2016 11,406,260 $ 3.64 Granted or Issued — $ — Exercised — $ — Forfeited, cancelled, or expired — $ - Warrants outstanding at March 31, 2017 11,406,260 $ 3.64 Warrants exercisable at March 31, 2017 11,271,260 $ 3.64 Vested warrants expired during the quarter ended March 31, 2017 — $ — Net Loss Per Share – Basic and Diluted Basic net income (loss) per share is computed by dividing income (loss) available to common stockholders by the weighted-average number of shares of BIOLASE common stock outstanding for the period. In computing diluted net income (loss) per share, the weighted average number of shares outstanding is adjusted to reflect the effect of potentially dilutive securities. Outstanding stock options, restricted stock units and warrants to purchase approximately 22,927,127 shares were not included in the calculation of diluted loss per share for the three months ended March 31, 2017, as their effect would have been anti-dilutive. For the same 2016 period, anti-dilutive outstanding stock options and warrants to purchase 15,227,739 shares were not included in the computation of diluted loss per share. |
Inventory
Inventory | 3 Months Ended |
Mar. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Inventory | NOTE 4—INVENTORY Inventory is valued at the lower of cost or market, with cost determined using the first-in, first-out method, and is comprised of the following (in thousands): March 31, December 31, 2017 2016 Raw materials $ 5,021 $ 4,837 Work-in-process 2,532 2,261 Finished goods 7,140 6,425 Inventory, net $ 14,693 $ 13,523 Inventory is net of a provision for excess and obsolete inventory totaling $1.9 million and $1.7 million as of March 31, 2017 and December 31, 2016, respectively. |
Property, Plant, and Equipment
Property, Plant, and Equipment | 3 Months Ended |
Mar. 31, 2017 | |
Property Plant And Equipment [Abstract] | |
Property, Plant, and Equipment | NOTE 5—PROPERTY, PLANT, AND EQUIPMENT Property, plant, and equipment, net is comprised of the following (in thousands): March 31, December 31, 2017 2016 Building $ 199 $ 196 Leasehold improvements 2,003 2,003 Equipment and computers 6,170 6,163 Furniture and fixtures 599 599 Construction in progress 1,857 1,590 10,828 10,551 Accumulated depreciation and amortization (6,517 ) (6,225 ) 4,311 4,326 Land 154 152 Property, plant, and equipment, net $ 4,465 $ 4,478 Depreciation and amortization expense related to property, plant, and equipment totaled $290,000 and $198,000 for the three months ended March 31, 2017 and 2016, respectively. The cost basis of assets held under capital lease was $378,000 and the accumulated depreciation related to assets held under capital lease was $264,000 as of March 31, 2017. For additional information on the capital lease, see Note 8 – Commitments and Contingencies. |
Intangible Assets and Goodwill
Intangible Assets and Goodwill | 3 Months Ended |
Mar. 31, 2017 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Intangible Assets And Goodwill | NOTE 6—INTANGIBLE ASSETS AND GOODWILL The Company conducted its annual impairment test of goodwill as of June 30, 2016 and determined that there was no impairment. The Company also tests its intangible assets and goodwill between the annual impairment tests if events occur or circumstances change that would more likely than not reduce the fair value of the Company or its assets below their carrying amounts. For intangible assets subject to amortization, the Company performs its impairment test when indicators, such as reductions in demand or significant economic slowdowns, are present. No events have occurred since June 30, 2016 through the date of these consolidated financial statements that would trigger further impairment testing of the Company’s intangible assets and goodwill. As of March 31, 2017 and December 31, 2016, the Company had goodwill (indefinite life) of $2.9 million. As of March 31, 2017 and December 31, 2016, all intangible assets have been fully amortized. There was no amortization expense for the three months ended March 31, 2017. Amortization expenses for the three months ended March 31, 2016 totaled $14,000. |
Accrued Liabilities and Deferre
Accrued Liabilities and Deferred Revenue | 3 Months Ended |
Mar. 31, 2017 | |
Payables And Accruals [Abstract] | |
Accrued Liabilities and Deferred Revenue | NOTE 7—ACCRUED LIABILITIES AND DEFERRED REVENUE Accrued liabilities are comprised of the following (in thousands): March 31, December 31, 2017 2016 Payroll and benefits $ 2,164 $ 2,147 Warranty accrual, current portion 973 933 Taxes 493 638 Accrued professional services 946 782 Accrued capital lease obligations, current portion 117 159 Accrued insurance premium 206 906 Other 264 213 Total accrued liabilities $ 5,163 $ 5,778 Changes in the initial product warranty accrual and the expenses incurred under the Company’s initial and extended warranties for the three months ended March 31, 2017 and 2016 are included within accrued liabilities on the Consolidated Balance Sheets and were as follows (in thousands): Three Months Ended March 31, 2017 2016 Initial warranty accrual, beginning balance $ 1,706 $ 2,188 Provision for estimated warranty cost (23 ) 61 Warranty expenditures (223 ) (189 ) 1,460 2,060 Less warranty accrual, long-term 487 973 Total warranty accrual, current portion $ 973 $ 1,087 Deferred revenue is comprised of the following (in thousands): March 31, December 31, 2017 2016 Undelivered elements (training, installation, and product and support services) $ 1,075 $ 1,404 Extended warranty contracts 1,499 1,487 Deferred royalties 112 142 Total Deferred Revenue 2,686 3,033 Less long-term amounts: Deferred royalties 20 23 Total Deferred Revenue - Long-Term 20 23 Total Deferred Revenue - Current $ 2,666 $ 3,010 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2017 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 8—COMMITMENTS AND CONTINGENCIES Leases The Company leases its 57,000 square foot corporate headquarters and manufacturing facility located at 4 Cromwell, Irvine, California. In March 2015, the corporate headquarters and manufacturing facility lease was amended to extend the term through April 30, 2020, modify provisions for a tenant improvement allowance of up to $398,000, and adjust the basic rent terms. Future minimum rental commitments under operating lease agreements with non-cancelable terms greater than one year for the years ending December 31 are listed below. The Company also leases certain office equipment and automobiles under various operating lease arrangements. In February 2015, the Company entered into a 30-month capital lease agreement for information technology equipment. Future minimum lease payments (using a 1.6% interest rate) under the capital lease, together with the present value of the net minimum lease payments, for the year ending December 31, 2017 is $117,000. The current obligation with respect to the present value of net minimum lease payments of $117,000 is reflected in the Consolidated Balance Sheets classified as an accrued liability, and there was no remaining portion of the present value of net minimum lease payments classified as a long-term obligation within capital lease obligations as of March 31, 2017. Future minimum rental commitments under lease agreements, including both operating and capital leases (principle and interest), with non-cancelable terms greater than one year for each of the years ending December 31 are as follows (in thousands): 2017 $ 654 2018 735 2019 656 2020 218 Thereafter — Total future minimum lease obligations $ 2,263 Employee arrangements and other compensation Certain members of management are entitled to severance benefits payable upon termination following a change in control, which would approximate $1.8 million, in the aggregate, at March 31, 2017. The Company also has agreements with certain employees to pay bonuses based on targeted performance criteria. As of March 31, 2017, approximately $67,000 was accrued for performance bonuses, which is included in accrued liabilities in the Consolidated Balance Sheets. Purchase commitments The Company generally purchases components and subassemblies for its products from a limited group of third-party suppliers through purchase orders. As of March 31, 2017, the Company had $15.2 million of purchase commitments for which the Company has not received certain goods or services that are expected to be purchased within one year. These purchase commitments were made to secure better pricing and to ensure the Company will have the necessary parts to meet anticipated near-term demand. Although open purchase orders are considered enforceable and legally binding, the Company may be able to cancel, reschedule or adjust requirements prior to supplier fulfillment. Litigation The Company discloses material loss contingencies deemed to be reasonably possible and accrues for loss contingencies when, in consultation with its legal advisors, management concludes that a loss is probable and reasonably estimable. The ability to predict the ultimate outcome of such matters involves judgments, estimates, and inherent uncertainties. The actual outcome of such matters could differ materially from management’s estimates. Intellectual Property Litigation On April 24, 2012, CAO Group, Inc. (“CAO”) filed a lawsuit against the Company in the District of Utah for patent infringement of U.S. Patent No. 7,485,116 (the “116 Patent”) regarding the Company’s ezlase dental laser. On September 9, 2012, CAO filed its First Amended Complaint, which added claims for (1) business disparagement/injurious falsehood under common law and (2) unfair competition under 15 U.S.C. Section 1125(a). The additional claims stem from a press release that the Company issued on April 30, 2012, which CAO claims contained false statements that are disparaging to CAO and its diode product. The First Amended Complaint seeks injunctive relief, treble damages, attorneys’ fees, punitive damages, and interest. On November 13, 2012, the Court stayed the lawsuit for 120 days to allow the United States Patent and Trademark Office (the “USPTO”) to consider the Company’s request for reexamination of the patent-in-suit. The USPTO granted the request to reexamine the asserted claims of the patent-in-suit and on February 28, 2013, the Court stayed the lawsuit until the termination of the reexamination proceedings. On April 23, 2013, the USPTO issued an office action rejecting all of the asserted claims over the prior art, and CAO responded to the office action. On August 28, 2013, the USPTO issued an Action Closing Procedure, rejecting all of CAO’s patent claims. CAO responded to the USPTO’s ruling and on December 10, 2013, the USPTO issued a Right of Appeal Notice, finally rejecting some claims of the 116 Patent while finding that other claims appeared to be patentable. The Company appealed the USPTO’s findings on January 9, 2014 and on January 27, 2014, the USPTO declined to reconsider the finding of certain claims as patentable and instructed the parties to proceed to appeal to the Patent Trial and Appeal Board (the “Patent Board”). On March 17, 2014, the Company filed its brief in support of its appeal of the USPTO’s decision not to reject certain claims of the 116 Patent. On March 24, 2014, CAO filed its brief in support of its appeal of the USPTO’s decision to reject certain claims of the 116 patent. On April 18, 2014, the Company filed a respondent brief in opposition to the CAO’s appeal arguments. On May 30, 2014, both parties filed rebuttal briefs in support of their appeals. On June 30, 2014, the Company requested an oral hearing before the Patent Board. On July 1, 2014, the Patent Board noted that request and docketed the case for consideration. A hearing on reconsideration was held in November 2014. On July 1, 2015, the Patent Board issued a decision that was generally favorable to the Company. On July 31, 2015, CAO requested a rehearing of the decision. On November 27, 2015, the Patent Board issued its decision regarding CAO’s request for rehearing, partially granting CAO’s request. On January 27, 2016, CAO filed its Notice of Appeal to the United States Court of Appeals for the Federal Circuit for review of the Patent Board’s decision dated July 1, 2015 and the Patent Board’s decision regarding CAO’s request for rehearing. CAO filed its opening appeal brief on June 1, 2016, and BIOLASE filed its responsive brief on July 25, 2016. CAO filed its reply brief on August 11, 2016. Oral argument before the Federal Circuit was held on January 11, 2017 and, on January 27, 2017, an order was entered by the Federal Circuit affirming all of the Patent Board’s findings. On February 9, 2017, the parties jointly filed a document with the court in the Utah litigation notifying it of the Federal Circuit’s decision and requesting that the stay remain in place until a reexamination certificate issues. The reexamination certificate is expected to issue in the next few months. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2017 | |
Segment Reporting [Abstract] | |
Segment Information | NOTE 9—SEGMENT INFORMATION The Company currently operates in a single business segment. Management uses one measurement of profitability and does not segregate its business for internal reporting. For the three months ended March 31, 2017 and 2016, sales to customers in the United States accounted for approximately 63% and 58% of net revenue, respectively, and international sales accounted for approximately 37% and 42% of net revenue, respectively. No individual country, other than the United States, represented more than 10% of total net revenue during the three months ended March 31, 2017 or 2016. Net revenue by geographic location based on the location of customers was as follows (in thousands): Three Months Ended March 31, 2017 2016 United States $ 6,843 $ 6,401 International 4,031 4,609 $ 10,874 $ 11,010 Property, plant, and equipment by geographic location was as follows (in thousands): March 31, December 31, 2017 2016 United States $ 4,161 $ 4,176 International 304 302 $ 4,465 $ 4,478 |
Concentrations
Concentrations | 3 Months Ended |
Mar. 31, 2017 | |
Risks And Uncertainties [Abstract] | |
Concentrations | NOTE 10—CONCENTRATIONS Revenue from the Company’s products for the three months ended March 31, 2017 and 2016 are as follows: Three Months Ended March 31, 2017 2016 Laser systems 61.9 % 62.3 % Imaging systems 5.7 % 6.3 % Consumables and other 15.6 % 16.1 % Services 16.5 % 15.0 % License fees and royalties 0.3 % 0.3 % Total revenue 100.0 % 100.0 % No individual customer represented more than 10% of the Company’s revenue for the three months ended March 31, 2017 or 2016. The Company maintains its cash and cash equivalent accounts with established commercial banks. Such cash deposits periodically exceed the Federal Deposit Insurance Corporation insured limit. No individual customer represented more than 10% of the Company’s accounts receivable at March 31, 2017 or December 31, 2016. The Company currently purchases certain key components of its products from single suppliers. Although there are a limited number of manufacturers of these key components, management believes that other suppliers could provide similar key components on comparable terms. A change in suppliers, however, could cause delays in manufacturing and a possible loss of sales, which could adversely affect the Company’s business, results of operations and financial condition. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 11—INCOME TAXES The Company accounts for income taxes under the asset and liability method, whereby deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply 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. Management evaluates the need to establish a valuation allowance for deferred tax assets based upon the amount of existing temporary differences, the period in which they are expected to be recovered, and expected levels of taxable income. A valuation allowance to reduce deferred tax assets is established when it is “more likely than not” that some or all of the deferred tax assets will not be realized. Based on the Company’s net losses in prior years, management has determined that a full valuation allowance against the Company’s net deferred tax assets is appropriate. Accounting for uncertainty in income taxes prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return and provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. The Company has elected to classify interest and penalties as a component of its income tax provision. With respect to the liability for unrecognized tax benefits, including related estimates of penalties and interest, the Company did not record a liability for unrecognized tax benefits for the three months ended March 31, 2017 and 2016. The Company does not expect any changes to its unrecognized tax benefit for the next 12 months that would materially impact its consolidated financial statements. During the three months ended March 31, 2017 and 2016, the Company recorded an income tax provision of $40,000 and $40,000, respectively, resulting in an effective tax rate of (1.0)% and (0.9)%, respectively. The income tax provisions for the three months ended March 31, 2017 and 2016 were calculated using the discrete year-to-date method. The effective tax rate differs from the statutory tax rate of 34% primarily due to the existence of valuation allowances against net deferred tax assets and current liabilities resulting from the estimated state income tax liabilities and foreign tax liability. |
Subsequent Event
Subsequent Event | 3 Months Ended |
Mar. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Event | NOTE 12—SUBSEQUENT EVENT Convertible Preferred Stock and Warrant Transaction On April 18, 2017, the Company completed a private placement with several institutional and individual investors and certain of its directors and officers, under which the Company sold an aggregate of 80,644 3,925,871 100 1.24 $10.5 million. |
Summary of Significant Accoun18
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The unaudited consolidated financial statements include the accounts of BIOLASE and its wholly-owned subsidiaries and have been prepared on a basis consistent with the December 31, 2016 audited consolidated financial statements and include all material adjustments, consisting of normal recurring adjustments and the elimination of all material intercompany transactions and balances, necessary to fairly present the information set forth therein. These unaudited, interim, consolidated financial statements do not include all the footnotes, presentations, and disclosures normally required by accounting principles generally accepted in the United States of America (“GAAP”) for complete consolidated financial statements. Certain amounts have been reclassified to conform to current period presentations. The consolidated results of operations for the three months ended March 31, 2017 are not necessarily indicative of the results for the full year. The accompanying consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the year ended December 31, 2016, included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016 filed with the Securities and Exchange Commission (the “SEC”) on March 10, 2017 (the “2016 Form 10-K”). |
Liquidity and Management's Plans | Liquidity and Management’s Plans The Company incurred a loss from operations, incurred a net loss, and used cash in operating activities for the three months ended March 31, 2017. The Company has also suffered recurring losses from operations during the three years ended December 31, 2016. The Company’s recurring losses, level of cash used in operations, and potential need for additional capital, and the uncertainties surrounding the Company’s ability to raise additional capital, raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. On April 18, 2017, the Company completed a private placement with several institutional and individual investors, and certain of its directors and officers, under which the Company sold an aggregate of 80,644 shares of BIOLASE Series D Participating Convertible Preferred Stock, par value $0.001 per share (“Preferred Stock”), and warrants (the “Warrants”) to purchase up to an aggregate of 3,925,871 unregistered shares of BIOLASE common stock at an exercise price of $1.80 per share (the “Exercise Price”), subject to customary anti-dilution adjustments. Each share of Preferred Stock converts automatically into shares of BIOLASE common stock upon receipt of stockholder approval and was initially convertible into 100 shares of common stock, reflecting a conversion price equal to $1.24 per share, which is the closing price of BIOLASE common stock quoted on the NASDAQ Capital Market on April 10, 2017. The shares of Preferred Stock have no other conversion rights. The Warrants become exercisable on October 18, 2017 and expire five years after the date of issuance or, if earlier, five business days after the Company delivers notice that the closing price per share of BIOLASE common stock exceeded the Exercise Price for 20 consecutive trading days during the exercise period. Gross proceeds from the sale were approximately $10.5 million. As of March 31, 2017, the Company had working capital of approximately $12.2 million. The Company’s principal sources of liquidity as of March 31, 2017 consisted of approximately $3.8 million in cash, cash equivalents and restricted cash and $9.2 million of net accounts receivable. In order for the Company to continue operations beyond the next 12 months and be able to discharge its liabilities and commitments in the normal course of business, the Company must increase sales of its products directly to end-users and through distributors, establish profitable operations through the combination of increased sales and decreased expenses, generate cash from operations or obtain additional funds when needed. The Company intends to improve its financial condition and ultimately improve its financial results by increasing revenues through expansion of its product offerings, continuing to expand and develop its field sales force and distributor relationships, both domestically and internationally, forming strategic arrangements within the dental and medical industries, educating dental and medical patients as to the benefits of its advanced medical technologies, and reducing expenses. Additional capital requirements may depend on many factors, including, among other things, continued losses, the rate at which the Company’s business grows, demands for working capital, manufacturing capacity, and any acquisitions that the Company may pursue. From time to time, the Company could be required, or may otherwise attempt, to raise capital, through either equity or debt offerings, or enter into a line of credit facility. The Company cannot provide assurances that it will be able to successfully consummate any such equity or debt financings, or enter into any such line of credit facility, in the future or that the required capital would be available on acceptable terms, if at all, or that any such financing activity would not be dilutive to its stockholders. |
Use of Estimates | Use of Estimates The preparation of these consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“U. S. GAAP”) requires the Company to make estimates and assumptions that affect amounts reported in the consolidated financial statements and the accompanying notes. Significant estimates in these consolidated financial statements include allowances on accounts receivable, inventory, and deferred taxes, as well as estimates for accrued warranty expenses, goodwill and the ability of goodwill to be realized, revenue deferrals, effects of stock-based compensation and warrants, contingent liabilities, and the provision or benefit for income taxes. Due to the inherent uncertainty involved in making estimates, actual results reported in future periods may differ materially from those estimates. |
Critical Accounting Policies | Critical Accounting Policies Information with respect to the Company’s critical accounting policies, which management believes could have the most significant effect on the Company’s reported results and require subjective or complex judgments by management is contained in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” of the 2016 Form 10-K. Management believes that there have been no significant changes during the three months ended March 31, 2017 in the Company’s critical accounting policies from those disclosed in Item 7 of the 2016 Form 10-K. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants in the principal market (or, if none exists, the most advantageous market) for the specific asset or liability at the measurement date (referred to as the “exit price”). The fair value is based on assumptions that market participants would use, including a consideration of nonperformance risk. Under the accounting guidance for fair value hierarchy there are three levels of measurement inputs. Level 1 inputs are quoted prices in active markets for identical assets or liabilities. Level 2 inputs reflect input other than quoted prices included in Level 1 that are observable, either directly or through collaboration with observable market data, other than Level 1. Level 3 inputs are unobservable due to little or no corroborating market data. The Company’s financial instruments, consisting of cash and cash equivalents, accounts receivable, accounts payable, and accrued liabilities, approximate fair value because of the short maturity of these items. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Changes to U.S. GAAP are established by the Financial Accounting Standards Board (“FASB”) in the form of accounting standards updates (“ASUs”) to the FASB’s Accounting Standards Codification (“ASC”). The Company considers the applicability and impact of all ASUs. ASUs not listed below were assessed and determined not to be applicable or are expected to have minimal impact on the Company’s consolidated financial position and results of operations. Adopted Accounting Pronouncements In July 2015, the FASB issued ASU No. 2015-11, Simplifying the Measurement of Inventory (“ASU 2015-11”), as part of its simplification initiative. The standard requires inventory within the scope of ASU 2015-11 to be measured using the lower of cost and net realizable value. The changes apply to all types of inventory, except those measured using the-last-in-first-out method or the retail inventory method. ASU 2015-11 applies to all entities and is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2016, with early adoption permitted. The Company adopted ASU 2015-11 as of January 1, 2017. The adoption of ASU 2015-11 did not have a material effect on the Company’s consolidated financial statements. In November 2015, FASB issued ASU 2015-17, Income Taxes (Topic 740) (“ASC 2015-17”). Current GAAP requires an entity to separate deferred income tax liabilities and assets into current and noncurrent amounts in a classified statement of financial position. To simplify the presentation of deferred income taxes, the amendments in this ASU require that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. The amendments in this ASU apply to all entities that present a classified statement of financial position. The new standard is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years with early adoption permitted. The Company adopted ASU 2015-17 as of January 1, 2017. The adoption of ASU 2015-17 did not have a material effect on the Company’s consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, Compensation – Stock Compensation (Topic 718) (“ASU 2016-09”). The updated standard simplifies several aspects of the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. The standard requires the recognition of the income tax effects of awards in the income statement when the awards vest or are settled, thus eliminating additional paid in capital pools . Recently Issued Accounting Standards In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”), which supersedes nearly all existing revenue recognition guidance under U.S. GAAP. The core principle of ASU 2014-09 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services. ASU 2014-09 defines a five-step process to achieve this core principle, and, in doing so, more judgment and estimates may be required within the revenue recognition process than are required under existing U.S. GAAP. The standard is effective for annual periods beginning after December 15, 2017, and interim periods therein, using either of the following transition methods: (i) a full retrospective approach reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients or (ii) a retrospective approach with the cumulative effect of initially adopting ASU 2014-09 recognized at the date of adoption (which includes additional footnote disclosures). The Company will adopt the standard during the year ending December 31, 2018. The expected adoption method and implementation analysis of ASU 2014-09 is in the early stages and the Company expects to have further information following the second quarter of 2017. The FASB has issued and may issue in the future, interpretive guidance, which may impact the Company’s implementation analysis. In February 2016, FASB issued ASU 2016-02, Leases. The new standard establishes a right-of-use (“ROU”) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is currently evaluating the impact of its pending adoption of the new standard on its consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230) (“ASU 2016-15”). The updated standard addresses eight specific cash flow issues with the objective of reducing diversity in practice. ASU 2016-15 is effective for public business entities for annual reporting periods beginning after December 15, 2017, including interim periods within those annual reporting periods. Early adoption is permitted. The Company is assessing the impact of the adoption of ASU 2016-15 on the Company's consolidated financial statements. |
Income Tax Uncertainties | Accounting for uncertainty in income taxes prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return and provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. The Company has elected to classify interest and penalties as a component of its income tax provision. With respect to the liability for unrecognized tax benefits, including related estimates of penalties and interest, the Company did not record a liability for unrecognized tax benefits for the three months ended March 31, 2017 and 2016. The Company does not expect any changes to its unrecognized tax benefit for the next 12 months that would materially impact its consolidated financial statements. |
Stock-Based Awards and Per Sh19
Stock-Based Awards and Per Share Information (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of Income Statement Classification of Compensation Expense | The following table summarizes the income statement classification of compensation expense associated with share-based payments (in thousands): Three Months Ended March 31, 2017 2016 Cost of revenue $ 40 $ 70 Sales and marketing 73 134 General and administrative 193 551 Engineering and development 73 79 $ 379 $ 834 |
Assumptions on Estimation of Stock Option Fair Values | The stock option fair values, under the 2002 Plan, were estimated using the Black-Scholes option-pricing model with the following assumptions: Three Months Ended March 31, 2017 2016 Expected term 5.8 years 6.3 years Volatility 79.43 % 86.30 % Annual dividend per share $ — $ — Risk-free interest rate 1.98 % 1.42 % |
Summary of Option Activity | A summary of option activity under the 2002 Plan for the three months ended March 31, 2017 is as follows (in thousands, except per share data) Weighted Average Weighted Remaining Aggregate Average Contractual Intrinsic Shares Exercise Price Term (Years) Value(1) Options outstanding, December 31, 2016 6,612 $ 2.06 7.70 $ 178 Granted at fair market value 611 $ 1.55 Exercised — Forfeited, cancelled, or expired (206 ) $ 2.14 Options outstanding at March 31, 2017 7,017 $ 2.02 7.72 $ 160 Options exercisable at March 31, 2017 3,582 $ 2.42 6.29 $ 71 Vested options expired during the quarter ended March 31, 2017 63 $ 2.91 (1) The intrinsic value calculation does not include negative values. This can occur when the fair market value on the reporting date is less than the exercise price of the grant. |
Summary of Unvested Stock Option Activity | A summary of unvested stock option activity under the 2002 Plan for the three months ended March 31, 2017 is as follows (in thousands, except per share data): Weighted Average Grant Shares Date Fair Value Unvested options at December 31, 2016 3,259 $ 1.16 Granted 611 $ 1.05 Vested (304 ) $ 1.10 Forfeited or cancelled (131 ) $ 1.23 Unvested options at March 31, 2017 3,435 $ 1.15 |
Cash Proceeds, Along With Fair Value Disclosures Related to Grants, Exercises, and Vesting Options | Cash proceeds, along with fair value disclosures related to grants, exercises, and vested options under the 2002 Plan are as follows for the three months ended March 31 (in thousands, except per share amounts): Three Months Ended March 31, 2017 2016 Proceeds from stock options exercised $ — $ — Tax benefit related to stock options exercised (1) N/A N/A Intrinsic value of stock options exercised (2) $ — $ — Weighted-average fair value of options granted during period $ 1.05 $ 0.67 Total fair value of shares vested during the period $ 334 $ 708 (1) Excess tax benefits received related to stock option exercises are presented as financing cash inflows. The Company currently does not receive a tax benefit related to the exercise of stock options due to the Company’s net operating losses. (2) The intrinsic value of stock options exercised is the amount by which the market price of the stock on the date of exercise exceeded the market price of the stock on the date of grant. |
Summary of Unvested Restricted Stock Units | A summary of unvested RSU activity under the 2002 Plan for the three months ended March 31, 2017 is as follows: Weighted Average Grant Shares Date Fair Value Unvested restricted stock units at December 31, 2016 418,511 $ 1.23 Granted 1,080,000 $ 1.55 Vested (94,761 ) $ 1.13 Forfeited or cancelled — $ — Unvested restricted stock units at March 31, 2017 1,403,750 $ 1.48 |
Summary of Warrant Activity | The Company issues warrants to acquire shares of BIOLASE common stock as approved by the Board. A summary of warrant activity for the three months ended March 31, 2017 is as follows: Weighted Average Shares Exercise Price Warrants outstanding, December 31, 2016 11,406,260 $ 3.64 Granted or Issued — $ — Exercised — $ — Forfeited, cancelled, or expired — $ - Warrants outstanding at March 31, 2017 11,406,260 $ 3.64 Warrants exercisable at March 31, 2017 11,271,260 $ 3.64 Vested warrants expired during the quarter ended March 31, 2017 — $ — |
Inventory (Tables)
Inventory (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Components of Inventory | Inventory is valued at the lower of cost or market, with cost determined using the first-in, first-out method, and is comprised of the following (in thousands): March 31, December 31, 2017 2016 Raw materials $ 5,021 $ 4,837 Work-in-process 2,532 2,261 Finished goods 7,140 6,425 Inventory, net $ 14,693 $ 13,523 |
Property, Plant, and Equipment
Property, Plant, and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Property Plant And Equipment [Abstract] | |
Summary of Property, Plant, and Equipment | Property, plant, and equipment, net is comprised of the following (in thousands): March 31, December 31, 2017 2016 Building $ 199 $ 196 Leasehold improvements 2,003 2,003 Equipment and computers 6,170 6,163 Furniture and fixtures 599 599 Construction in progress 1,857 1,590 10,828 10,551 Accumulated depreciation and amortization (6,517 ) (6,225 ) 4,311 4,326 Land 154 152 Property, plant, and equipment, net $ 4,465 $ 4,478 |
Accrued Liabilities and Defer22
Accrued Liabilities and Deferred Revenue (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Payables And Accruals [Abstract] | |
Components of Accrued Liabilities | Accrued liabilities are comprised of the following (in thousands): March 31, December 31, 2017 2016 Payroll and benefits $ 2,164 $ 2,147 Warranty accrual, current portion 973 933 Taxes 493 638 Accrued professional services 946 782 Accrued capital lease obligations, current portion 117 159 Accrued insurance premium 206 906 Other 264 213 Total accrued liabilities $ 5,163 $ 5,778 |
Changes in Initial Product Warranty Accrual and Expenses Under Initial and Extended Warranties | Changes in the initial product warranty accrual and the expenses incurred under the Company’s initial and extended warranties for the three months ended March 31, 2017 and 2016 are included within accrued liabilities on the Consolidated Balance Sheets and were as follows (in thousands): Three Months Ended March 31, 2017 2016 Initial warranty accrual, beginning balance $ 1,706 $ 2,188 Provision for estimated warranty cost (23 ) 61 Warranty expenditures (223 ) (189 ) 1,460 2,060 Less warranty accrual, long-term 487 973 Total warranty accrual, current portion $ 973 $ 1,087 |
Components of Deferred Revenue | Deferred revenue is comprised of the following (in thousands): March 31, December 31, 2017 2016 Undelivered elements (training, installation, and product and support services) $ 1,075 $ 1,404 Extended warranty contracts 1,499 1,487 Deferred royalties 112 142 Total Deferred Revenue 2,686 3,033 Less long-term amounts: Deferred royalties 20 23 Total Deferred Revenue - Long-Term 20 23 Total Deferred Revenue - Current $ 2,666 $ 3,010 |
Commitments and Contingencies
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Commitments And Contingencies Disclosure [Abstract] | |
Future minimum rental commitments under non-cancelable Operating Leases | Future minimum rental commitments under lease agreements, including both operating and capital leases (principle and interest), with non-cancelable terms greater than one year for each of the years ending December 31 are as follows (in thousands): 2017 $ 654 2018 735 2019 656 2020 218 Thereafter — Total future minimum lease obligations $ 2,263 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Segment Reporting [Abstract] | |
Summary of Net Revenue by Geographic Location | Net revenue by geographic location based on the location of customers was as follows (in thousands): Three Months Ended March 31, 2017 2016 United States $ 6,843 $ 6,401 International 4,031 4,609 $ 10,874 $ 11,010 |
Summary of Property, Plant and Equipment by Geographic Location | Property, plant, and equipment by geographic location was as follows (in thousands): March 31, December 31, 2017 2016 United States $ 4,161 $ 4,176 International 304 302 $ 4,465 $ 4,478 |
Concentrations (Tables)
Concentrations (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Risks And Uncertainties [Abstract] | |
Summary of Net Revenue from Various Products | Revenue from the Company’s products for the three months ended March 31, 2017 and 2016 are as follows: Three Months Ended March 31, 2017 2016 Laser systems 61.9 % 62.3 % Imaging systems 5.7 % 6.3 % Consumables and other 15.6 % 16.1 % Services 16.5 % 15.0 % License fees and royalties 0.3 % 0.3 % Total revenue 100.0 % 100.0 % |
Description of Business and B26
Description of Business and Basis of Presentation - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | Apr. 18, 2017 | Mar. 31, 2017 | Dec. 31, 2016 |
Description Of Business And Basis Of Presentation [Line Items] | |||
Preferred stock, par value | $ 0.001 | $ 0.001 | |
Working capital | $ 12,200 | ||
Cash and cash equivalents, including restricted cash | 3,800 | ||
Net accounts receivable | $ 9,220 | $ 9,784 | |
Private Placement | |||
Description Of Business And Basis Of Presentation [Line Items] | |||
Warrants exercisable description | The Warrants become exercisable on October 18, 2017 and expire five years after the date of issuance or, if earlier, five business days after the Company delivers notice that the closing price per share of BIOLASE common stock exceeded the Exercise Price for 20 consecutive trading days during the exercise period. | ||
Subsequent Event | Private Placement | |||
Description Of Business And Basis Of Presentation [Line Items] | |||
Aggregate unregistered shares | 80,644 | ||
Number of warrants to purchase aggregate unregistered shares of common stock | 3,925,871 | ||
Price per share of unregistered shares of common stock | $ 1.80 | ||
Conversion of stock, each shares issued | 100 | ||
Stock conversion, price | $ 1.24 | ||
Proceeds from equity offering, gross | $ 10,500 | ||
Warrants exercisable date | Oct. 18, 2017 | ||
Warrants exercisable of private placement term expiration period | 5 years | ||
Number of consecutive trading days | 20 days | ||
Subsequent Event | Series D Participating Convertible Preferred Stock | Private Placement | |||
Description Of Business And Basis Of Presentation [Line Items] | |||
Aggregate unregistered shares | 80,644 | ||
Preferred stock, par value | $ 0.001 | ||
Number of warrants to purchase aggregate unregistered shares of common stock | 3,925,871 |
Stock-Based Awards and Per Sh27
Stock-Based Awards and Per Share Information - Additional Information (Detail) | Mar. 27, 2017SeniorVicePresidentChiefFinancialOfficer$ / sharesshares | Mar. 13, 2017shares | Feb. 06, 2017$ / sharesshares | Mar. 31, 2017USD ($)$ / sharesshares | Sep. 30, 2016USD ($) | Mar. 31, 2016USD ($)$ / sharesshares | Apr. 18, 2016VicePresident$ / shares |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Compensation expense related to stock options | $ | $ 379,000 | $ 834,000 | |||||
Net impact of share based compensation expense to earnings per basic share | $ / shares | $ 0.01 | $ 0.01 | |||||
Net impact of share based compensation expense to earnings per diluted share | $ / shares | $ 0.01 | $ 0.01 | |||||
Total unrecognized compensation cost | $ | $ 5,300,000 | ||||||
Unrecognized share based compensation cost to be recognized over weighted-average period | 2 years 4 months 24 days | ||||||
Reversal of share based compensation expense | $ | $ 428,000 | ||||||
Number of newly hired vice presidents | VicePresident | 1 | ||||||
Number of senior vice president and chief financial officer | SeniorVicePresidentChiefFinancialOfficer | 1 | ||||||
Outstanding stock options, restricted stock units and warrants excluded from diluted loss per share | 22,927,127 | 15,227,739 | |||||
Stock Options | Employees | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Stock options granted | 611,000 | ||||||
Awards valued per share | $ / shares | $ 1.55 | ||||||
Options expiration period | 10 years | ||||||
Stock Options | Existing Employees | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Stock options granted | 586,000 | ||||||
Stock Options | Existing Employees | Vest on First Anniversary of Award Date | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Sharebased Compensation Arrangement By Sharebased Payment Award Award Vesting Rights Percentage | 50.00% | ||||||
Stock Options | Existing Employees | Vest on Second Anniversary of Award Date | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Sharebased Compensation Arrangement By Sharebased Payment Award Award Vesting Rights Percentage | 50.00% | ||||||
Stock Options | New Employees | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Share Based Compensation Arrangement By Share Based Payment Award, Vesting Commencement Date | Mar. 6, 2018 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Monthly Ratable Award Vesting Period | 36 months | ||||||
Options vesting description | For the 25,000 options awarded to new employees, 25% vest on February 6, 2018 and the remainder vest ratably over the 36-month period, commencing on March 6, 2018. | ||||||
Stock Options | New Employees | Vest on February 6, 2018 | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Stock options granted | 25,000 | ||||||
Share Based Compensation Arrangement By Share Based Payment Award, Vesting Commencement Date | Feb. 6, 2018 | ||||||
Sharebased Compensation Arrangement By Sharebased Payment Award Award Vesting Rights Percentage | 25.00% | ||||||
Stock Options | Vice Presidents | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Stock options granted | 400,000 | ||||||
Awards valued per share | $ / shares | $ 1.17 | ||||||
Options expiration period | 10 years | ||||||
Share Based Compensation Arrangement By Share Based Payment Award, Vesting Commencement Date | Mar. 13, 2018 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Monthly Ratable Award Vesting Period | 36 months | ||||||
Percentage of time based vesting for options | 75.00% | ||||||
Stock Options | Vice Presidents | Awards Vesting on March 13, 2018 | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Sharebased Compensation Arrangement By Sharebased Payment Award Award Vesting Rights Percentage | 25.00% | ||||||
Non Qualified Stock Options | Senior Vice President and Chief Financial Officer | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Stock options granted | 600,000 | ||||||
Awards valued per share | $ / shares | $ 1.28 | ||||||
Options expiration period | 10 years | ||||||
Share Based Compensation Arrangement By Share Based Payment Award, Vesting Commencement Date | Mar. 27, 2018 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Monthly Ratable Award Vesting Period | 36 months | ||||||
Percentage of time based vesting for options | 75.00% | ||||||
Non Qualified Stock Options | Senior Vice President and Chief Financial Officer | Awards Vesting on March 27, 2018 | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Sharebased Compensation Arrangement By Sharebased Payment Award Award Vesting Rights Percentage | 25.00% | ||||||
Restricted Stock Units (RSUs) | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Awards valued per share | $ / shares | $ 1.55 | ||||||
Granted | 80,000 | 1,080,000 | |||||
Vest in period | 94,761 | ||||||
Restricted Stock Units (RSUs) | Vest on March 14, 2017 | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Date | Mar. 14, 2017 | ||||||
Vest in period | 30,000 | ||||||
Restricted Stock Units (RSUs) | Vest on September 14, 2017 | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Date | Sep. 14, 2017 | ||||||
Vest in period | 20,000 | ||||||
Restricted Stock Units (RSUs) | Vest on May 10, 2018 | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Date | May 10, 2018 | ||||||
Vest in period | 30,000 | ||||||
Restricted Stock Units (RSUs) | President And Chief Executive Officer | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Awards valued per share | $ / shares | $ 1.55 | ||||||
Options vesting description | (i) one-quarter of the RSUs vest on February 6, 2019, (ii) one-eighth of the RSUs vest on February 6, 2020, (iii) one-eighth of the RSUs vest on February 6, 2021, and (iv) one-half of the RSUs vest upon the achievement of specific interim and annual Company performance criteria | ||||||
Granted | 1,000,000 | ||||||
Restricted Stock Units (RSUs) | President And Chief Executive Officer | Vest on February 6, 2017 | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Date | Feb. 6, 2019 | ||||||
Restricted Stock Units (RSUs) | President And Chief Executive Officer | Vest on February 6, 2020 | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Date | Feb. 6, 2020 | ||||||
Restricted Stock Units (RSUs) | President And Chief Executive Officer | Vest on February 6, 2021 | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Date | Feb. 6, 2021 | ||||||
2002 Stock Incentive Plan | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Plan expiration date | May 5, 2019 | ||||||
Common stock authorized for issuance under the 2002 Plan | 15,550,000 | ||||||
Common stock issued pursuant to options exercised | 3,651,829 | ||||||
Options and restricted stock units outstanding | 8,420,559 | ||||||
Options available for future grants | 3,477,612 |
Classification of Compensation
Classification of Compensation Expense Associated with Share-Based Payments (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Allocated Share-based Compensation Expense | $ 379 | $ 834 |
Cost Of Revenue | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Allocated Share-based Compensation Expense | 40 | 70 |
Sales and Marketing | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Allocated Share-based Compensation Expense | 73 | 134 |
General and Administrative | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Allocated Share-based Compensation Expense | 193 | 551 |
Engineering And Development | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Allocated Share-based Compensation Expense | $ 73 | $ 79 |
Assumptions Used in Estimating
Assumptions Used in Estimating Fair Value of Stock Options Granted (Detail) - 2002 Stock Incentive Plan | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Expected term | 5 years 9 months 18 days | 6 years 3 months 18 days |
Volatility | 79.43% | 86.30% |
Risk-free interest rate | 1.98% | 1.42% |
Summary of Option Activity (Det
Summary of Option Activity (Detail) - 2002 Stock Incentive Plan - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2017 | Dec. 31, 2016 | ||
Shares | |||
Beginning Balance | 6,612,000 | ||
Granted at fair market value | 611,000 | ||
Forfeited, cancelled, or expired | (206,000) | ||
Ending Balance | 7,017,000 | 6,612,000 | |
Options exercisable at March 31, 2017 | 3,582,000 | ||
Vested options expired during the quarter ended March 31, 2017 | 63,000 | ||
Weighted Average Exercise Price | |||
Beginning Balance | $ 2.06 | ||
Granted at fair market value | 1.55 | ||
Forfeited, cancelled, or expired | 2.14 | ||
Ending Balance | 2.02 | $ 2.06 | |
Options exercisable at March 31, 2017 | 2.42 | ||
Vested options expired during the quarter ended March 31, 2017 | $ 2.91 | ||
Weighted Average Remaining Contractual Term (Years) | |||
Options outstanding | 7 years 8 months 19 days | 7 years 8 months 12 days | |
Options exercisable | 6 years 3 months 15 days | ||
Aggregate Intrinsic Value | |||
Options outstanding | [1] | $ 160 | $ 178 |
Options exercisable | [1] | $ 71 | |
[1] | The intrinsic value calculation does not include negative values. This can occur when the fair market value on the reporting date is less than the exercise price of the grant. |
Summary of Unvested Stock Optio
Summary of Unvested Stock Option Activity (Detail) - $ / shares | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Weighted Average Grant Date Fair Value | ||
Granted | $ 1.05 | $ 0.67 |
Stock Options | ||
Shares | ||
Beginning Balance | 3,259,000 | |
Granted | 611,000 | |
Vested | (304,000) | |
Forfeited or cancelled | (131,000) | |
Ending Balance | 3,435,000 | |
Weighted Average Grant Date Fair Value | ||
Beginning Balance | $ 1.16 | |
Granted | 1.05 | |
Vested | 1.10 | |
Forfeited or cancelled | 1.23 | |
Ending Balance | $ 1.15 |
Cash Proceeds Along with Fair V
Cash Proceeds Along with Fair Value Disclosures Related to Grants, Exercises, and Vested Options (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||
Weighted-average fair value of options granted during period | $ 1.05 | $ 0.67 |
Total fair value of shares vested during the period | $ 334 | $ 708 |
Summary of Unvested Restricted
Summary of Unvested Restricted Stock Units (Detail) - Restricted Stock Units (RSUs) - $ / shares | Feb. 06, 2017 | Mar. 31, 2017 |
Shares | ||
Beginning Balance | 418,511 | |
Granted | 80,000 | 1,080,000 |
Vested | (94,761) | |
Ending Balance | 1,403,750 | |
Weighted Average Grant Date Fair Value | ||
Beginning Balance | $ 1.23 | |
Granted | 1.55 | |
Vested | 1.13 | |
Ending Balance | $ 1.48 |
Summary of Warrant Activity (De
Summary of Warrant Activity (Detail) - Warrants - $ / shares | Mar. 31, 2017 | Dec. 31, 2016 |
Shares | ||
Warrants outstanding | 11,406,260 | 11,406,260 |
Warrants exercisable at March 31, 2017 | 11,271,260 | |
Weighted Average Exercise Price | ||
Beginning Balance | $ 3.64 | $ 3.64 |
Warrants exercisable at March 31, 2017 | $ 3.64 |
Components of Inventory (Detail
Components of Inventory (Detail) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Components of inventory, net of allowances | ||
Raw materials | $ 5,021 | $ 4,837 |
Work-in-process | 2,532 | 2,261 |
Finished goods | 7,140 | 6,425 |
Inventory, net | $ 14,693 | $ 13,523 |
Inventory - Additional Informat
Inventory - Additional Information (Detail) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Inventory Disclosure [Abstract] | ||
Provision for excess and obsolete inventory | $ 1.9 | $ 1.7 |
Summary of Property, Plant, and
Summary of Property, Plant, and Equipment (Detail) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Property Plant And Equipment [Line Items] | ||
Property, plant, and equipment gross, excluding land | $ 10,828 | $ 10,551 |
Accumulated depreciation and amortization | (6,517) | (6,225) |
Property, plant, and equipment net, excluding land | 4,311 | 4,326 |
Land | 154 | 152 |
Property, plant, and equipment, net | 4,465 | 4,478 |
Building | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 199 | 196 |
Leasehold Improvements | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 2,003 | 2,003 |
Equipment and Computers | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 6,170 | 6,163 |
Furniture and Fixtures | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 599 | 599 |
Construction in Progress | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 1,857 | $ 1,590 |
Property, Plant, and Equipmen38
Property, Plant, and Equipment - Additional Information (Detail) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Property Plant And Equipment [Line Items] | ||
Depreciation and amortization expenses | $ 290,000 | $ 198,000 |
Assets Held Under Capital Lease | ||
Property Plant And Equipment [Line Items] | ||
Capital leased assets, Gross | 378,000 | |
Accumulated depreciation related to assets held under capital lease | $ 264,000 |
Intangible Assets and Goodwill
Intangible Assets and Goodwill - Additional Information (Detail) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Jun. 30, 2016 | Dec. 31, 2016 | |
Goodwill And Intangible Assets Disclosure [Abstract] | ||||
Intangible assets and goodwill impairment | $ 0 | |||
Amortization expense | $ 0 | $ 14,000 | ||
Goodwill | $ 2,926,000 | $ 2,926,000 |
Components of Accrued Liabiliti
Components of Accrued Liabilities (Detail) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 | Mar. 31, 2016 |
Components of accrued liabilities | |||
Payroll and benefits | $ 2,164 | $ 2,147 | |
Warranty accrual, current portion | 973 | 933 | $ 1,087 |
Taxes | 493 | 638 | |
Accrued professional services | 946 | 782 | |
Accrued capital lease obligations, current portion | 117 | 159 | |
Accrued insurance premium | 206 | 906 | |
Other | 264 | 213 | |
Total accrued liabilities | $ 5,163 | $ 5,778 |
Changes in Initial Product Warr
Changes in Initial Product Warranty Accrual and Expenses Under Initial and Extended Warranties (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Movement in Standard Product Warranty Accrual | |||
Initial warranty accrual, beginning balance | $ 1,706 | $ 2,188 | |
Provision for estimated warranty cost | (23) | 61 | |
Warranty expenditures | (223) | (189) | |
Initial warranty accrual, ending balance | 1,460 | 2,060 | |
Less warranty accrual, long-term | 487 | 973 | $ 773 |
Total warranty accrual, current portion | $ 973 | $ 1,087 | $ 933 |
Summary of Deferred Revenue (De
Summary of Deferred Revenue (Detail) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Components of deferred revenue | ||
Undelivered elements (training, installation, and product and support services) | $ 1,075 | $ 1,404 |
Extended warranty contracts | 1,499 | 1,487 |
Deferred royalties | 112 | 142 |
Total Deferred Revenue | 2,686 | 3,033 |
Less long-term amounts: | ||
Deferred royalties | 20 | 23 |
Total Deferred Revenue - Long-Term | 20 | 23 |
Total Deferred Revenue - Current | $ 2,666 | $ 3,010 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) | 1 Months Ended | 3 Months Ended | ||
Mar. 31, 2015USD ($) | Feb. 28, 2015 | Mar. 31, 2017USD ($)ft² | Dec. 31, 2016USD ($) | |
Commitment And Contingencies [Line Items] | ||||
Area of corporate headquarters and manufacturing facility | ft² | 57,000 | |||
Extended lease term | Apr. 30, 2020 | |||
Provisions for tenant improvement allowance, maximum | $ 398,000 | |||
Capital lease agreement term for information technology equipment | 30 months | |||
Future minimum lease payments under capital lease, borrowing rate | 1.60% | |||
Future minimum lease payments under capital lease including net minimum lease payment for year ended December 31, 2017 | $ 117,000 | |||
Accrued capital lease obligations, current position | 117,000 | $ 159,000 | ||
Capital lease obligation, long-term | 0 | |||
Purchase commitments pending | 15,200,000 | |||
Employee Arrangements and Other Compensation | ||||
Commitment And Contingencies [Line Items] | ||||
Change in control, if occurs, may require severance benefits payable | 1,800,000 | |||
Accrued for performance bonuses | $ 67,000 |
Future Minimum Rental Commitmen
Future Minimum Rental Commitments Under Lease Agreements (Detail) $ in Thousands | Mar. 31, 2017USD ($) |
Commitments And Contingencies Disclosure [Abstract] | |
2,017 | $ 654 |
2,018 | 735 |
2,019 | 656 |
2,020 | 218 |
Total future minimum lease obligations | $ 2,263 |
Segment Information - Additiona
Segment Information - Additional Information (Detail) - Sales Revenue, Net - Customer | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Customer Concentration Risk | UNITED STATES | ||
Segment Reporting Information [Line Items] | ||
Concentration Risk Percentage | 63.00% | 58.00% |
Customer Concentration Risk | International | ||
Segment Reporting Information [Line Items] | ||
Concentration Risk Percentage | 37.00% | 42.00% |
Geographic Concentration Risk | International | ||
Segment Reporting Information [Line Items] | ||
Number of customers which represented more than 10% of the Company's revenue | 0 | 0 |
Geographic Concentration Risk | International | Minimum | ||
Segment Reporting Information [Line Items] | ||
Concentration Risk Percentage | 10.00% | 10.00% |
Summary of Net Revenue by Geogr
Summary of Net Revenue by Geographic Location (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Segment Reporting Information [Line Items] | ||
Net revenue | $ 10,874 | $ 11,010 |
UNITED STATES | ||
Segment Reporting Information [Line Items] | ||
Net revenue | 6,843 | 6,401 |
International | ||
Segment Reporting Information [Line Items] | ||
Net revenue | $ 4,031 | $ 4,609 |
Summary of Property, Plant and
Summary of Property, Plant and Equipment by Geographic Location (Detail) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Segment Reporting Information [Line Items] | ||
Property, plant, and equipment, net | $ 4,465 | $ 4,478 |
UNITED STATES | ||
Segment Reporting Information [Line Items] | ||
Property, plant, and equipment, net | 4,161 | 4,176 |
International | ||
Segment Reporting Information [Line Items] | ||
Property, plant, and equipment, net | $ 304 | $ 302 |
Concentrations - Summary of Net
Concentrations - Summary of Net Revenue from Various Products (Detail) - Product Concentration Risk - Sales Revenue, Net | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Concentration Risk [Line Items] | ||
Concentration Risk Percentage | 100.00% | 100.00% |
Laser systems | ||
Concentration Risk [Line Items] | ||
Concentration Risk Percentage | 61.90% | 62.30% |
Imaging systems | ||
Concentration Risk [Line Items] | ||
Concentration Risk Percentage | 5.70% | 6.30% |
Consumables and other | ||
Concentration Risk [Line Items] | ||
Concentration Risk Percentage | 15.60% | 16.10% |
Services | ||
Concentration Risk [Line Items] | ||
Concentration Risk Percentage | 16.50% | 15.00% |
License fees and royalties | ||
Concentration Risk [Line Items] | ||
Concentration Risk Percentage | 0.30% | 0.30% |
Concentrations - Additional Inf
Concentrations - Additional Information (Detail) - Product Concentration Risk - Customer | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Concentration Risk [Line Items] | |||
Number of customers which represented more than 10% of the Company's accounts receivable | 0 | 0 | |
Sales Revenue, Net | |||
Concentration Risk [Line Items] | |||
Number of customers which represented more than 10% of the Company's revenue | 0 | 0 | |
Concentration Risk Percentage | 100.00% | 100.00% | |
Account Receivable | |||
Concentration Risk [Line Items] | |||
Concentration Risk Percentage | 10.00% | 10.00% | |
Minimum | Sales Revenue, Net | |||
Concentration Risk [Line Items] | |||
Concentration Risk Percentage | 10.00% | 10.00% |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Income Tax Disclosure [Abstract] | ||
Liability for unrecognized tax benefit, including related estimates of penalties and interest | $ 0 | $ 0 |
Income tax provision (benefit) | $ 40,000 | $ 40,000 |
Projected annual effective tax rate | (1.00%) | (0.90%) |
Statutory tax rate | 34.00% | 34.00% |
Subsequent Event - Additional I
Subsequent Event - Additional Information (Detail) - Private Placement - USD ($) $ / shares in Units, $ in Millions | Apr. 18, 2017 | Mar. 31, 2017 |
Subsequent Event [Line Items] | ||
Warrants exercisable description | The Warrants become exercisable on October 18, 2017 and expire five years after the date of issuance or, if earlier, five business days after the Company delivers notice that the closing price per share of BIOLASE common stock exceeded the Exercise Price for 20 consecutive trading days during the exercise period. | |
Subsequent Event | ||
Subsequent Event [Line Items] | ||
Aggregate unregistered shares | 80,644 | |
Number of Warrants to purchase aggregate unregistered shares of common stock | 3,925,871 | |
Conversion of stock, each shares issued | 100 | |
Stock conversion, price | $ 1.24 | |
Warrants exercisable date | Oct. 18, 2017 | |
Warrants exercisable of private placement term expiration period | 5 years | |
Proceeds from equity offering, gross | $ 10.5 | |
Number of consecutive trading days | 20 days |