Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Jun. 30, 2018 | Jul. 26, 2018 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | DIGI INTERNATIONAL INC. | |
Entity Central Index Key | 854,775 | |
Current Fiscal Year End Date | --09-30 | |
Entity Filer Category | Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 27,242,693 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Revenue: | ||||
Product | $ 51,691 | $ 40,660 | $ 137,733 | $ 125,599 |
Services and solutions | 11,025 | 5,079 | 24,971 | 10,930 |
Total revenue | 62,716 | 45,739 | 162,704 | 136,529 |
Cost of sales: | ||||
Cost of product | 26,639 | 20,195 | 68,929 | 63,930 |
Cost of services and solutions | 6,007 | 2,550 | 13,737 | 5,727 |
Amortization of intangibles | 741 | 509 | 2,118 | 1,032 |
Total cost of sales | 33,387 | 23,254 | 84,784 | 70,689 |
Gross profit | 29,329 | 22,485 | 77,920 | 65,840 |
Operating expenses: | ||||
Sales and marketing | 11,595 | 8,504 | 32,530 | 25,557 |
Research and development | 8,205 | 7,420 | 24,573 | 21,304 |
General and administrative | 7,302 | 3,337 | 20,210 | 11,821 |
Restructuring charges, net | 190 | 2,515 | 190 | 2,515 |
Total operating expenses | 27,292 | 21,776 | 77,503 | 61,197 |
Operating income | 2,037 | 709 | 417 | 4,643 |
Other income (expense), net: | ||||
Interest income | 97 | 155 | 343 | 434 |
Interest expense | (5) | (2) | (12) | (45) |
Other income (expense), net | 535 | (221) | (37) | 210 |
Total other income (expense), net | 627 | (68) | 294 | 599 |
Income before income taxes | 2,664 | 641 | 711 | 5,242 |
Income tax provision (benefit) | 43 | (694) | 3,016 | 219 |
Net income (loss) | $ 2,621 | $ 1,335 | $ (2,305) | $ 5,023 |
Basic net income (loss) per common share: | ||||
Net income (loss), basic (USD per share) | $ 0.10 | $ 0.05 | $ (0.09) | $ 0.19 |
Diluted net income (loss) per common share | ||||
Net income (loss), diluted (USD per share) | $ 0.09 | $ 0.05 | $ (0.09) | $ 0.19 |
Weighted average common shares: | ||||
Basic (shares) | 27,177 | 26,522 | 27,002 | 26,390 |
Diluted (shares) | 27,764 | 26,956 | 27,002 | 27,110 |
Condensed Consolidated Stateme3
Condensed Consolidated Statements of Comprehensive (Loss) Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | ||
Statement of Comprehensive Income [Abstract] | |||||
Net income (loss) | $ 2,621 | $ 1,335 | $ (2,305) | $ 5,023 | |
Other comprehensive (loss) income, net of tax: | |||||
Foreign currency translation adjustment | (3,116) | 2,535 | (1,058) | 57 | |
Change in net unrealized (loss) gain on investments | (1) | 8 | (41) | (2) | |
Less income tax benefit (expense) | 1 | (3) | 9 | 1 | |
Reclassification of realized loss on investments included in net income | 0 | 0 | 31 | [1] | 0 |
Less income tax benefit | 0 | 0 | (8) | [2] | 0 |
Other comprehensive (loss) income, net of tax | (3,116) | 2,540 | (1,067) | 56 | |
Comprehensive (loss) income | $ (495) | $ 3,875 | $ (3,372) | $ 5,079 | |
[1] | Recorded in Other income (expense), net on our Condensed Consolidated Statements of Operations. | ||||
[2] | Recorded in Income tax provision (benefit) in our Condensed Consolidated Statements of Operations. |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2018 | Sep. 30, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 47,694 | $ 78,222 |
Marketable securities | 4,763 | 32,015 |
Accounts receivable, net | 48,246 | 28,855 |
Inventories | 41,782 | 30,238 |
Receivable from sale of business | 0 | 1,998 |
Other | 3,554 | 3,032 |
Total current assets | 146,039 | 174,360 |
Marketable securities, long-term | 2,243 | 4,753 |
Property, equipment and improvements, net | 11,474 | 12,801 |
Identifiable intangible assets, net | 41,778 | 11,800 |
Goodwill | 154,565 | 131,995 |
Deferred tax assets | 3,665 | 9,211 |
Other | 462 | 269 |
Total assets | 360,226 | 345,189 |
Current liabilities: | ||
Accounts payable | 10,849 | 6,240 |
Accrued compensation | 6,245 | 4,325 |
Accrued warranty | 1,295 | 987 |
Accrued professional fees | 1,019 | 928 |
Accrued restructuring | 666 | 1,656 |
Unearned revenue | 3,710 | 1,343 |
Contingent consideration on acquired businesses | 4,440 | 388 |
Other | 2,270 | 2,113 |
Total current liabilities | 30,494 | 17,980 |
Income taxes payable | 699 | 877 |
Deferred tax liabilities | 422 | 534 |
Contingent consideration on acquired businesses | 4,581 | 6,000 |
Other non-current liabilities | 608 | 654 |
Total liabilities | 36,804 | 26,045 |
Contingencies (see Note 12) | ||
Stockholders' equity: | ||
Preferred stock, $.01 par value; 2,000,000 shares authorized; none issued and outstanding | 0 | 0 |
Common stock, $.01 par value; 60,000,000 shares authorized; 33,646,457 and 33,007,993 shares issued | 337 | 330 |
Additional paid-in capital | 253,037 | 245,528 |
Retained earnings | 148,140 | 150,478 |
Accumulated other comprehensive loss | (23,726) | (22,659) |
Treasury stock, at cost, 6,403,764 and 6,436,578 shares | (54,366) | (54,533) |
Total stockholders' equity | 323,422 | 319,144 |
Total liabilities and stockholders' equity | $ 360,226 | $ 345,189 |
Condensed Consolidated Balance5
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Jun. 30, 2018 | Sep. 30, 2017 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (USD per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 2,000,000 | 2,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (USD per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 60,000,000 | 60,000,000 |
Common stock, shares issued | 33,646,457 | 33,007,993 |
Treasury stock, shares | 6,403,764 | 6,436,578 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Operating activities: | ||
Net (loss) income | $ (2,305) | $ 5,023 |
Adjustments to reconcile net (loss) income to net cash used in operating activities: | ||
Depreciation of property, equipment and improvements | 2,140 | 2,187 |
Amortization of identifiable intangible assets | 6,866 | 1,842 |
Stock-based compensation | 3,598 | 3,502 |
Excess tax benefits from stock-based compensation | 0 | (326) |
Deferred income tax provision | 2,551 | (648) |
Change in fair value of contingent consideration | 333 | (1,330) |
Bad debt/product return provision | 404 | 338 |
Inventory obsolescence | 1,550 | 1,030 |
Restructuring charges | 190 | 2,515 |
Other | (66) | 138 |
Changes in operating assets and liabilities (net of acquisitions) | (24,105) | (14,729) |
Net cash used in operating activities | (8,844) | (458) |
Investing activities: | ||
Purchase of marketable securities | 0 | (33,469) |
Proceeds from maturities and sales of marketable securities | 29,752 | 76,149 |
Proceeds from sale of Etherios | 2,000 | 3,000 |
Acquisition of businesses, net of cash acquired | (56,588) | (30,111) |
Purchase of property, equipment, improvements and certain other identifiable intangible assets | (963) | (1,577) |
Net cash (used in) provided by investing activities | (25,799) | 13,992 |
Financing activities: | ||
Acquisition earn-out payments | 0 | (518) |
Excess tax benefits from stock-based compensation | 0 | 326 |
Proceeds from stock option plan transactions | 3,871 | 3,264 |
Proceeds from employee stock purchase plan transactions | 892 | 686 |
Purchases of common stock | (730) | (922) |
Net cash provided by financing activities | 4,033 | 2,836 |
Effect of exchange rate changes on cash and cash equivalents | 82 | (45) |
Net (decrease) increase in cash and cash equivalents | (30,528) | 16,325 |
Cash and cash equivalents, beginning of period | 78,222 | 75,727 |
Cash and cash equivalents, end of period | 47,694 | 92,052 |
Supplemental schedule of non-cash investing and financing activities | ||
Liability related to acquisition of businesses | $ (2,300) | $ (1,310) |
Basis of Presentation of Unaudi
Basis of Presentation of Unaudited Interim Condensed Consolidated Financial Statements and Significant Accounting Policies | 9 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
BASIS OF PRESENTATION OF UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND SIGNIFICANTACCOUNTING POLICIES | BASIS OF PRESENTATION OF UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The interim unaudited condensed consolidated financial statements included in this Form 10-Q have been prepared by Digi International Inc. (the āCompany,ā āDigi,ā āwe,ā āour,ā or āusā) pursuant to the rules and regulations of the United States Securities and Exchange Commission (the āSECā). Certain information and footnote disclosures, normally included in consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (āU.S. GAAPā), have been condensed or omitted pursuant to such rules and regulations. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes thereto, including (but not limited to) the summary of significant accounting policies, presented in our Annual Report on Form 10-K for the year ended September 30, 2017, as filed with the SEC (ā2017 Financial Statementsā). The condensed consolidated financial statements presented herein reflect, in the opinion of management, all adjustments which consist only of normal, recurring adjustments necessary for a fair presentation of the condensed consolidated balance sheets and condensed consolidated statements of operations, comprehensive income and cash flows for the periods presented. The condensed consolidated results of operations for any interim period are not necessarily indicative of results for the full year. The year-end condensed consolidated balance sheet data were derived from our 2017 Financial Statements, but do not include all disclosures required by U.S. GAAP. Recently Issued Accounting Pronouncements Not Yet Adopted In May 2017, the Financial Accounting Standards Board (āFASBā) issued Accounting Standards Update (āASUā) 2017-09, āCompensation-Stock Compensation (Topic 718): Scope of Modification Accounting.ā ASU 2017-09 provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting. The amendments in this update should be applied prospectively to an award modified on or after the adoption date. This ASU is effective for annual periods and interim periods within those annual periods beginning after December 15, 2017, which for us is the first quarter ending December 31, 2018. Early adoption is permitted. We do not expect the adoption of this guidance to have a material impact to our consolidated financial statements. In January 2017, FASB issued ASU 2017-04, āIntangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment.ā ASU 2017-04 eliminates the second step in the goodwill impairment test which requires an entity to determine the implied fair value of the reporting unitās goodwill. Instead, an entity should perform its annual or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying value and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unitās fair value, not to exceed the total amount of goodwill allocated to the reporting unit. The standard, which should be applied prospectively, is effective for fiscal years beginning after December 15, 2019, which for us is our fiscal year ending September 30, 2021. Early adoption is permitted. We are currently evaluating the impact of the adoption of ASU 2017-04 on our consolidated financial statements. In August 2016, FASB issued ASU 2016-15, āStatement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments.ā The amendments in this update provide guidance on eight specific cash flow issues, thereby reducing the diversity in practice in how certain transaction are classified in the statement of cash flows. This ASU is effective for annual periods and interim periods for those annual periods beginning after December 15, 2017, which for us is the first quarter ending December 31, 2018. Early adoption is permitted. We are currently evaluating the impact of the adoption of ASU 2016-15 on our consolidated financial statements. In June 2016, FASB issued ASU 2016-13, āFinancial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments.ā The amendments in this update replace the incurred loss impairment methodology in current U.S. GAAP with a methodology that reflects expected credit losses. This update is intended to provide financial statement users with more decision-useful information about the expected credit losses. This ASU is effective for annual periods and interim periods for those annual periods beginning after December 15, 2019, which for us is the first quarter ending December 31, 2020. Entities may early adopt beginning after December 15, 2018. We are currently evaluating the impact of the adoption of ASU 2016-13 on our consolidated financial statements. 1. BASIS OF PRESENTATION OF UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) In February 2016, FASB issued ASU 2016-02, āLeases (Topic 842)ā, which amends the existing guidance to require lessees to recognize lease assets and lease liabilities from operating leases on the balance sheet. This ASU is effective using the modified retrospective approach for annual periods and interim periods within those annual periods beginning after December 15, 2018, which for us is the first fiscal quarter ending December 31, 2019. Early adoption is permitted. We are currently evaluating the impact of the adoption of ASU 2016-02 on our consolidated financial statements. In January 2016, FASB issued ASU 2016-01, āFinancial Instruments - Overall: Recognition and Measurement of Financial Assets and Financial Liabilities.ā ASU 2016-01 will require equity investments in unconsolidated entities (other than those accounted for using the equity method of accounting) to be measured at fair value with changes in fair value recognized in net income. The amendments in this update will also simplify the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment, eliminate the requirement for public business entities to disclose the method and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet and require these entities to use the exit price notion when measuring fair value of financial instruments for disclosure purposes. This ASU would also change the presentation and disclosure requirements for financial instruments. In addition, this ASU clarifies the guidance related to valuation allowance assessment when recognizing deferred tax assets resulting from unrealized losses on available-for-sale debt securities. The amendments in this ASU are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years, which for us is the first fiscal quarter ending December 31, 2018. Early adoption is permitted for financial statements of fiscal years and interim periods that have not been issued. We are currently evaluating the impact of the adoption of ASU 2016-01. In May 2014, FASB issued ASU 2014-09, āRevenue from Contracts with Customers.ā This guidance provides a five-step analysis in determining when and how revenue is recognized so that an entity will recognize revenue when it transfers promised goods or services to customers in an amount that reflects what it expects in exchange for the goods and services. It also requires more detailed disclosures to enable users of financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. In August 2015, FASB issued ASU 2015-14 āRevenue from Contracts with Customers (Topic 606): Deferral of the Effective Dateā which approved a one-year deferral of the effective date of ASU 2014-09. As a result of this deferral, ASU 2014-09 is effective for our fiscal year ending September 30, 2019, including interim periods within that reporting period. In addition, FASB issued ASU 2016-08, ASU 2016-10, ASU 2016-12 and ASU 2017-14, to provide interpretive clarifications on the new guidance in Accounting Standards Codification (āASCā) Topic 606. We are currently working through an adoption plan and have identified our revenue streams and completed a preliminary analysis of how we currently account for revenue transactions compared to the revenue accounting required under the new standard. We intend to complete our adoption plan during the fourth quarter of fiscal 2018. This plan includes a review of transactions supporting each revenue stream to determine the impact of accounting treatment under ASC 606, evaluation of the method of adoption, and completing a rollout plan for implementation of the new standard with affected functions in our organization. Because of the nature of the work that remains, at this time we are unable to reasonably estimate the impact of adoption on our consolidated financial statements. We plan to adopt the new guidance beginning with our fiscal quarter ending December 31, 2018. |
Acquisition
Acquisition | 9 Months Ended |
Jun. 30, 2018 | |
Business Combinations [Abstract] | |
ACQUISITIONS | ACQUISITIONS Acquisition of Accelerated Concepts, Inc. On January 22, 2018, we purchased all the outstanding stock of Accelerated Concepts, Inc. (āAcceleratedā), a Tampa-based provider of secure, enterprise-grade, cellular (LTE) networking equipment for primary and backup connectivity applications. This acquisition is included with our IoT Products and Services segment. The terms of the acquisition include an upfront cash payment together with future earn-out payments. Cash of $16.8 million (excluding cash acquired of $0.3 million ) was paid at the time of closing. The earn-out payments are scheduled to be paid in two installments and the payment amount, if any, will be calculated based on the revenue performance of Accelerated products. The first installment will be based on revenues from January 22, 2018 through January 21, 2019 (the ā2018 periodā) and the second installment will be based on revenues from January 22, 2019 through January 21, 2020 (the ā2019 periodā). The cumulative amount of these earn-outs will be $4.5 million , if certain revenue thresholds are met. Additional payments, not to exceed $2.0 million for both installments, may also be due depending on revenue performance. The fair value of this contingent consideration was $2.3 million at the date of acquisition and $3.3 million at June 30, 2018 (see Note 7 to the 2. ACQUISITIONS (CONTINUED) Condensed Consolidated Financial Statements). We have determined that the fair value of the earn-out on the acquisition date will be considered as part of the purchase price consideration as there are no continuing employment requirements associated with the earn-out. The purchase price was allocated to the estimated fair value of assets and liabilities assumed. The purchase price allocation resulted in the recognition of $5.9 million of goodwill. For tax purposes, this acquisition is treated as a stock acquisition, therefore the goodwill is not deductible. We believe this is a complementary acquisition for us as it significantly enhances our existing cellular product lines and immediately extends our market reach with a line of commercial routers and network appliance products. This acquisition will further enhance and expand the capabilities of the IoT Products and Services segment (see Note 9 to our Condensed Consolidated Financial Statements). The Accelerated acquisition has been accounted for using the acquisition method of accounting which requires, among other things, that assets acquired and liabilities assumed pursuant to the purchase agreement be recognized at fair value as of the acquisition date. The following table summarizes the preliminary values of Accelerated assets acquired and liabilities assumed as of the acquisition date (in thousands): Cash $ 16,759 Fair value of contingent consideration on acquired business 2,300 Total purchase price consideration $ 19,059 Fair value of net tangible assets acquired $ 826 Fair value of identifiable intangible assets acquired: Customer relationships 6,500 Purchased and core technology 3,000 Trade name and trademarks 1,000 Order backlog 1,800 Goodwill 5,933 Total $ 19,059 Operating results for Accelerated after January 22, 2018 are included in our Condensed Consolidated Statements of Operations. The Condensed Consolidated Balance Sheet as of June 30, 2018 reflects the preliminary allocation of the purchase price to the assets acquired and liabilities assumed based on their estimated fair values at the date of acquisition. The net working capital values are preliminary and we expect to finalize them in the fourth quarter of fiscal 2018. The weighted average useful life for all the identifiable intangibles listed above is 5.5 years. For purposes of determining fair value, the purchased and core technology identified above is assumed to have a useful life of five years, the customer relationships are assumed to have useful lives of seven years, the trade name and trademarks are assumed to have useful lives of five years and the order backlog is assumed to have a useful life of one year. Useful lives for identifiable intangible assets are estimated at the time of acquisition based on the periods of time from which we expect to derive benefits from the identifiable intangible assets. The amounts of revenue and net income included in the Condensed Consolidated Statements of Operations from the acquisition date of January 22, 2018 were $14.2 million and $1.8 million , respectively. Costs directly related to the acquisition of $0.3 million incurred in the first nine months of fiscal 2018 have been charged directly to operations and are included in general and administrative expense in our Condensed Consolidated Statements of Operations. These acquisition costs include legal, accounting and valuation fees. Acquisition of TempAlert LLC On October 20, 2017, we purchased all the outstanding interests of TempAlert LLC (āTempAlertā), a Boston-based provider of automated, real-time temperature monitoring and task management solutions. The purchase price was $45.0 million in cash adjusted for certain net working capital adjustments. We believe this is a complementary acquisition for us as the acquired 2. ACQUISITIONS (CONTINUED) technology will continue to be supported to further enhance and expand the capabilities of the IoT Solutions segment (see Note 9 to our Condensed Consolidated Financial Statements). The terms of the acquisition included an upfront cash payment together with future earn-out payments. Cash of $40.7 million (excluding cash acquired of $0.6 million ) was paid at the time of closing. The earn-out payments are scheduled to be paid after December 31, 2018 and December 31, 2019 which is the end of the earn-out periods. The cumulative amount of these earn-outs for the periods ended December 31, 2018 and 2019, will not exceed $35.0 million and $45.0 million , respectively. The fair value of this contingent consideration was zero at the date of acquisition and at June 30, 2018 (see Note 7 to the Condensed Consolidated Financial Statements). The purchase price was allocated to the estimated fair value of assets acquired and liabilities assumed. The purchase price allocation resulted in the recognition of $17.6 million of goodwill. For tax purposes, this acquisition is treated as an asset acquisition, therefore the goodwill is deductible. We believe that the acquisition resulted in the recognition of goodwill because this is a complementary acquisition for us and will provide a source of recurring revenue in a new vertically focused solutions business. The TempAlert acquisition has been accounted for using the acquisition method of accounting which requires, among other things, that assets acquired and liabilities assumed pursuant to the purchase agreement be recognized at fair value as of the acquisition date. The following table summarizes the preliminary values of TempAlert assets acquired and liabilities assumed as of the acquisition date (in thousands): Cash $ 40,741 Fair value of contingent consideration on acquired business ā Total purchase price consideration $ 40,741 Fair value of net tangible assets acquired $ (1,111 ) Fair value of identifiable intangible assets acquired: Customer relationships 18,300 Purchased and core technology 4,000 Trade name and trademarks 2,000 Goodwill 17,552 Total $ 40,741 Operating results for TempAlert after October 20, 2017 are included in our Condensed Consolidated Statements of Operations. The Condensed Consolidated Balance Sheet as of June 30, 2018 reflects the preliminary allocation of the purchase price to the assets acquired and liabilities assumed based on their estimated fair values at the date of acquisition. The net working capital values are preliminary and we expect to finalize them in the fourth fiscal quarter of 2018. The weighted average useful life for all the identifiable intangibles listed above is 6.5 years. For purposes of determining fair value, the purchased and core technology identified above is assumed to have a useful life of five years, the customer relationships are assumed to have useful lives of seven years and the trade name and trademarks are assumed to have useful lives of five years. Useful lives for identifiable intangible assets are estimated at the time of acquisition based on the periods of time from which we expect to derive benefits from the identifiable intangible assets. The amount of revenue included in the Condensed Consolidated Statements of Operations from the acquisition date of October 20, 2017 was $11.4 million . Costs directly related to the acquisition of $1.4 million incurred in the first nine months of fiscal 2018 and $0.4 million incurred in fiscal 2017 have been charged directly to operations and are included in general and administrative expense in our Condensed Consolidated Statements of Operations. These acquisition costs include legal, accounting, valuation and success fees. 2. ACQUISITIONS (CONTINUED) Pro Forma Financial Information The following consolidated pro forma information is as if the Accelerated and TempAlert acquisitions had occurred on October 1, 2016 (in thousands): Three months ended June 30, Nine months ended June 30, 2018 2017 2018 2017 Revenue $ 62,716 $ 52,309 $ 168,127 $ 157,658 Net income (loss) $ 2,622 $ 670 $ (2,294 ) $ (1,172 ) Pro forma net loss was adjusted to exclude interest expense related to debt that was paid off prior to acquisition, interest income related to promissory note that was settled prior to acquisition, adjust amortization to the fair value of the intangibles acquired and remove any costs associated with the sale transaction. |
Sale of Business
Sale of Business | 9 Months Ended |
Jun. 30, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | |
SALE OF BUSINESS | On October 23, 2015, we sold all the outstanding stock of our wholly owned subsidiary, Etherios Inc. (āEtheriosā) to West Monroe Partners, LLC. We sold Etherios as part of a strategy to focus on providing highly reliable machine connectivity solutions for business and mission-critical application environments. Etherios was included in our single operating segment prior to fiscal 2017. The terms of the sale agreement provided that West Monroe Partners, LLC would pay us $3.0 million on October 23, 2016 and $2.0 million on October 23, 2017. The present value of these amounts was included within the total fair value of consideration received. These receivable amounts were unsecured and non-interest bearing. We received $3.0 million in October 2016 and $2.0 million in October 2017. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | EARNINGS PER SHARE Basic net income (loss) per common share is calculated based on the weighted average number of common shares outstanding during the period. Diluted net income per common share is computed by dividing net income by the weighted average number of common shares and potentially dilutive common shares outstanding during the period. Potentially dilutive common shares result from dilutive common stock options and restricted stock units. Diluted net loss per common share is computed by dividing net loss by the weighted average number of common shares. All potentially dilutive common equivalent shares are excluded from the calculations of net loss per diluted share due to their anti-dilutive effect for the nine month period ended June 30, 2018 . The following table is a reconciliation of the numerators and denominators in the net income (loss) per common share calculations (in thousands, except per common share data): Three months ended June 30, Nine months ended June 30, 2018 2017 2018 2017 Numerator: Net income (loss) $ 2,621 $ 1,335 $ (2,305 ) $ 5,023 Denominator: Denominator for basic net income (loss) per common share ā weighted average shares outstanding 27,177 26,522 27,002 26,390 Effect of dilutive securities: Stock options and restricted stock units 587 434 ā 720 Denominator for diluted net income (loss) per common share ā adjusted weighted average shares 27,764 26,956 27,002 27,110 Net income (loss) per common share, basic $ 0.10 $ 0.05 $ (0.09 ) $ 0.19 Net income (loss) per common share, diluted $ 0.09 $ 0.05 $ (0.09 ) $ 0.19 4. EARNINGS PER SHARE (CONTINUED) For the three months ended June 30, 2018 and 2017 , there were 770,178 and 1,910,081 potentially dilutive shares, respectively, and for the nine months ended June 30, 2018 and 2017 , there were 977,828 and 1,169,422 potentially dilutive shares, respectively, related to stock options to purchase common shares that were not included in the above computation of diluted earnings per common share. This is because the optionsā exercise prices were greater than the average market price of our common shares. In addition, due to the net loss for the nine month period ended June 30, 2018 , there were 440,002 common stock options and restricted stock units, respectively, that were not included in the above computation of diluted earnings per share. |
Selected Balance Sheet Data
Selected Balance Sheet Data | 9 Months Ended |
Jun. 30, 2018 | |
Selected Balance Sheet Data [Abstract] | |
SELECTED BALANCE SHEET DATA | SELECTED BALANCE SHEET DATA The following table shows selected balance sheet data (in thousands): June 30, September 30, 2017 Accounts receivable, net: Accounts receivable $ 51,241 $ 31,365 Less allowance for doubtful accounts 563 341 Less reserve for future returns and pricing adjustments 2,432 2,169 Accounts receivable, net $ 48,246 $ 28,855 Inventories: Raw materials $ 25,734 $ 24,050 Work in process 375 484 Finished goods 15,673 5,704 Inventories $ 41,782 $ 30,238 Inventories are stated at the lower of cost or net realizable value, with cost determined using the first-in, first-out method. |
Marketable Securities
Marketable Securities | 9 Months Ended |
Jun. 30, 2018 | |
Marketable Securities [Abstract] | |
MARKETABLE SECURITIES | MARKETABLE SECURITIES Our marketable securities may consist of certificates of deposit, commercial paper, corporate bonds and government municipal bonds. We analyze our available-for-sale marketable securities for impairment on an ongoing basis. When we perform this analysis, we consider factors such as the length of time and extent to which the securities have been in an unrealized loss position and the trend of any unrealized losses. We also consider whether an unrealized loss is a temporary loss or an other-than-temporary loss based on factors such as: (a) whether we have the intent to sell the security, (b) whether it is more likely than not that we will be required to sell the security before its anticipated recovery, or (c) permanent impairment due to bankruptcy or insolvency. In order to estimate the fair value for each security in our investment portfolio, we obtain quoted market prices and trading activity for each security where available. We obtain relevant information from our investment advisor and, if warranted, also may review the financial solvency of certain security issuers. As of June 30, 2018 , 28 of our 28 securities that we held were trading below our amortized cost basis. We determined each decline in value to be temporary based upon the above described factors. We expect to realize the fair value of these securities, plus accrued interest, either at the time of maturity or when the security is sold. All of our current holdings are classified as available-for-sale marketable securities and are recorded at fair value on our consolidated balance sheet with the unrealized gains and losses recorded in accumulated other comprehensive income (loss). All of our current marketable securities will mature in less than one year and our non-current marketable securities will mature in less than two years. Our balance sheet classification of available for sale securities is based on our best estimate of when we expect to liquidate such investments and, presently, is consistent with the stated maturity dates of such investments. However, we are not committed to holding these investments until their maturity and may determine to liquidate some or all of these investments earlier based on our liquidity and other needs. During the nine months ended June 30, 2018 and 2017 , we received proceeds from our available-for-sale marketable securities of $29.8 million and $76.1 million , respectively. 6. MARKETABLE SECURITIES (CONTINUED) At June 30, 2018 our marketable securities were (in thousands): Amortized Cost (1) Unrealized Gains Unrealized Losses Fair Value (1) Current marketable securities: Certificates of deposit $ 4,773 $ ā $ (10 ) $ 4,763 Non-current marketable securities: Certificates of deposit 2,262 ā (19 ) 2,243 Total marketable securities $ 7,035 $ ā $ (29 ) $ 7,006 (1) Included in amortized cost and fair value is purchased and accrued interest of $35 . At September 30, 2017 our marketable securities were (in thousands): Amortized Cost (1) Unrealized Gains Unrealized Losses Fair Value (1) Current marketable securities: Corporate bonds $ 28,275 $ ā $ (20 ) $ 28,255 Certificates of deposit 3,756 4 ā 3,760 Current marketable securities 32,031 4 (20 ) 32,015 Non-current marketable securities: Certificates of deposit 4,757 ā (4 ) 4,753 Total marketable securities $ 36,788 $ 4 $ (24 ) $ 36,768 (1) Included in amortized cost and fair value is purchased and accrued interest of $211 . The following tables show the fair values and gross unrealized losses of our available-for-sale marketable securities that have been in a continuous unrealized loss position deemed to be temporary, aggregated by investment category (in thousands): June 30, 2018 Less than 12 Months More than 12 Months Fair Value Unrealized Losses Fair Value Unrealized Losses Certificates of deposit 6,755 (29 ) ā ā Total $ 6,755 $ (29 ) $ ā $ ā September 30, 2017 Less than 12 Months More than 12 Months Fair Value Unrealized Losses Fair Value Unrealized Losses Corporate bonds $ 26,196 $ (20 ) $ ā $ ā Certificates of deposit 3,751 (4 ) ā ā Total $ 29,947 $ (24 ) $ ā $ ā |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS Fair value is defined as the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. This standard also establishes a hierarchy for inputs used in measuring fair value. This standard maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use in valuing the asset or liability based on market data obtained from independent sources. Unobservable inputs are inputs that reflect our assumptions about the factors market participants would use in valuing the asset or liability based upon the best information available in the circumstances. 7. FAIR VALUE MEASUREMENTS (CONTINUED) The categorization of financial assets and liabilities within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The hierarchy is broken down into three levels. Level 1 inputs are quoted prices in active markets for identical assets or liabilities. Level 2 inputs include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, and inputs (other than quoted prices) that are observable for the asset or liability, either directly or indirectly. Level 3 inputs are unobservable for the asset or liability and their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable. Level 3 may also include certain investment securities for which there is limited market activity or a decrease in the observability of market pricing for the investments, such that the determination of fair value requires significant judgment or estimation. Fair value is applied to financial assets such as our marketable securities, which are classified and accounted for as available-for-sale and to financial liabilities for contingent consideration. These items are stated at fair value at each reporting period using the above guidance. The following tables provide information by level for financial assets and liabilities that are measured at fair value on a recurring basis (in thousands): Total Fair Value at Fair Value Measurements Using Inputs Considered as June 30, 2018 Level 1 Level 2 Level 3 Assets: Money market $ 9,954 $ 9,954 $ ā $ ā Certificates of deposit 7,006 ā 7,006 ā Total assets measured at fair value $ 16,960 $ 9,954 $ 7,006 $ ā Liabilities: Contingent consideration on acquired businesses $ 9,021 $ ā $ ā $ 9,021 Total liabilities measured at fair value $ 9,021 $ ā $ ā $ 9,021 Total Fair Value at Fair Value Measurements Using Inputs Considered as September 30, 2017 Level 1 Level 2 Level 3 Assets: Money market $ 39,524 $ 39,524 $ ā $ ā Corporate bonds 28,255 ā 28,255 ā Certificates of deposit 8,513 ā 8,513 ā Total assets measured at fair value $ 76,292 $ 39,524 $ 36,768 $ ā Liabilities: Contingent consideration on acquired businesses $ 6,388 $ ā $ ā $ 6,388 Total liabilities measured at fair value $ 6,388 $ ā $ ā $ 6,388 Our money market funds, which have been determined to be cash equivalents, are measured at fair value using quoted market prices in active markets for identical assets and are therefore classified as Level 1 assets. We value our Level 2 assets using inputs that are based on market indices of similar assets within an active market. There were no transfers into or out of our Level 2 financial assets during the nine months ended June 30, 2018 . The use of different assumptions, applying different judgment to matters that inherently are subjective and changes in future market conditions could result in different estimates of fair value of our securities or contingent consideration, currently and in the future. If market conditions deteriorate, we may incur impairment charges for securities in our investment portfolio. We may also incur changes to our contingent consideration liability as discussed below. We are required to make contingent payments for our acquisitions. In connection with the October 2015 acquisition of Bluenica Corporation (āBluenicaā), we are required to make contingent payments over a period of up to four years, subject to achieving specified revenue thresholds for sales of Bluenica products. The fair value of the liability for contingent payments recognized upon acquisition was $10.4 million and was $5.5 million at June 30, 2018 . We paid $0.5 million for the period ended September 30, 2016 and zero for the period ended September 30, 2017. 7. FAIR VALUE MEASUREMENTS (CONTINUED) In connection with the November 2016 acquisition of FreshTemp, LLC (āFreshTempā), we are required to make a contingent payment after June 30, 2018, for revenue related to specific customer contracts signed by June 30, 2017. The fair value of the liability recognized upon acquisition was $1.3 million and was $0.2 million at June 30, 2018 . For the January 2017 acquisition of SMART Temps LLC (āSMART Tempsā), we were required to make a contingent payment after December 31, 2017 based on achieving specified revenue thresholds. Since the revenue threshold was not met, no payment was made. The fair value of the liability for contingent payments recognized upon acquisition of SMART Temps was $10,000 and was zero at June 30, 2018 . For the TempAlert acquisition, we are required to make contingent payments for the twelve month periods ending December 31, 2018 and December 31, 2019 based on the total Digi IoT Solutions segment revenue. The fair value of the liability for contingent payments recognized upon acquisition of TempAlert and at June 30, 2018 was zero . For the Accelerated acquisition, we are required to make contingent payments for the twelve month periods ending January 21, 2019 and January 21, 2020, based upon certain thresholds. The fair values of the liability for contingent payments recognized upon acquisition of Accelerated and at June 30, 2018 was $2.3 million and was $3.3 million , respectively. As of June 30, 2018, the fair value of the liability for contingent payments increased $1.0 million as Accelerated is currently outperforming initial revenue expectations. The fair value of these contingent payments was estimated by discounting to present value the probability-weighted contingent payments expected to be made. Assumptions used in these calculations include the discount rate and various probability factors. This liability is considered to be a Level 3 financial liability that is re-measured each reporting period as a charge or credit to general and administrative expense within the Condensed Consolidated Statements of Operations. The following table presents a reconciliation of the contingent consideration liability measured at fair value on a recurring basis using significant unobservable inputs (Level 3) (in thousands): Three months ended June 30, Nine months ended June 30, 2018 2017 2018 2017 Fair value at beginning of period $ 8,263 $ 10,068 $ 6,388 $ 9,960 Purchase price contingent consideration ā ā 2,300 1,310 Contingent consideration payments ā ā ā (518 ) Change in fair value of contingent consideration 758 (646 ) 333 (1,330 ) Fair value at end of period $ 9,021 $ 9,422 $ 9,021 $ 9,422 The change in fair value of contingent consideration relates to the acquisitions of Bluenica, FreshTemp and Accelerated and is included in general and administrative expense. The change in fair value of contingent consideration reflects our estimate of the probability of achieving the relevant targets and is discounted based on our estimated discount rate. We have estimated the fair value of the contingent consideration based on the probability of achieving the specified revenue thresholds at 93.5% to 98.5% for Bluenica, 100% for FreshTemp, 0% for both SMART Temp and TempAlert, and 34.0% to 70.0% for Accelerated. A significant change in our estimates of achieving the relevant targets could materially change the fair value of the contingent consideration liability. |
Goodwill and Other Identifiable
Goodwill and Other Identifiable Intangible Assets, Net | 9 Months Ended |
Jun. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER IDENTIFIABLE INTANGIBLE ASSETS, NET | GOODWILL AND OTHER IDENTIFIABLE INTANGIBLE ASSETS, NET Amortizable identifiable intangible assets were (in thousands): June 30, 2018 September 30, 2017 Gross carrying amount Accum. amort. Net Gross carrying amount Accum. amort. Net Purchased and core technology $ 58,048 $ (47,983 ) $ 10,065 $ 51,292 $ (46,304 ) $ 4,988 License agreements 102 (39 ) 63 18 (17 ) 1 Patents and trademarks 15,612 (11,965 ) 3,647 12,484 (11,280 ) 1,204 Customer relationships 46,569 (19,886 ) 26,683 21,914 (16,817 ) 5,097 Non-compete agreements 600 (180 ) 420 600 (90 ) 510 Order backlog 1,800 (900 ) 900 ā ā ā Total $ 122,731 $ (80,953 ) $ 41,778 $ 86,308 $ (74,508 ) $ 11,800 Amortization expense was $2.6 million and $0.9 million for the three month periods ended June 30, 2018 and 2017 , respectively, and $6.9 million and $1.8 million for the nine month periods ended June 30, 2018 and 2017 , respectively. Amortization expense is recorded on our consolidated statements of operations within cost of sales and in general and administrative expense. Estimated amortization expense related to identifiable intangible assets for the remainder of fiscal 2018 and the five succeeding fiscal years is (in thousands): 2018 (three months) $ 2,466 2019 8,356 2020 7,592 2021 7,126 2022 6,754 2023 4,751 The changes in the carrying amount of goodwill are (in thousands): Nine months ended 2018 2017 Beginning balance, October 1 $ 131,995 $ 109,448 Acquisitions 23,485 21,206 Foreign currency translation adjustment (915 ) (733 ) Ending balance, June 30 $ 154,565 $ 129,921 Goodwill is tested for impairment on an annual basis as of June 30, or more frequently if events or circumstances occur which could indicate impairment. The calculation of goodwill impairment requires us to make assumptions about the fair value of our reporting unit(s), which historically has been approximated by using our market capitalization plus a control premium for our reporting unit(s). Control premium assumptions require judgment and actual results may differ from assumed or estimated amounts. We have two reportable operating segments, our IoT Solutions segment and our IoT Products & Services segment (see Note 9 to the Condensed Consolidated Financial Statements). As a result, we concluded that the IoT Solutions segment and the IoT Products & Services segment constitute separate reporting units for purposes of the ASC 350-20-35 āGoodwill Measurement of Impairmentā assessment and both units were tested individually for impairment. Our test for potential goodwill impairment is a two-step approach. First, we estimate the fair values for each reporting unit by comparing the fair value to the carrying value. If the carrying value of the reporting unit exceeds its estimated fair value, then we conduct the second step, which requires us to measure the amount of the impairment loss. The impairment loss, if any, is calculated by comparing the implied fair value of the goodwill to its carrying amount. To calculate the implied fair value of goodwill, the fair value of the reporting unitās assets and liabilities, excluding goodwill, is estimated. The excess of the fair 8. GOODWILL AND OTHER IDENTIFIABLE INTANGIBLE ASSETS, NET (CONTINUED) value of the reporting unit over the amount assigned to its assets and liabilities, excluding goodwill, is the implied fair value of the reporting unitās goodwill. At June 30, 2018 , we had a total of $104.6 million of goodwill on our Condensed Consolidated Balance Sheet for the IoT Products & Services reporting unit and the implied fair value of this reporting unit exceeded its carrying value by approximately 36% . At June 30, 2018 , we had a total of $50.0 million of goodwill on our Condensed Consolidated Balance Sheet for the Solutions reporting unit and the implied fair value of this reporting unit exceeded its carrying value by approximately 7% . Based on that data, we concluded that no impairment was indicated for either reporting unit and we were not required to complete the second step of the goodwill impairment analysis. No goodwill impairment charges were recorded. Implied fair values for both reporting units were each calculated on a standalone basis using a weighted combination of the income approach and market approach. The income approach indicates the fair value of a business based on the value of the cash flows the business or asset can be expected to generate in the future. A commonly used variation of the income approach used to value a business is the discounted cash flow (āDCFā) method. The DCF method is a valuation technique in which the value of a business is estimated on the earnings capacity, or available cash flow, of that business. Earnings capacity represents the earnings available for distribution to stockholders after consideration of the reinvestment required for future growth. Significant judgment is required to estimate the amount and timing of future cash flows for each reporting unit and the relative risk of achieving those cash flows. The market approach indicates the fair value of a business or asset based on a comparison of the business or asset to comparable publicly traded companies or assets and transactions in its industry as well as prior company or asset transactions. This approach can be estimated through the guideline company method. This method indicates fair value of a business by comparing it to publicly traded companies in similar lines of business. After identifying and selecting the guideline companies, we make judgments about the comparability of the companies based on size, growth rates, profitability, risk, and return on investment in order to estimate market multiples. These multiples are then applied to the reporting units to estimate a fair value. The implied fair values of each reporting unit were added together to get an indicated value of total equity to which a range of indicated value of total equity was derived. This range was compared to the total market capitalization of $359.6 million as of June 30, 2018, which implied a range of control premiums of 5.7% to 16.4% . This range of control premiums fell below the control premiums observed in the last five years in the communications equipment industry. As a result, the market capitalization reconciliation analysis proved support for the reasonableness of the fair values estimated for each individual reporting unit. Should the facts and circumstances surrounding our assumptions change, the first step of our goodwill impairment analysis may fail. Assumptions and estimates to determine fair values are complex and often subjective. They can be affected by a variety of factors, including external factors such as industry and economic trends, and internal factors such as changes in our business strategy and our internal forecasts. For example, if our future operating results do not meet current forecasts or if we experience a sustained decline in our market capitalization that is determined to be indicative of a reduction in fair value of one or more of our reporting units, we may be required to record future impairment charges for goodwill. An impairment could have a material effect on our consolidated balance sheet and results of operations. We have had no goodwill impairment losses since the adoption of ASC 350, Intangibles-Goodwill and Others, in fiscal 2003. |
Segment Information
Segment Information | 9 Months Ended |
Jun. 30, 2018 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | SEGMENT INFORMATION We have two reportable operating segments for purposes of ASC 280-10-50 āSegment Reportingā: (1) IoT Products & Services (formerly M2M), and (2) IoT Solutions (formerly Solutions). Our segments are described below: IoT Products & Services Our IoT Products & Services segment is composed of the following communications products and development services and includes our recent acquisition of Accelerated: ā¢ Cellular routers and gateways; ā¢ Radio frequency (RF) which include our XBee Ā® modules as well as other RF solutions; ā¢ Embedded products include Digi Connect Ā® and Rabbit Ā® embedded systems on module and single board computers; 9. SEGMENT INFORMATION (CONTINUED) ā¢ Network products, which has the highest concentration of mature products, including console and serial servers and USB connected products; ā¢ Digi Wireless Design Services; ā¢ Digi Remote Manager Ā® ; and ā¢ Support services which offers various levels of technical services for development assistance, consulting and training. IoT Solutions We have formed the IoT Solutions segment primarily through four acquisitions: the October 2015 acquisition of Bluenica, the November 2016 acquisition of FreshTemp, the January 2017 acquisition of SMART Temps and the October 2017 acquisition of TempAlert. Our IoT Solutions segment offers wireless temperature and other environmental condition monitoring services as well as employee task management services. These products and services are provided to food service, transportation, education, healthcare and pharma, and industrial markets and are marketed as SmartSense by Digiā¢, formerly Digi Smart Solutionsā¢. We measure our segment results primarily by reference to revenue and operating income. IoT Solutions revenue includes both product and service revenue. Certain costs incurred at the corporate level are allocated to our segments. These costs include information technology, employee benefits and shared facility services. The information technology and shared facility costs are allocated based on headcount and the employee benefits costs are allocated based on compensation costs. Summary operating results for each of our segments were as follows (in thousands): Three months ended June 30, Nine months ended June 30, 2018 2017 2018 2017 Revenue IoT Products & Services $ 54,406 $ 42,844 $ 145,111 $ 131,653 IoT Solutions 8,310 2,895 17,593 4,876 Total revenue $ 62,716 $ 45,739 $ 162,704 $ 136,529 Operating income IoT Products & Services $ 4,544 $ 1,841 $ 10,497 $ 7,638 IoT Solutions (2,507 ) (1,132 ) (10,080 ) (2,995 ) Total operating income $ 2,037 $ 709 $ 417 $ 4,643 Depreciation and amortization IoT Products & Services $ 1,754 $ 904 $ 4,332 $ 2,704 IoT Solutions 1,559 735 4,674 1,325 Total depreciation and amortization $ 3,313 $ 1,639 $ 9,006 $ 4,029 Total expended for property, plant and equipment was as follows (in thousand): Nine months ended June 30, 2018 2017 Expended for property, plant and equipment IoT Products & Services $ 963 $ 1,545 IoT Solutions ā 32 Total expended for property, plant and equipment $ 963 $ 1,577 9. SEGMENT INFORMATION (CONTINUED) Total assets for each of our segments were as follows (in thousands): June 30, September 30, 2017 Assets IoT Products & Services $ 210,118 $ 182,555 IoT Solutions 95,408 47,644 Unallocated* 54,700 114,990 Total assets $ 360,226 $ 345,189 *Unallocated consists of cash and cash equivalents, current marketable securities and long-term marketable securities. Total goodwill for each of our segments were as follows (in thousands): June 30, September 30, 2017 Goodwill IoT Products & Services $ 104,584 $ 98,981 IoT Solutions 49,981 33,014 Total goodwill $ 154,565 $ 131,995 |
Income Taxes
Income Taxes | 9 Months Ended |
Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES Income tax provision was $3.0 million for the nine months ended June 30, 2018 . Net tax expense discretely related to the nine months ended June 30, 2018 was $3.0 million , primarily as a result of new U.S. tax legislation that was enacted during the first quarter of fiscal 2018 and the adoption of ASU 2016-09 related to the accounting for the tax effects of stock compensation. The Tax Cuts and Jobs Act of 2017 (the āActā) was enacted on December 22, 2017. The Act lowered the U.S. federal corporate tax rate from 35% to 21% as of January 1, 2018 and requires companies to pay a one-time transition tax on earnings of certain foreign subsidiaries that were previously tax deferred. Due to our fiscal year end, our statutory rate for fiscal 2018 will be a blend of the new and old tax rates. At June 30, 2018 we had not fully completed our accounting for the tax effects of enactment of the Act; however, in certain cases, as described below, we have made a reasonable estimate of the effects on our existing deferred tax balances and the one-time transition tax. For the items for which we were able to determine a reasonable estimate, we recognized a provisional income tax expense amount of $2.7 million which is included as a component of income tax expense. We remeasured U.S. deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future, which requires estimates of our changes in deferred tax assets and liabilities before and after the new statutory rate was enacted. As a result, we are still analyzing certain aspects of the legislation and refining our calculations such as, refining current year estimates and filings of tax returns, of which could potentially affect the measurement of these balances or potentially give rise to new deferred tax amounts. As of June 30, 2018 , the provisional amount recorded related to the re-measurement of this deferred tax balance was $2.7 million . In addition, we considered the potential tax expense impacts of the one-time transition tax. The transition tax is based on our total post-1986 earnings and profits (āE&Pā) that we previously deferred from U.S. income taxes. We recorded a provisional amount for our one-time transition tax liability for our foreign subsidiaries, resulting in an increase in income tax expense of $0.1 million for the nine months ended June 30, 2018 . We have not yet completed the calculation of the post-1986 E&P for these foreign subsidiaries and, further, this transition tax is based in part on the amount of those earnings held in cash and other specified assets. This amount may change when we finalize the calculation of post-1986 foreign E&P previously deferred from U.S. federal taxation, evaluate the testing periods for cash and E&P measurement and finalize substantiation of material foreign taxes paid or accrued. Furthermore, it is expected that further guidance will be forthcoming from U.S. Treasury which may or may not impact the final transition tax required. We continue to review the outside basis differential of our foreign investments. At this point, no additional income taxes have been provided for any undistributed foreign earnings not subject to the transition tax and additional outside basis difference inherent in these entities, as these amounts continue to be indefinitely reinvested in foreign operations. Determining the amount of unrecognized deferred tax liability related to any remaining undistributed foreign earnings not subject to the transition tax and additional outside basis difference in these entities (i.e., basis difference in excess of that subject to the one-time transition tax) is not practical at this time, but it is expected that with 10. INCOME TAXES (CONTINUED) inclusion of the transition tax, the potential outstanding basis difference as of June 30, 2018 is expected to be a deductible temporary difference for which no deferred tax asset would be allowed. We adopted ASU 2016-09 āImprovements to Employee Share-Based Payment Accountingā on October 1, 2017. As a result of the adoption, we recorded $0.7 million of excess tax expense related to our share-based payments in our provision for income taxes for the nine months ended June 30, 2018 . Historically, this was record in additional paid-in capital. The excess tax expense related to share-based payments are recognized as tax expense discretely related to the nine months ended June 30, 2018 . For the nine months ended June 30, 2018 , our effective tax rate before items discretely related to the period was less than the U.S. statutory rate due primarily to the mix of income between taxing jurisdictions, certain of which have lower statutory tax rates than the U.S., and also due to certain income tax credits generated in the U.S. Income tax provision was $0.2 million for the nine months ended June 30, 2017 . Net tax benefits discretely related to the nine months ended June 30, 2017 were $0.8 million resulting primarily from the reversal of tax reserves due to the expiration of statutes of limitation from U.S. and foreign tax jurisdictions. For the nine months ended June 30, 2017 , our effective tax rate before items discretely related to the period was less than the U.S. statutory rate primarily due to the mix of income between taxing jurisdictions, certain of which have lower statutory tax rates than the U.S., and certain tax credits in the U.S. Our effective tax rate will vary based on a variety of factors, including overall profitability, the geographical mix of income before taxes and related statutory tax rate in each jurisdiction, and tax items discretely related to the period, such as settlements of audits. We expect that we may record other benefits or expenses in the future that are specific to a particular quarter such as expiration of statutes of limitation, the completion of tax audits, or legislation that is enacted for both U.S. and foreign jurisdictions. A reconciliation of the beginning and ending amount of unrecognized tax benefits is (in thousands): Unrecognized tax benefits as of September 30, 2017 $ 1,335 Decreases related to: Expiration of statute of limitations (121 ) Unrecognized tax benefits as of June 30, 2018 $ 1,214 The total amount of unrecognized tax benefits that, if recognized, would affect our effective tax rate is $1.0 million , after considering the impact of interest and deferred benefit items. We expect that the total amount of unrecognized tax benefits will decrease minimally over the next 12 months. |
Product Warranty Obligation
Product Warranty Obligation | 9 Months Ended |
Jun. 30, 2018 | |
Product Warranties Disclosures [Abstract] | |
PRODUCT WARRANTY OBLIGATION | PRODUCT WARRANTY OBLIGATION In general, we warrant our products to be free from defects in material and workmanship under normal use and service. The warranty periods generally range from one to five years. We typically have the option to either repair or replace products we deem defective with regard to material or workmanship. Estimated warranty costs are accrued in the period that the related revenue is recognized based upon an estimated average per unit repair or replacement cost applied to the estimated number of units under warranty. These estimates are based upon historical warranty incidents and are evaluated on an ongoing basis to ensure the adequacy of the warranty accrual. The following table summarizes the activity associated with the product warranty accrual (in thousands) and is included on our Condensed Consolidated Balance Sheets within current liabilities: Balance at Warranties Settlements Balance at Period April 1 issued made June 30 Three months ended June 30, 2018 $ 1,348 $ 82 $ (135 ) $ 1,295 Three months ended June 30, 2017 $ 892 $ 248 $ (165 ) $ 975 Balance at Warranties Settlements Balance at Period October 1 issued made June 30 Nine months ended June 30, 2018 $ 987 $ 798 $ (490 ) $ 1,295 Nine months ended June 30, 2017 $ 1,033 $ 479 $ (537 ) $ 975 We are not responsible for, and do not warrant, that custom software versions created by original equipment manufacturer (āOEMā) customers based upon our software source code will function in a particular way, will conform to any specifications or are fit for any particular purpose. Further, we do not indemnify these customers from any third-party liability as it relates to or arises from any customization or modifications made by the OEM customer. |
Contingencies
Contingencies | 9 Months Ended |
Jun. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
CONTINGENCIES | CONTINGENCIES In the normal course of business, we are subject to various claims and litigation. There can be no assurance that any claims by third parties, if proven to have merit, will not materially adversely affect our business, liquidity or financial condition. |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Jun. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK-BASED COMPENSATION | STOCK-BASED COMPENSATION Stock-based awards were granted under the 2018 Omnibus Incentive Plan (the ā2018 Planā) beginning January 29, 2018 and, prior to that, were granted under the 2017 Omnibus Incentive Plan (the ā2017 Planā). Upon stockholder approval of the 2018 Plan, we ceased granting awards under any prior plan. Shares subject to awards under prior plans that are forfeited, canceled, returned to the Company for failure to satisfy vesting requirements, settled in cash or otherwise terminated without payment also will be available for grant under the 2018 Plan. The authority to grant options under the 2018 Plan and to set other terms and conditions rests with the Compensation Committee of the Board of Directors. The 2018 Plan authorizes the issuance of up to 1,500,000 common shares in connection with awards of stock options, stock appreciation rights, restricted stock, restricted stock units, performance-based full value awards or other stock-based awards. Eligible participants include our employees, our affiliates, non-employee directors of our Company and any consultant or advisor who is a natural person and provides services to us or our affiliates. Options that have been granted under the 2018 Plan typically vest over a four -year period and will expire if unexercised after seven years from the date of grant. Restricted stock unit awards (āRSUsā) that have been granted to directors typically vest in one year. RSUs that have been granted to executives and employees typically vest in January over a four -year period. Awards may be granted under the 2018 Plan until January 28, 2028. Options under the 2018 Plan can be granted as either incentive stock options (āISOsā) or non-statutory stock options (āNSOsā). The exercise price of options and the grant date price of restricted stock units shall be determined by our Compensation Committee but shall not be less than the fair market value of our common stock based on the closing price on the date of grant. Upon exercise, we issue new shares of stock. As of June 30, 2018 , there were approximately 1,473,215 shares available for future grants under the 2018 Plan. Our equity plans and corresponding forms of award agreements generally have provisions allowing employees to elect to satisfy tax withholding obligations through the delivery of shares, having us retain a portion of shares issuable under the award or paying cash to us for the withholding. During the nine months ended June 30, 2018 and 2017 , our employees forfeited 13. STOCK-BASED COMPENSATION (CONTINUED) 72,918 shares and 48,076 shares, respectively in order to satisfy $0.7 million and $0.6 million , respectively of withholding tax obligations related to stock-based compensation, pursuant to terms of awards under our board and shareholder-approved compensation plans for each respective period. Cash received from the exercise of stock options was $3.9 million and $3.3 million during the nine months ended June 30, 2018 and 2017 , respectively. We sponsor an Employee Stock Purchase Plan (the āPurchase Planā), covering all domestic employees with at least 90 days of continuous service and who are customarily employed at least 20 hours per week. The Purchase Plan allows eligible participants the right to purchase common stock on a quarterly basis at the lower of 85% of the market price at the beginning or end of each three -month offering period. Employee contributions to the Purchase Plan were $0.9 million and $0.7 million during both nine month periods ended June 30, 2018 and 2017 . Pursuant to the Purchase Plan, 105,732 and 72,594 common shares were issued to employees during the nine months ended June 30, 2018 and 2017 , respectively. Shares are issued under the Purchase Plan from treasury stock. As of June 30, 2018 , 335,290 common shares were available for future issuances under the Purchase Plan. Stock-based compensation expense is included in the consolidated results of operations as follows (in thousands): Three months ended June 30, Nine months ended June 30, 2018 2017 2018 2017 Cost of sales $ 49 $ 52 $ 145 $ 168 Sales and marketing 406 348 1,131 1,033 Research and development 168 160 343 497 General and administrative 597 614 1,979 1,804 Stock-based compensation before income taxes 1,220 1,174 3,598 3,502 Income tax benefit (249 ) (383 ) (747 ) (1,140 ) Stock-based compensation after income taxes $ 971 $ 791 $ 2,851 $ 2,362 Stock-based compensation cost capitalized as part of inventory was immaterial as of June 30, 2018 and September 30, 2017 . Stock Options The following table summarizes our stock option activity (in thousands, except per common share amounts): Options Outstanding Weighted Average Exercised Price Weighted Average Contractual Term (in years) Aggregate Intrinsic Value (1) Balance at September 30, 2017 3,902 $10.54 Granted 711 10.37 Exercised (435 ) 8.90 Forfeited / Canceled (604 ) 12.65 Balance at June 30, 2018 3,574 $10.35 4.3 $ 10,318 Exercisable at June 30, 2018 2,350 $10.06 3.4 $ 7,455 (1) The aggregate intrinsic value represents the total pre-tax intrinsic value, based on our closing stock price of $13.20 as of June 30, 2018 , which would have been received by the option holders had all option holders exercised their options as of that date. The intrinsic value of an option is the amount by which the fair value of the underlying stock exceeds its exercise price. The total intrinsic value of all options exercised during the nine months ended June 30, 2018 was $0.7 million and during the nine months ended June 30, 2017 was $0.9 million . 13. STOCK-BASED COMPENSATION (CONTINUED) The table below shows the weighted average fair value, which was determined based upon the fair value of each option on the grant date utilizing the Black-Scholes option-pricing model and the related assumptions: Nine months ended June 30, 2018 2017 Weighted average per option grant date fair value $3.76 $4.64 Assumptions used for option grants: Risk free interest rate 2.12% - 2.88% 1.46% - 1.96% Expected term 6.00 years 6.00 years Expected volatility 33% - 34% 33% - 34% Weighted average volatility 31% 34% Expected dividend yield 0 0 Expected volatilities are based on the historical volatility of our stock. We use historical data to estimate option exercise and employee termination information within the valuation model. The expected term of options granted is derived from the vesting period and historical information and represents the period of time that options granted are expected to be outstanding. The risk-free rate used is the zero-coupon U.S. Treasury bond rate in effect at the time of the grant whose maturity equals the expected term of the option. As of June 30, 2018 , the total unrecognized compensation cost related to non-vested stock options was $4.3 million and the related weighted average period over which it is expected to be recognized is approximately 2.7 years. Non-vested Restricted Stock Units A summary of our non-vested restricted stock units as of June 30, 2018 and changes during the nine months then ended is presented below (in thousands, except per common share amounts): Number of Awards Weighted Average Grant Date Fair Value Nonvested at September 30, 2017 566 $ 11.28 Granted 360 $ 10.35 Vested (203 ) $ 11.02 Canceled (90 ) $ 11.11 Nonvested at June 30, 2018 633 $ 10.86 As of June 30, 2018 , the total unrecognized compensation cost related to non-vested restricted stock units was $5.4 million , and the related weighted average period over which it is expected to be recognized is approximately 1.4 years. |
Restructuring (Notes)
Restructuring (Notes) | 9 Months Ended |
Jun. 30, 2018 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING | RESTRUCTURING Below is a summary of the restructuring charges and other activity (in thousands) all within our IoT Products and Services segment: Manufacturing Transition 2017 Restructuring Employee Employee Other Total Balance at September 30, 2017 $ ā $ 1,528 $ 128 $ 1,656 Restructuring charge 190 ā ā 190 Payments (105 ) (971 ) (146 ) (1,222 ) Foreign currency fluctuation ā 38 4 42 Balance at June 30, 2018 $ 85 $ 595 $ (14 ) $ 666 14. RESTRUCTURING (CONTINUED) Manufacturing Transition As announced on April 3, 2018, Digi will transfer the manufacturing functions of its Eden Prairie, Minnesota operations facility to existing contract manufacture suppliers. As a result, approximately 53 positions in total have or will be eliminated, resulting in restructuring charges amounting to approximately $0.5 million related to employee costs during the third and fourth quarters of fiscal 2018. The payments associated with these charges are expected to be completed by December 31, 2018. This manufacturing transition is expected to result in total annualized savings of approximately $3.0 million to $5.0 million . 2017 Restructuring In May 2017, we approved a restructuring plan primarily impacting our France location. We also eliminated certain employee costs in the U.S. The restructuring is a result of a decision to consolidate our France operations to our Europe, Middle East and Africa (āEMEAā) headquarters in Munich. The total restructuring charges amounted to $2.5 million that included $2.3 million of employee costs and $0.2 million of contract termination costs during the third quarter of fiscal 2017. These actions resulted in an elimination of 10 positions in the U.S. and 8 positions in France. The payments associated with these charges are expected to be completed by the end of the fourth quarter ending September 30, 2018. |
Common Stock Repurchase
Common Stock Repurchase | 9 Months Ended |
Jun. 30, 2018 | |
Common Stock Repurchase [Abstract] | |
COMMON STOCK REPURCHASE | COMMON STOCK REPURCHASE On April 24, 2018 our Board of Directors authorized a new program to repurchase up to $20.0 million of our common stock primarily to return capital to shareholders. This repurchase authorization began on May 23, 2018 and expires on November 23, 2018. Shares repurchased under the new program may be made through open market and privately negotiated transactions from time to time and in amounts that management deems appropriate. The amount and timing of share repurchases depends upon market conditions and other corporate considerations. There were no shares repurchased under this program. On May 2, 2017, our Board of Directors authorized a program to repurchase up to $20.0 million of our common stock primarily to return capital to shareholders. This repurchase authorization expired on May 1, 2018. Shares repurchased under the program could be made through open market and privately negotiated transactions from time to time and in amounts that management deemed appropriate. The amount and timing of share repurchases depended upon market conditions and other corporate considerations. During the third quarter of fiscal 2017, we began to repurchase our common stock on the open market. During the third quarter of fiscal 2017, we repurchased 28,691 shares for $0.3 million . No further repurchases of common stock were made under this program. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Jun. 30, 2018 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS On September 7, 2017, we signed a purchase agreement for the sale of our corporate headquarters in Minnetonka, Minnesota to Minnetonka Leased Housing Associates II, LLLP for $10.0 million . The agreement had several contingencies, one of which was dependent upon government and financing approvals. Subsequent to the end of the third fiscal quarter of 2018, the final contingency was satisfied on July 23, 2018 at which time we moved the net book value of the land, building and related leasehold improvements as held-for-sale. The sale of our corporate building is part of our ongoing plan to relocate our corporate headquarters in the Minneapolis area. We expect to close on this transaction by October 2018. |
Basis of Presentation of Unau23
Basis of Presentation of Unaudited Interim Condensed Consolidated Financial Statements and Significant Accounting Policies (Policies) | 9 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements Not Yet Adopted In May 2017, the Financial Accounting Standards Board (āFASBā) issued Accounting Standards Update (āASUā) 2017-09, āCompensation-Stock Compensation (Topic 718): Scope of Modification Accounting.ā ASU 2017-09 provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting. The amendments in this update should be applied prospectively to an award modified on or after the adoption date. This ASU is effective for annual periods and interim periods within those annual periods beginning after December 15, 2017, which for us is the first quarter ending December 31, 2018. Early adoption is permitted. We do not expect the adoption of this guidance to have a material impact to our consolidated financial statements. In January 2017, FASB issued ASU 2017-04, āIntangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment.ā ASU 2017-04 eliminates the second step in the goodwill impairment test which requires an entity to determine the implied fair value of the reporting unitās goodwill. Instead, an entity should perform its annual or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying value and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unitās fair value, not to exceed the total amount of goodwill allocated to the reporting unit. The standard, which should be applied prospectively, is effective for fiscal years beginning after December 15, 2019, which for us is our fiscal year ending September 30, 2021. Early adoption is permitted. We are currently evaluating the impact of the adoption of ASU 2017-04 on our consolidated financial statements. In August 2016, FASB issued ASU 2016-15, āStatement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments.ā The amendments in this update provide guidance on eight specific cash flow issues, thereby reducing the diversity in practice in how certain transaction are classified in the statement of cash flows. This ASU is effective for annual periods and interim periods for those annual periods beginning after December 15, 2017, which for us is the first quarter ending December 31, 2018. Early adoption is permitted. We are currently evaluating the impact of the adoption of ASU 2016-15 on our consolidated financial statements. In June 2016, FASB issued ASU 2016-13, āFinancial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments.ā The amendments in this update replace the incurred loss impairment methodology in current U.S. GAAP with a methodology that reflects expected credit losses. This update is intended to provide financial statement users with more decision-useful information about the expected credit losses. This ASU is effective for annual periods and interim periods for those annual periods beginning after December 15, 2019, which for us is the first quarter ending December 31, 2020. Entities may early adopt beginning after December 15, 2018. We are currently evaluating the impact of the adoption of ASU 2016-13 on our consolidated financial statements. 1. BASIS OF PRESENTATION OF UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) In February 2016, FASB issued ASU 2016-02, āLeases (Topic 842)ā, which amends the existing guidance to require lessees to recognize lease assets and lease liabilities from operating leases on the balance sheet. This ASU is effective using the modified retrospective approach for annual periods and interim periods within those annual periods beginning after December 15, 2018, which for us is the first fiscal quarter ending December 31, 2019. Early adoption is permitted. We are currently evaluating the impact of the adoption of ASU 2016-02 on our consolidated financial statements. In January 2016, FASB issued ASU 2016-01, āFinancial Instruments - Overall: Recognition and Measurement of Financial Assets and Financial Liabilities.ā ASU 2016-01 will require equity investments in unconsolidated entities (other than those accounted for using the equity method of accounting) to be measured at fair value with changes in fair value recognized in net income. The amendments in this update will also simplify the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment, eliminate the requirement for public business entities to disclose the method and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet and require these entities to use the exit price notion when measuring fair value of financial instruments for disclosure purposes. This ASU would also change the presentation and disclosure requirements for financial instruments. In addition, this ASU clarifies the guidance related to valuation allowance assessment when recognizing deferred tax assets resulting from unrealized losses on available-for-sale debt securities. The amendments in this ASU are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years, which for us is the first fiscal quarter ending December 31, 2018. Early adoption is permitted for financial statements of fiscal years and interim periods that have not been issued. We are currently evaluating the impact of the adoption of ASU 2016-01. In May 2014, FASB issued ASU 2014-09, āRevenue from Contracts with Customers.ā This guidance provides a five-step analysis in determining when and how revenue is recognized so that an entity will recognize revenue when it transfers promised goods or services to customers in an amount that reflects what it expects in exchange for the goods and services. It also requires more detailed disclosures to enable users of financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. In August 2015, FASB issued ASU 2015-14 āRevenue from Contracts with Customers (Topic 606): Deferral of the Effective Dateā which approved a one-year deferral of the effective date of ASU 2014-09. As a result of this deferral, ASU 2014-09 is effective for our fiscal year ending September 30, 2019, including interim periods within that reporting period. In addition, FASB issued ASU 2016-08, ASU 2016-10, ASU 2016-12 and ASU 2017-14, to provide interpretive clarifications on the new guidance in Accounting Standards Codification (āASCā) Topic 606. We are currently working through an adoption plan and have identified our revenue streams and completed a preliminary analysis of how we currently account for revenue transactions compared to the revenue accounting required under the new standard. We intend to complete our adoption plan during the fourth quarter of fiscal 2018. This plan includes a review of transactions supporting each revenue stream to determine the impact of accounting treatment under ASC 606, evaluation of the method of adoption, and completing a rollout plan for implementation of the new standard with affected functions in our organization. Because of the nature of the work that remains, at this time we are unable to reasonably estimate the impact of adoption on our consolidated financial statements. We plan to adopt the new guidance beginning with our fiscal quarter ending December 31, 2018. |
Acquisition (Tables)
Acquisition (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Business Combinations [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the preliminary values of Accelerated assets acquired and liabilities assumed as of the acquisition date (in thousands): Cash $ 16,759 Fair value of contingent consideration on acquired business 2,300 Total purchase price consideration $ 19,059 Fair value of net tangible assets acquired $ 826 Fair value of identifiable intangible assets acquired: Customer relationships 6,500 Purchased and core technology 3,000 Trade name and trademarks 1,000 Order backlog 1,800 Goodwill 5,933 Total $ 19,059 The following table summarizes the preliminary values of TempAlert assets acquired and liabilities assumed as of the acquisition date (in thousands): Cash $ 40,741 Fair value of contingent consideration on acquired business ā Total purchase price consideration $ 40,741 Fair value of net tangible assets acquired $ (1,111 ) Fair value of identifiable intangible assets acquired: Customer relationships 18,300 Purchased and core technology 4,000 Trade name and trademarks 2,000 Goodwill 17,552 Total $ 40,741 |
Business Acquisition, Pro Forma Information | The following consolidated pro forma information is as if the Accelerated and TempAlert acquisitions had occurred on October 1, 2016 (in thousands): Three months ended June 30, Nine months ended June 30, 2018 2017 2018 2017 Revenue $ 62,716 $ 52,309 $ 168,127 $ 157,658 Net income (loss) $ 2,622 $ 670 $ (2,294 ) $ (1,172 ) |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of Calculation of Numerator and Denominator in Earnings Per Share | The following table is a reconciliation of the numerators and denominators in the net income (loss) per common share calculations (in thousands, except per common share data): Three months ended June 30, Nine months ended June 30, 2018 2017 2018 2017 Numerator: Net income (loss) $ 2,621 $ 1,335 $ (2,305 ) $ 5,023 Denominator: Denominator for basic net income (loss) per common share ā weighted average shares outstanding 27,177 26,522 27,002 26,390 Effect of dilutive securities: Stock options and restricted stock units 587 434 ā 720 Denominator for diluted net income (loss) per common share ā adjusted weighted average shares 27,764 26,956 27,002 27,110 Net income (loss) per common share, basic $ 0.10 $ 0.05 $ (0.09 ) $ 0.19 Net income (loss) per common share, diluted $ 0.09 $ 0.05 $ (0.09 ) $ 0.19 |
Selected Balance Sheet Data (Ta
Selected Balance Sheet Data (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Selected Balance Sheet Data [Abstract] | |
Schedule of Selected Balance Sheet Data | The following table shows selected balance sheet data (in thousands): June 30, September 30, 2017 Accounts receivable, net: Accounts receivable $ 51,241 $ 31,365 Less allowance for doubtful accounts 563 341 Less reserve for future returns and pricing adjustments 2,432 2,169 Accounts receivable, net $ 48,246 $ 28,855 Inventories: Raw materials $ 25,734 $ 24,050 Work in process 375 484 Finished goods 15,673 5,704 Inventories $ 41,782 $ 30,238 |
Marketable Securities (Tables)
Marketable Securities (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Marketable Securities [Abstract] | |
Schedule of Marketable Securities | At June 30, 2018 our marketable securities were (in thousands): Amortized Cost (1) Unrealized Gains Unrealized Losses Fair Value (1) Current marketable securities: Certificates of deposit $ 4,773 $ ā $ (10 ) $ 4,763 Non-current marketable securities: Certificates of deposit 2,262 ā (19 ) 2,243 Total marketable securities $ 7,035 $ ā $ (29 ) $ 7,006 (1) Included in amortized cost and fair value is purchased and accrued interest of $35 . At September 30, 2017 our marketable securities were (in thousands): Amortized Cost (1) Unrealized Gains Unrealized Losses Fair Value (1) Current marketable securities: Corporate bonds $ 28,275 $ ā $ (20 ) $ 28,255 Certificates of deposit 3,756 4 ā 3,760 Current marketable securities 32,031 4 (20 ) 32,015 Non-current marketable securities: Certificates of deposit 4,757 ā (4 ) 4,753 Total marketable securities $ 36,788 $ 4 $ (24 ) $ 36,768 (1) Included in amortized cost and fair value is purchased and accrued interest of $211 . |
Schedule of Unrealized Losses on Available-For-Sale Securities | The following tables show the fair values and gross unrealized losses of our available-for-sale marketable securities that have been in a continuous unrealized loss position deemed to be temporary, aggregated by investment category (in thousands): June 30, 2018 Less than 12 Months More than 12 Months Fair Value Unrealized Losses Fair Value Unrealized Losses Certificates of deposit 6,755 (29 ) ā ā Total $ 6,755 $ (29 ) $ ā $ ā September 30, 2017 Less than 12 Months More than 12 Months Fair Value Unrealized Losses Fair Value Unrealized Losses Corporate bonds $ 26,196 $ (20 ) $ ā $ ā Certificates of deposit 3,751 (4 ) ā ā Total $ 29,947 $ (24 ) $ ā $ ā |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Assets Measured on Recurring Basis | The following tables provide information by level for financial assets and liabilities that are measured at fair value on a recurring basis (in thousands): Total Fair Value at Fair Value Measurements Using Inputs Considered as June 30, 2018 Level 1 Level 2 Level 3 Assets: Money market $ 9,954 $ 9,954 $ ā $ ā Certificates of deposit 7,006 ā 7,006 ā Total assets measured at fair value $ 16,960 $ 9,954 $ 7,006 $ ā Liabilities: Contingent consideration on acquired businesses $ 9,021 $ ā $ ā $ 9,021 Total liabilities measured at fair value $ 9,021 $ ā $ ā $ 9,021 Total Fair Value at Fair Value Measurements Using Inputs Considered as September 30, 2017 Level 1 Level 2 Level 3 Assets: Money market $ 39,524 $ 39,524 $ ā $ ā Corporate bonds 28,255 ā 28,255 ā Certificates of deposit 8,513 ā 8,513 ā Total assets measured at fair value $ 76,292 $ 39,524 $ 36,768 $ ā Liabilities: Contingent consideration on acquired businesses $ 6,388 $ ā $ ā $ 6,388 Total liabilities measured at fair value $ 6,388 $ ā $ ā $ 6,388 |
Fair Value of Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation | The following table presents a reconciliation of the contingent consideration liability measured at fair value on a recurring basis using significant unobservable inputs (Level 3) (in thousands): Three months ended June 30, Nine months ended June 30, 2018 2017 2018 2017 Fair value at beginning of period $ 8,263 $ 10,068 $ 6,388 $ 9,960 Purchase price contingent consideration ā ā 2,300 1,310 Contingent consideration payments ā ā ā (518 ) Change in fair value of contingent consideration 758 (646 ) 333 (1,330 ) Fair value at end of period $ 9,021 $ 9,422 $ 9,021 $ 9,422 |
Goodwill and Other Identifiab29
Goodwill and Other Identifiable Intangible Assets, Net (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Amortizable Identifiable Intangible Assets | Amortizable identifiable intangible assets were (in thousands): June 30, 2018 September 30, 2017 Gross carrying amount Accum. amort. Net Gross carrying amount Accum. amort. Net Purchased and core technology $ 58,048 $ (47,983 ) $ 10,065 $ 51,292 $ (46,304 ) $ 4,988 License agreements 102 (39 ) 63 18 (17 ) 1 Patents and trademarks 15,612 (11,965 ) 3,647 12,484 (11,280 ) 1,204 Customer relationships 46,569 (19,886 ) 26,683 21,914 (16,817 ) 5,097 Non-compete agreements 600 (180 ) 420 600 (90 ) 510 Order backlog 1,800 (900 ) 900 ā ā ā Total $ 122,731 $ (80,953 ) $ 41,778 $ 86,308 $ (74,508 ) $ 11,800 |
Schedule of Estimated Future Amortization Expense Related to Identifiable Intangible Assets | Estimated amortization expense related to identifiable intangible assets for the remainder of fiscal 2018 and the five succeeding fiscal years is (in thousands): 2018 (three months) $ 2,466 2019 8,356 2020 7,592 2021 7,126 2022 6,754 2023 4,751 |
Schedule of Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill are (in thousands): Nine months ended 2018 2017 Beginning balance, October 1 $ 131,995 $ 109,448 Acquisitions 23,485 21,206 Foreign currency translation adjustment (915 ) (733 ) Ending balance, June 30 $ 154,565 $ 129,921 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Summary operating results for each of our segments were as follows (in thousands): Three months ended June 30, Nine months ended June 30, 2018 2017 2018 2017 Revenue IoT Products & Services $ 54,406 $ 42,844 $ 145,111 $ 131,653 IoT Solutions 8,310 2,895 17,593 4,876 Total revenue $ 62,716 $ 45,739 $ 162,704 $ 136,529 Operating income IoT Products & Services $ 4,544 $ 1,841 $ 10,497 $ 7,638 IoT Solutions (2,507 ) (1,132 ) (10,080 ) (2,995 ) Total operating income $ 2,037 $ 709 $ 417 $ 4,643 Depreciation and amortization IoT Products & Services $ 1,754 $ 904 $ 4,332 $ 2,704 IoT Solutions 1,559 735 4,674 1,325 Total depreciation and amortization $ 3,313 $ 1,639 $ 9,006 $ 4,029 |
Payments to Acquire Property, Plant and Equipment by Segment | Total expended for property, plant and equipment was as follows (in thousand): Nine months ended June 30, 2018 2017 Expended for property, plant and equipment IoT Products & Services $ 963 $ 1,545 IoT Solutions ā 32 Total expended for property, plant and equipment $ 963 $ 1,577 |
Reconciliation of Assets from Segment to Consolidated | Total assets for each of our segments were as follows (in thousands): June 30, September 30, 2017 Assets IoT Products & Services $ 210,118 $ 182,555 IoT Solutions 95,408 47,644 Unallocated* 54,700 114,990 Total assets $ 360,226 $ 345,189 *Unallocated consists of cash and cash equivalents, current marketable securities and long-term marketable securities. |
Reconciliation of Goodwill to Consolidated | Total goodwill for each of our segments were as follows (in thousands): June 30, September 30, 2017 Goodwill IoT Products & Services $ 104,584 $ 98,981 IoT Solutions 49,981 33,014 Total goodwill $ 154,565 $ 131,995 |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is (in thousands): Unrecognized tax benefits as of September 30, 2017 $ 1,335 Decreases related to: Expiration of statute of limitations (121 ) Unrecognized tax benefits as of June 30, 2018 $ 1,214 |
Product Warranty Obligation (Ta
Product Warranty Obligation (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Product Warranties Disclosures [Abstract] | |
Schedule of Product Warranty Accrual | The following table summarizes the activity associated with the product warranty accrual (in thousands) and is included on our Condensed Consolidated Balance Sheets within current liabilities: Balance at Warranties Settlements Balance at Period April 1 issued made June 30 Three months ended June 30, 2018 $ 1,348 $ 82 $ (135 ) $ 1,295 Three months ended June 30, 2017 $ 892 $ 248 $ (165 ) $ 975 Balance at Warranties Settlements Balance at Period October 1 issued made June 30 Nine months ended June 30, 2018 $ 987 $ 798 $ (490 ) $ 1,295 Nine months ended June 30, 2017 $ 1,033 $ 479 $ (537 ) $ 975 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Stock-Based Compensation Expense | Stock-based compensation expense is included in the consolidated results of operations as follows (in thousands): Three months ended June 30, Nine months ended June 30, 2018 2017 2018 2017 Cost of sales $ 49 $ 52 $ 145 $ 168 Sales and marketing 406 348 1,131 1,033 Research and development 168 160 343 497 General and administrative 597 614 1,979 1,804 Stock-based compensation before income taxes 1,220 1,174 3,598 3,502 Income tax benefit (249 ) (383 ) (747 ) (1,140 ) Stock-based compensation after income taxes $ 971 $ 791 $ 2,851 $ 2,362 |
Schedule of Stock Option Activity | The following table summarizes our stock option activity (in thousands, except per common share amounts): Options Outstanding Weighted Average Exercised Price Weighted Average Contractual Term (in years) Aggregate Intrinsic Value (1) Balance at September 30, 2017 3,902 $10.54 Granted 711 10.37 Exercised (435 ) 8.90 Forfeited / Canceled (604 ) 12.65 Balance at June 30, 2018 3,574 $10.35 4.3 $ 10,318 Exercisable at June 30, 2018 2,350 $10.06 3.4 $ 7,455 (1) The aggregate intrinsic value represents the total pre-tax intrinsic value, based on our closing stock price of $13.20 as of June 30, 2018 , which would have been received by the option holders had all option holders exercised their options as of that date. The intrinsic value of an option is the amount by which the fair value of the underlying stock exceeds its exercise price. |
Schedule of Valuation Assumptions | The table below shows the weighted average fair value, which was determined based upon the fair value of each option on the grant date utilizing the Black-Scholes option-pricing model and the related assumptions: Nine months ended June 30, 2018 2017 Weighted average per option grant date fair value $3.76 $4.64 Assumptions used for option grants: Risk free interest rate 2.12% - 2.88% 1.46% - 1.96% Expected term 6.00 years 6.00 years Expected volatility 33% - 34% 33% - 34% Weighted average volatility 31% 34% Expected dividend yield 0 0 |
Schedule of Nonvested Restricted Stock Units | A summary of our non-vested restricted stock units as of June 30, 2018 and changes during the nine months then ended is presented below (in thousands, except per common share amounts): Number of Awards Weighted Average Grant Date Fair Value Nonvested at September 30, 2017 566 $ 11.28 Granted 360 $ 10.35 Vested (203 ) $ 11.02 Canceled (90 ) $ 11.11 Nonvested at June 30, 2018 633 $ 10.86 |
Restructuring (Tables)
Restructuring (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Reserve | Below is a summary of the restructuring charges and other activity (in thousands) all within our IoT Products and Services segment: Manufacturing Transition 2017 Restructuring Employee Employee Other Total Balance at September 30, 2017 $ ā $ 1,528 $ 128 $ 1,656 Restructuring charge 190 ā ā 190 Payments (105 ) (971 ) (146 ) (1,222 ) Foreign currency fluctuation ā 38 4 42 Balance at June 30, 2018 $ 85 $ 595 $ (14 ) $ 666 |
Acquisition (Details)
Acquisition (Details) | Jan. 22, 2018USD ($) | Oct. 20, 2017USD ($) | Jun. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Jun. 30, 2017USD ($) | Sep. 30, 2016USD ($) |
Business Acquisition [Line Items] | ||||||||
Goodwill | $ 154,565,000 | $ 131,995,000 | $ 129,921,000 | $ 109,448,000 | ||||
Accelerated | ||||||||
Business Acquisition [Line Items] | ||||||||
Total purchase price consideration | $ 19,059,000 | |||||||
Cash paid at closing | 16,759,000 | |||||||
Cash acquired | 300,000 | |||||||
Goodwill | $ 5,933,000 | |||||||
Weighted average use life of acquired intangibles | 5 years 6 months | |||||||
Revenues | 14,200,000 | |||||||
Net income | 1,800,000 | |||||||
Acquisition costs | 300,000 | |||||||
Earn-out payment installments | 2 | |||||||
TempAlert | ||||||||
Business Acquisition [Line Items] | ||||||||
Purchase price before working capital adjustments | $ 45,000,000 | |||||||
Total purchase price consideration | 40,741,000 | |||||||
Cash paid at closing | 40,741,000 | |||||||
Cash acquired | 600,000 | |||||||
Goodwill | $ 17,552,000 | |||||||
Weighted average use life of acquired intangibles | 6 years 6 months | |||||||
Revenues | 11,400,000 | |||||||
Acquisition costs | 1,400,000 | 400,000 | ||||||
Purchased and Core Technology | Accelerated | ||||||||
Business Acquisition [Line Items] | ||||||||
Estimated useful life of finite lived intangibles | 5 years | |||||||
Purchased and Core Technology | TempAlert | ||||||||
Business Acquisition [Line Items] | ||||||||
Estimated useful life of finite lived intangibles | 5 years | |||||||
Customer Relationships | Accelerated | ||||||||
Business Acquisition [Line Items] | ||||||||
Estimated useful life of finite lived intangibles | 7 years | |||||||
Customer Relationships | TempAlert | ||||||||
Business Acquisition [Line Items] | ||||||||
Estimated useful life of finite lived intangibles | 7 years | |||||||
Trademarks and Trade Names | Accelerated | ||||||||
Business Acquisition [Line Items] | ||||||||
Estimated useful life of finite lived intangibles | 5 years | |||||||
Trademarks and Trade Names | TempAlert | ||||||||
Business Acquisition [Line Items] | ||||||||
Estimated useful life of finite lived intangibles | 5 years | |||||||
Order backlog | Accelerated | ||||||||
Business Acquisition [Line Items] | ||||||||
Estimated useful life of finite lived intangibles | 1 year | |||||||
Earn-out payments | Accelerated | ||||||||
Business Acquisition [Line Items] | ||||||||
Earn-out payment maximum | $ 4,500,000 | |||||||
Additional earn-out payment | Accelerated | ||||||||
Business Acquisition [Line Items] | ||||||||
Earn-out payment maximum | 2,000,000 | |||||||
Fair Value, Measurements, Recurring | Contingent Consideration | Estimate of Fair Value Measurement | ||||||||
Business Acquisition [Line Items] | ||||||||
Contingent consideration fair value | 9,021,000 | $ 6,388,000 | ||||||
Fair Value, Measurements, Recurring | Contingent Consideration | Estimate of Fair Value Measurement | Accelerated | ||||||||
Business Acquisition [Line Items] | ||||||||
Contingent consideration fair value | $ 2,300,000 | 3,300,000 | ||||||
Fair Value, Measurements, Recurring | Contingent Consideration | Estimate of Fair Value Measurement | TempAlert | ||||||||
Business Acquisition [Line Items] | ||||||||
Contingent consideration fair value | $ 0 | $ 0 | ||||||
Forecast | Earn-out payments | TempAlert | ||||||||
Business Acquisition [Line Items] | ||||||||
Earn-out payment maximum | $ 45,000,000 | $ 35,000,000 |
Acquisition (Assets Acquired an
Acquisition (Assets Acquired and Liabilities Assumed) (Details) - USD ($) $ in Thousands | Jan. 22, 2018 | Oct. 20, 2017 | Jun. 30, 2018 | Sep. 30, 2017 | Jun. 30, 2017 | Sep. 30, 2016 |
Business Acquisition [Line Items] | ||||||
Goodwill | $ 154,565 | $ 131,995 | $ 129,921 | $ 109,448 | ||
TempAlert | ||||||
Business Acquisition [Line Items] | ||||||
Cash | $ 40,741 | |||||
Fair value of contingent consideration on acquired business | 0 | |||||
Total purchase price consideration | 40,741 | |||||
Fair value of net tangible assets acquired | (1,111) | |||||
Goodwill | 17,552 | |||||
Total assets acquired and liabilities assumed | 40,741 | |||||
Accelerated | ||||||
Business Acquisition [Line Items] | ||||||
Cash | $ 16,759 | |||||
Fair value of contingent consideration on acquired business | 2,300 | |||||
Total purchase price consideration | 19,059 | |||||
Fair value of net tangible assets acquired | 826 | |||||
Goodwill | 5,933 | |||||
Total assets acquired and liabilities assumed | 19,059 | |||||
Customer relationships | TempAlert | ||||||
Business Acquisition [Line Items] | ||||||
Fair value of identifiable intangible assets acquired | 18,300 | |||||
Customer relationships | Accelerated | ||||||
Business Acquisition [Line Items] | ||||||
Fair value of identifiable intangible assets acquired | 6,500 | |||||
Purchased and core technology | TempAlert | ||||||
Business Acquisition [Line Items] | ||||||
Fair value of identifiable intangible assets acquired | 4,000 | |||||
Purchased and core technology | Accelerated | ||||||
Business Acquisition [Line Items] | ||||||
Fair value of identifiable intangible assets acquired | 3,000 | |||||
Trade name and trademarks | TempAlert | ||||||
Business Acquisition [Line Items] | ||||||
Fair value of identifiable intangible assets acquired | $ 2,000 | |||||
Trade name and trademarks | Accelerated | ||||||
Business Acquisition [Line Items] | ||||||
Fair value of identifiable intangible assets acquired | 1,000 | |||||
Order backlog | Accelerated | ||||||
Business Acquisition [Line Items] | ||||||
Fair value of identifiable intangible assets acquired | $ 1,800 |
Acquisition (Pro Forma) (Detail
Acquisition (Pro Forma) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Business Combinations [Abstract] | ||||
Revenue | $ 62,716 | $ 52,309 | $ 168,127 | $ 157,658 |
Net income (loss) | $ 2,622 | $ 670 | $ (2,294) | $ (1,172) |
Sale of Business (Details)
Sale of Business (Details) - Etherios, Inc. - Discontinued Operations, Disposed of by Sale - USD ($) $ in Millions | 1 Months Ended | |||
Oct. 31, 2017 | Oct. 31, 2016 | Oct. 23, 2017 | Oct. 23, 2016 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Consideration receivable | $ 2 | $ 3 | ||
Proceeds from Divestiture of Businesses | $ 2 | $ 3 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Numerator: | ||||
Net income (loss) | $ 2,621 | $ 1,335 | $ (2,305) | $ 5,023 |
Denominator: | ||||
Denominator for basic net income (loss) per common share ā weighted average shares outstanding | 27,177,000 | 26,522,000 | 27,002,000 | 26,390,000 |
Effect of dilutive securities: | ||||
Stock options and restricted stock units | 587,000 | 434,000 | 0 | 720,000 |
Denominator for diluted net income (loss) per common share ā adjusted weighted average shares | 27,764,000 | 26,956,000 | 27,002,000 | 27,110,000 |
Basic net income (loss) per common share: | ||||
Net income (loss), basic (USD per share) | $ 0.10 | $ 0.05 | $ (0.09) | $ 0.19 |
Diluted net income (loss) per common share | ||||
Net income (loss), diluted (USD per share) | $ 0.09 | $ 0.05 | $ (0.09) | $ 0.19 |
Potentially dilutive securities excluded from computation of earnings per share | 770,178 | 1,910,081 | 977,828 | 1,169,422 |
Excluded incremental common shares related to common stock options and restricted stock units | 440,002 |
Selected Balance Sheet Data (De
Selected Balance Sheet Data (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Sep. 30, 2017 |
Accounts receivable, net: | ||
Accounts receivable | $ 51,241 | $ 31,365 |
Less allowance for doubtful accounts | 563 | 341 |
Less reserve for future returns and pricing adjustments | 2,432 | 2,169 |
Accounts receivable, net | 48,246 | 28,855 |
Inventories: | ||
Raw materials | 25,734 | 24,050 |
Work in process | 375 | 484 |
Finished goods | 15,673 | 5,704 |
Inventories | $ 41,782 | $ 30,238 |
Marketable Securities (Details)
Marketable Securities (Details) $ in Thousands | 9 Months Ended | |
Jun. 30, 2018USD ($)Security | Jun. 30, 2017USD ($) | |
Schedule of Available-for-sale Securities [Line Items] | ||
Number of securities below amortized cost basis | 28 | |
Number of securities | 28 | |
Proceeds from maturities and sales of marketable securities | $ | $ 29,752 | $ 76,149 |
Current Assets | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, next twelve months, maximum year mature | 1 year | |
Non-current Assets | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, year two through five, maximum year mature | 2 years |
Marketable Securities (Fair Val
Marketable Securities (Fair Value to Amortized Cost) (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Sep. 30, 2017 | |||
Schedule of Available-for-sale Securities [Line Items] | |||||
Available-for-sale securities, amortized cost basis | $ 7,035 | [1] | $ 36,788 | [2] | |
Available-for-sale securities, unrealized gains | 0 | 4 | |||
Available-for-sale securities, unrealized losses | (29) | (24) | |||
Available-for-sale marketable securities, fair value | 7,006 | [1] | 36,768 | [2] | |
Purchased and accrued interest | 35 | 211 | |||
Current Assets | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Available-for-sale securities, amortized cost basis | [2] | 32,031 | |||
Available-for-sale securities, unrealized gains | 4 | ||||
Available-for-sale securities, unrealized losses | (20) | ||||
Available-for-sale marketable securities, fair value | [2] | 32,015 | |||
Current Assets | Corporate Bonds | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Available-for-sale securities, amortized cost basis | [2] | 28,275 | |||
Available-for-sale securities, unrealized gains | 0 | ||||
Available-for-sale securities, unrealized losses | (20) | ||||
Available-for-sale marketable securities, fair value | [2] | 28,255 | |||
Current Assets | Certificates of Deposit | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Available-for-sale securities, amortized cost basis | 4,773 | [1] | 3,756 | [2] | |
Available-for-sale securities, unrealized gains | 0 | 4 | |||
Available-for-sale securities, unrealized losses | (10) | 0 | |||
Available-for-sale marketable securities, fair value | 4,763 | [1] | 3,760 | [2] | |
Non-current Assets | Certificates of Deposit | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Available-for-sale securities, amortized cost basis | 2,262 | [1] | 4,757 | [2] | |
Available-for-sale securities, unrealized gains | 0 | 0 | |||
Available-for-sale securities, unrealized losses | (19) | (4) | |||
Available-for-sale marketable securities, fair value | $ 2,243 | [1] | $ 4,753 | [2] | |
[1] | Included in amortized cost and fair value is purchased and accrued interest of $35 | ||||
[2] | Included in amortized cost and fair value is purchased and accrued interest of $211. |
Marketable Securities (Fair V43
Marketable Securities (Fair Value and Gross Unrealized Losses for AFS) (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Sep. 30, 2017 |
Schedule of Available-for-sale Securities [Line Items] | ||
Fair value of available-for-sale securities in continuous unrealized loss position for less than twelve months | $ 6,755 | $ 29,947 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | (29) | (24) |
Fair value of available-for-sale securities in continuous unrealized loss position for twelve months or longer | 0 | 0 |
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | 0 | 0 |
Corporate Bonds | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fair value of available-for-sale securities in continuous unrealized loss position for less than twelve months | 26,196 | |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | (20) | |
Fair value of available-for-sale securities in continuous unrealized loss position for twelve months or longer | 0 | |
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | 0 | |
Certificates of Deposit | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fair value of available-for-sale securities in continuous unrealized loss position for less than twelve months | 6,755 | 3,751 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | (29) | (4) |
Fair value of available-for-sale securities in continuous unrealized loss position for twelve months or longer | 0 | 0 |
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | $ 0 | $ 0 |
Fair Value Measurements (Financ
Fair Value Measurements (Financial Assets and Liabilities) (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Sep. 30, 2016 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Available-for-sale marketable securities | $ 7,006 | [1] | $ 36,768 | [2] | ||||
Fair Value, Inputs, Level 1 | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Total assets measured at fair value | 9,954 | 39,524 | ||||||
Total liabilities measured at fair value | 0 | 0 | ||||||
Fair Value, Inputs, Level 2 | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Total assets measured at fair value | 7,006 | 36,768 | ||||||
Total liabilities measured at fair value | 0 | 0 | ||||||
Fair Value, Inputs, Level 3 | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Contingent consideration fair value | 9,021 | $ 8,263 | 6,388 | $ 9,422 | $ 10,068 | $ 9,960 | ||
Fair Value, Inputs, Level 3 | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Total assets measured at fair value | 0 | 0 | ||||||
Total liabilities measured at fair value | 9,021 | 6,388 | ||||||
Contingent Consideration | Fair Value, Inputs, Level 1 | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Contingent consideration fair value | 0 | 0 | ||||||
Contingent Consideration | Fair Value, Inputs, Level 2 | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Contingent consideration fair value | 0 | 0 | ||||||
Contingent Consideration | Fair Value, Inputs, Level 3 | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Contingent consideration fair value | 9,021 | 6,388 | ||||||
Money market | Fair Value, Inputs, Level 1 | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Cash equivalents | 9,954 | 39,524 | ||||||
Money market | Fair Value, Inputs, Level 2 | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Cash equivalents | 0 | 0 | ||||||
Money market | Fair Value, Inputs, Level 3 | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Cash equivalents | 0 | 0 | ||||||
Corporate Bonds | Fair Value, Inputs, Level 1 | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Available-for-sale marketable securities | 0 | |||||||
Corporate Bonds | Fair Value, Inputs, Level 2 | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Available-for-sale marketable securities | 28,255 | |||||||
Corporate Bonds | Fair Value, Inputs, Level 3 | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Available-for-sale marketable securities | 0 | |||||||
Certificates of Deposit | Fair Value, Inputs, Level 1 | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Available-for-sale marketable securities | 0 | 0 | ||||||
Certificates of Deposit | Fair Value, Inputs, Level 2 | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Available-for-sale marketable securities | 7,006 | 8,513 | ||||||
Certificates of Deposit | Fair Value, Inputs, Level 3 | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Available-for-sale marketable securities | 0 | 0 | ||||||
Estimate of Fair Value Measurement | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Total assets measured at fair value | 16,960 | 76,292 | ||||||
Total liabilities measured at fair value | 9,021 | 6,388 | ||||||
Estimate of Fair Value Measurement | Contingent Consideration | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Contingent consideration fair value | 9,021 | 6,388 | ||||||
Estimate of Fair Value Measurement | Money market | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Cash equivalents | 9,954 | 39,524 | ||||||
Estimate of Fair Value Measurement | Corporate Bonds | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Available-for-sale marketable securities | 28,255 | |||||||
Estimate of Fair Value Measurement | Certificates of Deposit | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Available-for-sale marketable securities | $ 7,006 | $ 8,513 | ||||||
[1] | Included in amortized cost and fair value is purchased and accrued interest of $35 | |||||||
[2] | Included in amortized cost and fair value is purchased and accrued interest of $211. |
Fair Value Measurements (Reconc
Fair Value Measurements (Reconciliation of Liability) (Details) - Fair Value, Inputs, Level 3 - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Fair value at beginning of period | $ 8,263 | $ 10,068 | $ 6,388 | $ 9,960 |
Purchase price contingent consideration | 0 | 0 | 2,300 | 1,310 |
Contingent consideration payments | 0 | 0 | 0 | (518) |
Change in fair value of contingent consideration | 758 | (646) | 333 | (1,330) |
Fair value at end of period | $ 9,021 | $ 9,422 | $ 9,021 | $ 9,422 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) | Oct. 05, 2015 | Jun. 30, 2018 | Jun. 30, 2017 | Sep. 30, 2017 | Sep. 30, 2016 | Mar. 31, 2018 | Jan. 22, 2018 | Oct. 20, 2017 | Mar. 31, 2017 | Jan. 09, 2017 | Nov. 01, 2016 |
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Increase in contingent consideration | $ 333,000 | $ (1,330,000) | |||||||||
Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Contingent consideration fair value | 9,021,000 | $ 9,422,000 | $ 6,388,000 | $ 9,960,000 | $ 8,263,000 | $ 10,068,000 | |||||
Contingent Consideration | Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 1 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Contingent consideration fair value | 0 | 0 | |||||||||
Contingent Consideration | Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Contingent consideration fair value | 0 | 0 | |||||||||
Contingent Consideration | Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Contingent consideration fair value | $ 9,021,000 | 6,388,000 | |||||||||
Bluenica Corporation | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Earn-out payment installment period | 4 years | ||||||||||
Bluenica Corporation | Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Payment for contingent consideration | 0 | $ 500,000 | |||||||||
Bluenica Corporation | Minimum | Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Fair value inputs probability of payment | 93.50% | ||||||||||
Bluenica Corporation | Maximum | Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Fair value inputs probability of payment | 98.50% | ||||||||||
FreshTemp | Maximum | Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Fair value inputs probability of payment | 100.00% | ||||||||||
TempAlert | Maximum | Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Fair value inputs probability of payment | 0.00% | ||||||||||
SMART Temps | Maximum | Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Fair value inputs probability of payment | 0.00% | ||||||||||
Accelerated | Minimum | Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Fair value inputs probability of payment | 34.00% | ||||||||||
Accelerated | Maximum | Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Fair value inputs probability of payment | 70.00% | ||||||||||
Accelerated | Contingent Consideration | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Increase in contingent consideration | $ 1,000,000 | ||||||||||
Estimate of Fair Value Measurement | Contingent Consideration | Fair Value, Measurements, Recurring | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Contingent consideration fair value | 9,021,000 | $ 6,388,000 | |||||||||
Estimate of Fair Value Measurement | Bluenica Corporation | Contingent Consideration | Fair Value, Measurements, Recurring | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Contingent consideration fair value | $ 10,400,000 | 5,500,000 | |||||||||
Estimate of Fair Value Measurement | FreshTemp | Contingent Consideration | Fair Value, Measurements, Recurring | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Contingent consideration fair value | 200,000 | $ 1,300,000 | |||||||||
Estimate of Fair Value Measurement | TempAlert | Contingent Consideration | Fair Value, Measurements, Recurring | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Contingent consideration fair value | 0 | $ 0 | |||||||||
Estimate of Fair Value Measurement | SMART Temps | Contingent Consideration | Fair Value, Measurements, Recurring | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Contingent consideration fair value | 0 | $ 10,000 | |||||||||
Estimate of Fair Value Measurement | Accelerated | Contingent Consideration | Fair Value, Measurements, Recurring | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Contingent consideration fair value | $ 3,300,000 | $ 2,300,000 |
Goodwill and Other Identifiab47
Goodwill and Other Identifiable Intangible Assets, Net (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Sep. 30, 2017 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 122,731 | $ 86,308 |
Accumulated amortization | (80,953) | (74,508) |
Net | 41,778 | 11,800 |
Purchased and Core Technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 58,048 | 51,292 |
Accumulated amortization | (47,983) | (46,304) |
Net | 10,065 | 4,988 |
License Agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 102 | 18 |
Accumulated amortization | (39) | (17) |
Net | 63 | 1 |
Patents and Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 15,612 | 12,484 |
Accumulated amortization | (11,965) | (11,280) |
Net | 3,647 | 1,204 |
Customer Relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 46,569 | 21,914 |
Accumulated amortization | (19,886) | (16,817) |
Net | 26,683 | 5,097 |
Non-compete Agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 600 | 600 |
Accumulated amortization | (180) | (90) |
Net | 420 | 510 |
Order backlog | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 1,800 | 0 |
Accumulated amortization | (900) | 0 |
Net | $ 900 | $ 0 |
Goodwill and Other Identifiab48
Goodwill and Other Identifiable Intangible Assets, Net (Additional Information) (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Sep. 30, 2017 | Sep. 30, 2016 |
Goodwill [Line Items] | |||||||
Goodwill | $ 154,565 | $ 154,565 | $ 129,921 | $ 154,565 | $ 129,921 | $ 131,995 | $ 109,448 |
Market Capitalization | 359,600 | 359,600 | 359,600 | ||||
IoT Products & Services | |||||||
Goodwill [Line Items] | |||||||
Goodwill | $ 104,584 | $ 104,584 | $ 104,584 | 98,981 | |||
Reporting Unit, Percentage of Fair Value in Excess of Carrying Amount | 36.00% | 36.00% | 36.00% | ||||
IoT Solutions | |||||||
Goodwill [Line Items] | |||||||
Goodwill | $ 49,981 | $ 49,981 | $ 49,981 | $ 33,014 | |||
Reporting Unit, Percentage of Fair Value in Excess of Carrying Amount | 7.00% | 7.00% | 7.00% | ||||
Cost of Sales and General and Administrative Expense | |||||||
Goodwill [Line Items] | |||||||
Amortization expense | $ 2,600 | $ 900 | $ 6,900 | $ 1,800 | |||
Minimum | |||||||
Goodwill [Line Items] | |||||||
Control Premium Percent | 5.70% | ||||||
Maximum | |||||||
Goodwill [Line Items] | |||||||
Control Premium Percent | 16.40% |
Goodwill and Other Identifiab49
Goodwill and Other Identifiable Intangible Assets, Net (Amortization Expense) (Details) $ in Thousands | Jun. 30, 2018USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2018 (three months) | $ 2,466 |
2,019 | 8,356 |
2,020 | 7,592 |
2,021 | 7,126 |
2,022 | 6,754 |
2,023 | $ 4,751 |
Goodwill and Other Identifiab50
Goodwill and Other Identifiable Intangible Assets, Net (Goodwill Rollforward) (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Goodwill [Roll Forward] | ||
Beginning balance | $ 131,995 | $ 109,448 |
Acquisitions | 23,485 | 21,206 |
Foreign currency translation adjustment | (915) | (733) |
Ending balance | $ 154,565 | $ 129,921 |
Segment Information (Details)
Segment Information (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2018USD ($) | Jun. 30, 2017USD ($) | Jun. 30, 2018USD ($)segment | Jun. 30, 2017USD ($) | |
Segment Reporting Information [Line Items] | ||||
Number of Reportable Segments | segment | 2 | |||
Revenues | $ 62,716 | $ 45,739 | $ 162,704 | $ 136,529 |
Operating income | 2,037 | 709 | 417 | 4,643 |
Depreciation and amortization | 3,313 | 1,639 | 9,006 | 4,029 |
IoT Products & Services | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 54,406 | 42,844 | 145,111 | 131,653 |
Operating income | 4,544 | 1,841 | 10,497 | 7,638 |
Depreciation and amortization | 1,754 | 904 | 4,332 | 2,704 |
IoT Solutions | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 8,310 | 2,895 | 17,593 | 4,876 |
Operating income | (2,507) | (1,132) | (10,080) | (2,995) |
Depreciation and amortization | $ 1,559 | $ 735 | $ 4,674 | $ 1,325 |
Segment Information Expended fo
Segment Information Expended for Property, Plant and Equipment (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Segment Reporting Information [Line Items] | ||
Expended of property, equipment, improvements and certain other identifiable intangible assets | $ 963 | $ 1,577 |
IoT Products & Services | ||
Segment Reporting Information [Line Items] | ||
Expended of property, equipment, improvements and certain other identifiable intangible assets | 963 | 1,545 |
IoT Solutions | ||
Segment Reporting Information [Line Items] | ||
Expended of property, equipment, improvements and certain other identifiable intangible assets | $ 0 | $ 32 |
Segment Information Total Asset
Segment Information Total Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Sep. 30, 2017 | |
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Assets | $ 360,226 | $ 345,189 | |
IoT Products & Services | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Assets | 210,118 | 182,555 | |
IoT Solutions | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Assets | 95,408 | 47,644 | |
Unallocated | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Assets | [1] | $ 54,700 | $ 114,990 |
[1] | Unallocated consists of cash and cash equivalents, current marketable securities and long-term marketable securities. |
Segment Information Goodwill by
Segment Information Goodwill by Segment (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Sep. 30, 2017 | Jun. 30, 2017 | Sep. 30, 2016 |
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||||
Goodwill | $ 154,565 | $ 131,995 | $ 129,921 | $ 109,448 |
IoT Products & Services | ||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||||
Goodwill | 104,584 | 98,981 | ||
IoT Solutions | ||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||||
Goodwill | $ 49,981 | $ 33,014 |
Income Taxes (Unrecognized Tax
Income Taxes (Unrecognized Tax Benefits) (Details) $ in Thousands | 9 Months Ended |
Jun. 30, 2018USD ($) | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |
Unrecognized tax benefits, beginning balance | $ 1,335 |
Decreases related to Expiration of statute of limitations | (121) |
Unrecognized tax benefits, ending balance | $ 1,214 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | Jan. 01, 2018 | Dec. 31, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 |
Income tax provision (benefit) | $ 43 | $ (694) | $ 3,016 | $ 219 | ||
Income tax expense (benefit) specific to the period | 3,000 | $ (800) | ||||
Federal corporate tax rate | 21.00% | 35.00% | ||||
Unrecognized tax benefits that would impact effective tax rate | $ 1,000 | 1,000 | ||||
Accounting Standards Update 2016-09 | ||||||
Income tax provision (benefit) | 700 | |||||
Tax Cuts and Jobs Act of 2017 | ||||||
Income tax provision (benefit) | 2,700 | |||||
Tax Cuts and Jobs Act of 2017, Remeasurement Of Deferred Tax | ||||||
Income tax provision (benefit) | 2,700 | |||||
Tax Cuts and Jobs Act of 2017, One Time Transition Tax For Foreign Subsidiaries | ||||||
Income tax provision (benefit) | $ 100 |
Product Warranty Obligation (De
Product Warranty Obligation (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Product Warranties Disclosures [Abstract] | ||||
Warranty period, minimum | 1 year | |||
Warranty period, maximum | 5 years | |||
Standard Product Warranty Accrual [Roll Forward] | ||||
Beginning balance | $ 1,348 | $ 892 | $ 987 | $ 1,033 |
Warranties issued | 82 | 248 | 798 | 479 |
Settlements made | (135) | (165) | (490) | (537) |
Ending balance | $ 1,295 | $ 975 | $ 1,295 | $ 975 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jan. 29, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares Paid for Tax Withholding for Share Based Compensation | 72,918 | 48,076 | |
Tax withholding for share-based compensation | $ 700 | $ 600 | |
Proceeds from stock option plan transactions | 3,871 | 3,264 | |
Employee contributions | 892 | 686 | |
Total intrinsic value of all options exercised | 700 | 900 | |
Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total unrecognized compensation cost nonvested awards | $ 4,300 | ||
Weighted average period, unrecognized compensation cost, nonvested awards | 2 years 8 months 12 days | ||
Restricted Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total unrecognized compensation cost nonvested restricted stock units | $ 5,400 | ||
Weighted average period, unrecognized compensation cost, nonvested awards | 1 year 4 months 24 days | ||
The 2018 Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares authorized | 1,500,000 | ||
Number of shares available for future grants | 1,473,215 | ||
The 2018 Plan | Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 4 years | ||
Expiration period | 7 years | ||
The Purchase Plan | The Purchase Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of continuous days of service | 90 days | ||
Number of hours per week employed | 20 hours | ||
Percent of market value | 85.00% | ||
Offering period | 3 months | ||
Employee contributions | $ 900 | $ 700 | |
Common shares issued to employees | 105,732 | 72,594 | |
Shares available for future issuance | 335,290 | ||
Director | The 2018 Plan | Restricted Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 1 year | ||
Executives and Employees | The 2018 Plan | Restricted Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 4 years |
Stock-Based Compensation (Stock
Stock-Based Compensation (Stock-Based Compensation Expense) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation before income taxes | $ 1,220 | $ 1,174 | $ 3,598 | $ 3,502 |
Income tax benefit | (249) | (383) | (747) | (1,140) |
Stock-based compensation after income taxes | 971 | 791 | 2,851 | 2,362 |
Cost of Sales | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation before income taxes | 49 | 52 | 145 | 168 |
Sales and Marketing | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation before income taxes | 406 | 348 | 1,131 | 1,033 |
Research and Development | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation before income taxes | 168 | 160 | 343 | 497 |
General and Administrative | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation before income taxes | $ 597 | $ 614 | $ 1,979 | $ 1,804 |
Stock-Based Compensation (Optio
Stock-Based Compensation (Options and Common Shares Reserved for Grant) (Details) - Stock Options $ / shares in Units, shares in Thousands, $ in Thousands | 9 Months Ended | |
Jun. 30, 2018USD ($)$ / sharesshares | ||
Options Outstanding [Roll Forward] | ||
Options Outstanding, Beginning Balance (in shares) | shares | 3,902 | |
Options Outstanding, Granted (in shares) | shares | 711 | |
Options Outstanding, Exercised (in shares) | shares | (435) | |
Options Outstanding, Forfeited / Canceled (in shares) | shares | (604) | |
Options Outstanding, Ending Balance (in shares) | shares | 3,574 | |
Options Outstanding, Exercisable (in shares) | shares | 2,350 | |
Weighted Average Exercise Price [Roll Forward] | ||
Weighted Average Exercise Price, Beginning Balance | $ 10.54 | |
Weighted Average Exercise Price, Granted | 10.37 | |
Weighted Average Exercise Price, Exercised | 8.90 | |
Weighted Average Exercise Price, Forfeited / Canceled | 12.65 | |
Weighted Average Exercise Price, Ending Balance | 10.35 | |
Weighted Average Exercise Price, Exercisable | $ 10.06 | |
Weighted Average Remaining Contractual Term [Abstract] | ||
Weighted Average Remaining Contractual Term, Outstanding | 4 years 3 months 18 days | |
Weighted Average Remaining Contractual Term, Exercisable | 3 years 4 months 24 days | |
Aggregate Intrinsic Value [Abstract] | ||
Aggregate Intrinsic Value, Outstanding | $ | $ 10,318 | [1] |
Aggregate Intrinsic Value, Exercisable | $ | $ 7,455 | [1] |
Closing Stock Price | $ 13.20 | |
[1] | The aggregate intrinsic value represents the total pre-tax intrinsic value, based on our closing stock price of $13.20 as of JuneĀ 30, 2018, which would have been received by the option holders had all option holders exercised their options as of that date. The intrinsic value of an option is the amount by which the fair value of the underlying stock exceeds its exercise price. |
Stock-Based Compensation (Fair
Stock-Based Compensation (Fair Value Assumptions) (Details) - Stock Options - $ / shares | 9 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted average per option grant date fair value | $ 3.76 | $ 4.64 |
Assumptions Used For Options Grants [Abstract] | ||
Risk free interest rate, minimum | 2.12% | 1.46% |
Risk free interest rate, maximum | 2.88% | 1.96% |
Expected term | 6 years | 6 years |
Expected volatility rate, minimum | 33.00% | 33.00% |
Expected volatility rate, maximum | 34.00% | 34.00% |
Weighted average volatility | 31.00% | 34.00% |
Expected dividend yield | 0.00% | 0.00% |
Stock-Based Compensation (Non-V
Stock-Based Compensation (Non-Vested Options) (Details) - Restricted Stock Units shares in Thousands | 9 Months Ended |
Jun. 30, 2018$ / sharesshares | |
Nonvested Number of Restricted Stock Units [Roll Forward] | |
Number of Restricted Stock Units, Beginning Balance | shares | 566 |
Number of Restricted Stock Units, Granted | shares | 360 |
Number of Restricted Stock Units, Vested | shares | (203) |
Number of Restricted Stock Units, Canceled | shares | (90) |
Number of Restricted Stock Units, Ending Balance | shares | 633 |
Nonvested Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share [Roll Forward] | |
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Beginning Balance | $ / shares | $ 11.28 |
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Granted | $ / shares | 10.35 |
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Vested | $ / shares | 11.02 |
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Canceled | $ / shares | 11.11 |
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Ending Balance | $ / shares | $ 10.86 |
Restructuring (Details)
Restructuring (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended |
May 31, 2017employee | Jun. 30, 2017USD ($) | Sep. 30, 2018USD ($)employee | Jun. 30, 2018USD ($) | Sep. 30, 2019USD ($) | |
Restructuring Reserve [Roll Forward] | |||||
Restructuring Reserve | $ 1,656 | ||||
Restructuring Reserve | 666 | ||||
IoT Products & Services | |||||
Restructuring Reserve [Roll Forward] | |||||
Restructuring Reserve | 1,656 | ||||
Restructuring Charge | 190 | ||||
Payments | (1,222) | ||||
Foreign currency fluctuation | 42 | ||||
Restructuring Reserve | 666 | ||||
IoT Products & Services | Q3 2017 Restructuring | |||||
Restructuring Reserve [Roll Forward] | |||||
Restructuring Charge | $ 2,500 | ||||
IoT Products & Services | Employee Termination Costs | Manufacturing Transition | |||||
Restructuring Reserve [Roll Forward] | |||||
Restructuring Reserve | 0 | ||||
Restructuring Charge | 190 | ||||
Payments | (105) | ||||
Foreign currency fluctuation | 0 | ||||
Restructuring Reserve | 85 | ||||
IoT Products & Services | Employee Termination Costs | Q3 2017 Restructuring | |||||
Restructuring Reserve [Roll Forward] | |||||
Restructuring Reserve | 1,528 | ||||
Restructuring Charge | 2,300 | 0 | |||
Payments | (971) | ||||
Foreign currency fluctuation | 38 | ||||
Restructuring Reserve | 595 | ||||
IoT Products & Services | Other | Q3 2017 Restructuring | |||||
Restructuring Reserve [Roll Forward] | |||||
Restructuring Reserve | 128 | ||||
Restructuring Charge | $ 200 | 0 | |||
Payments | (146) | ||||
Foreign currency fluctuation | 4 | ||||
Restructuring Reserve | $ (14) | ||||
IoT Products & Services | UNITED STATES | Q3 2017 Restructuring | |||||
Restructuring Reserve [Roll Forward] | |||||
Number of employees eliminated | employee | 10 | ||||
IoT Products & Services | FRANCE | Q3 2017 Restructuring | |||||
Restructuring Reserve [Roll Forward] | |||||
Number of employees eliminated | employee | 8 | ||||
Forecast | IoT Products & Services | Manufacturing Transition | |||||
Restructuring Reserve [Roll Forward] | |||||
Number of employees eliminated | employee | 53 | ||||
Forecast | IoT Products & Services | Employee Termination Costs | Manufacturing Transition | |||||
Restructuring Reserve [Roll Forward] | |||||
Restructuring Charge | $ 500 | ||||
Forecast | Minimum | IoT Products & Services | Manufacturing Transition | |||||
Restructuring Reserve [Roll Forward] | |||||
Effect on Future Earnings, Amount | $ 3,000 | ||||
Forecast | Maximum | IoT Products & Services | Manufacturing Transition | |||||
Restructuring Reserve [Roll Forward] | |||||
Effect on Future Earnings, Amount | $ 5,000 |
Common Stock Repurchase (Detail
Common Stock Repurchase (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2018 | Apr. 24, 2018 | May 02, 2017 | |
May 2018 Repurchase program | ||||
Stock repurchase program, authorized amount | $ 20,000,000 | |||
Shares repurchased | 0 | |||
May 2017 Repurchase program | ||||
Stock repurchase program, authorized amount | $ 20,000,000 | |||
Shares repurchased | 28,691 | |||
Shares repurchased, cost | $ 300,000 |
Subsequent Events - Sale of Bui
Subsequent Events - Sale of Building (Details) $ in Millions | 3 Months Ended |
Dec. 31, 2018USD ($) | |
Forecast | Minnetonka, MN | |
Subsequent Event [Line Items] | |
Proceeds from sale of buildings | $ 10 |