Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Sep. 30, 2018 | Nov. 15, 2018 | Mar. 31, 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-K | ||
Document Period End Date | Sep. 30, 2018 | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY | ||
Entity Emerging Growth Company | false | ||
Entity Small Business | false | ||
Amendment Flag | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 27,468,302 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 274,986,004 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | ||
Revenue: | ||||
Revenues | $ 228,366 | $ 181,634 | $ 203,005 | |
Cost of sales: | ||||
Amortization | 2,871 | 1,444 | 887 | |
Total cost of sales | 119,483 | 94,460 | 103,325 | |
Gross profit | 108,883 | 87,174 | 99,680 | |
Operating expenses: | ||||
Sales and marketing | 44,517 | 33,955 | 33,847 | |
Research and development | 33,178 | 28,566 | 30,955 | |
General and administrative | 28,565 | 13,331 | 17,026 | |
Restructuring charges, net | 301 | 2,515 | 747 | |
Total operating expenses | 106,561 | 78,367 | 82,575 | |
Operating income | 2,322 | 8,807 | 17,105 | |
Other income (expense), net: | ||||
Interest income | 445 | 656 | 545 | |
Interest expense | (25) | (48) | (291) | |
Other income (expense), net | 48 | 76 | (669) | |
Total other income (expense), net | 468 | 684 | (415) | |
Income from continuing operations, before income taxes | 2,790 | 9,491 | 16,690 | |
Income tax provision | 1,487 | 125 | 3,212 | |
Income from continuing operations | 1,303 | 9,366 | 13,478 | |
Income from discontinued operations, after income taxes | 0 | 0 | 3,230 | |
Net income | $ 1,303 | $ 9,366 | $ 16,708 | |
Basic net income per common share: | ||||
Continuing operations | $ 0.05 | $ 0.35 | $ 0.52 | |
Discontinued operations | 0 | 0 | 0.13 | |
Net income | 0.05 | 0.35 | 0.65 | |
Diluted net income per common share: | ||||
Continuing operations | 0.05 | 0.35 | 0.51 | |
Discontinued operations | 0 | 0 | 0.12 | |
Net income (1) | $ 0.05 | $ 0.35 | $ 0.64 | [1] |
Weighted average common shares: | ||||
Basic (shares) | 27,083 | 26,432 | 25,760 | |
Diluted (shares) | 27,652 | 27,099 | 26,311 | |
Hardware product | ||||
Revenue: | ||||
Total revenue | $ 191,050 | $ 166,480 | $ 196,101 | |
Cost of sales: | ||||
Cost of sales | 96,332 | 85,369 | 97,776 | |
Services and solutions | ||||
Revenue: | ||||
Total revenue | 37,316 | 15,154 | 6,904 | |
Cost of sales: | ||||
Cost of sales | $ 20,280 | $ 7,647 | $ 4,662 | |
[1] | Earnings per share presented are calculated by line item and may not add due to the use of rounded amounts. |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | ||
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 1,303 | $ 9,366 | $ 16,708 | |
Other comprehensive (loss) income, net of tax: | ||||
Foreign currency translation adjustment | (865) | 2,041 | (2,107) | |
Change in net unrealized (loss) gain on investments | (31) | (14) | 53 | |
Less income tax benefit (provision) | 6 | 5 | (20) | |
Reclassification of realized loss (gain) on investments included in net income (1) | [1] | 31 | 0 | (7) |
Less income tax benefit (provision) (2) | [2] | (8) | 0 | 3 |
Other comprehensive (loss) income, net of tax | (867) | 2,032 | (2,078) | |
Comprehensive income | $ 436 | $ 11,398 | $ 14,630 | |
[1] | Recorded in Other income (expense), net in our Consolidated Statements of Operations. | |||
[2] | Recorded in Income tax provision in our Consolidated Statements of Operations. |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2018 | Sep. 30, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 58,014 | $ 78,222 |
Marketable securities | 4,736 | 32,015 |
Accounts receivable, net | 50,817 | 28,855 |
Inventories | 41,644 | 30,238 |
Receivable from sale of business | 0 | 1,998 |
Other | 2,613 | 3,032 |
Assets held for sale | 5,220 | 0 |
Total current assets | 163,044 | 174,360 |
Marketable securities, long-term | 0 | 4,753 |
Property, equipment and improvements, net | 6,270 | 12,801 |
Identifiable intangible assets, net | 39,320 | 11,800 |
Goodwill | 154,535 | 131,995 |
Deferred tax assets | 6,665 | 9,211 |
Other | 1,291 | 269 |
Total assets | 371,125 | 345,189 |
Current liabilities: | ||
Accounts payable | 12,911 | 6,240 |
Accrued compensation | 8,190 | 4,325 |
Accrued warranty | 1,172 | 987 |
Accrued professional fees | 1,367 | 928 |
Unearned revenue | 2,579 | 1,343 |
Accrued restructuring | 453 | 1,656 |
Contingent consideration on acquired businesses | 5,890 | 388 |
Other | 2,413 | 2,113 |
Total current liabilities | 34,975 | 17,980 |
Income taxes payable | 851 | 877 |
Deferred tax liabilities | 334 | 534 |
Contingent consideration on acquired businesses | 4,175 | 6,000 |
Other non-current liabilities | 510 | 654 |
Total liabilities | 40,845 | 26,045 |
Commitments and Contingencies (see Notes 15 & 16) | ||
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; 33,812,838 and 33,007,993 shares issued | 338 | 330 |
Additional paid-in capital | 255,936 | 245,528 |
Retained earnings | 151,748 | 150,478 |
Accumulated other comprehensive loss | (23,526) | (22,659) |
Treasury stock, at cost, 6,385,336 and 6,436,578 shares | (54,216) | (54,533) |
Total stockholders’ equity | 330,280 | 319,144 |
Total liabilities and stockholders’ equity | $ 371,125 | $ 345,189 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 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 | 33,812,838 | 33,007,993 |
Treasury stock, shares | 6,385,336 | 6,436,578 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Operating activities: | |||
Net income | $ 1,303 | $ 9,366 | $ 16,708 |
Adjustments to reconcile net income to net cash (used in) provided by operating activities: | |||
Depreciation of property, equipment and improvements | 2,835 | 2,900 | 2,742 |
Amortization of identifiable intangible assets | 9,435 | 2,597 | 1,872 |
Stock-based compensation | 4,854 | 4,659 | 3,654 |
Excess tax benefits from stock-based compensation | 0 | (326) | (212) |
Deferred income tax (benefit) provision | (508) | (2,108) | 1,115 |
Gain on sale of property, equipment and improvements | (622) | 0 | 0 |
Gain on sale of business | 0 | 0 | (2,870) |
Change in fair value of contingent consideration | 1,377 | (4,364) | (441) |
Bad debt/product return provision | 1,120 | 361 | 168 |
Inventory obsolescence | 2,056 | 1,850 | 1,734 |
Restructuring charges, net | 301 | 2,515 | 747 |
Other | 67 | (9) | 66 |
Changes in operating assets and liabilities (net of acquisitions): | |||
Accounts receivable | (17,002) | 833 | (1,188) |
Inventories | (9,186) | (4,484) | 3,993 |
Other assets | (1,412) | 562 | 597 |
Income taxes | 697 | (3) | (1,589) |
Accounts payable | 2,728 | (3,536) | 1,612 |
Accrued expenses | (821) | (8,338) | (1,619) |
Net cash (used in) provided by operating activities | (2,778) | 2,475 | 27,089 |
Investing activities: | |||
Purchase of marketable securities | 0 | (61,964) | (74,759) |
Proceeds from maturities of marketable securities | 32,032 | 87,105 | 73,706 |
Proceeds from sale of business | 2,000 | 3,000 | 2,849 |
Acquisition of businesses, net of cash acquired | (56,258) | (30,111) | (2,860) |
Proceeds from sale of property and equipment | 731 | 0 | 0 |
Proceeds from sale of investment | 0 | 0 | 13 |
Purchase of property, equipment, improvements and certain other intangible assets | (1,842) | (1,773) | (2,729) |
Net cash used in investing activities | (23,337) | (3,743) | (3,780) |
Financing activities: | |||
Acquisition earn-out payments | 0 | (518) | 0 |
Excess tax benefits from stock-based compensation | 0 | 326 | 212 |
Proceeds from stock option plan transactions | 5,460 | 3,502 | 7,191 |
Proceeds from employee stock purchase plan transactions | 1,115 | 685 | 896 |
Repurchase of common stock | (748) | (938) | (550) |
Net cash provided by financing activities | 5,827 | 3,057 | 7,749 |
Effect of exchange rate changes on cash and cash equivalents | 80 | 706 | (349) |
Net (decrease) increase in cash and cash equivalents | (20,208) | 2,495 | 30,709 |
Cash and cash equivalents, beginning of period | 78,222 | 75,727 | 45,018 |
Cash and cash equivalents, end of period | 58,014 | 78,222 | 75,727 |
Supplemental disclosures of cash flow information: | |||
Interest paid | 10 | 1 | 9 |
Income taxes paid, net | 1,235 | 2,129 | 3,029 |
Supplemental schedule of non-cash investing and financing activities: | |||
Accrual for capitalized intangible asset | (78) | (36) | (183) |
Receivable related to sale of business | 0 | 0 | 4,956 |
Liability related to acquisition of business | $ (2,300) | $ (1,310) | $ (10,550) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Treasury Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Loss |
Beginning balance at Sep. 30, 2015 | $ 274,938 | $ 315 | $ (54,535) | $ 227,367 | $ 124,404 | $ (22,613) |
Beginning balance (in shares) at Sep. 30, 2015 | 31,534 | 6,487 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 16,708 | 16,708 | ||||
Other comprehensive income (loss) | (2,078) | (2,078) | ||||
Employee stock purchase issuances (in shares) | (104) | |||||
Employee stock purchase issuances | 896 | $ 876 | 20 | |||
Repurchase of common stock (in shares) | 48 | |||||
Repurchase of common stock | (550) | $ (550) | ||||
Issuance of stock under stock award plans (in shares) | 937 | |||||
Issuance of stock under stock award plans | 7,191 | $ 10 | 7,181 | |||
Tax impact from equity awards | (914) | (914) | ||||
Accelerated vesting of Etherios stock award plans | 184 | 184 | ||||
Stock-based compensation expense | 3,654 | 3,654 | ||||
Ending balance (in shares) at Sep. 30, 2016 | 32,471 | 6,431 | ||||
Ending balance at Sep. 30, 2016 | 300,029 | $ 325 | $ (54,209) | 237,492 | 141,112 | (24,691) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 9,366 | 9,366 | ||||
Other comprehensive income (loss) | 2,032 | 2,032 | ||||
Employee stock purchase issuances (in shares) | (72) | |||||
Employee stock purchase issuances | 685 | $ 614 | 71 | |||
Repurchase of common stock (in shares) | 78 | |||||
Repurchase of common stock | (938) | $ (938) | ||||
Issuance of stock under stock award plans (in shares) | 537 | |||||
Issuance of stock under stock award plans | 3,502 | $ 5 | 3,497 | |||
Tax impact from equity awards | (191) | (191) | ||||
Stock-based compensation expense | 4,659 | 4,659 | ||||
Ending balance (in shares) at Sep. 30, 2017 | 33,008 | 6,437 | ||||
Ending balance at Sep. 30, 2017 | 319,144 | $ 330 | $ (54,533) | 245,528 | 150,478 | (22,659) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Cumulative-effect adjustment from adoption of ASU 2016-09 | ASU 2016-09 | 19 | 52 | (33) | |||
Net income | 1,303 | 1,303 | ||||
Other comprehensive income (loss) | (867) | (867) | ||||
Employee stock purchase issuances (in shares) | (126) | |||||
Employee stock purchase issuances | 1,115 | $ 1,065 | 50 | |||
Repurchase of common stock (in shares) | 74 | |||||
Repurchase of common stock | (748) | $ (748) | ||||
Issuance of stock under stock award plans (in shares) | 805 | |||||
Issuance of stock under stock award plans | 5,460 | $ 8 | 5,452 | |||
Stock-based compensation expense | 4,854 | 4,854 | ||||
Ending balance (in shares) at Sep. 30, 2018 | 33,813 | 6,385 | ||||
Ending balance at Sep. 30, 2018 | $ 330,280 | $ 338 | $ (54,216) | $ 255,936 | $ 151,748 | $ (23,526) |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Business Description We are a leading global provider of business and mission-critical and Internet of Things ("IoT") connectivity products and services. We help our customers create next-generation connected products and deploy and manage critical communications infrastructures in demanding environments with high levels of security and reliability. We have two reportable operating segments under applicable accounting standards: (i) IoT Products & Services (formerly "M2M") segment; and (ii) IoT Solutions (formerly "Solutions") segment. Our IoT Products & Services segment consists primarily of distinct communications products and communication product development services. Among other things, these products and services help our customers create next-generation connected products and deploy and manage critical communications infrastructures in demanding environments with high levels of security and reliability. This segment creates secure, easy-to-implement embedded solutions and services to help customers build IoT connectivity. It also deploys ready-to-use, complete box solutions to connect remote equipment, including products from our January 2018 acquisition of Accelerated Concepts, Inc. ("Accelerated"). The IoT Products & Services segment also offers dedicated professional services for the design of specialized wireless communications products for customers. Finally, this segment offers managed cloud services that enable customers to capture and manage data from devices they connect to networks. Our IoT products and services are used by a wide range of businesses and institutions. Our IoT Solutions segment offers wireless temperature and other condition-based monitoring services as well as employee task management services. These solutions are focused on three primary vertical markets: healthcare (including retail pharmacies), food service and transportation/logistics. The solutions are marketed as SmartSense by Digi ™ , formerly Digi Smart Solutions. We have formed, expanded and enhanced the IoT Solutions segment through four acquisitions. These include: the October 2015 acquisition of Bluenica Corporation ("Bluenica"), the November 2016 acquisition of FreshTemp ® , LLC ("FreshTemp ® "), the January 2017 acquisition of SMART Temps ® , LLC ("SMART Temps ® ") and the October 2017 acquisition of TempAlert, LLC ("TempAlert"). Discontinued Operations On October 23, 2015, we sold all of the outstanding stock of our wholly owned subsidiary, Etherios Inc. (Etherios) to West Monroe Partners, LLC. Because the sale of Etherios represented a strategic shift that had a major effect on our operations and financial results, we classified our Etherios business as discontinued operations, which requires retrospective application to financial information for all periods presented. Since the cost of segregating the consolidated statement of cash flows outweighed the benefits, we elected not to segregate our consolidated statement of cash flows as the material items in the operating and investing sections are disclosed in Note 3 to our Consolidated Financial Statements. Principles of Consolidation The consolidated financial statements include our accounts and the accounts of our wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Reclassifications Certain prior year amounts have been reclassified to conform to our fiscal 2018 presentation. On the Consolidated Balance Sheet for the period ended September 30, 2017, contingent consideration on acquired businesses has been reclassified from other current liabilities to its own respective line item. Cash Equivalents Cash equivalents consist of money market accounts and other highly liquid investments purchased with an original maturity of three months or less. The carrying amounts approximate fair value due to the short maturities of these investments. We maintain our cash and cash equivalents in bank accounts which, at times, may exceed federally insured limits. We have not experienced any losses in such accounts. Marketable Securities Marketable securities consist of certificates of deposit, commercial paper, corporate bonds and government municipal bonds. All marketable securities are accounted for as available-for-sale and are carried at fair value on our consolidated balance sheets 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) with unrealized gains and losses recorded in accumulated other comprehensive loss within stockholders’ equity. 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 when available. We obtain relevant information from our investment advisor and, if warranted, also may review the financial solvency of certain security issuers. We regularly monitor and evaluate the value of our marketable securities. When assessing marketable securities for other-than-temporary declines in value, we consider several factors. These factors include: how significant the decline in value is as a percentage of the original cost, how long the market value of the investment has been less than its original cost, the underlying factors contributing to a decline in the prices of securities in a single asset class, the performance of the issuer’s stock price in relation to the stock price of its competitors within the industry, expected market volatility, analyst recommendations, the views of external investment managers, any news or financial information that has been released specific to the investee and the outlook for the overall industry in which the issuer operates. If events and circumstances indicate that a decline in the value of a security has occurred and is other-than-temporary, we would record a charge to other (expense) income. Accounts Receivable Accounts receivable are stated at the amount we expect to collect, which is net of an allowance for doubtful accounts for estimated losses resulting from the inability of our customers to make required payments. The following factors are considered when determining the collectability of specific customer accounts: customer creditworthiness, past transaction history with the customer, and changes in customer payment terms or practices. In addition, overall historical collection experience, current economic industry trends, and a review of the current status of trade accounts receivable are considered when determining the required allowance for doubtful accounts. Based on our assessment, we provide for estimated uncollectible amounts through a charge to earnings and a credit to our allowance for doubtful accounts. Balances that remain outstanding after we have used reasonable collection efforts are written off through a charge to the allowance for doubtful accounts and a credit to accounts receivable. Inventories Inventories are stated at the lower of cost or net realizable value, with cost determined using the lower of cost or net-realizable value. Appropriate consideration is given to deterioration, obsolescence and other factors in evaluating net realizable value. Property, Equipment and Improvements, Net Property, equipment and improvements are carried at cost, net of accumulated depreciation. Depreciation is provided by charges to operations using the straight-line method over the estimated asset useful lives. Furniture and fixtures, purchased software and other equipment are depreciated over a period of three to seven years. Building improvements and buildings are depreciated over ten and thirty-nine years, respectively (see Note 6 to the Consolidated Financial Statements for regarding Assets held for sale at September 30, 2018). Expenditures for maintenance and repairs are charged to operations as incurred, while major renewals and betterments are capitalized. The assets and related accumulated depreciation accounts are adjusted for asset retirements and disposals with the resulting gain or loss included in operations. Identifiable Intangible Assets Purchased proven technology, license agreements, covenants not to compete and other identifiable intangible assets are recorded at fair value when acquired in a business acquisition, or at cost when not purchased in a business acquisition. All other identifiable intangible assets are amortized on either a straight-line basis over their estimated useful lives of three to twelve years or based on the pattern in which the asset is consumed. 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. Amortization of purchased and core technology is included in cost of sales in the Consolidated Statements of Operations. Amortization of all other acquired identifiable intangible assets is charged to operating expenses as a component of general and administrative expense. Identifiable intangible assets are reviewed for impairment annually or whenever events or circumstances indicate that undiscounted expected future cash flows are not sufficient to recover the carrying value amount. We measure impairment loss by utilizing cash flow valuation technique using the income approach. Impairment losses, if any, would be recorded in the period the impairment is identified. There were no material impairments identified in fiscal 2018, 2017 or 2016. 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Goodwill Goodwill represents the excess of cost over the fair value of identifiable assets acquired. 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 5 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 "Goodwill Measurement of Impairment" 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 unit’s assets and liabilities, excluding goodwill, is estimated. The excess of the fair value of the reporting unit over the amount assigned to its assets and liabilities, excluding goodwill, is the implied fair value of the reporting unit’s 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. During the fourth quarter of fiscal 2018, we assessed various qualitative factors to determine whether or not an additional goodwill impairment assessment was required as of September 30, 2018, and we concluded that no additional impairment assessment was required. 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 (“DCF”) 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. 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 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 not had a goodwill impairment loss since the adoption of ASC 350, Intangibles-Goodwill and Other, in fiscal 2003. Contingent Consideration We measure our contingent consideration liabilities recognized in connection with business combinations at fair value on a recurring basis using significant unobservable inputs classified within Level 3 of the fair value hierarchy as defined in ASC 820 "Fair Value Measurement". We used a probability-weighted discounted cash flow approach as a valuation technique to determine the fair value of the contingent consideration on the acquisition date. At each subsequent reporting period, the fair value is re-measured with the change in fair value recognized in general and administrative expense and interest expense in our Condensed Consolidated Statements of Operations. Amounts, if any, paid to the seller in excess of the amount recorded on the acquisition date will be classified as cash flows used in operating activities. Payments to the seller not exceeding the acquisition-date fair value of the contingent consideration will be classified as cash flows used in financing activities. Warranties In general, we warrant our hardware 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 hardware 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. We also warrant our software or firmware incorporated into our products generally for a period of one year and offer to provide a bug fix or software patch within a reasonable period. We have not accrued specifically for this warranty and have not had claims specifically related to the software. Treasury Stock We record treasury stock at cost. Treasury stock includes shares purchased from employees for tax withholding purposes related to vesting of restricted stock awards. Revenue Recognition We recognize revenue in accordance with authoritative guidance issued by Financial Accounting Standards Board ("FASB") related to revenue recognition. Hardware product revenue as a percentage of total revenue was 83.7% , 91.7% and 96.6% in fiscal 2018 , 2017 and 2016 , respectively. We recognize hardware product revenue when persuasive evidence of an arrangement exists, delivery has occurred, the sales price is fixed or determinable, collectability is reasonably assured and there are no post-delivery obligations, other than warranty. Under these criteria, product revenue generally is recognized upon shipment of product to customers. Sales to authorized domestic and foreign distributors and Direct / OEMs are made with certain rights of return and price adjustment provisions. Estimated reserves for future returns and pricing adjustments are established by us based on an analysis of historical patterns of returns and price adjustments as well as an analysis of authorized returns compared to received returns and distribution sales for the current period. Estimated reserves for future returns and price adjustments are charged against revenue in the same period as the corresponding revenue is recorded. Services and solutions revenue as a percentage of total revenue represented 16.3% , 8.3% and 3.4% in fiscal 2018 , 2017 and 2016 , respectively. Our services and solutions revenue is derived primarily from our Digi Wireless Design Services and our SmartSense by Digi ™ . Our SmartSense by Digi ™ revenue includes subscription revenue, support and equipment. Our 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) equipment and implementation fees are recorded as a sale up–front due to these items having stand–alone value to the customer because the customer can utilize our equipment with other monitoring services or use our monitoring services with hardware purchased from other vendors. Our installation charges are recorded when the product is installed. Our subscription revenue is recorded on a monthly basis. These subscriptions are generally for one year, but can be as long as five years, and may contain an evergreen renewal provision. Generally, our subscription renewal charges per month are the same as the original contract term. We also have some service revenue that is derived from our Digi Remote Manager ® , which is a platform-as-a-service (PaaS) offering in which customers pay for services consumed in terms of devices being managed and monitored, or as a monthly service fee for access to information. In addition, we recognize small amounts of revenue from our Digi Support Services which is recognized over the life of the contract, and training as the services are performed. We recognize revenue from our Digi Wireless Design Services, SmartSense by Digi ™ and Digi Remote Manager ® based upon performance, including final product delivery and customer acceptance. Research and Development Research and development costs are expensed when incurred. Research and development costs include compensation, allocation of corporate costs, depreciation, utilities, professional services and prototypes. Software development costs are expensed as incurred until the point that technological feasibility and proven marketability of the product are established. To date, the time period between the establishment of technological feasibility and completion of software development has been short, and no significant development costs have been incurred during that period. Accordingly, we have not capitalized any software development costs to date. Income Taxes Deferred income taxes are recognized for the tax consequences in future years of differences between the tax basis of assets and liabilities and their financial reporting amounts at each year end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Income tax expense is equal to the tax payable for the period and the change during the period in deferred tax assets and liabilities and also changes in income tax reserves. Stock-Based Compensation Stock-based compensation expense represents the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of the award. This cost must be recognized over the period during which an employee is required to provide the service (usually the vesting period). Foreign Currency Translation Financial position and results of operations of our international subsidiaries are measured using local currencies as the functional currency, except for our Singapore location which uses the U.S. Dollar as its functional currency. Assets and liabilities of these operations are translated at the exchange rates in effect at the end of each reporting period. For our larger international subsidiaries, statements of operations accounts are translated at the daily rate. For all other international subsidiaries, our statements of operations accounts are translated at the weighted average rates of exchange prevailing during each reporting period. Translation adjustments arising from the use of differing currency exchange rates from period to period are included in accumulated other comprehensive loss in stockholders’ equity. Gains and losses on foreign currency exchange transactions, as well as translation gains or losses on transactions denominated in currencies other than an entity’s functional currency, are reflected in the statement of operations. During both fiscal 2018 and 2017 there were net transaction gains of $0.1 million , and during fiscal 2016 , there were net transaction losses of $(0.7) million that were recorded in other income (expense), net. We manage our net asset or net liability position for U.S. dollar accounts in our foreign locations to reduce our foreign currency risk. We have not implemented a formal hedging strategy. Use of Estimates and Risks and Uncertainties The preparation of consolidated financial statements in conformity with generally accepted accounting principles in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenue and expenses during the reporting period. Actual results could differ from those estimates. Estimates that could significantly affect 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) our results of operations or financial condition involve the assignment of fair values upon acquisition of goodwill and other intangible assets and testing for impairment; the determination of our allowance for doubtful accounts and reserve for future returns and pricing adjustments; the estimation of our inventory obsolescence, warranty reserve, income tax reserves, contingent consideration and other contingencies. Comprehensive Income Our comprehensive income is comprised of net income, foreign currency translation adjustments and unrealized gains and losses on available-for-sale marketable securities, which are charged or credited to the accumulated other comprehensive loss account in stockholders’ equity. Net Income Per Common Share Basic net income 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 and potentially dilutive common shares outstanding during the period. Potentially dilutive common shares of our stock result from dilutive common stock options and restricted stock units. We use the treasury stock method to calculate the weighted-average shares used in the diluted earnings per share computation. Under the treasury stock method, the proceeds from exercise of an option, the amount of compensation cost, if any, for future service that we have not yet recognized, and the amount of estimated tax benefits that would be recorded in paid-in capital, if any, when the option is exercised are assumed to be used to repurchase shares in the current period. The following table is a reconciliation of the numerators and denominators in the net income per common share calculations (in thousands, except per common share data): Fiscal years ended September 30, 2018 2017 2016 Numerator: Income from continuing operations $ 1,303 $ 9,366 $ 13,478 Income from discontinued operations, after income taxes $ — $ — $ 3,230 Net income $ 1,303 $ 9,366 $ 16,708 Denominator: Denominator for basic net income per common share — weighted average shares outstanding 27,083 26,432 25,760 Effect of dilutive securities: Stock options and restricted stock units 569 667 551 Denominator for diluted net income per common share — adjusted weighted average shares 27,652 27,099 26,311 Basic net income per common share: Continuing operations $ 0.05 $ 0.35 $ 0.52 Discontinued operations $ — $ — $ 0.13 Net income $ 0.05 $ 0.35 $ 0.65 Diluted net income per common share: Continuing operations $ 0.05 $ 0.35 $ 0.51 Discontinued operations $ — $ — $ 0.12 Net income (1) $ 0.05 $ 0.35 $ 0.64 (1) Earnings per share presented are calculated by line item and may not add due to the use of rounded amounts. Because their effect would be anti-dilutive at period end, certain potentially dilutive shares related to stock options to purchase common shares were excluded in the above computation of diluted earnings per share because the options’ exercise prices were greater than the average market price of our common shares. At September 30, 2018 , 2017 and 2016 , such excluded stock options were 925,063 , 1,142,322 and 1,519,691 , respectively. 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Recent Accounting Developments Adopted In March 2016, the FASB issued Accounting Standards Updated (“ASU”) 2016-09, “Improvements to Employee Share-Based Payment Accounting.” This update includes provisions intended to simplify various aspects related to how share-based payments are accounted for and presented in the financial statements. This ASU is effective for annual periods and interim periods within those annual periods beginning after December 15, 2016. We adopted ASU 2016-09 on October 1, 2017. There was no material impact on our condensed consolidated financial statements. Below is a summary of the impact upon adoption of ASU 2016-09: • In accordance with ASU 2016-09, beginning on October 1, 2017, we prospectively recorded excess tax benefits/deficiencies as an income tax benefit/expense in the statement of operations. This resulted in a $0.6 million tax deficiency in the twelve months ended September 30, 2018, resulting in an unfavorable impact to EPS of $0.02 per diluted share. This amount was recognized as a discrete item within income tax expense in the condensed consolidated statement of operations. • We adjusted our dilutive shares to remove the excess tax benefits from the calculation of EPS on a prospective basis beginning October 2, 2017. The revised calculation is more dilutive, but did not have a material impact on the Company’s diluted EPS calculation for the three months ended December 31, 2017. • Further, we had no tax benefits that were not previously recognized because the related tax deduction had not reduced taxes payable, therefore, there was no cumulative-effect adjustment to our beginning retained earnings on October 1, 2017. • Additionally, we prospectively adopted the provision to classify excess tax benefits and deficiencies within cash flows from operating activities as part of cash payments for taxes on the statement of cash flows. Prior periods on the statement of cash flows have not been adjusted. • Upon adoption of ASU 2016-09, we account for forfeitures as they occur, rather than estimating forfeitures as of an awards grant date. This change in accounting policy election was adopted using a modified retrospective transition method and on October 1, 2017, we recognized a cumulative effect unfavorable adjustment to retained earnings of approximately $33,000 . • We have previously shown separately, tax payments made on behalf of an employee by repurchasing shares of stock as cash outflows from financing activities on the statement of cash flows. This provision was retrospectively adopted, and prior period cash flows already conformed with this presentation. In July 2015, FASB issued ASU 2015-11, "Simplifying the Measurement of Inventory." This provision would require inventory that was previously recorded using first-in, first-out (FIFO) to be recorded at lower of cost or net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. This guidance is effective for fiscal years beginning after December 15, 2016 and interim periods within those years. We adopted this guidance beginning October 1, 2017. The amendments in this guidance should be applied prospectively with earlier application permitted as of the beginning of an interim or annual period. The adoption of ASU 2015-11 did not have a material impact on our consolidated financial statements. Not Yet Adopted In May 2014, FASB issued ASU 2014-09, "Revenue from Contracts with Customers." This standard requires that revenue is recognized in a manner to depict the transfer of goods or services to a customer at an amount that reflects the consideration expected to be received in exchange for those goods or services. The FASB has issued several amendments to the standard, including clarifications on disclosure of prior-period performance obligations and remaining performance obligations. The guidance permits two methods of adoption: retrospectively to each prior reporting period presented (full retrospective method), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (modified retrospectively method). We elected to adopt the standard effective October 1, 2018 using the full retrospective method to restate each prior reporting period presented. 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) The most significant impact of the standard relates to our accounting for nonrefundable upfront fees related to implementation and related equipment cost which will be recognized over the expected useful life of the equipment. In addition, the standard requires the deferral of certain contract costs which will be amortized over the term of the initial and expected renewal periods of the contract. We will amortize these costs over the calculated average expected life of the pool of contracts closed during the period. We will elect t |
Acquisition
Acquisition | 12 Months Ended |
Sep. 30, 2018 | |
Business Combinations [Abstract] | |
ACQUISITION | ACQUISITIONS Fiscal 2018 Acquisitions Acquisition of Accelerated Concepts, Inc. On January 22, 2018, we purchased all the outstanding stock of Accelerated Concepts, Inc. (“Accelerated”), 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 $16.4 million (excluding cash acquired of $0.2 million ) was paid. 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 “2018 period”) and the second installment will be based on revenues from January 22, 2019 through January 21, 2020 (the “2019 period”). 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 $4.4 million at September 30, 2018 (see Note 8 to the 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 $5.7 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 2. ACQUISITIONS (CONTINUED) appliance products. This acquisition will further enhance and expand the capabilities of the IoT Products and Services segment (see Note 5 to our 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 final values of Accelerated assets acquired and liabilities assumed as of the acquisition date (in thousands): Cash $ 16,430 Fair value of contingent consideration on acquired business 2,300 Total purchase price consideration $ 18,730 Fair value of net tangible assets acquired $ 766 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 5,664 Total $ 18,730 Operating results for Accelerated after January 22, 2018 are included in our Consolidated Statements of Operations. The Consolidated Balance Sheet as of September 30, 2018 reflects the final 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 were finalized during 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 Consolidated Statements of Operations from the acquisition date of January 22, 2018 were $22.2 million and $2.8 million , respectively. Costs directly related to the acquisition of $0.3 million incurred in fiscal 2018 have been charged directly to operations and are included in general and administrative expense in our 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 (“TempAlert”), 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 technology will continue to be supported to further enhance and expand the capabilities of the IoT Solutions segment (see Note 5 to our 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 September 30, 2018 (see Note 8 to the Consolidated Financial Statements). 2. ACQUISITIONS (CONTINUED) 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 — 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 Consolidated Statements of Operations. The Consolidated Balance Sheet as of September 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 first half of fiscal 2019. 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 Consolidated Statements of Operations from the acquisition date of October 20, 2017 was $17.0 million . Costs directly related to the acquisition of $1.4 million incurred in 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 Consolidated Statements of Operations. These acquisition costs include legal, accounting, valuation and success fees. Pro Forma Financial Information (unaudited) The following consolidated pro forma information is as if the Accelerated and TempAlert acquisitions had occurred on October 1, 2016 (in thousands): Fiscal years ended September 30, 2018 2017 Revenue $ 233,789 $ 213,505 Net income $ 1,314 $ 4,117 Pro forma net income 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. 2. ACQUISITIONS (CONTINUED) Fiscal 2017 Acquisitions Acquisition of SMART Temps ® , LLC On January 9, 2017, we purchased all of the outstanding interests of SMART Temps ® , LLC ("SMART Temps ® "), an Indiana-based provider of real-time temperature management for pharmacies, education, and hospital settings as well as real-time temperature management for blood bank, laboratory environments, restaurants, and grocery. We believe this is a complementary acquisition for us as the acquired technology will continue to be supported to further enhance our portfolio of products for the IoT Solutions segment (see Note 5 to our Consolidated Financial Statements). The terms of the acquisition included an upfront cash payment together with future earn-out payments. Cash of $28.8 million (excluding cash acquired of $0.5 million ) was paid at time of closing. The earn-out payments were scheduled to be paid after December 31, 2017 which is the end of the earn-out period. The cumulative amount of those earn-out payments could not exceed $7.2 million . We determined that the earn-out would be considered as part of the purchase price consideration because there were no continuing employment requirements associated with the earn-out. The fair value of this contingent consideration was $10,000 at the date of acquisition and zero at December 31, 2017, therefore no earn-out was paid (see Note 8 to the Consolidated Financial Statements). The purchase price was allocated to the estimated fair value of assets acquired and liabilities assumed. The final purchase price allocation resulted in the recognition of $18.8 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 IoT Solutions segment. Operating results for SMART Temps ® are included in our Consolidated Statements of Operations from January 9, 2017. Acquisition of FreshTemp ® , LLC On November 1, 2016, we purchased all of the outstanding interests of FreshTemp ® , LLC (FreshTemp ® ), a Pittsburgh-based provider of temperature monitoring and automated task management solutions for the food industry. We believe this is a complementary acquisition for us as the acquired technology will continue to be supported to create an advanced portfolio of products for the IoT Solutions segment. The terms of the acquisition included an upfront cash payment together with future earn-out payments and a holdback amount. Cash of $1.7 million was paid at time of closing. The earn-out payments are based on revenue related to certain customer contracts entered into by June 30, 2017. The fair value of this contingent consideration was $1.3 million at the date of acquisition and $0.2 million at September 30, 2018 (see Note 8 to the Consolidated Financial Statements). The final calculation date was on June 30, 2018. The cumulative amount of these earn-out payments could not exceed $2.3 million . We determined that the earn-out would be considered as part of the purchase price consideration as there was no continuing employment requirements associated with the earn-out. 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 $2.7 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. Operating results for FreshTemp ® are included in our Consolidated Statements of Operations from November 2, 2016. Fiscal 2016 Acquisition Acquisition of Bluenica Corporation On October 5, 2015, we purchased all of the outstanding stock of Bluenica Corporation ("Bluenica '), a company focused on temperature monitoring of perishable goods in the food industry by using wireless sensors, which are installed in grocery and convenience stores, restaurants, and in products during shipment and storage to ensure that quality, freshness and public health requirements are met. This acquisition formed the basis for our IoT Solutions segment. The terms of the acquisition included an upfront cash payment together with earn-out payments. Cash of $2.9 million was paid at time of closing. The earn-out payments are scheduled to be paid in installments over a four -year period based on revenue achievement of the acquired business. Each of the earn-out payments will be calculated based on the revenue performance of 2. ACQUISITIONS (CONTINUED) the IoT Solutions segment for each respective earn-out period. The cumulative amount of these earn-out payments will not exceed $11.6 million . An additional payment, not to exceed $3.5 million , may also be due depending on revenue performance. The fair value of this contingent consideration was $10.4 million at the date of acquisition and $5.5 million at September 30, 2018 (see Note 8 to the Consolidated Financial Statements). We determined that the earn-out would be considered as part of the purchase price consideration as there was no continuing employment requirements associated with the earn-out. 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 $11.0 million of goodwill. 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. Operating results for Bluenica are included in our Consolidated Statements of Operations from October 6, 2015. |
Discontinued Operations Discont
Discontinued Operations Discontinued Operations | 12 Months Ended |
Sep. 30, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | |
DISCONTINUED OPERATIONS | DISCONTINUED OPERATIONS On October 23, 2015, we sold all the outstanding stock of our wholly owned subsidiary, Etherios, 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 provide that West Monroe Partners LLC will 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. We received the second installment of $2.0 million in October 2017. Goodwill was included in the net assets of Etherios based on the relative fair value of Etherios compared to the fair value of the Company, as the Company consisted of a single reporting unit for goodwill impairment testing purposes at the time of disposal. As a condition to the sale agreement, we retained the operating leases in the Dallas and Chicago locations. Digi ceased using these facilities in October 2015 and has sublet the Dallas location to West Monroe Partners, LLC through December 31, 2018. In January 2017, we signed an early-termination agreement along with an immaterial payment to exit our Chicago lease. Also, in connection with the sale, we assigned our San Francisco lease to West Monroe Partners, LLC. Income from discontinued operations, after income taxes, as presented in the Consolidated Statements of Operations for the twelve months ended September 30, 2016 is as follows (in thousands): Fiscal year ended September 30, 2016 Service revenue $ 891 Cost of service 713 Gross profit 178 Operating expenses: Sales and marketing 148 Research and development 103 General and administrative 43 Total operating expenses 294 Loss from discontinued operations, before income taxes (116 ) Gain on sale of discontinued operations, before income taxes 2,870 Income from discontinued operations, before income taxes 2,754 Income tax benefit on discontinued operations (476 ) Income from discontinued operations, after income taxes $ 3,230 Income tax benefit on discontinued operations for the twelve months ended September 30, 2016 was $0.5 million , which primarily represented income tax benefits for deductible transaction costs, partially offset by a tax expense for equity awards for which we will not receive a tax deduction. For tax purposes, this transaction resulted in a capital loss, as the tax basis of the 3. DISCONTINUED OPERATIONS (CONTINUED) Etherios stock was higher than the book basis of the assets that were sold. Since we do not expect to be able to utilize this capital loss in the five-year carryforward period, a deferred tax asset offset by a full valuation allowance was recorded in the third quarter of fiscal 2016 upon completion of the capital loss calculation. The following table presents amortization of the discontinued operations related to Etherios (in thousands): Fiscal year ended September 30, 2016 Amortization of identifiable intangible assets $ 30 |
Goodwill and other Identifiable
Goodwill and other Identifiable Intangible Assets | 12 Months Ended |
Sep. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER IDENTIFIABLE INTANGIBLE ASSETS, NET | GOODWILL AND OTHER IDENTIFIABLE INTANGIBLE ASSETS, NET Identifiable Intangible Assets, Net Amortizable identifiable intangible assets, net as of September 30, 2018 and 2017 were comprised of the following (in thousands): September 30, 2018 September 30, 2017 Gross carrying amount Accum. amort. Net Gross carrying amount Accum. amort. Net Purchased and core technology $ 58,102 $ (48,693 ) $ 9,409 $ 51,292 $ (46,304 ) $ 4,988 License agreements 102 (46 ) 56 18 (17 ) 1 Patents and trademarks 15,701 (12,242 ) 3,459 12,484 (11,280 ) 1,204 Customer relationships 46,605 (21,049 ) 25,556 21,914 (16,817 ) 5,097 Non-compete agreements 600 (210 ) 390 600 (90 ) 510 Order backlog 1,800 (1,350 ) 450 — — — Total $ 122,910 $ (83,590 ) $ 39,320 $ 86,308 $ (74,508 ) $ 11,800 Amortization expense is included in our consolidated statement of operations in cost of sales and general and administrative expense. Amortization expense in cost of sales includes amortization for purchased and core technology and certain patents and trademarks. Amortization expense for fiscal years 2018 , 2017 and 2016 was as follows (in thousands): Fiscal year Total 2018 $ 9,435 2017 $ 2,597 2016 $ 1,842 Estimated amortization expense for the next five years is as follows (in thousands): Fiscal year Total 2019 $ 8,888 2020 $ 8,118 2021 $ 7,422 2022 $ 6,554 2023 $ 4,362 4. GOODWILL AND OTHER IDENTIFIABLE INTANGIBLE ASSETS, NET (CONTINUED) Goodwill The changes in the carrying amount of goodwill were (in thousands): Fiscal years ended September 30, 2018 2017 Beginning balance, October 1 $ 131,995 $ 109,448 Acquisitions 23,216 21,465 Foreign currency translation adjustment (676 ) 1,082 Ending balance, September 30 $ 154,535 $ 131,995 |
Segment Information and Major C
Segment Information and Major Customers | 12 Months Ended |
Sep. 30, 2018 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION AND MAJOR CUSTOMERS | SEGMENT INFORMATION AND MAJOR CUSTOMERS We have two reportable operating segments for purposes of ASC 280-10-50 “Segment Reporting”: (i) IoT Products & Services (formerly "M2M") segment, and (ii) IoT Solutions (formerly "Solutions") segment. This determination was made by considering both qualitative and quantitative information. The qualitative information included, but was not limited to, the following: the nature of the products and services and customers differ between the two segments, the Chief Operating Decision Maker ("CODM") is reviewing both segments’ operating results separately and makes decisions about the allocation of resources, and discrete financial information is available through operating income (loss) for both segments. Our segments are described below: IoT Products & Services Our IoT Products & Services segment is composed of the following communications products and development services: • Cellular routers and gateways; • Radio frequency ("RF") which include our Digi XBee ® modules as well as other RF solutions; • Embedded products include Digi Connect ® and Rabbit ® embedded systems on module and single board computers; • Network products, which has the highest concentration of mature products, including console and serial servers and USB connected products; • Digi Wireless Design Services; • Digi Remote Manager ® ; and • Digi Support Services which offers various levels of technical services for development assistance, consulting and training. IoT Solutions Our IoT Solutions segment offers wireless temperature and other condition-based monitoring services as well as employee task management services. These solutions are focused on three primary vertical markets: healthcare (including retail pharmacies), food service and transportation/logistics. The solutions are marketed as SmartSense by Digi ™ , formerly Digi Smart Solutions. We have formed, expanded and enhanced the IoT Solutions segment through four acquisitions. These include: the October 2015 acquisition of Bluenica Corporation ("Bluenica"), the November 2016 acquisition of FreshTemp ® , LLC ("FreshTemp ® "), the January 2017 acquisition of SMART Temps ® , LLC ("SMART Temps ® ") and the October 2017 acquisition of TempAlert, LLC ("TempAlert"). 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. 5. SEGMENT INFORMATION AND MAJOR CUSTOMERS (CONTINUED) Summary operating results for each of our segments were as follows (in thousands): Fiscal years ended September 30, 2018 2017 2016 Revenue IoT Products & Services $ 201,506 $ 174,237 $ 202,294 IoT Solutions 26,860 7,397 711 Total revenue $ 228,366 $ 181,634 $ 203,005 Operating income (loss) IoT Products & Services $ 14,923 $ 12,804 $ 18,822 IoT Solutions (12,601 ) (3,997 ) (1,717 ) Total operating income $ 2,322 $ 8,807 $ 17,105 Depreciation and amortization IoT Products & Services $ 6,040 $ 3,575 $ 4,040 IoT Solutions 6,230 1,922 544 Total depreciation and amortization $ 12,270 $ 5,497 $ 4,584 Total expended for property, plant and equipment was as follows (in thousands): Fiscal years ended September 30, 2018 2017 2016 IoT Products & Services $ 1,773 $ 1,738 $ 2,641 IoT Solutions 69 35 88 Total expended for property, plant and equipment $ 1,842 $ 1,773 $ 2,729 Total assets for each of our segments were as follows (in thousands): As of September 30, 2018 2017 IoT Products & Services $ 209,574 $ 182,555 IoT Solutions 98,801 47,644 Unallocated* 62,750 114,990 Total assets $ 371,125 $ 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): As of September 30, 2018 2017 IoT Products & Services $ 104,358 $ 98,981 IoT Solutions 50,177 33,014 Total goodwill $ 154,535 $ 131,995 Net property, equipment and improvements by geographic location were as follows (in thousands): As of September 30, 2018 2017 United States $ 6,156 $ 12,648 International, primarily Europe 114 153 Total net property, equipment and improvements $ 6,270 $ 12,801 5. SEGMENT INFORMATION AND MAJOR CUSTOMERS (CONTINUED) The information in the following table provides total consolidated revenue by the geographic location of the customer (in thousands): Fiscal years ended September 30, 2018 2017 2016 North America, primarily United States $ 163,397 $ 117,749 $ 131,457 Europe, Middle East & Africa 39,211 39,403 44,932 Asia 20,881 19,892 20,390 Latin America 4,877 4,590 6,226 Total revenue $ 228,366 $ 181,634 $ 203,005 Our U.S. export sales represented 29.9% , 37.1% and 38.7% of revenue for the fiscal years ended September 30, 2018 , 2017 and 2016 . No single customer exceeded 10% of revenue for any of the periods presented. At September 30, 2018, we had one customer, whose accounts receivable balance represented 12.0% of total accounts receivable. No single customer exceeded 10% of total accounts receivable at September 30, 2017. |
Selected Balance Sheet Data
Selected Balance Sheet Data | 12 Months Ended |
Sep. 30, 2018 | |
Selected Balance Sheet Data [Abstract] | |
SELECTED BALANCE SHEET DATA | SELECTED BALANCE SHEET DATA (in thousands) As of September 30, 2018 2017 Accounts receivable, net: Accounts receivable $ 54,451 $ 31,365 Less allowance for doubtful accounts 1,074 341 Less reserve for future returns and pricing adjustments 2,560 2,169 Total accounts receivable, net $ 50,817 $ 28,855 Inventories: Raw materials $ 22,047 $ 24,050 Work in process 525 484 Finished goods 19,072 5,704 Total inventories $ 41,644 $ 30,238 Property, equipment and improvements, net: Land $ 570 $ 1,800 Buildings 2,338 10,522 Improvements 1,698 3,445 Equipment 15,803 17,133 Purchased software 3,966 3,571 Furniture and fixtures 3,350 3,473 Total property, equipment and improvements, gross 27,725 39,944 Less accumulated depreciation and amortization 21,455 27,143 Total property, equipment and improvements, net $ 6,270 $ 12,801 At September 30, 2018 there was $5.2 million of assets held for sale on our Consolidated Balance Sheet, which consist of land, buildings and improvements related to our Minnetonka, Minnesota headquarters. On October 2, 2018, we sold our corporate headquarters building to Minnetonka Leased Housing Associates II, LLLP (see Note 18 to our Consolidated Financial Statements). |
Marketable Securities
Marketable Securities | 12 Months Ended |
Sep. 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. 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 September 30, 2018 , all of our 19 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 loss. All of our current marketable securities mature in less than one year and our non-current marketable securities mature in less than two years. We received proceeds from the sale of our available-for-sale marketable securities of $32.0 million , $87.1 million and $73.7 million for fiscal 2018, 2017 and 2016, respectively. At September 30, 2018 our marketable securities consisted of (in thousands): Amortized Cost (1) Unrealized Gains Unrealized Losses Fair Value (1) Current marketable securities: Certificates of deposit $ 4,756 $ — $ (20 ) $ 4,736 Total marketable securities $ 4,756 $ — $ (20 ) $ 4,736 (1) Included in amortized cost and fair value is purchased and accrued interest of $6 . At September 30, 2017 our marketable securities consisted of (in thousands): Amortized Cost (1) Unrealized Gains Unrealized Losses Fair Value (1) Current marketable securities: Corporate bonds $ 28,275 $ — $ (20 ) $ 28,255 Certificates of deposit 3,756 4 — 3,760 Current marketable securities 32,031 4 (20 ) 32,015 Non-current marketable securities: Certificates of deposit 4,757 — (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 securities that have been in a continuous unrealized loss position deemed to be temporary, aggregated by investment category (in thousands): September 30, 2018 Less than 12 Months More than 12 Months Fair Value Unrealized Losses Fair Value Unrealized Losses Certificates of deposit $ — $ — $ 4,736 $ (20 ) Total $ — $ — $ 4,736 $ (20 ) 7. MARKETABLE SECURITIES (CONTINUED) September 30, 2017 Less than 12 Months More than 12 Months Fair Value Unrealized Losses Fair Value Unrealized Losses Corporate bonds $ 26,196 $ (20 ) $ — $ — Certificates of deposit 3,751 (4 ) — — Total $ 29,947 $ (24 ) $ — $ — |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Sep. 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. 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): Fair Value Measurements at September 30, 2018 using: Total carrying value at September 30, 2018 Quoted price in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Assets: Money market $ 24,318 $ 24,318 $ — $ — Certificates of deposit 4,736 — 4,736 — Total assets measured at fair value $ 29,054 $ 24,318 $ 4,736 $ — Liabilities: Contingent consideration on acquired business $ 10,065 $ — $ — $ 10,065 Total liabilities measured at fair value $ 10,065 $ — $ — $ 10,065 8. FAIR VALUE MEASUREMENTS (CONTINUED) Fair Value Measurements at September 30, 2017 using: Total carrying value at September 30, 2017 Quoted price in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Assets: Money market $ 39,524 $ 39,524 $ — $ — Corporate bonds 28,255 — 28,255 — Certificates of deposit 8,513 — 8,513 — Total assets measured at fair value $ 76,292 $ 39,524 $ 36,768 $ — Liabilities: Contingent consideration on acquired business $ 6,388 $ — $ — $ 6,388 Total liabilities measured at fair value $ 6,388 $ — $ — $ 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 fiscal 2018 . The use of different assumptions, applying different judgment to matters that are inherently 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 (“Bluenica”), 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 September 30, 2018 . We paid $0.5 million for the period ended September 30, 2016 and zero for the period ended September 30, 2017. In connection with the November 2016 acquisition of FreshTemp ® , LLC (“FreshTemp ® ”), 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 September 30, 2018 . We have paid the $0.2 million in November 2018. For the January 2017 acquisition of SMART Temps ® LLC (“SMART Temps ® ”), we were required to make a contingent payment after December 31, 2017 based on achieving specified revenue thresholds. The fair value of the liability for contingent payments recognized upon acquisition of SMART Temps ® was $10,000 . Since the revenue threshold was not met, no payment was made. 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 September 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 specified revenue thresholds. The fair values of the liability for contingent payments recognized upon acquisition of Accelerated and at September 30, 2018 was $2.3 million and was $4.4 million , respectively. The increase is a result of Accelerated outperforming initial revenue expectations. The fair values of these contingent payments were 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 Consolidated Statements of Operations. 8. FAIR VALUE MEASUREMENTS (CONTINUED) 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): Fiscal years ended September 30, 2018 2017 Fair value at beginning of period $ 6,388 $ 9,960 Purchase price contingent consideration 2,300 1,310 Contingent consideration payments — (518 ) Change in fair value of contingent consideration 1,377 (4,364 ) Fair value at end of period $ 10,065 $ 6,388 The change in fair value of contingent consideration relates to the acquisitions of Accelerated, Bluenica, FreshTemp ® and SMART Temps ® 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 44.4% to 100.0% for Accelerated 98.6% for Bluenica, 100% for FreshTemp ® and 0% for SMART Temp. A significant increase (decrease) in our estimates of achieving the relevant targets could materially increase (decrease) the fair value of the contingent consideration liability. |
Product Warranty Obligation
Product Warranty Obligation | 12 Months Ended |
Sep. 30, 2018 | |
Product Warranties Disclosures [Abstract] | |
PRODUCT WARRANTY OBLIGATION | PRODUCT WARRANTY OBLIGATION The following table summarizes the activity associated with the product warranty accrual (in thousands) and is listed on our Consolidated Balance Sheets under Current Liabilities: Balance at Warranties Settlements Balance at Fiscal year October 1 issued made September 30 2018 $ 987 $ 759 $ (574 ) $ 1,172 2017 $ 1,033 $ 679 $ (725 ) $ 987 2016 $ 1,014 $ 771 $ (752 ) $ 1,033 We also warrant our software or firmware incorporated into our products and offer to provide a bug fix or software patch within a reasonable period. We have not accrued specifically for this warranty and have not had claims specifically related to the software. We are not responsible for, and do not warrant that, custom software versions, created by original equipment manufacturer (OEM) 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. |
Restructuring
Restructuring | 12 Months Ended |
Sep. 30, 2018 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING | RESTRUCTURING Below is a summary of the restructuring charges and other activity within the restructuring accrual all of which is included in our IoT Products & Services segment (in thousands): Manufacturing Transition 2017 Restructuring 2016 Restructuring Employee Termination Costs Employee Termination Costs Other Employee Other Total Balance at September 30, 2015 $ — $ — $ — $ — $ — $ — Restructuring charge — — — 558 195 753 Payments — — — (559 ) (195 ) (754 ) Reversals — — — (6 ) — (6 ) Foreign currency fluctuation — — — 7 — 7 Balance at September 30, 2016 $ — $ — $ — $ — $ — $ — Restructuring charge — 2,258 257 — — 2,515 Payments — (845 ) (141 ) — — (986 ) Foreign currency fluctuation — 115 12 — — 127 Balance at September 30, 2017 $ — $ 1,528 $ 128 $ — $ — $ 1,656 Restructuring charge 504 — — — — 504 Payments (357 ) (1,035 ) (161 ) — — (1,553 ) Reversals — (244 ) 42 — — (202 ) Foreign currency fluctuation — 44 4 — — 48 Balance at September 30, 2018 $ 147 $ 293 $ 13 $ — $ — $ 453 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, 51 positions in total have been 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 (EMEA) 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 during the first half of fiscal 2019. 2016 Restructuring On January 19, 2016, we approved a restructuring plan for our Digi Wireless Design Services group. This plan resulted in an elimination of 5 positions. We recorded a restructuring charge of $0.1 million related to severance during the second quarter of fiscal 2016 and paid the majority of the severance during that same quarter. On November 19, 2015, we approved a restructuring plan impacting our corporate staff. The plan closed our Dortmund, Germany office and relocated certain employees to our Munich office. We also recorded a contract termination charge as we relocated employees in our Minneapolis, Minnesota office to our World Headquarters in Minnetonka, Minnesota in December 2015. We recorded a restructuring charge of $0.7 million that included $0.5 million of severance and $0.2 million of contract termination costs during the first quarter of fiscal 2016. This restructuring resulted in an elimination of 10 positions. The payments associated with these charges were completed in the third quarter of fiscal 2016. |
Income Taxes
Income Taxes | 12 Months Ended |
Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The components of income from continuing operations, before income taxes are as follows (in thousands): Fiscal years ended September 30, 2018 2017 2016 United States $ (2,887 ) $ 5,170 $ 9,841 International 5,677 4,321 6,849 Income from continuing operations, before income taxes $ 2,790 $ 9,491 $ 16,690 The components of the income tax provision are as follows (in thousands): Fiscal years ended September 30, 2018 2017 2016 Current: Federal $ 526 $ 312 $ (141 ) State 57 165 139 Foreign 1,412 1,756 2,099 Deferred: U.S. (668 ) (1,454 ) 1,260 Foreign 160 (654 ) (145 ) Income tax provision $ 1,487 $ 125 $ 3,212 The net deferred tax asset consists of the following (in thousands): As of September 30, 2018 2017 Non-current deferred tax asset $ 6,665 $ 9,211 Non-current deferred tax liability (334 ) (534 ) Net deferred tax asset $ 6,331 $ 8,677 Uncollectible accounts and other reserves $ 1,000 $ 1,063 Depreciation and amortization (369 ) (673 ) Inventories 740 824 Compensation costs 3,388 5,863 Tax carryforwards 7,063 7,514 Valuation allowance (3,291 ) (5,952 ) Identifiable intangible assets (2,298 ) (581 ) Other 98 619 Net deferred tax asset $ 6,331 $ 8,677 As of September 30, 2018 , our estimated carryforwards for tax purposes are as follows: We have $3.6 million of tax carryforwards (net of reserves) related to federal and state research and development tax credits. We also have $3.5 million of carryforwards (net, tax effected) consisting of U.S. capital loss of $3.2 million and non-U.S. net operating losses of $0.3 million . The majority of our federal research and development tax credits have a 20-year carryforward period. The state research and development tax credits have a 15-year carryforward period. The majority of our non-U.S. net operating losses have an unlimited carryforward period. Our non-U.S. tax credit carryforwards will expire in 2032. Our U.S. capital loss carryforward will expire in 2020. Our valuation allowance for certain U.S. and foreign locations was $3.3 million at September 30, 2018 and $6.0 million at September 30, 2017 . The decrease is a result of expected tax capital gains in fiscal 2019 resulting from the sale of our corporate headquarters building (see Note 18 to the Consolidated Financial Statements). The deferred tax assets realized could vary if there are differences in the timing or amount of future reversals of existing deferred tax liabilities or changes in the 11. INCOME TAXES (CONTINUED) amounts of future taxable income. If future taxable income projections are not realized, an additional valuation allowance may be required, and would be reflected as income tax expense at the time that any such change in future taxable income is determined. The reconciliation of the statutory federal income tax amount to our income tax provision is as follows (in thousands): Fiscal years ended September 30, 2018 2017 2016 Statutory income tax amount $ 1,001 $ 2,917 $ 5,548 Increase (decrease) resulting from: State taxes, net of federal benefits (312 ) (125 ) 204 Manufacturing deduction (364 ) (150 ) (450 ) Meal and entertainment 82 63 55 Transaction costs 79 — — Employee stock purchase plan 56 79 83 Foreign operations (3 ) 218 276 Valuation allowance - current year increase 275 159 (43 ) Utilization of tax credits (1,609 ) (1,168 ) (1,116 ) Discrete items: Valuation allowance (1,317 ) — — Discrete tax benefits (765 ) (954 ) (1,461 ) One-time transition tax 250 — — Deferred balance sheet remeasure 2,727 — — ASU 2016-09 excess stock compensation 643 — — Contingent consideration 388 (1,172 ) (154 ) Adjustment of tax contingency reserves 315 257 202 Other, net 41 1 68 Income tax provision $ 1,487 $ 125 $ 3,212 During fiscal 2018, net tax expense discrete to the period was $1.5 million , primarily as a result of $3.0 million tax expense related to new U.S. tax legislation that was enacted during the first quarter of fiscal 2018 and $0.6 million for the adoption of ASU 2016-09 related to the accounting for the tax effects of stock compensation (discussed below). This was offset partially by a net tax benefit of $1.3 million for the release of valuation allowances. The valuation allowance release consists of a $1.1 million release of a valuation allowance against U.S. federal capital loss carryforward due to expected capital gains tax in fiscal 2019 resulting from the sale of our corporate headquarters building in October 2018 (see Note 18 to the Consolidated Financial Statements). This expense is included within the discrete items in the above table. The Tax Cuts and Jobs Act of 2017 (the “Act”) 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 September 30, 2018 we had not fully completed our accounting for the tax effects of enactment of the Act. However, in certain cases 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 $3.0 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. This 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, which could potentially affect the measurement of these balances or potentially give rise to new deferred tax amounts. As of September 30, 2018 , the provisional amount recorded related to the re-measurement of this deferred tax balance was $2.7 million . This is a result a federal income tax rate of 35% for fiscal 2017, 24.25% for fiscal 2018 11. INCOME TAXES (CONTINUED) and 21% for fiscal 2019 and beyond. Timing differences as of September 30, 2018 are estimated balances and thus will result in a change to our estimate of the deferred rate change. This estimate will be finalized with the filing of our fiscal 2018 income tax return. Since many of the deferred tax balances in the period include estimates of events that have not yet occurred, we are unable to determine the final impact of the tax change at this time. 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 (“E&P”) previously deferred from U.S. income taxes. A provisional amount for our one-time transition tax liability was recorded for foreign subsidiaries, including estimated state tax impacts. This resulted in an increase in income tax expense of $0.3 million for the twelve months ended September 30, 2018 . We have not yet completed the calculation of E&P for foreign subsidiaries. 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 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 additional guidance will be forthcoming from U.S. Treasury which may or may not impact the final transition tax required. We will complete our accounting for the Act during the first quarter of fiscal 2019. We do not expect any material adjustments. We adopted ASU 2016-09 “Improvements to Employee Share-Based Payment Accounting” on October 1, 2017. As a result of the adoption, we recorded $0.6 million of excess tax expense related to our share-based payments in our provision for income taxes for the twelve months ended September 30, 2018 . Historically, this was recorded in additional paid-in capital. The excess tax expense related to share-based payments are recognized as tax expense discretely related to the twelve months ended September 30, 2018 . During fiscal 2017, net tax benefits discrete to the period were $1.0 million , primarily from the reversal of tax reserves due to the expiration of statutes of limitation from U.S. and foreign tax jurisdictions. These benefits are included within the discrete tax benefits in the above table. During fiscal 2016, net tax benefits discrete to the period were $1.5 million , primarily from the reinstatement of the federal research and development tax credit for calendar year 2015 and the reversal of tax reserves due to the expiration of statutes of limitation from U.S. and foreign tax jurisdictions. In addition, we filed amended income tax returns resulting in an additional domestic refund related to qualified manufacturing activities. These benefits are included within the discrete items in the above table. A reconciliation of the beginning and ending amount of unrecognized tax benefits is (in thousands): Fiscal years ended September 30, 2018 2017 2016 Unrecognized tax benefits at beginning of fiscal year $ 1,335 $ 1,708 $ 1,618 Increases related to: Prior year income tax positions 39 21 107 Current year income tax positions 315 257 240 Decreases related to: Prior year income tax positions — — (71 ) Settlements — — (30 ) Expiration of statute of limitations (128 ) (651 ) (156 ) Unrecognized tax benefits at end of fiscal year $ 1,561 $ 1,335 $ 1,708 The total amount of unrecognized tax benefits ("UTB") at September 30, 2018 that, if recognized, would affect our effective tax rate is $1.4 million . We expect that it is reasonably possible that the total amounts of UTB that will decrease over the next 12 months due to the expiration of various statutes of limitations will be immaterial. Of the $1.6 million of UTB, $0.8 million is included in non-current income taxes payable and $0.8 million is included with non-current deferred tax assets on the consolidated balance sheet at September 30, 2018 . We recognize interest and penalties related to income tax matters in income tax expense. During fiscal 2018 and 2017 , there were insignificant amounts of interest and penalties related to income tax matters in income tax expense. We had accrued 11. INCOME TAXES (CONTINUED) interest and penalties related to unrecognized tax benefits of $0.1 million at both September 30, 2018 and 2017 . These accrued interest and penalties are included in our non-current income taxes payable on our consolidated balance sheets. We file a U.S. federal income tax return and income tax returns in various states and foreign jurisdictions. With few exceptions, we are no longer subject to state and local or non-U.S. income tax examinations by tax authorities for years before fiscal year 2014 . We continue to review the outside basis differential of our foreign investments given recent US tax reform as discussed above. Our policy is to reinvest earnings of our foreign subsidiaries indefinitely to fund current operations and provide for future international expansion opportunities, and only repatriate earnings to the extent that U.S. taxes have been recorded. As a majority of foreign earnings have been subject to tax under the one time transition tax ("IRC Sec. 965"), a portion of already taxed cash balances were remitted to the US during the year which gave rise to nominal additional tax effects. Furthermore, we have considered any additional taxes which may result from future distributions of cash which have also been subject to US tax under IRC Sec. 965, such as local withholding taxes, US tax on currency as well as potential US State income taxes, which additional nominal deferred tax effects were included in the current year tax computations. Other than these potential distributions, 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. At September 30, 2018 , we had approximately $4.0 million of un-taxed accumulated undistributed foreign earnings that was not subject to IRC Sec. 965, for which we have not accrued additional U.S. tax. Although we have no current need to repatriate historical foreign earnings that have not been taxed in the United States, if we change our assertion from indefinitely reinvesting undistributed foreign earnings, we would have to accrue applicable taxes. The amount of any taxes and the application of any tax credits would be determined based on the income tax laws at the time of such repatriation. Under current tax laws, we estimate the unrecognized deferred tax liability to be immaterial. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Sep. 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 "2018 Plan") beginning January 29, 2018 and, prior to that, were granted under the 2017 Omnibus Incentive Plan (the "2017 Plan"). 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. We also have awards outstanding under our 2016 Omnibus Plan (the "2016 Plan"), 2014 Omnibus Plan (the "2014 Plan"), 2013 Omnibus Incentive Plan (the "2013 Plan") and the 2000 Omnibus Stock Plan, as amended and restated as of December 4, 2009 (the "2000 Plan"). 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 (“RSUs”) 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 (“ISOs”) or non-statutory stock options (“NSOs”). 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. As of September 30, 2018 , there were approximately 1,313,651 shares available for future grants under the 2018 Plan. The 2017 Plan, under which grants ceased upon approval of the 2018 Plan, authorized 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 included our employees, our affiliates, non-employee directors of our Company and any consultant or advisor who is a natural person and provided services to us or our affiliates. Options that have been granted under the 2017 Plan typically vested over a four -year period and expired if unexercised after seven years from the date of grant. RSUs that were granted to directors typically vested in one year. RSUs that were granted to executives and employees typically vested in January over a four -year period. Options under the 2017 Plan 12. STOCK-BASED COMPENSATION (CONTINUED) could be granted as ISOs or NSOs. The exercise price of options and the grant date price of restricted stock units was determined by our Compensation Committee but could not be less than the fair market value of our common stock based on the closing price on the date of grant. The 2016 Plan initially authorized 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 included our employees, our affiliates, non-employee directors of our Company and any consultant or advisor who is a natural person and provided services to us or our affiliates. Options that were granted under the 2016 Plan typically vested over a four -year period and expired if unexercised after seven years from the date of grant. RSUs that were granted to directors typically vested in one year. RSUs that were granted to executives and employees typically vested in November or January over a four -year period. Options under the 2016 Plan could be granted as either ISOs or NSOs. The exercise price of options and the grant date price of restricted stock was determined by our Compensation Committee but were not less than the fair market value of our common stock based on the closing price on the date of grant. The 2014 Plan initially authorized the issuance of up to 2,250,000 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 included 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 granted under this plan generally vested over a four -year service period and expired if unexercised after eight years from the date of grant. RSUs that were granted to Directors typically vested in one year. RSUs that were granted to executives and employees typically vested in November over a four -year period. Options under the 2014 Plan were granted as either ISOs or NSOs. Awards may no longer be granted under the 2014 Plan as grants ceased upon approval of the 2016 Plan effective February 1, 2016 at the Annual Meeting of Stockholders. The exercise price of options and the grant date price of restricted stock was determined by our Compensation Committee but could not be less than the fair market value of our common stock based on the closing price on the date of grant. The 2013 Plan initially authorized the issuance of up to 1,750,000 common shares in connection with awards of stock options, stock appreciation rights, restricted stock, restricted stock units, performance-based full value awards or stock awards. Eligible participants included our employees, non-employee directors, consultants and advisors. Options granted under this plan generally vested over a four -year service period and expired if unexercised after eight years from the date of grant. RSUs that were granted to Directors typically vested in one year. Awards may no longer be granted under the 2013 Plan as grants ceased upon approval of the 2014 Plan effective January 27, 2014 at the Annual Meeting of Stockholders. Options under the 2013 Plan were granted as either ISOs or NSOs. The exercise price was determined by our Compensation Committee but could not be less than the fair market value of our common stock based on the closing price on the date of grant. The 2000 Plan initially authorized the issuance of up to 5,750,000 common shares in connection with awards of stock options, stock appreciation rights, restricted stock, performance units or stock awards. Eligible participants included our employees, non-employee directors, consultants and advisors. An authorization to issue an additional 2,500,000 common shares was ratified on January 25, 2010 at the Annual Meeting of Stockholders. Awards may no longer be granted under the 2000 Plan as the plan was terminated as to future awards on January 28, 2013 at the Annual Meeting of Stockholders. Options under the 2000 Plan were granted as either ISOs or non-statutory stock options NSOs. The exercise price was determined by our Compensation Committee but could not be less than the fair market value of our common stock based on the closing price on the date of grant. 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 fiscal 2018 , 2017 and 2016 our employees forfeited 74,204 , 49,684 and 47,464 shares, respectively in order to satisfy $0.7 million , $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. We recorded cash received from the exercise of stock options of $5.5 million , $3.5 million and $7.2 million during fiscal years 2018 , 2017 and 2016 , respectively. We sponsor an Employee Stock Purchase Plan, as amended and restated as of October 29, 2013, December 4, 2009 and November 27, 2006 (the "Purchase Plan"), 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 12. STOCK-BASED COMPENSATION (CONTINUED) 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. The most recent amendments to the Purchase Plan, ratified by our stockholders on January 27, 2014, increased the total number of shares to 2,800,000 that may be purchased under the plan. Employee contributions to the Purchase Plan were $1.1 million , $0.7 million and $0.9 million in fiscal 2018 , 2017 and 2016 . Pursuant to the Purchase Plan, 125,446 , 72,594 , and 103,915 shares of common stock were issued to employees during fiscal 2018 , 2017 and 2016 , respectively. Shares are issued under the Purchase Plan from treasury stock. As of September 30, 2018 , 315,576 shares of common stock were available for future issuances under the Purchase Plan. Stock-based compensation cost capitalized as part of inventory was immaterial as of September 30, 2018 , 2017 and 2016 . Stock-based compensation expense is included in the consolidated results of operations as follows (in thousands): Fiscal years ended September 30, 2018 2017 2016 Cost of sales $ 195 $ 213 $ 215 Sales and marketing 1,492 1,348 921 Research and development 516 656 590 General and administrative 2,651 2,442 1,923 Stock-based compensation before income taxes 4,854 4,659 3,649 Income tax benefit (1,017 ) (1,536 ) (1,185 ) Stock-based compensation after income taxes $ 3,837 $ 3,123 $ 2,464 Stock Options A summary of our stock options as of September 30, 2018 and changes during the twelve months then ended is presented below (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 863 10.92 Exercised (597 ) 9.14 Forfeited / Canceled (642 ) 12.64 Balance at September 30, 2018 3,526 $10.49 4.2 $ 10,470 Exercisable at September 30, 2018 2,245 $10.09 3.3 $ 7,558 (1) The aggregate intrinsic value represents the total pre-tax intrinsic value, based on our closing stock price of $13.45 as of September 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 each of the twelve months ended September 30, 2018 , 2017 and 2016 was $1.2 million , $0.9 million and $1.9 million , respectively. 12. 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: Fiscal years ended September 30, 2018 2017 2016 Weighted average per option grant date fair value $ 3.98 $ 4.63 $ 3.90 Assumptions used for option grants: Risk free interest rate 2.12% - 2.89% 1.46% - 1.96% 1.22% - 1.85% Expected term 6.00 years 6.00 years 6.00 years Expected volatility 33% - 34% 33% - 34% 32% - 33% Weighted average volatility 33% 34% 32% Expected dividend yield 0% 0% 0% The fair value of each option award granted during the periods presented was estimated using the Black-Scholes option valuation model that uses the assumptions noted in the table above. 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 September 30, 2018 , the total unrecognized compensation cost related to non-vested stock-based compensation arrangements, net of expected forfeitures, was $4.4 million and the related weighted average period over which it is expected to be recognized was approximately 2.8 years. As of September 30, 2018 , the weighted average exercise price and remaining life of the stock options are as follows (in thousands, except remaining life and exercise price): Options Outstanding Options Exercisable Range of Exercise Prices Options Outstanding Weighted Average Remaining Contractual Life (In Years) Weighted Average Exercise Price Number of Shares Vested Weighted Average Exercise Price $7.40 - $8.30 694 3.16 $ 8.00 604 $ 7.97 $8.31 - $9.68 551 3.27 $ 9.39 515 $ 9.42 $9.69 - $10.33 644 5.38 $ 10.14 129 $ 9.89 $10.34 - $10.81 554 3.79 $ 10.63 421 $ 10.72 $10.82 - $12.63 523 4.36 $ 12.00 379 $ 11.99 $12.64 - $13.50 548 5.55 $ 13.50 185 $ 13.50 $13.51 - $14.75 12 2.82 $ 14.75 12 $ 14.75 $7.40 - $14.75 3,526 4.23 $ 10.49 2,245 $ 10.09 The total grant date fair value of shares vested was $3.3 million , $2.4 million and $2.9 million in each of fiscal 2018 , 2017 and 2016 , respectively. 12. STOCK-BASED COMPENSATION (CONTINUED) Non-vested Restricted Stock Units A summary of our non-vested restricted stock units as of September 30, 2018 and changes during the twelve 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 415 $ 10.77 Vested (207 ) $ 11.02 Canceled (100 ) $ 11.21 Nonvested at September 30, 2018 674 $ 11.05 As of September 30, 2018 , the total unrecognized compensation cost related to non-vested restricted stock units was $5.3 million and the related weighted average period over which it is expected to be recognized was approximately 1.3 years. |
Common Stock Repurchase
Common Stock Repurchase | 12 Months Ended |
Sep. 30, 2018 | |
Common Stock Repurchase [Abstract] | |
COMMON STOCK REPURCHASE | COMMON STOCK REPURCHASE Common Stock Repurchase Program 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. On April 26, 2016, our Board of Directors authorized a program to repurchase up to $15.0 million of our common stock primarily to return capital to shareholders. This authorization expired on May 1, 2017. There were no shares repurchased under this program. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Sep. 30, 2018 | |
Retirement Benefits [Abstract] | |
EMPLOYEE BENEFIT PLANS | EMPLOYEE BENEFIT PLANS We currently have a savings and profit sharing plan pursuant to Section 401(k) of the Internal Revenue Code (the Code), whereby eligible employees may contribute up to 25% of their pre-tax earnings, not to exceed amounts allowed under the Code. We provide a match of 100% on the first 3% of each employee’s bi-weekly contribution and a 50% match on the next 2% of each employee’s bi-weekly contribution. In addition, we may make contributions to the plan at the discretion of the Board of Directors. We provided matching contributions of $1.6 million for fiscal 2018 , and $1.4 million for each of fiscal 2017 and 2016 . |
Commitments
Commitments | 12 Months Ended |
Sep. 30, 2018 | |
Leases, Operating [Abstract] | |
COMMITMENTS | COMMITMENTS We have entered into various operating lease agreements for office facilities and equipment, the last of which expires in fiscal 2026 . The office facility leases generally require us to pay a pro-rata share of the lessor’s operating expenses. Certain operating leases contain escalation clauses and are being amortized on a straight-line basis over the term of the lease. The following schedule reflects future minimum rental commitments at September 30, 2018 under noncancelable operating leases (in thousands): Fiscal year Amount 2019 $ 1,986 2020 1,675 2021 1,235 2022 1,054 2023 833 Thereafter 1,836 Total minimum payments required $ 8,619 Subsequent to the end of the fiscal 2018, in October 2018, we signed a thirteen -year lease agreement with minimum lease obligations of $15.9 million with Colfin Midwest NNN Investor, LLC (see Note 18 to our Consolidated Financial Statements). The following schedule shows the composition of total rental expense for all operating leases for the years ended September 30 (in thousands): Fiscal years ended September 30, 2018 2017 2016 Rentals $ 1,735 $ 1,342 $ 1,613 Less: sublease rentals — — (46 ) Total rental expense $ 1,735 $ 1,342 $ 1,567 |
Contingencies
Contingencies | 12 Months Ended |
Sep. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
CONTINGENCIES | CONTINGENCIES In the normal course of business, we are subject to various claims and litigation, which may include, but are not limited to, patent infringement and intellectual property claims. While we are unable to predict the outcome of any potential claims or litigation due to the inherent unpredictability of these matters, we believe that it is possible that we could, in the future, incur judgments or enter into settlements of claims that could have a material adverse effect on our operations in any particular period. |
Quarterly Financial Data
Quarterly Financial Data | 12 Months Ended |
Sep. 30, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Data | QUARTERLY FINANCIAL DATA (UNAUDITED) (in thousands, except per common share data) Quarter ended Dec. 31 March 31 June 30 Sept. 30 Fiscal 2018 Revenue $ 45,197 $ 54,791 $ 62,716 $ 65,662 Gross profit $ 21,937 $ 26,654 $ 29,329 $ 30,963 Net (loss) income (1)(2) $ (4,569 ) $ (357 ) $ 2,621 $ 3,608 Net (loss) income per common share - basic $ (0.17 ) $ (0.01 ) $ 0.10 $ 0.13 Net (loss) income per common share - diluted $ (0.17 ) $ (0.01 ) $ 0.09 $ 0.13 Fiscal 2017 Revenue $ 45,175 $ 45,615 $ 45,739 $ 45,105 Gross profit $ 21,453 $ 21,902 $ 22,485 $ 21,334 Net income (1)(2) $ 2,357 $ 1,331 $ 1,335 $ 4,343 Net income per common share - basic $ 0.09 $ 0.05 $ 0.05 $ 0.16 Net income per common share - diluted $ 0.09 $ 0.05 $ 0.05 $ 0.16 (1) During fiscal 2018, we recorded net tax expenses of $1.5 million and in fiscal 2017, we recorded net tax benefits of $1.0 million , respectively. We recorded tax expense of $2.8 million in the first quarter of fiscal 2018, $0.2 million in the second quarter of fiscal 2018 and $0.1 million in the third quarter of fiscal 2018 resulting from new U.S. tax legislation that was enacted during the first quarter of fiscal 2018 and the adoption of ASU 2016-09 relating to the accounting for the tax effects of stock compensation. In the fourth quarter of fiscal 2018, we recorded a net tax benefit of $1.5 million for the release of a valuation allowance against U.S. federal capital loss carryforward due to expected capital gains tax in fiscal 2019 resulting from the sale of our corporate headquarters building in October 2018 (see Note 18 to the Consolidated Financial Statements) along with U.S., state and foreign prior year true-up provision to return. We recorded a benefit of $0.1 million in the first quarter of fiscal 2017 resulting from reversal of income tax reserves due to the expiration of the statutes of limitation from various U.S. and foreign tax jurisdictions. In the third quarter of fiscal 2017, we recorded a tax benefit of $0.7 million from reversal of income tax reserves due to the expiration of the statutes of limitation from various U.S. and foreign tax jurisdictions. In the fourth quarter of fiscal 2017, we recorded a net tax benefit of $0.2 million , primarily from the reversal of income tax reserves due to the expiration of the statutes of limitation from various U.S. and foreign tax jurisdictions and state and foreign prior year true-up provision to return. (2) For continuing operations, we recorded business restructuring charges of $0.2 million ( $0.1 million after tax) in the third quarter of fiscal 2018 and $0.1 million ( $0.1 million after tax) in the fourth quarter of fiscal 2018. We also recorded business restructuring charges of $2.5 million ( $1.6 million after tax) in the third quarter of fiscal 2017. |
Subsequent Event
Subsequent Event | 12 Months Ended |
Sep. 30, 2018 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENT | SUBSEQUENT EVENT Corporate Headquarters Move Subsequent to the end of fiscal 2018, on October 2, 2018, we sold our 130,000 square feet corporate headquarters building in Minnetonka, Minnesota to Minnetonka Leased Housing Associates II, LLLP. The sales price was $10.0 million in cash adjusted for certain selling costs and an escrow for the leaseback of the building for four months. At September 30, 2018 the net book value of the land, building and improvements was $5.2 million and listed as Assets held for sale on our Consolidated Balance Sheet. As a result, we recorded a $1.1 million tax benefit in the fourth quarter of fiscal 2018 because we are able to use credit loss carryforwards which previously had a valuation allowance. We expect to record a gain of approximately $4.5 million ( $3.4 million net of deferred tax effects) in the first quarter of fiscal 2019. In October 2018, we signed a thirteen -year lease agreement with minimum lease obligations of $15.9 million with Colfin Midwest NNN Investor, LLC for 59,497 square feet of office space. This will be our new headquarters location in Hopkins, Minnesota, which is approximately three miles from our current headquarters. |
Schedule II - Valuation and Qua
Schedule II - Valuation and Qualifying Accounts | 12 Months Ended |
Sep. 30, 2018 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
Schedule II- Valuation and Qualifying Accounts | SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS DIGI INTERNATIONAL INC. (in thousands) Additions Description Balance at beginning of period Charged to costs and expenses Charged to Other Accounts Deductions Balance at end of period Valuation allowance - deferred tax assets September 30, 2018 $ 5,952 $ 521 $ — $ 3,182 $ 3,291 September 30, 2017 $ 5,914 $ 136 $ — $ 98 $ 5,952 September 30, 2016 $ 862 $ 5,260 $ — $ 208 $ 5,914 Valuation account - doubtful accounts September 30, 2018 $ 341 $ 729 $ 40 (1) $ 37 (3) $ 1,073 September 30, 2017 $ 209 $ 127 $ 20 (2) $ 15 (3) $ 341 September 30, 2016 $ 285 $ 10 $ — $ 86 (3) $ 209 Reserve for future returns and pricing adjustments September 30, 2018 $ 2,169 $ 10,715 $ — $ 10,324 $ 2,560 September 30, 2017 $ 1,991 $ 10,447 $ — $ 10,269 $ 2,169 September 30, 2016 $ 1,817 $ 9,946 $ — $ 9,772 $ 1,991 (1) Established through purchase accounting relating to the acquisition of TempAlert (2) Established through purchase accounting relating to the acquisition of SMART Temps ® (3) Uncollectible accounts charged against allowance, net of recoveries |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Discontinued Operations | Discontinued Operations On October 23, 2015, we sold all of the outstanding stock of our wholly owned subsidiary, Etherios Inc. (Etherios) to West Monroe Partners, LLC. Because the sale of Etherios represented a strategic shift that had a major effect on our operations and financial results, we classified our Etherios business as discontinued operations, which requires retrospective application to financial information for all periods presented. Since the cost of segregating the consolidated statement of cash flows outweighed the benefits, we elected not to segregate our consolidated statement of cash flows as the material items in the operating and investing sections are disclosed in Note 3 to our Consolidated Financial Statements. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include our accounts and the accounts of our wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. |
Reclassifications | Reclassifications Certain prior year amounts have been reclassified to conform to our fiscal 2018 presentation. On the Consolidated Balance Sheet for the period ended September 30, 2017, contingent consideration on acquired businesses has been reclassified from other current liabilities to its own respective line item. |
Cash Equivalents | Cash Equivalents Cash equivalents consist of money market accounts and other highly liquid investments purchased with an original maturity of three months or less. The carrying amounts approximate fair value due to the short maturities of these investments. We maintain our cash and cash equivalents in bank accounts which, at times, may exceed federally insured limits. We have not experienced any losses in such accounts. |
Marketable Securities | Marketable Securities Marketable securities consist of certificates of deposit, commercial paper, corporate bonds and government municipal bonds. All marketable securities are accounted for as available-for-sale and are carried at fair value on our consolidated balance sheets 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) with unrealized gains and losses recorded in accumulated other comprehensive loss within stockholders’ equity. 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 when available. We obtain relevant information from our investment advisor and, if warranted, also may review the financial solvency of certain security issuers. We regularly monitor and evaluate the value of our marketable securities. When assessing marketable securities for other-than-temporary declines in value, we consider several factors. These factors include: how significant the decline in value is as a percentage of the original cost, how long the market value of the investment has been less than its original cost, the underlying factors contributing to a decline in the prices of securities in a single asset class, the performance of the issuer’s stock price in relation to the stock price of its competitors within the industry, expected market volatility, analyst recommendations, the views of external investment managers, any news or financial information that has been released specific to the investee and the outlook for the overall industry in which the issuer operates. If events and circumstances indicate that a decline in the value of a security has occurred and is other-than-temporary, we would record a charge to other (expense) income. |
Accounts Receivable | Accounts Receivable Accounts receivable are stated at the amount we expect to collect, which is net of an allowance for doubtful accounts for estimated losses resulting from the inability of our customers to make required payments. The following factors are considered when determining the collectability of specific customer accounts: customer creditworthiness, past transaction history with the customer, and changes in customer payment terms or practices. In addition, overall historical collection experience, current economic industry trends, and a review of the current status of trade accounts receivable are considered when determining the required allowance for doubtful accounts. Based on our assessment, we provide for estimated uncollectible amounts through a charge to earnings and a credit to our allowance for doubtful accounts. Balances that remain outstanding after we have used reasonable collection efforts are written off through a charge to the allowance for doubtful accounts and a credit to accounts receivable. |
Inventories | Inventories Inventories are stated at the lower of cost or net realizable value, with cost determined using the lower of cost or net-realizable value. Appropriate consideration is given to deterioration, obsolescence and other factors in evaluating net realizable value. |
Property, Equipment and Improvements, Net | Property, Equipment and Improvements, Net Property, equipment and improvements are carried at cost, net of accumulated depreciation. Depreciation is provided by charges to operations using the straight-line method over the estimated asset useful lives. Furniture and fixtures, purchased software and other equipment are depreciated over a period of three to seven years. Building improvements and buildings are depreciated over ten and thirty-nine years, respectively (see Note 6 to the Consolidated Financial Statements for regarding Assets held for sale at September 30, 2018). Expenditures for maintenance and repairs are charged to operations as incurred, while major renewals and betterments are capitalized. The assets and related accumulated depreciation accounts are adjusted for asset retirements and disposals with the resulting gain or loss included in operations. |
Identifiable Intangible Assets | Identifiable Intangible Assets Purchased proven technology, license agreements, covenants not to compete and other identifiable intangible assets are recorded at fair value when acquired in a business acquisition, or at cost when not purchased in a business acquisition. All other identifiable intangible assets are amortized on either a straight-line basis over their estimated useful lives of three to twelve years or based on the pattern in which the asset is consumed. 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. Amortization of purchased and core technology is included in cost of sales in the Consolidated Statements of Operations. Amortization of all other acquired identifiable intangible assets is charged to operating expenses as a component of general and administrative expense. Identifiable intangible assets are reviewed for impairment annually or whenever events or circumstances indicate that undiscounted expected future cash flows are not sufficient to recover the carrying value amount. We measure impairment loss by utilizing cash flow valuation technique using the income approach. Impairment losses, if any, would be recorded in the period the impairment is identified. |
Goodwill | Goodwill Goodwill represents the excess of cost over the fair value of identifiable assets acquired. 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 5 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 "Goodwill Measurement of Impairment" 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 unit’s assets and liabilities, excluding goodwill, is estimated. The excess of the fair value of the reporting unit over the amount assigned to its assets and liabilities, excluding goodwill, is the implied fair value of the reporting unit’s 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. During the fourth quarter of fiscal 2018, we assessed various qualitative factors to determine whether or not an additional goodwill impairment assessment was required as of September 30, 2018, and we concluded that no additional impairment assessment was required. 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 (“DCF”) 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. |
Contingent Consideration | Contingent Consideration We measure our contingent consideration liabilities recognized in connection with business combinations at fair value on a recurring basis using significant unobservable inputs classified within Level 3 of the fair value hierarchy as defined in ASC 820 "Fair Value Measurement". We used a probability-weighted discounted cash flow approach as a valuation technique to determine the fair value of the contingent consideration on the acquisition date. At each subsequent reporting period, the fair value is re-measured with the change in fair value recognized in general and administrative expense and interest expense in our Condensed Consolidated Statements of Operations. Amounts, if any, paid to the seller in excess of the amount recorded on the acquisition date will be classified as cash flows used in operating activities. Payments to the seller not exceeding the acquisition-date fair value of the contingent consideration will be classified as cash flows used in financing activities. |
Warranties | Warranties In general, we warrant our hardware 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 hardware 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. We also warrant our software or firmware incorporated into our products generally for a period of one year and offer to provide a bug fix or software patch within a reasonable period. We have not accrued specifically for this warranty and have not had claims specifically related to the software. |
Treasury stock | Treasury Stock We record treasury stock at cost. Treasury stock includes shares purchased from employees for tax withholding purposes related to vesting of restricted stock awards. |
Revenue Recognition | Revenue Recognition We recognize revenue in accordance with authoritative guidance issued by Financial Accounting Standards Board ("FASB") related to revenue recognition. Hardware product revenue as a percentage of total revenue was 83.7% , 91.7% and 96.6% in fiscal 2018 , 2017 and 2016 , respectively. We recognize hardware product revenue when persuasive evidence of an arrangement exists, delivery has occurred, the sales price is fixed or determinable, collectability is reasonably assured and there are no post-delivery obligations, other than warranty. Under these criteria, product revenue generally is recognized upon shipment of product to customers. Sales to authorized domestic and foreign distributors and Direct / OEMs are made with certain rights of return and price adjustment provisions. Estimated reserves for future returns and pricing adjustments are established by us based on an analysis of historical patterns of returns and price adjustments as well as an analysis of authorized returns compared to received returns and distribution sales for the current period. Estimated reserves for future returns and price adjustments are charged against revenue in the same period as the corresponding revenue is recorded. Services and solutions revenue as a percentage of total revenue represented 16.3% , 8.3% and 3.4% in fiscal 2018 , 2017 and 2016 , respectively. Our services and solutions revenue is derived primarily from our Digi Wireless Design Services and our SmartSense by Digi ™ . Our SmartSense by Digi ™ revenue includes subscription revenue, support and equipment. Our 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) equipment and implementation fees are recorded as a sale up–front due to these items having stand–alone value to the customer because the customer can utilize our equipment with other monitoring services or use our monitoring services with hardware purchased from other vendors. Our installation charges are recorded when the product is installed. Our subscription revenue is recorded on a monthly basis. These subscriptions are generally for one year, but can be as long as five years, and may contain an evergreen renewal provision. Generally, our subscription renewal charges per month are the same as the original contract term. We also have some service revenue that is derived from our Digi Remote Manager ® , which is a platform-as-a-service (PaaS) offering in which customers pay for services consumed in terms of devices being managed and monitored, or as a monthly service fee for access to information. In addition, we recognize small amounts of revenue from our Digi Support Services which is recognized over the life of the contract, and training as the services are performed. We recognize revenue from our Digi Wireless Design Services, SmartSense by Digi ™ and Digi Remote Manager ® based upon performance, including final product delivery and customer acceptance. |
Research and Development | Research and Development Research and development costs are expensed when incurred. Research and development costs include compensation, allocation of corporate costs, depreciation, utilities, professional services and prototypes. Software development costs are expensed as incurred until the point that technological feasibility and proven marketability of the product are established. To date, the time period between the establishment of technological feasibility and completion of software development has been short, and no significant development costs have been incurred during that period. Accordingly, we have not capitalized any software development costs to date. |
Income Taxes | Income Taxes Deferred income taxes are recognized for the tax consequences in future years of differences between the tax basis of assets and liabilities and their financial reporting amounts at each year end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Income tax expense is equal to the tax payable for the period and the change during the period in deferred tax assets and liabilities and also changes in income tax reserves. |
Stock-Based Compensation | Stock-Based Compensation Stock-based compensation expense represents the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of the award. This cost must be recognized over the period during which an employee is required to provide the service (usually the vesting period). |
Foreign Currency Translation | Foreign Currency Translation Financial position and results of operations of our international subsidiaries are measured using local currencies as the functional currency, except for our Singapore location which uses the U.S. Dollar as its functional currency. Assets and liabilities of these operations are translated at the exchange rates in effect at the end of each reporting period. For our larger international subsidiaries, statements of operations accounts are translated at the daily rate. For all other international subsidiaries, our statements of operations accounts are translated at the weighted average rates of exchange prevailing during each reporting period. Translation adjustments arising from the use of differing currency exchange rates from period to period are included in accumulated other comprehensive loss in stockholders’ equity. Gains and losses on foreign currency exchange transactions, as well as translation gains or losses on transactions denominated in currencies other than an entity’s functional currency, are reflected in the statement of operations. During both fiscal 2018 and 2017 there were net transaction gains of $0.1 million , and during fiscal 2016 , there were net transaction losses of $(0.7) million that were recorded in other income (expense), net. We manage our net asset or net liability position for U.S. dollar accounts in our foreign locations to reduce our foreign currency risk. We have not implemented a formal hedging strategy. |
Use of Estimates and Risks and Uncertainties | Use of Estimates and Risks and Uncertainties The preparation of consolidated financial statements in conformity with generally accepted accounting principles in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenue and expenses during the reporting period. Actual results could differ from those estimates. Estimates that could significantly affect 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) our results of operations or financial condition involve the assignment of fair values upon acquisition of goodwill and other intangible assets and testing for impairment; the determination of our allowance for doubtful accounts and reserve for future returns and pricing adjustments; the estimation of our inventory obsolescence, warranty reserve, income tax reserves, contingent consideration and other contingencies. |
Comprehensive Income (Loss) | Comprehensive Income Our comprehensive income is comprised of net income, foreign currency translation adjustments and unrealized gains and losses on available-for-sale marketable securities, which are charged or credited to the accumulated other comprehensive loss account in stockholders’ equity. |
Net Income Per Common Share | Net Income Per Common Share Basic net income 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 and potentially dilutive common shares outstanding during the period. Potentially dilutive common shares of our stock result from dilutive common stock options and restricted stock units. We use the treasury stock method to calculate the weighted-average shares used in the diluted earnings per share computation. Under the treasury stock method, the proceeds from exercise of an option, the amount of compensation cost, if any, for future service that we have not yet recognized, and the amount of estimated tax benefits that would be recorded in paid-in capital, if any, when the option is exercised are assumed to be used to repurchase shares in the current period. |
Recent Accounting Developments | Recent Accounting Developments Adopted In March 2016, the FASB issued Accounting Standards Updated (“ASU”) 2016-09, “Improvements to Employee Share-Based Payment Accounting.” This update includes provisions intended to simplify various aspects related to how share-based payments are accounted for and presented in the financial statements. This ASU is effective for annual periods and interim periods within those annual periods beginning after December 15, 2016. We adopted ASU 2016-09 on October 1, 2017. There was no material impact on our condensed consolidated financial statements. Below is a summary of the impact upon adoption of ASU 2016-09: • In accordance with ASU 2016-09, beginning on October 1, 2017, we prospectively recorded excess tax benefits/deficiencies as an income tax benefit/expense in the statement of operations. This resulted in a $0.6 million tax deficiency in the twelve months ended September 30, 2018, resulting in an unfavorable impact to EPS of $0.02 per diluted share. This amount was recognized as a discrete item within income tax expense in the condensed consolidated statement of operations. • We adjusted our dilutive shares to remove the excess tax benefits from the calculation of EPS on a prospective basis beginning October 2, 2017. The revised calculation is more dilutive, but did not have a material impact on the Company’s diluted EPS calculation for the three months ended December 31, 2017. • Further, we had no tax benefits that were not previously recognized because the related tax deduction had not reduced taxes payable, therefore, there was no cumulative-effect adjustment to our beginning retained earnings on October 1, 2017. • Additionally, we prospectively adopted the provision to classify excess tax benefits and deficiencies within cash flows from operating activities as part of cash payments for taxes on the statement of cash flows. Prior periods on the statement of cash flows have not been adjusted. • Upon adoption of ASU 2016-09, we account for forfeitures as they occur, rather than estimating forfeitures as of an awards grant date. This change in accounting policy election was adopted using a modified retrospective transition method and on October 1, 2017, we recognized a cumulative effect unfavorable adjustment to retained earnings of approximately $33,000 . • We have previously shown separately, tax payments made on behalf of an employee by repurchasing shares of stock as cash outflows from financing activities on the statement of cash flows. This provision was retrospectively adopted, and prior period cash flows already conformed with this presentation. In July 2015, FASB issued ASU 2015-11, "Simplifying the Measurement of Inventory." This provision would require inventory that was previously recorded using first-in, first-out (FIFO) to be recorded at lower of cost or net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. This guidance is effective for fiscal years beginning after December 15, 2016 and interim periods within those years. We adopted this guidance beginning October 1, 2017. The amendments in this guidance should be applied prospectively with earlier application permitted as of the beginning of an interim or annual period. The adoption of ASU 2015-11 did not have a material impact on our consolidated financial statements. Not Yet Adopted In May 2014, FASB issued ASU 2014-09, "Revenue from Contracts with Customers." This standard requires that revenue is recognized in a manner to depict the transfer of goods or services to a customer at an amount that reflects the consideration expected to be received in exchange for those goods or services. The FASB has issued several amendments to the standard, including clarifications on disclosure of prior-period performance obligations and remaining performance obligations. The guidance permits two methods of adoption: retrospectively to each prior reporting period presented (full retrospective method), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (modified retrospectively method). We elected to adopt the standard effective October 1, 2018 using the full retrospective method to restate each prior reporting period presented. 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) The most significant impact of the standard relates to our accounting for nonrefundable upfront fees related to implementation and related equipment cost which will be recognized over the expected useful life of the equipment. In addition, the standard requires the deferral of certain contract costs which will be amortized over the term of the initial and expected renewal periods of the contract. We will amortize these costs over the calculated average expected life of the pool of contracts closed during the period. We will elect the practical expedient and not capitalize commissions for contracts with cost amortization periods of one year or less. The adoption of the standard related to the new revenue recognition is expected to impact our reported results as follows: Fiscal year ended September 30, 2018 (in thousands, except per common share data) As Reported Impact of Adoption As Adjusted Revenue: Hardware product $ 191,050 $ — $ 191,050 Services and solutions 37,316 (1,473 ) 35,843 Total revenue 228,366 (1,473 ) 226,893 Cost of sales: Cost of hardware product 96,332 — 96,332 Cost of services and solutions 20,280 (1,644 ) 18,636 Amortization 2,871 — 2,871 Total cost of sales 119,483 (1,644 ) 117,839 Gross profit 108,883 171 109,054 Operating expenses 106,561 (289 ) 106,272 Operating income 2,322 460 2,782 Net income $ 1,303 $ 328 $ 1,631 Diluted earnings per share $ 0.05 $ 0.01 $ 0.06 Fiscal year ended September 30, 2017 (in thousands, except per common share data) As Reported Impact of Adoption As Adjusted Revenue: Hardware product $ 166,480 — $ 166,480 Services and solutions 15,154 (294 ) 14,860 Total revenue 181,634 (294 ) 181,340 Cost of sales: Cost of hardware product 85,369 — 85,369 Cost of services and solutions 7,647 (353 ) 7,294 Amortization 1,444 — 1,444 Total cost of sales 94,460 (353 ) 94,107 Gross profit 87,174 59 87,233 Operating expenses 78,367 — 78,367 Operating income 8,807 59 8,866 Net income $ 9,366 37 $ 9,403 Diluted earnings per share $ 0.35 $ — $ 0.35 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) September 30, 2018 (in thousands) As Reported Impact of Adoption As Adjusted Accounts receivable, net $ 50,817 $ (998 ) $ 49,819 Other current assets $ 2,613 $ 885 $ 3,498 Deferred tax assets $ 6,665 $ (65 ) $ 6,600 Other non-current assets $ 1,291 $ 1,199 $ 2,490 Other current liabilities $ 2,413 $ 598 $ 3,011 Other non-current liabilities $ 510 $ 210 $ 720 Stockholders' equity $ 330,280 $ 213 $ 330,493 September 30, 2017 (in thousands) As Reported Impact of Adoption As Adjusted Other current assets $ 3,032 $ 172 $ 3,204 Deferred tax assets $ 9,211 $ 67 $ 9,278 Other non-current assets $ 269 $ 268 $ 537 Other current liabilities $ 2,113 $ 469 $ 2,582 Other non-current liabilities $ 654 $ 153 $ 807 Stockholders' equity $ 319,144 $ (115 ) $ 319,029 Adoption of the standards related to revenue recognition had no impact to cash from our used in operating, financing or investing on our consolidated statements of cash flows. In May 2017, FASB issued ASU 2017-09, "Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting." 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 March 2017, FASB issued ASU 2017-08, "Receivables-Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities." The amendments in this update shorten the amortization period for certain callable debt securities that are held at a premium. The amendments require the premium to be amortized to the earliest call date. The amendments do not require an accounting change for securities held at a discount, which would be amortized to maturity. This ASU is effective for fiscal years and interim periods within those fiscal years, beginning after December 15, 2018, which for us is the first quarter ending December 31, 2019. Early adoption is permitted. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements. In January 2017, FASB issued ASU 2017-04, "Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment." 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 unit’s 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 unit’s 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, "Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments." 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 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 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, "Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments." 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. In February 2016, FASB issued ASU 2016-02, "Leases (Topic 842)", 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, "Financial Instruments - Overall: Recognition and Measurement of Financial Assets and Financial Liabilities." 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. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [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 per common share calculations (in thousands, except per common share data): Fiscal years ended September 30, 2018 2017 2016 Numerator: Income from continuing operations $ 1,303 $ 9,366 $ 13,478 Income from discontinued operations, after income taxes $ — $ — $ 3,230 Net income $ 1,303 $ 9,366 $ 16,708 Denominator: Denominator for basic net income per common share — weighted average shares outstanding 27,083 26,432 25,760 Effect of dilutive securities: Stock options and restricted stock units 569 667 551 Denominator for diluted net income per common share — adjusted weighted average shares 27,652 27,099 26,311 Basic net income per common share: Continuing operations $ 0.05 $ 0.35 $ 0.52 Discontinued operations $ — $ — $ 0.13 Net income $ 0.05 $ 0.35 $ 0.65 Diluted net income per common share: Continuing operations $ 0.05 $ 0.35 $ 0.51 Discontinued operations $ — $ — $ 0.12 Net income (1) $ 0.05 $ 0.35 $ 0.64 (1) Earnings per share presented are calculated by line item and may not add due to the use of rounded amounts. |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles [Table Text Block] | The adoption of the standard related to the new revenue recognition is expected to impact our reported results as follows: Fiscal year ended September 30, 2018 (in thousands, except per common share data) As Reported Impact of Adoption As Adjusted Revenue: Hardware product $ 191,050 $ — $ 191,050 Services and solutions 37,316 (1,473 ) 35,843 Total revenue 228,366 (1,473 ) 226,893 Cost of sales: Cost of hardware product 96,332 — 96,332 Cost of services and solutions 20,280 (1,644 ) 18,636 Amortization 2,871 — 2,871 Total cost of sales 119,483 (1,644 ) 117,839 Gross profit 108,883 171 109,054 Operating expenses 106,561 (289 ) 106,272 Operating income 2,322 460 2,782 Net income $ 1,303 $ 328 $ 1,631 Diluted earnings per share $ 0.05 $ 0.01 $ 0.06 Fiscal year ended September 30, 2017 (in thousands, except per common share data) As Reported Impact of Adoption As Adjusted Revenue: Hardware product $ 166,480 — $ 166,480 Services and solutions 15,154 (294 ) 14,860 Total revenue 181,634 (294 ) 181,340 Cost of sales: Cost of hardware product 85,369 — 85,369 Cost of services and solutions 7,647 (353 ) 7,294 Amortization 1,444 — 1,444 Total cost of sales 94,460 (353 ) 94,107 Gross profit 87,174 59 87,233 Operating expenses 78,367 — 78,367 Operating income 8,807 59 8,866 Net income $ 9,366 37 $ 9,403 Diluted earnings per share $ 0.35 $ — $ 0.35 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) September 30, 2018 (in thousands) As Reported Impact of Adoption As Adjusted Accounts receivable, net $ 50,817 $ (998 ) $ 49,819 Other current assets $ 2,613 $ 885 $ 3,498 Deferred tax assets $ 6,665 $ (65 ) $ 6,600 Other non-current assets $ 1,291 $ 1,199 $ 2,490 Other current liabilities $ 2,413 $ 598 $ 3,011 Other non-current liabilities $ 510 $ 210 $ 720 Stockholders' equity $ 330,280 $ 213 $ 330,493 September 30, 2017 (in thousands) As Reported Impact of Adoption As Adjusted Other current assets $ 3,032 $ 172 $ 3,204 Deferred tax assets $ 9,211 $ 67 $ 9,278 Other non-current assets $ 269 $ 268 $ 537 Other current liabilities $ 2,113 $ 469 $ 2,582 Other non-current liabilities $ 654 $ 153 $ 807 Stockholders' equity $ 319,144 $ (115 ) $ 319,029 |
Acquisition (Tables)
Acquisition (Tables) | 12 Months Ended |
Sep. 30, 2018 | |
Business Combinations [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block] | The following table summarizes the final values of Accelerated assets acquired and liabilities assumed as of the acquisition date (in thousands): Cash $ 16,430 Fair value of contingent consideration on acquired business 2,300 Total purchase price consideration $ 18,730 Fair value of net tangible assets acquired $ 766 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 5,664 Total $ 18,730 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 — 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): Fiscal years ended September 30, 2018 2017 Revenue $ 233,789 $ 213,505 Net income $ 1,314 $ 4,117 |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 12 Months Ended |
Sep. 30, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Disposal Groups, Including Discontinued Operations | The following table presents amortization of the discontinued operations related to Etherios (in thousands): Fiscal year ended September 30, 2016 Amortization of identifiable intangible assets $ 30 Income from discontinued operations, after income taxes, as presented in the Consolidated Statements of Operations for the twelve months ended September 30, 2016 is as follows (in thousands): Fiscal year ended September 30, 2016 Service revenue $ 891 Cost of service 713 Gross profit 178 Operating expenses: Sales and marketing 148 Research and development 103 General and administrative 43 Total operating expenses 294 Loss from discontinued operations, before income taxes (116 ) Gain on sale of discontinued operations, before income taxes 2,870 Income from discontinued operations, before income taxes 2,754 Income tax benefit on discontinued operations (476 ) Income from discontinued operations, after income taxes $ 3,230 |
Goodwill and other Identifiab_2
Goodwill and other Identifiable Intangible Assets (Tables) | 12 Months Ended |
Sep. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Amortizable Identifiable Intangible Assets | Amortizable identifiable intangible assets, net as of September 30, 2018 and 2017 were comprised of the following (in thousands): September 30, 2018 September 30, 2017 Gross carrying amount Accum. amort. Net Gross carrying amount Accum. amort. Net Purchased and core technology $ 58,102 $ (48,693 ) $ 9,409 $ 51,292 $ (46,304 ) $ 4,988 License agreements 102 (46 ) 56 18 (17 ) 1 Patents and trademarks 15,701 (12,242 ) 3,459 12,484 (11,280 ) 1,204 Customer relationships 46,605 (21,049 ) 25,556 21,914 (16,817 ) 5,097 Non-compete agreements 600 (210 ) 390 600 (90 ) 510 Order backlog 1,800 (1,350 ) 450 — — — Total $ 122,910 $ (83,590 ) $ 39,320 $ 86,308 $ (74,508 ) $ 11,800 |
Schedule of Amortization Expense | Amortization expense for fiscal years 2018 , 2017 and 2016 was as follows (in thousands): Fiscal year Total 2018 $ 9,435 2017 $ 2,597 2016 $ 1,842 |
Schedule of Estimated Future Amortization Expense Related to Identifiable Intangible Assets | Estimated amortization expense for the next five years is as follows (in thousands): Fiscal year Total 2019 $ 8,888 2020 $ 8,118 2021 $ 7,422 2022 $ 6,554 2023 $ 4,362 |
Schedule of Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill were (in thousands): Fiscal years ended September 30, 2018 2017 Beginning balance, October 1 $ 131,995 $ 109,448 Acquisitions 23,216 21,465 Foreign currency translation adjustment (676 ) 1,082 Ending balance, September 30 $ 154,535 $ 131,995 |
Segment Information and Major_2
Segment Information and Major Customers (Tables) | 12 Months Ended |
Sep. 30, 2018 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |
Schedule of Segment Reporting Information, by Segment | Summary operating results for each of our segments were as follows (in thousands): Fiscal years ended September 30, 2018 2017 2016 Revenue IoT Products & Services $ 201,506 $ 174,237 $ 202,294 IoT Solutions 26,860 7,397 711 Total revenue $ 228,366 $ 181,634 $ 203,005 Operating income (loss) IoT Products & Services $ 14,923 $ 12,804 $ 18,822 IoT Solutions (12,601 ) (3,997 ) (1,717 ) Total operating income $ 2,322 $ 8,807 $ 17,105 Depreciation and amortization IoT Products & Services $ 6,040 $ 3,575 $ 4,040 IoT Solutions 6,230 1,922 544 Total depreciation and amortization $ 12,270 $ 5,497 $ 4,584 |
Payments to Acquire Property, Plant and Equipment by Segment | Total expended for property, plant and equipment was as follows (in thousands): Fiscal years ended September 30, 2018 2017 2016 IoT Products & Services $ 1,773 $ 1,738 $ 2,641 IoT Solutions 69 35 88 Total expended for property, plant and equipment $ 1,842 $ 1,773 $ 2,729 |
Schedule of Total Assets by Segment | Total assets for each of our segments were as follows (in thousands): As of September 30, 2018 2017 IoT Products & Services $ 209,574 $ 182,555 IoT Solutions 98,801 47,644 Unallocated* 62,750 114,990 Total assets $ 371,125 $ 345,189 *Unallocated consists of cash and cash equivalents, current marketable securities and long-term marketable securities. |
Schedule of Goodwill by Segment | Total goodwill for each of our segments were as follows (in thousands): As of September 30, 2018 2017 IoT Products & Services $ 104,358 $ 98,981 IoT Solutions 50,177 33,014 Total goodwill $ 154,535 $ 131,995 |
Schedule of Net Property, Equipment and Improvements by Geographical Location | Net property, equipment and improvements by geographic location were as follows (in thousands): As of September 30, 2018 2017 United States $ 6,156 $ 12,648 International, primarily Europe 114 153 Total net property, equipment and improvements $ 6,270 $ 12,801 |
Schedule of Revenue by Geographic Location | The information in the following table provides total consolidated revenue by the geographic location of the customer (in thousands): Fiscal years ended September 30, 2018 2017 2016 North America, primarily United States $ 163,397 $ 117,749 $ 131,457 Europe, Middle East & Africa 39,211 39,403 44,932 Asia 20,881 19,892 20,390 Latin America 4,877 4,590 6,226 Total revenue $ 228,366 $ 181,634 $ 203,005 |
Selected Balance Sheet Data (Ta
Selected Balance Sheet Data (Tables) | 12 Months Ended |
Sep. 30, 2018 | |
Selected Balance Sheet Data [Abstract] | |
Schedule of Selected Balance Sheet Data | (in thousands) As of September 30, 2018 2017 Accounts receivable, net: Accounts receivable $ 54,451 $ 31,365 Less allowance for doubtful accounts 1,074 341 Less reserve for future returns and pricing adjustments 2,560 2,169 Total accounts receivable, net $ 50,817 $ 28,855 Inventories: Raw materials $ 22,047 $ 24,050 Work in process 525 484 Finished goods 19,072 5,704 Total inventories $ 41,644 $ 30,238 Property, equipment and improvements, net: Land $ 570 $ 1,800 Buildings 2,338 10,522 Improvements 1,698 3,445 Equipment 15,803 17,133 Purchased software 3,966 3,571 Furniture and fixtures 3,350 3,473 Total property, equipment and improvements, gross 27,725 39,944 Less accumulated depreciation and amortization 21,455 27,143 Total property, equipment and improvements, net $ 6,270 $ 12,801 |
Marketable Securities (Tables)
Marketable Securities (Tables) | 12 Months Ended |
Sep. 30, 2018 | |
Marketable Securities [Abstract] | |
Schedule of Marketable Securities | At September 30, 2018 our marketable securities consisted of (in thousands): Amortized Cost (1) Unrealized Gains Unrealized Losses Fair Value (1) Current marketable securities: Certificates of deposit $ 4,756 $ — $ (20 ) $ 4,736 Total marketable securities $ 4,756 $ — $ (20 ) $ 4,736 (1) Included in amortized cost and fair value is purchased and accrued interest of $6 . At September 30, 2017 our marketable securities consisted of (in thousands): Amortized Cost (1) Unrealized Gains Unrealized Losses Fair Value (1) Current marketable securities: Corporate bonds $ 28,275 $ — $ (20 ) $ 28,255 Certificates of deposit 3,756 4 — 3,760 Current marketable securities 32,031 4 (20 ) 32,015 Non-current marketable securities: Certificates of deposit 4,757 — (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 securities that have been in a continuous unrealized loss position deemed to be temporary, aggregated by investment category (in thousands): September 30, 2018 Less than 12 Months More than 12 Months Fair Value Unrealized Losses Fair Value Unrealized Losses Certificates of deposit $ — $ — $ 4,736 $ (20 ) Total $ — $ — $ 4,736 $ (20 ) 7. MARKETABLE SECURITIES (CONTINUED) September 30, 2017 Less than 12 Months More than 12 Months Fair Value Unrealized Losses Fair Value Unrealized Losses Corporate bonds $ 26,196 $ (20 ) $ — $ — Certificates of deposit 3,751 (4 ) — — Total $ 29,947 $ (24 ) $ — $ — |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Sep. 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): Fair Value Measurements at September 30, 2018 using: Total carrying value at September 30, 2018 Quoted price in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Assets: Money market $ 24,318 $ 24,318 $ — $ — Certificates of deposit 4,736 — 4,736 — Total assets measured at fair value $ 29,054 $ 24,318 $ 4,736 $ — Liabilities: Contingent consideration on acquired business $ 10,065 $ — $ — $ 10,065 Total liabilities measured at fair value $ 10,065 $ — $ — $ 10,065 8. FAIR VALUE MEASUREMENTS (CONTINUED) Fair Value Measurements at September 30, 2017 using: Total carrying value at September 30, 2017 Quoted price in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Assets: Money market $ 39,524 $ 39,524 $ — $ — Corporate bonds 28,255 — 28,255 — Certificates of deposit 8,513 — 8,513 — Total assets measured at fair value $ 76,292 $ 39,524 $ 36,768 $ — Liabilities: Contingent consideration on acquired business $ 6,388 $ — $ — $ 6,388 Total liabilities measured at fair value $ 6,388 $ — $ — $ 6,388 |
Fair Value, 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): Fiscal years ended September 30, 2018 2017 Fair value at beginning of period $ 6,388 $ 9,960 Purchase price contingent consideration 2,300 1,310 Contingent consideration payments — (518 ) Change in fair value of contingent consideration 1,377 (4,364 ) Fair value at end of period $ 10,065 $ 6,388 |
Product Warranty Obligation (Ta
Product Warranty Obligation (Tables) | 12 Months Ended |
Sep. 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 listed on our Consolidated Balance Sheets under Current Liabilities: Balance at Warranties Settlements Balance at Fiscal year October 1 issued made September 30 2018 $ 987 $ 759 $ (574 ) $ 1,172 2017 $ 1,033 $ 679 $ (725 ) $ 987 2016 $ 1,014 $ 771 $ (752 ) $ 1,033 |
Restructuring (Tables)
Restructuring (Tables) | 12 Months Ended |
Sep. 30, 2018 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Reserve | Below is a summary of the restructuring charges and other activity within the restructuring accrual all of which is included in our IoT Products & Services segment (in thousands): Manufacturing Transition 2017 Restructuring 2016 Restructuring Employee Termination Costs Employee Termination Costs Other Employee Other Total Balance at September 30, 2015 $ — $ — $ — $ — $ — $ — Restructuring charge — — — 558 195 753 Payments — — — (559 ) (195 ) (754 ) Reversals — — — (6 ) — (6 ) Foreign currency fluctuation — — — 7 — 7 Balance at September 30, 2016 $ — $ — $ — $ — $ — $ — Restructuring charge — 2,258 257 — — 2,515 Payments — (845 ) (141 ) — — (986 ) Foreign currency fluctuation — 115 12 — — 127 Balance at September 30, 2017 $ — $ 1,528 $ 128 $ — $ — $ 1,656 Restructuring charge 504 — — — — 504 Payments (357 ) (1,035 ) (161 ) — — (1,553 ) Reversals — (244 ) 42 — — (202 ) Foreign currency fluctuation — 44 4 — — 48 Balance at September 30, 2018 $ 147 $ 293 $ 13 $ — $ — $ 453 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Taxes | The components of income from continuing operations, before income taxes are as follows (in thousands): Fiscal years ended September 30, 2018 2017 2016 United States $ (2,887 ) $ 5,170 $ 9,841 International 5,677 4,321 6,849 Income from continuing operations, before income taxes $ 2,790 $ 9,491 $ 16,690 |
Schedule of Components of Income Tax Provision | The components of the income tax provision are as follows (in thousands): Fiscal years ended September 30, 2018 2017 2016 Current: Federal $ 526 $ 312 $ (141 ) State 57 165 139 Foreign 1,412 1,756 2,099 Deferred: U.S. (668 ) (1,454 ) 1,260 Foreign 160 (654 ) (145 ) Income tax provision $ 1,487 $ 125 $ 3,212 |
Schedule of Net Deferred Tax Asset | The net deferred tax asset consists of the following (in thousands): As of September 30, 2018 2017 Non-current deferred tax asset $ 6,665 $ 9,211 Non-current deferred tax liability (334 ) (534 ) Net deferred tax asset $ 6,331 $ 8,677 Uncollectible accounts and other reserves $ 1,000 $ 1,063 Depreciation and amortization (369 ) (673 ) Inventories 740 824 Compensation costs 3,388 5,863 Tax carryforwards 7,063 7,514 Valuation allowance (3,291 ) (5,952 ) Identifiable intangible assets (2,298 ) (581 ) Other 98 619 Net deferred tax asset $ 6,331 $ 8,677 |
Schedule of Effective Income Tax Rate Reconciliation | The reconciliation of the statutory federal income tax amount to our income tax provision is as follows (in thousands): Fiscal years ended September 30, 2018 2017 2016 Statutory income tax amount $ 1,001 $ 2,917 $ 5,548 Increase (decrease) resulting from: State taxes, net of federal benefits (312 ) (125 ) 204 Manufacturing deduction (364 ) (150 ) (450 ) Meal and entertainment 82 63 55 Transaction costs 79 — — Employee stock purchase plan 56 79 83 Foreign operations (3 ) 218 276 Valuation allowance - current year increase 275 159 (43 ) Utilization of tax credits (1,609 ) (1,168 ) (1,116 ) Discrete items: Valuation allowance (1,317 ) — — Discrete tax benefits (765 ) (954 ) (1,461 ) One-time transition tax 250 — — Deferred balance sheet remeasure 2,727 — — ASU 2016-09 excess stock compensation 643 — — Contingent consideration 388 (1,172 ) (154 ) Adjustment of tax contingency reserves 315 257 202 Other, net 41 1 68 Income tax provision $ 1,487 $ 125 $ 3,212 |
Schedule of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is (in thousands): Fiscal years ended September 30, 2018 2017 2016 Unrecognized tax benefits at beginning of fiscal year $ 1,335 $ 1,708 $ 1,618 Increases related to: Prior year income tax positions 39 21 107 Current year income tax positions 315 257 240 Decreases related to: Prior year income tax positions — — (71 ) Settlements — — (30 ) Expiration of statute of limitations (128 ) (651 ) (156 ) Unrecognized tax benefits at end of fiscal year $ 1,561 $ 1,335 $ 1,708 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Sep. 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): Fiscal years ended September 30, 2018 2017 2016 Cost of sales $ 195 $ 213 $ 215 Sales and marketing 1,492 1,348 921 Research and development 516 656 590 General and administrative 2,651 2,442 1,923 Stock-based compensation before income taxes 4,854 4,659 3,649 Income tax benefit (1,017 ) (1,536 ) (1,185 ) Stock-based compensation after income taxes $ 3,837 $ 3,123 $ 2,464 |
Schedule of Stock Option Activity | A summary of our stock options as of September 30, 2018 and changes during the twelve months then ended is presented below (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 863 10.92 Exercised (597 ) 9.14 Forfeited / Canceled (642 ) 12.64 Balance at September 30, 2018 3,526 $10.49 4.2 $ 10,470 Exercisable at September 30, 2018 2,245 $10.09 3.3 $ 7,558 (1) The aggregate intrinsic value represents the total pre-tax intrinsic value, based on our closing stock price of $13.45 as of September 30, 2018 , which would have been received by the option holders had all option holders exercised their options as of that date. |
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: Fiscal years ended September 30, 2018 2017 2016 Weighted average per option grant date fair value $ 3.98 $ 4.63 $ 3.90 Assumptions used for option grants: Risk free interest rate 2.12% - 2.89% 1.46% - 1.96% 1.22% - 1.85% Expected term 6.00 years 6.00 years 6.00 years Expected volatility 33% - 34% 33% - 34% 32% - 33% Weighted average volatility 33% 34% 32% Expected dividend yield 0% 0% 0% |
Schedule of Weighted Average Exercise Price Range and Remaining Contractual Life | As of September 30, 2018 , the weighted average exercise price and remaining life of the stock options are as follows (in thousands, except remaining life and exercise price): Options Outstanding Options Exercisable Range of Exercise Prices Options Outstanding Weighted Average Remaining Contractual Life (In Years) Weighted Average Exercise Price Number of Shares Vested Weighted Average Exercise Price $7.40 - $8.30 694 3.16 $ 8.00 604 $ 7.97 $8.31 - $9.68 551 3.27 $ 9.39 515 $ 9.42 $9.69 - $10.33 644 5.38 $ 10.14 129 $ 9.89 $10.34 - $10.81 554 3.79 $ 10.63 421 $ 10.72 $10.82 - $12.63 523 4.36 $ 12.00 379 $ 11.99 $12.64 - $13.50 548 5.55 $ 13.50 185 $ 13.50 $13.51 - $14.75 12 2.82 $ 14.75 12 $ 14.75 $7.40 - $14.75 3,526 4.23 $ 10.49 2,245 $ 10.09 |
Schedule of Nonvested Restricted Stock Units | A summary of our non-vested restricted stock units as of September 30, 2018 and changes during the twelve 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 415 $ 10.77 Vested (207 ) $ 11.02 Canceled (100 ) $ 11.21 Nonvested at September 30, 2018 674 $ 11.05 |
Commitments (Tables)
Commitments (Tables) | 12 Months Ended |
Sep. 30, 2018 | |
Leases, Operating [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases | The following schedule reflects future minimum rental commitments at September 30, 2018 under noncancelable operating leases (in thousands): Fiscal year Amount 2019 $ 1,986 2020 1,675 2021 1,235 2022 1,054 2023 833 Thereafter 1,836 Total minimum payments required $ 8,619 |
Schedule of Rent Expense | The following schedule shows the composition of total rental expense for all operating leases for the years ended September 30 (in thousands): Fiscal years ended September 30, 2018 2017 2016 Rentals $ 1,735 $ 1,342 $ 1,613 Less: sublease rentals — — (46 ) Total rental expense $ 1,735 $ 1,342 $ 1,567 |
Quarterly Financial Data (Table
Quarterly Financial Data (Tables) | 12 Months Ended |
Sep. 30, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Data (Unaudited) | (in thousands, except per common share data) Quarter ended Dec. 31 March 31 June 30 Sept. 30 Fiscal 2018 Revenue $ 45,197 $ 54,791 $ 62,716 $ 65,662 Gross profit $ 21,937 $ 26,654 $ 29,329 $ 30,963 Net (loss) income (1)(2) $ (4,569 ) $ (357 ) $ 2,621 $ 3,608 Net (loss) income per common share - basic $ (0.17 ) $ (0.01 ) $ 0.10 $ 0.13 Net (loss) income per common share - diluted $ (0.17 ) $ (0.01 ) $ 0.09 $ 0.13 Fiscal 2017 Revenue $ 45,175 $ 45,615 $ 45,739 $ 45,105 Gross profit $ 21,453 $ 21,902 $ 22,485 $ 21,334 Net income (1)(2) $ 2,357 $ 1,331 $ 1,335 $ 4,343 Net income per common share - basic $ 0.09 $ 0.05 $ 0.05 $ 0.16 Net income per common share - diluted $ 0.09 $ 0.05 $ 0.05 $ 0.16 (1) During fiscal 2018, we recorded net tax expenses of $1.5 million and in fiscal 2017, we recorded net tax benefits of $1.0 million , respectively. We recorded tax expense of $2.8 million in the first quarter of fiscal 2018, $0.2 million in the second quarter of fiscal 2018 and $0.1 million in the third quarter of fiscal 2018 resulting from new U.S. tax legislation that was enacted during the first quarter of fiscal 2018 and the adoption of ASU 2016-09 relating to the accounting for the tax effects of stock compensation. In the fourth quarter of fiscal 2018, we recorded a net tax benefit of $1.5 million for the release of a valuation allowance against U.S. federal capital loss carryforward due to expected capital gains tax in fiscal 2019 resulting from the sale of our corporate headquarters building in October 2018 (see Note 18 to the Consolidated Financial Statements) along with U.S., state and foreign prior year true-up provision to return. We recorded a benefit of $0.1 million in the first quarter of fiscal 2017 resulting from reversal of income tax reserves due to the expiration of the statutes of limitation from various U.S. and foreign tax jurisdictions. In the third quarter of fiscal 2017, we recorded a tax benefit of $0.7 million from reversal of income tax reserves due to the expiration of the statutes of limitation from various U.S. and foreign tax jurisdictions. In the fourth quarter of fiscal 2017, we recorded a net tax benefit of $0.2 million , primarily from the reversal of income tax reserves due to the expiration of the statutes of limitation from various U.S. and foreign tax jurisdictions and state and foreign prior year true-up provision to return. (2) For continuing operations, we recorded business restructuring charges of $0.2 million ( $0.1 million after tax) in the third quarter of fiscal 2018 and $0.1 million ( $0.1 million after tax) in the fourth quarter of fiscal 2018. We also recorded business restructuring charges of $2.5 million ( $1.6 million after tax) in the third quarter of fiscal 2017. |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Property, Equipment and Improvements, Net) (Details) | 12 Months Ended |
Sep. 30, 2018 | |
Furniture and Fixtures | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property, equipment and improvements depreciation life | 3 years |
Furniture and Fixtures | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property, equipment and improvements depreciation life | 7 years |
Building Improvements | |
Property, Plant and Equipment [Line Items] | |
Property, equipment and improvements depreciation life | 10 years |
Buildings | |
Property, Plant and Equipment [Line Items] | |
Property, equipment and improvements depreciation life | 39 years |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Identifiable Intangible Assets) (Details) | 12 Months Ended |
Sep. 30, 2018 | |
Minimum | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated useful life | 3 years |
Maximum | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated useful life | 12 years |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Goodwill) (Details) $ in Thousands | 12 Months Ended | |||
Sep. 30, 2018USD ($)segment | Jun. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | |
Goodwill [Line Items] | ||||
Number of reportable segments | segment | 2 | |||
Goodwill | $ 154,535 | $ 131,995 | $ 109,448 | |
Market Capitalization | $ 359,600 | |||
IoT Products & Services | ||||
Goodwill [Line Items] | ||||
Goodwill | 104,358 | $ 104,600 | 98,981 | |
Percent fair value in excess of carrying value of goodwill | 36.00% | |||
IoT Solutions | ||||
Goodwill [Line Items] | ||||
Goodwill | $ 50,177 | $ 50,000 | $ 33,014 | |
Percent fair value in excess of carrying value of goodwill | 7.00% | |||
Measurement Input, Control Premium [Member] | Minimum | ||||
Goodwill [Line Items] | ||||
Goodwill Valuation Implied Control Premium | 5.70% | |||
Measurement Input, Control Premium [Member] | Maximum | ||||
Goodwill [Line Items] | ||||
Goodwill Valuation Implied Control Premium | 16.40% |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies (Warranty) (Details) | 12 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Warranty period products, minimum | 1 year |
Warranty period products, maximum | 5 years |
Warranty period software, maximum | 1 year |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies (Revenue Recognition) (Details) | 12 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Hardware products | |||
Concentration Risk [Line Items] | |||
Percentage of revenue | 83.70% | 91.70% | 96.60% |
Services and solutions | |||
Concentration Risk [Line Items] | |||
Percentage of revenue | 16.30% | 8.30% | 3.40% |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies (Foreign Currency Translation) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Accounting Policies [Abstract] | |||
Foreign currency net transaction gains (losses) | $ 0.1 | $ 0.1 | $ (0.7) |
Summary of Significant Accou_10
Summary of Significant Accounting Policies (Net Income Per Common Share) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||||||||||
Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | ||||||||||
Accounting Policies [Abstract] | ||||||||||||||||||||
Income from continuing operations | $ 1,303 | $ 9,366 | $ 13,478 | |||||||||||||||||
Income from discontinued operations, after income taxes | 0 | 0 | 3,230 | |||||||||||||||||
Net income | $ 3,608 | [1],[2] | $ 2,621 | [1],[2] | $ (357) | [1],[2] | $ (4,569) | [1],[2] | $ 4,343 | [1],[2] | $ 1,335 | [1],[2] | $ 1,331 | [1],[2] | $ 2,357 | [1],[2] | $ 1,303 | $ 9,366 | $ 16,708 | |
Denominator for basic net income per common share — weighted average shares outstanding | 27,083,000 | 26,432,000 | 25,760,000 | |||||||||||||||||
Effect of dilutive securities: | ||||||||||||||||||||
Stock options and restricted stock units | 569,000 | 667,000 | 551,000 | |||||||||||||||||
Denominator for diluted net income per common share — adjusted weighted average shares | 27,652,000 | 27,099,000 | 26,311,000 | |||||||||||||||||
Basic net income per common share: | ||||||||||||||||||||
Continuing operations | $ 0.05 | $ 0.35 | $ 0.52 | |||||||||||||||||
Discontinued operations | 0 | 0 | 0.13 | |||||||||||||||||
Net income | $ 0.13 | $ 0.10 | $ (0.01) | $ (0.17) | $ 0.16 | $ 0.05 | $ 0.05 | $ 0.09 | 0.05 | 0.35 | 0.65 | |||||||||
Diluted net income per common share: | ||||||||||||||||||||
Continuing operations | 0.05 | 0.35 | 0.51 | |||||||||||||||||
Discontinued operations | 0 | 0 | 0.12 | |||||||||||||||||
Net (loss) income per common share, diluted (USD per share) | $ 0.13 | $ 0.09 | $ (0.01) | $ (0.17) | $ 0.16 | $ 0.05 | $ 0.05 | $ 0.09 | $ 0.05 | $ 0.35 | $ 0.64 | [3] | ||||||||
Antidilutive securities excluded from computation of earnings per share | 925,063 | 1,142,322 | 1,519,691 | |||||||||||||||||
[1] | During fiscal 2018, we recorded net tax expenses of $1.5 million and in fiscal 2017, we recorded net tax benefits of $1.0 million, respectively. We recorded tax expense of $2.8 million in the first quarter of fiscal 2018, $0.2 million in the second quarter of fiscal 2018 and $0.1 million in the third quarter of fiscal 2018 resulting from new U.S. tax legislation that was enacted during the first quarter of fiscal 2018 and the adoption of ASU 2016-09 relating to the accounting for the tax effects of stock compensation. In the fourth quarter of fiscal 2018, we recorded a net tax benefit of $1.5 million for the release of a valuation allowance against U.S. federal capital loss carryforward due to expected capital gains tax in fiscal 2019 resulting from the sale of our corporate headquarters building in October 2018 (see Note 18 to the Consolidated Financial Statements) along with U.S., state and foreign prior year true-up provision to return.We recorded a benefit of $0.1 million in the first quarter of fiscal 2017 resulting from reversal of income tax reserves due to the expiration of the statutes of limitation from various U.S. and foreign tax jurisdictions. In the third quarter of fiscal 2017, we recorded a tax benefit of $0.7 million from reversal of income tax reserves due to the expiration of the statutes of limitation from various U.S. and foreign tax jurisdictions. In the fourth quarter of fiscal 2017, we recorded a net tax benefit of $0.2 million, primarily from the reversal of income tax reserves due to the expiration of the statutes of limitation from various U.S. and foreign tax jurisdictions and state and foreign prior year true-up provision to return. | |||||||||||||||||||
[2] | For continuing operations, we recorded business restructuring charges of $0.2 million ($0.1 million after tax) in the third quarter of fiscal 2018 and $0.1 million ($0.1 million after tax) in the fourth quarter of fiscal 2018. We also recorded business restructuring charges of $2.5 million ($1.6 million after tax) in the third quarter of fiscal 2017. | |||||||||||||||||||
[3] | Earnings per share presented are calculated by line item and may not add due to the use of rounded amounts. |
Summary of Significant Accou_11
Summary of Significant Accounting Policies (Recent Accounting Developments) (Details) - USD ($) | 12 Months Ended | ||
Sep. 30, 2018 | Oct. 01, 2017 | Sep. 30, 2017 | |
Retained Earnings | |||
Cumulative Effect of New Accounting Principle in Period of Adoption | $ 33,000 | ||
ASU 2016-09 | |||
Tax deficiency from exercise of stock options | $ 600,000 | ||
Impact on EPS diluted (USD per share) | $ 0.02 | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | $ (19,000) | ||
ASU 2016-09 | Retained Earnings | |||
Cumulative Effect of New Accounting Principle in Period of Adoption | $ 33,000 |
Summary of Significant Accou_12
Summary of Significant Accounting Policies (Adoption of ASC 606) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||||||||
Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2015 | ||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||||||||||
Revenues | $ 65,662 | $ 62,716 | $ 54,791 | $ 45,197 | $ 45,105 | $ 45,739 | $ 45,615 | $ 45,175 | $ 228,366 | $ 181,634 | $ 203,005 | ||||||||||
Amortization | 2,871 | 1,444 | 887 | ||||||||||||||||||
Total cost of sales | 119,483 | 94,460 | 103,325 | ||||||||||||||||||
Gross profit | 30,963 | 29,329 | 26,654 | 21,937 | 21,334 | 22,485 | 21,902 | 21,453 | 108,883 | 87,174 | 99,680 | ||||||||||
Total operating expenses | 106,561 | 78,367 | 82,575 | ||||||||||||||||||
Operating income | 2,322 | 8,807 | 17,105 | ||||||||||||||||||
Net income | $ 3,608 | [1],[2] | $ 2,621 | [1],[2] | $ (357) | [1],[2] | $ (4,569) | [1],[2] | $ 4,343 | [1],[2] | $ 1,335 | [1],[2] | $ 1,331 | [1],[2] | $ 2,357 | [1],[2] | $ 1,303 | $ 9,366 | $ 16,708 | ||
Net (loss) income per common share, diluted (USD per share) | $ 0.13 | $ 0.09 | $ (0.01) | $ (0.17) | $ 0.16 | $ 0.05 | $ 0.05 | $ 0.09 | $ 0.05 | $ 0.35 | $ 0.64 | [3] | |||||||||
Accounts receivable, net | $ 50,817 | $ 28,855 | $ 50,817 | $ 28,855 | |||||||||||||||||
Other current assets | 2,613 | 3,032 | 2,613 | 3,032 | |||||||||||||||||
Deferred tax assets | 6,665 | 9,211 | 6,665 | 9,211 | |||||||||||||||||
Other non-current assets | 1,291 | 269 | 1,291 | 269 | |||||||||||||||||
Other current liabilities | 2,413 | 2,113 | 2,413 | 2,113 | |||||||||||||||||
Other non-current liabilities | 510 | 654 | 510 | 654 | |||||||||||||||||
Stockholders' equity | 330,280 | 319,144 | 330,280 | 319,144 | $ 300,029 | $ 274,938 | |||||||||||||||
Hardware product | |||||||||||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||||||||||
Total revenue | 191,050 | 166,480 | 196,101 | ||||||||||||||||||
Cost of sales | 96,332 | 85,369 | 97,776 | ||||||||||||||||||
Services and solutions | |||||||||||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||||||||||
Total revenue | 37,316 | 15,154 | 6,904 | ||||||||||||||||||
Cost of sales | 20,280 | 7,647 | $ 4,662 | ||||||||||||||||||
As Reported | |||||||||||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||||||||||
Revenues | 228,366 | 181,634 | |||||||||||||||||||
Amortization | 2,871 | 1,444 | |||||||||||||||||||
Total cost of sales | 119,483 | 94,460 | |||||||||||||||||||
Gross profit | 108,883 | 87,174 | |||||||||||||||||||
Total operating expenses | 106,561 | 78,367 | |||||||||||||||||||
Operating income | 2,322 | 8,807 | |||||||||||||||||||
Net income | $ 1,303 | $ 9,366 | |||||||||||||||||||
Net (loss) income per common share, diluted (USD per share) | $ 0.05 | $ 0.35 | |||||||||||||||||||
Accounts receivable, net | 50,817 | $ 50,817 | |||||||||||||||||||
Other current assets | 2,613 | 3,032 | 2,613 | $ 3,032 | |||||||||||||||||
Deferred tax assets | 6,665 | 9,211 | 6,665 | 9,211 | |||||||||||||||||
Other non-current assets | 1,291 | 269 | 1,291 | 269 | |||||||||||||||||
Other current liabilities | 2,413 | 2,113 | 2,413 | 2,113 | |||||||||||||||||
Other non-current liabilities | 510 | 654 | 510 | 654 | |||||||||||||||||
Stockholders' equity | 330,280 | 319,144 | 330,280 | 319,144 | |||||||||||||||||
As Reported | Hardware product | |||||||||||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||||||||||
Total revenue | 191,050 | 166,480 | |||||||||||||||||||
Cost of sales | 96,332 | 85,369 | |||||||||||||||||||
As Reported | Services and solutions | |||||||||||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||||||||||
Total revenue | 37,316 | 15,154 | |||||||||||||||||||
Cost of sales | 20,280 | 7,647 | |||||||||||||||||||
ASU 2014-09 | |||||||||||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||||||||||
Revenues | 226,893 | 181,340 | |||||||||||||||||||
Amortization | 2,871 | 1,444 | |||||||||||||||||||
Total cost of sales | 117,839 | 94,107 | |||||||||||||||||||
Gross profit | 109,054 | 87,233 | |||||||||||||||||||
Total operating expenses | 106,272 | 78,367 | |||||||||||||||||||
Operating income | 2,782 | 8,866 | |||||||||||||||||||
Net income | $ 1,631 | $ 9,403 | |||||||||||||||||||
Net (loss) income per common share, diluted (USD per share) | $ 0.06 | $ 0.35 | |||||||||||||||||||
Accounts receivable, net | 49,819 | $ 49,819 | |||||||||||||||||||
Other current assets | 3,498 | 3,204 | 3,498 | $ 3,204 | |||||||||||||||||
Deferred tax assets | 6,600 | 9,278 | 6,600 | 9,278 | |||||||||||||||||
Other non-current assets | 2,490 | 537 | 2,490 | 537 | |||||||||||||||||
Other current liabilities | 3,011 | 2,582 | 3,011 | 2,582 | |||||||||||||||||
Other non-current liabilities | 720 | 807 | 720 | 807 | |||||||||||||||||
Stockholders' equity | 330,493 | 319,029 | 330,493 | 319,029 | |||||||||||||||||
ASU 2014-09 | Hardware product | |||||||||||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||||||||||
Total revenue | 191,050 | 166,480 | |||||||||||||||||||
Cost of sales | 96,332 | 85,369 | |||||||||||||||||||
ASU 2014-09 | Services and solutions | |||||||||||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||||||||||
Total revenue | 35,843 | 14,860 | |||||||||||||||||||
Cost of sales | 18,636 | 7,294 | |||||||||||||||||||
ASU 2014-09 | Impact of Adoption | |||||||||||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||||||||||
Revenues | (1,473) | (294) | |||||||||||||||||||
Amortization | 0 | 0 | |||||||||||||||||||
Total cost of sales | (1,644) | (353) | |||||||||||||||||||
Gross profit | 171 | 59 | |||||||||||||||||||
Total operating expenses | (289) | 0 | |||||||||||||||||||
Operating income | 460 | 59 | |||||||||||||||||||
Net income | $ 328 | $ 37 | |||||||||||||||||||
Net (loss) income per common share, diluted (USD per share) | $ 0.01 | $ 0 | |||||||||||||||||||
Accounts receivable, net | (998) | $ (998) | |||||||||||||||||||
Other current assets | 885 | 172 | 885 | $ 172 | |||||||||||||||||
Deferred tax assets | (65) | 67 | (65) | 67 | |||||||||||||||||
Other non-current assets | 1,199 | 268 | 1,199 | 268 | |||||||||||||||||
Other current liabilities | 598 | 469 | 598 | 469 | |||||||||||||||||
Other non-current liabilities | 210 | 153 | 210 | 153 | |||||||||||||||||
Stockholders' equity | $ 213 | $ (115) | 213 | (115) | |||||||||||||||||
ASU 2014-09 | Impact of Adoption | Hardware product | |||||||||||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||||||||||
Total revenue | 0 | 0 | |||||||||||||||||||
Cost of sales | 0 | 0 | |||||||||||||||||||
ASU 2014-09 | Impact of Adoption | Services and solutions | |||||||||||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||||||||||
Total revenue | (1,473) | (294) | |||||||||||||||||||
Cost of sales | $ (1,644) | $ (353) | |||||||||||||||||||
[1] | During fiscal 2018, we recorded net tax expenses of $1.5 million and in fiscal 2017, we recorded net tax benefits of $1.0 million, respectively. We recorded tax expense of $2.8 million in the first quarter of fiscal 2018, $0.2 million in the second quarter of fiscal 2018 and $0.1 million in the third quarter of fiscal 2018 resulting from new U.S. tax legislation that was enacted during the first quarter of fiscal 2018 and the adoption of ASU 2016-09 relating to the accounting for the tax effects of stock compensation. In the fourth quarter of fiscal 2018, we recorded a net tax benefit of $1.5 million for the release of a valuation allowance against U.S. federal capital loss carryforward due to expected capital gains tax in fiscal 2019 resulting from the sale of our corporate headquarters building in October 2018 (see Note 18 to the Consolidated Financial Statements) along with U.S., state and foreign prior year true-up provision to return.We recorded a benefit of $0.1 million in the first quarter of fiscal 2017 resulting from reversal of income tax reserves due to the expiration of the statutes of limitation from various U.S. and foreign tax jurisdictions. In the third quarter of fiscal 2017, we recorded a tax benefit of $0.7 million from reversal of income tax reserves due to the expiration of the statutes of limitation from various U.S. and foreign tax jurisdictions. In the fourth quarter of fiscal 2017, we recorded a net tax benefit of $0.2 million, primarily from the reversal of income tax reserves due to the expiration of the statutes of limitation from various U.S. and foreign tax jurisdictions and state and foreign prior year true-up provision to return. | ||||||||||||||||||||
[2] | For continuing operations, we recorded business restructuring charges of $0.2 million ($0.1 million after tax) in the third quarter of fiscal 2018 and $0.1 million ($0.1 million after tax) in the fourth quarter of fiscal 2018. We also recorded business restructuring charges of $2.5 million ($1.6 million after tax) in the third quarter of fiscal 2017. | ||||||||||||||||||||
[3] | Earnings per share presented are calculated by line item and may not add due to the use of rounded amounts. |
Acquisition (Details)
Acquisition (Details) | Jan. 22, 2018USD ($) | Oct. 20, 2017USD ($) | Jan. 09, 2017USD ($) | Nov. 01, 2016USD ($) | Oct. 05, 2015USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Sep. 30, 2016USD ($) |
Business Acquisition [Line Items] | |||||||||||
Goodwill | $ 154,535,000 | $ 131,995,000 | $ 109,448,000 | ||||||||
Accelerated Concepts | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Cash paid at closing | $ 16,430,000 | ||||||||||
Cash acquired | $ 200,000 | ||||||||||
Earn-out payment installment period | 2 | ||||||||||
Goodwill | $ 5,664,000 | ||||||||||
Weighted average useful life of acquired intangibles | 5 years 6 months | ||||||||||
Acquisition costs | 300,000 | ||||||||||
Business Combination, Pro Forma Information, Revenue of Acquiree since Acquisition Date, Actual | 22,200,000 | ||||||||||
Business Combination, Pro Forma Information, Earnings or Loss of Acquiree since Acquisition Date, Actual | 2,800,000 | ||||||||||
TempAlert | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Cash paid at closing | $ 40,741,000 | ||||||||||
Cash acquired | 600,000 | ||||||||||
Goodwill | $ 17,552,000 | ||||||||||
Weighted average useful life of acquired intangibles | 6 years 6 months | ||||||||||
Acquisition costs | 1,400,000 | 400,000 | |||||||||
Payments to Acquire Business Gross before working capital adjustments | $ 45,000,000 | ||||||||||
Business Combination, Pro Forma Information, Revenue of Acquiree since Acquisition Date, Actual | 17,000,000 | ||||||||||
SMART Temps | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Cash paid at closing | $ 28,800,000 | ||||||||||
Cash acquired | 500,000 | ||||||||||
Goodwill | 18,800,000 | ||||||||||
FreshTemp | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Cash paid at closing | $ 1,700,000 | ||||||||||
Earn-out payment maximum | 2,300,000 | ||||||||||
Goodwill | 2,700,000 | ||||||||||
Bluenica Corporation | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Cash paid at closing | $ 2,900,000 | ||||||||||
Business Combination, Contingent Liability, Payout Period | 4 years | ||||||||||
Earn-out payment maximum | $ 11,600,000 | ||||||||||
Goodwill | 11,000,000 | ||||||||||
Purchased and Core Technology | Accelerated Concepts | |||||||||||
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 Concepts | |||||||||||
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 Concepts | |||||||||||
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 Concepts | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Estimated useful life of finite lived intangibles | 1 year | ||||||||||
Earn-out payments | Accelerated Concepts | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Earn-out payment maximum | $ 4,500,000 | ||||||||||
Earn-out payments | SMART Temps | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Earn-out payment maximum | 7,200,000 | ||||||||||
Additional earn-out payment | Accelerated Concepts | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Earn-out payment maximum | 2,000,000 | ||||||||||
Additional earn-out payment | Bluenica Corporation | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Earn-out payment maximum | 3,500,000 | ||||||||||
Fair Value, Measurements, Recurring | Contingent Consideration | Estimate of Fair Value Measurement | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Contingent consideration fair value | 10,065,000 | $ 6,388,000 | |||||||||
Fair Value, Measurements, Recurring | Contingent Consideration | Estimate of Fair Value Measurement | Accelerated Concepts | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Contingent consideration fair value | $ 2,300,000 | 4,400,000 | |||||||||
Fair Value, Measurements, Recurring | Contingent Consideration | Estimate of Fair Value Measurement | TempAlert | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Contingent consideration fair value | $ 0 | 0 | |||||||||
Fair Value, Measurements, Recurring | Contingent Consideration | Estimate of Fair Value Measurement | SMART Temps | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Contingent consideration fair value | $ 10,000 | $ 0 | |||||||||
Fair Value, Measurements, Recurring | Contingent Consideration | Estimate of Fair Value Measurement | FreshTemp | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Contingent consideration fair value | $ 1,300,000 | 200,000 | |||||||||
Fair Value, Measurements, Recurring | Contingent Consideration | Estimate of Fair Value Measurement | Bluenica Corporation | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Contingent consideration fair value | $ 10,400,000 | $ 5,500,000 | |||||||||
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 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 |
Business Acquisition [Line Items] | |||||
Goodwill | $ 154,535 | $ 131,995 | $ 109,448 | ||
Accelerated Concepts | |||||
Business Acquisition [Line Items] | |||||
Cash | $ 16,430 | ||||
Fair value of contingent consideration on acquired business | 2,300 | ||||
Total purchase price consideration | 18,730 | ||||
Fair value of net tangible assets acquired | 766 | ||||
Goodwill | 5,664 | ||||
Total assets acquired and liabilities assumed | 18,730 | ||||
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 | ||||
Purchased and Core Technology | Accelerated Concepts | |||||
Business Acquisition [Line Items] | |||||
Fair value of identifiable intangible assets acquired | 3,000 | ||||
Purchased and Core Technology | TempAlert | |||||
Business Acquisition [Line Items] | |||||
Fair value of identifiable intangible assets acquired | 4,000 | ||||
Customer Relationships | Accelerated Concepts | |||||
Business Acquisition [Line Items] | |||||
Fair value of identifiable intangible assets acquired | 6,500 | ||||
Customer Relationships | TempAlert | |||||
Business Acquisition [Line Items] | |||||
Fair value of identifiable intangible assets acquired | 18,300 | ||||
Trademarks and Trade Names | Accelerated Concepts | |||||
Business Acquisition [Line Items] | |||||
Fair value of identifiable intangible assets acquired | 1,000 | ||||
Trademarks and Trade Names | TempAlert | |||||
Business Acquisition [Line Items] | |||||
Fair value of identifiable intangible assets acquired | $ 2,000 | ||||
Order backlog | Accelerated Concepts | |||||
Business Acquisition [Line Items] | |||||
Fair value of identifiable intangible assets acquired | $ 1,800 |
Acquisition Pro Forma (Details)
Acquisition Pro Forma (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Business Combinations [Abstract] | ||
Revenue | $ 233,789 | $ 213,505 |
Net income | $ 1,314 | $ 4,117 |
Discontinued Operations (Detail
Discontinued Operations (Details) - Etherios, Inc. - Discontinued Operations, Disposed of by Sale - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Oct. 31, 2017 | Oct. 31, 2016 | Sep. 30, 2016 | Oct. 23, 2017 | Oct. 23, 2016 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Consideration receivable | $ 2,000 | $ 3,000 | |||
Proceeds from Divestiture of Business | $ 2,000 | $ 3,000 | |||
Income tax benefit on discontinued operations | $ 476 |
Discontinued Operations (Income
Discontinued Operations (Income (loss) from Discontinued Operations, Net of Tax) (Details) - Etherios, Inc. - Discontinued Operations, Disposed of by Sale $ in Thousands | 12 Months Ended |
Sep. 30, 2016USD ($) | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Service revenue | $ 891 |
Cost of service | 713 |
Gross profit | 178 |
Operating expenses: | |
Sales and marketing | 148 |
Research and development | 103 |
General and administrative | 43 |
Total operating expenses | 294 |
Loss from discontinued operations, before income taxes | (116) |
Gain on sale of discontinued operations, before income taxes | 2,870 |
Income from discontinued operations, before income taxes | 2,754 |
Income tax benefit on discontinued operations | (476) |
Income from discontinued operations, after income taxes | $ 3,230 |
Discontinued Operations (Amorti
Discontinued Operations (Amortization, Depreciation, and Purchase of PPE) (Details) $ in Thousands | 12 Months Ended |
Sep. 30, 2016USD ($) | |
Etherios, Inc. | Discontinued Operations, Disposed of by Sale | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Amortization of identifiable intangible assets | $ 30 |
Goodwill and other Identifiab_3
Goodwill and other Identifiable Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Sep. 30, 2017 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 122,910 | $ 86,308 |
Accumulated amortization | (83,590) | (74,508) |
Net | 39,320 | 11,800 |
Purchased and Core Technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 58,102 | 51,292 |
Accumulated amortization | (48,693) | (46,304) |
Net | 9,409 | 4,988 |
License Agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 102 | 18 |
Accumulated amortization | (46) | (17) |
Net | 56 | 1 |
Patents and Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 15,701 | 12,484 |
Accumulated amortization | (12,242) | (11,280) |
Net | 3,459 | 1,204 |
Customer Relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 46,605 | 21,914 |
Accumulated amortization | (21,049) | (16,817) |
Net | 25,556 | 5,097 |
Non-compete Agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 600 | 600 |
Accumulated amortization | (210) | (90) |
Net | 390 | 510 |
Order backlog | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 1,800 | 0 |
Accumulated amortization | (1,350) | 0 |
Net | $ 450 | $ 0 |
Goodwill and other Identifiab_4
Goodwill and other Identifiable Intangible Assets (Amortization Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Finite-Lived Intangible Assets [Line Items] | |||
2,019 | $ 8,888 | ||
2,020 | 8,118 | ||
2,021 | 7,422 | ||
2,022 | 6,554 | ||
2,023 | 4,362 | ||
Cost of Sales and General and Administrative Expense [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expense | $ 9,435 | $ 2,597 | $ 1,842 |
Goodwill and other Identifiab_5
Goodwill and other Identifiable Intangible Assets (Goodwill) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Goodwill [Roll Forward] | ||
Beginning balance | $ 131,995 | $ 109,448 |
Acquisitions | 23,216 | 21,465 |
Foreign currency translation adjustment | (676) | 1,082 |
Ending balance | $ 154,535 | $ 131,995 |
Segment Information and Major_3
Segment Information and Major Customers Summary of Operating Results by Segment (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Sep. 30, 2018USD ($)segment | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | |
Segment Reporting Information [Line Items] | |||||||||||
Number of reportable segments | segment | 2 | ||||||||||
Revenue | $ 65,662 | $ 62,716 | $ 54,791 | $ 45,197 | $ 45,105 | $ 45,739 | $ 45,615 | $ 45,175 | $ 228,366 | $ 181,634 | $ 203,005 |
Operating income (loss) | 2,322 | 8,807 | 17,105 | ||||||||
Depreciation and amortization | 12,270 | 5,497 | 4,584 | ||||||||
IoT Products & Services | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 201,506 | 174,237 | 202,294 | ||||||||
Operating income (loss) | 14,923 | 12,804 | 18,822 | ||||||||
Depreciation and amortization | 6,040 | 3,575 | 4,040 | ||||||||
IoT Solutions | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 26,860 | 7,397 | 711 | ||||||||
Operating income (loss) | (12,601) | (3,997) | (1,717) | ||||||||
Depreciation and amortization | $ 6,230 | $ 1,922 | $ 544 |
Segment Information and Major_4
Segment Information and Major Customers Expended for Property, Plant and Equipment by Segment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Payments to Acquire Property Plant and Equipment by Segment [Line Items] | |||
Expended for property, plant and equipment | $ 1,842 | $ 1,773 | $ 2,729 |
IoT Products & Services | |||
Payments to Acquire Property Plant and Equipment by Segment [Line Items] | |||
Expended for property, plant and equipment | 1,773 | 1,738 | 2,641 |
IoT Solutions | |||
Payments to Acquire Property Plant and Equipment by Segment [Line Items] | |||
Expended for property, plant and equipment | $ 69 | $ 35 | $ 88 |
Segment Information and Major_5
Segment Information and Major Customers Total Assets by Segment (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Sep. 30, 2017 |
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total Assets | $ 371,125 | $ 345,189 |
IoT Products & Services | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total Assets | 209,574 | 182,555 |
IoT Solutions | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total Assets | 98,801 | 47,644 |
Unallocated | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total Assets | $ 62,750 | $ 114,990 |
Segment Information and Major_6
Segment Information and Major Customers Goodwill by Segment (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Jun. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 |
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||||
Goodwill | $ 154,535 | $ 131,995 | $ 109,448 | |
IoT Products & Services | ||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||||
Goodwill | 104,358 | $ 104,600 | 98,981 | |
IoT Solutions | ||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||||
Goodwill | $ 50,177 | $ 50,000 | $ 33,014 |
Segment Information and Major_7
Segment Information and Major Customers Net Property, Equipment and Improvements by Segment (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Sep. 30, 2017 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net property, equipment and improvements | $ 6,270 | $ 12,801 |
North America, primarily United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net property, equipment and improvements | 6,156 | 12,648 |
International, primarily Europe | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net property, equipment and improvements | $ 114 | $ 153 |
Segment Information and Major_8
Segment Information and Major Customers Geographic revenue (Details) $ in Thousands | Sep. 30, 2018customer | Sep. 30, 2018USD ($)customer | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($)customer | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Sep. 30, 2018USD ($)customer | Sep. 30, 2017USD ($)customer | Sep. 30, 2016USD ($)customer |
Segment Reporting Information [Line Items] | ||||||||||||
Revenues | $ 65,662 | $ 62,716 | $ 54,791 | $ 45,197 | $ 45,105 | $ 45,739 | $ 45,615 | $ 45,175 | $ 228,366 | $ 181,634 | $ 203,005 | |
Number of customer representing over ten percent of revenue | customer | 0 | 0 | 0 | |||||||||
Number of customer representing over ten percent of consolidated accounts receivable | customer | 1 | 1 | 0 | 1 | 0 | |||||||
Accounts Receivable | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Percentage of concentration | 12.00% | |||||||||||
North America, primarily United States | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Revenues | $ 163,397 | $ 117,749 | $ 131,457 | |||||||||
United States | U.S. Export Net Sales | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Percentage of concentration | 29.90% | 37.10% | 38.70% | |||||||||
Europe, Middle East and Africa | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Revenues | $ 39,211 | $ 39,403 | $ 44,932 | |||||||||
Asia | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Revenues | 20,881 | 19,892 | 20,390 | |||||||||
Latin America | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Revenues | $ 4,877 | $ 4,590 | $ 6,226 |
Selected Balance Sheet Data (De
Selected Balance Sheet Data (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Sep. 30, 2017 |
Accounts receivable, net: | ||
Accounts receivable | $ 54,451 | $ 31,365 |
Less allowance for doubtful accounts | 1,074 | 341 |
Less reserve for future returns and pricing adjustments | 2,560 | 2,169 |
Total accounts receivable, net | 50,817 | 28,855 |
Inventories: | ||
Raw materials | 22,047 | 24,050 |
Work in process | 525 | 484 |
Finished goods | 19,072 | 5,704 |
Total Inventories | 41,644 | 30,238 |
Property, Plant and Equipment, Net | ||
Total property, equipment and improvements, gross | 27,725 | 39,944 |
Less accumulated depreciation and amortization | 21,455 | 27,143 |
Total property, equipment and improvements, net | 6,270 | 12,801 |
Land | ||
Property, Plant and Equipment, Net | ||
Total property, equipment and improvements, gross | 570 | 1,800 |
Buildings | ||
Property, Plant and Equipment, Net | ||
Total property, equipment and improvements, gross | 2,338 | 10,522 |
Improvements | ||
Property, Plant and Equipment, Net | ||
Total property, equipment and improvements, gross | 1,698 | 3,445 |
Equipment | ||
Property, Plant and Equipment, Net | ||
Total property, equipment and improvements, gross | 15,803 | 17,133 |
Purchased Software | ||
Property, Plant and Equipment, Net | ||
Total property, equipment and improvements, gross | 3,966 | 3,571 |
Furniture and Fixtures | ||
Property, Plant and Equipment, Net | ||
Total property, equipment and improvements, gross | $ 3,350 | $ 3,473 |
Selected Balance Sheet Data Ass
Selected Balance Sheet Data Assets Held for Sale (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Sep. 30, 2017 |
Statement of Financial Position [Abstract] | ||
Assets held for sale | $ 5,220 | $ 0 |
Marketable Securities (Details)
Marketable Securities (Details) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2018USD ($)Security | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | |
Debt Securities, Available-for-sale [Line Items] | |||
Available-for-sale Securities, Total Number of Securities | 19 | ||
Proceeds from Sale and Maturity of Debt Securities, Available-for-sale | $ | $ 32,032 | $ 87,105 | $ 73,706 |
Debt Securities, Available-for-sale, Unrealized Loss Position, Number of Positions | 19 | ||
Current Assets | |||
Debt Securities, Available-for-sale [Line Items] | |||
Available-For-Sale Securities, Next Twelve Months, Maximum Year Mature | 1 year | ||
Non-current Assets | |||
Debt Securities, Available-for-sale [Line Items] | |||
Available-for sale Securities, Debt Maturities, Year Two Through Five, Maximum Year Mature | 2 years |
Marketable Securities (Fair Val
Marketable Securities (Fair Value to Amortized Cost) (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Sep. 30, 2017 | ||
Debt Securities, Available-for-sale [Line Items] | ||||
Available-for-sale securities, amortized cost basis | $ 4,756 | [1] | $ 36,788 | [2] |
Available-for-sale securities, unrealized gains | 0 | 4 | ||
Available-for-sale securities, unrealized losses | (20) | (24) | ||
Available-for-sale marketable securities, fair value | 4,736 | [1] | 36,768 | [2] |
Purchased and accrued interest | 6 | 211 | ||
Current Assets | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Available-for-sale securities, amortized cost basis | 32,031 | |||
Available-for-sale securities, unrealized gains | 4 | |||
Available-for-sale securities, unrealized losses | (20) | |||
Available-for-sale marketable securities, fair value | 32,015 | |||
Current Assets | Corporate bonds | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Available-for-sale securities, amortized cost basis | 28,275 | |||
Available-for-sale securities, unrealized gains | 0 | |||
Available-for-sale securities, unrealized losses | (20) | |||
Available-for-sale marketable securities, fair value | 28,255 | |||
Current Assets | Certificates of deposit | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Available-for-sale securities, amortized cost basis | 4,756 | 3,756 | ||
Available-for-sale securities, unrealized gains | 0 | 4 | ||
Available-for-sale securities, unrealized losses | (20) | 0 | ||
Available-for-sale marketable securities, fair value | $ 4,736 | 3,760 | ||
Non-current Assets | Certificates of deposit | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Available-for-sale securities, amortized cost basis | 4,757 | |||
Available-for-sale securities, unrealized gains | 0 | |||
Available-for-sale securities, unrealized losses | (4) | |||
Available-for-sale marketable securities, fair value | $ 4,753 | |||
[1] | Included in amortized cost and fair value is purchased and accrued interest of $6. | |||
[2] | Included in amortized cost and fair value is purchased and accrued interest of $211 |
Marketable Securities (Fair Va
Marketable Securities (Fair Value and Gross Unrealized Losses for AFS) (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Sep. 30, 2017 |
Debt Securities, Available-for-sale [Line Items] | ||
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months | $ 0 | $ 29,947 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | 0 | (24) |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer | 4,736 | 0 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | (20) | 0 |
Corporate bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months | 26,196 | |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | (20) | |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer | 0 | |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | 0 | |
Certificates of deposit | ||
Debt Securities, Available-for-sale [Line Items] | ||
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months | 0 | 3,751 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | 0 | (4) |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer | 4,736 | 0 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | $ (20) | $ 0 |
(Financial Assets and Liabiliti
(Financial Assets and Liabilities) (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Sep. 30, 2017 | Jun. 30, 2017 | Sep. 30, 2016 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Available-for-sale marketable securities | $ 4,736 | [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] | ||||||
Assets, Fair Value Disclosure | 24,318 | 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] | ||||||
Assets, Fair Value Disclosure | 4,736 | 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 | 10,065 | 6,388 | $ 6,388 | $ 9,960 | ||
Fair Value, Inputs, Level 3 | Fair Value, Measurements, Recurring | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Assets, Fair Value Disclosure | 0 | 0 | ||||
Total liabilities measured at fair value | 10,065 | 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 | 10,065 | 6,388 | ||||
Money Market Funds | Fair Value, Inputs, Level 1 | Fair Value, Measurements, Recurring | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Cash equivalents | 24,318 | 39,524 | ||||
Money Market Funds | 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 Funds | 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 | 4,736 | 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] | ||||||
Assets, Fair Value Disclosure | 29,054 | 76,292 | ||||
Total liabilities measured at fair value | 10,065 | 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 | 10,065 | 6,388 | ||||
Estimate of Fair Value Measurement | Money Market Funds | Fair Value, Measurements, Recurring | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Cash equivalents | 24,318 | 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 | $ 4,736 | $ 8,513 | ||||
[1] | Included in amortized cost and fair value is purchased and accrued interest of $6. | |||||
[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 | 12 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Fair value at beginning of period | $ 6,388 | $ 9,960 |
Purchase price contingent consideration | 2,300 | 1,310 |
Contingent consideration payments | 0 | (518) |
Change in fair value of contingent consideration | 1,377 | (4,364) |
Fair value at end of period | $ 10,065 | $ 6,388 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) | Oct. 05, 2015 | Nov. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | Jan. 22, 2018 | Dec. 31, 2017 | Oct. 20, 2017 | Jun. 30, 2017 | Jan. 09, 2017 | Nov. 01, 2016 |
Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Contingent consideration fair value | $ 10,065,000 | $ 6,388,000 | $ 9,960,000 | $ 6,388,000 | |||||||
Contingent Consideration | Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Contingent consideration fair value | $ 10,065,000 | 6,388,000 | |||||||||
Accelerated Concepts | Minimum | Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Fair value inputs probability of payment | 44.40% | ||||||||||
Accelerated Concepts | Maximum | Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Fair value inputs probability of payment | 100.00% | ||||||||||
Bluenica Corporation | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Business Combination, Contingent Liability, Payout Period | 4 years | ||||||||||
Bluenica Corporation | Maximum | Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Fair value inputs probability of payment | 98.60% | ||||||||||
Bluenica Corporation | Contingent Consideration | Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Payment for Contingent Consideration Liability, Investing Activities | 0 | $ 500,000 | |||||||||
FreshTemp | Maximum | Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Fair value inputs probability of payment | 100.00% | ||||||||||
SMART Temps | Maximum | Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Fair value inputs probability of payment | 0.00% | ||||||||||
Estimate of Fair Value Measurement | Contingent Consideration | Fair Value, Measurements, Recurring | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Contingent consideration fair value | $ 10,065,000 | $ 6,388,000 | |||||||||
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 | Accelerated Concepts | Contingent Consideration | Fair Value, Measurements, Recurring | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Contingent consideration fair value | 4,400,000 | $ 2,300,000 | |||||||||
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 | SMART Temps | Contingent Consideration | Fair Value, Measurements, Recurring | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Contingent consideration fair value | $ 0 | $ 10,000 | |||||||||
Subsequent Event | Estimate of Fair Value Measurement | FreshTemp | Contingent Consideration | Fair Value, Measurements, Recurring | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Payment for Contingent Consideration Liability, Investing Activities | $ 200,000 |
Product Warranty Obligation (De
Product Warranty Obligation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Standard Product Warranty Accrual [Roll Forward] | |||
Beginning balance | $ 987 | $ 1,033 | $ 1,014 |
Warranties issued | 759 | 679 | 771 |
Settlements made | (574) | (725) | (752) |
Ending balance | $ 1,172 | $ 987 | $ 1,033 |
Restructuring (Details)
Restructuring (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||||
May 31, 2017employee | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Sep. 30, 2018USD ($)employee | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($)employee | Sep. 30, 2016USD ($) | |
Restructuring Reserve [Roll Forward] | ||||||||||
Restructuring reserve, beginning balance | $ 453 | $ 1,656 | $ 0 | $ 0 | ||||||
Restructuring charge | $ 100 | $ 200 | $ 2,500 | 504 | 2,515 | 753 | ||||
Payments for restructuring | (1,553) | (986) | (754) | |||||||
Restructuring reversals | (202) | (6) | ||||||||
Restructuring foreign currency fluctuation | 48 | 127 | 7 | |||||||
Restructuring reserve, ending balance | 453 | $ 1,656 | $ 453 | 453 | 1,656 | 0 | ||||
Employee Severance | Manufacturing Transition | ||||||||||
Restructuring Reserve [Roll Forward] | ||||||||||
Restructuring reserve, beginning balance | 147 | 0 | 0 | 0 | ||||||
Restructuring charge | 504 | 0 | 0 | |||||||
Payments for restructuring | (357) | 0 | 0 | |||||||
Restructuring reversals | 0 | 0 | ||||||||
Restructuring foreign currency fluctuation | 0 | 0 | 0 | |||||||
Restructuring reserve, ending balance | 147 | 0 | 147 | 147 | 0 | 0 | ||||
Employee Severance | 2017 Restructuring | ||||||||||
Restructuring Reserve [Roll Forward] | ||||||||||
Restructuring reserve, beginning balance | 293 | 1,528 | 0 | 0 | ||||||
Restructuring charge | 0 | 2,258 | 0 | |||||||
Payments for restructuring | (1,035) | (845) | 0 | |||||||
Restructuring reversals | (244) | 0 | ||||||||
Restructuring foreign currency fluctuation | 44 | 115 | 0 | |||||||
Restructuring reserve, ending balance | 293 | 1,528 | 293 | 293 | 1,528 | 0 | ||||
Employee Severance | 2016 Restructuring | ||||||||||
Restructuring Reserve [Roll Forward] | ||||||||||
Restructuring reserve, beginning balance | 0 | 0 | 0 | 0 | ||||||
Restructuring charge | 0 | 0 | 558 | |||||||
Payments for restructuring | 0 | 0 | (559) | |||||||
Restructuring reversals | 0 | (6) | ||||||||
Restructuring foreign currency fluctuation | 0 | 0 | 7 | |||||||
Restructuring reserve, ending balance | 0 | 0 | 0 | 0 | 0 | 0 | ||||
Facility Closing | 2017 Restructuring | ||||||||||
Restructuring Reserve [Roll Forward] | ||||||||||
Restructuring reserve, beginning balance | 13 | 128 | 0 | 0 | ||||||
Restructuring charge | 0 | 257 | 0 | |||||||
Payments for restructuring | (161) | (141) | 0 | |||||||
Restructuring reversals | 42 | 0 | ||||||||
Restructuring foreign currency fluctuation | 4 | 12 | 0 | |||||||
Restructuring reserve, ending balance | 13 | 128 | 13 | 13 | 128 | 0 | ||||
Facility Closing | 2016 Restructuring | ||||||||||
Restructuring Reserve [Roll Forward] | ||||||||||
Restructuring reserve, beginning balance | 0 | 0 | 0 | 0 | ||||||
Restructuring charge | 0 | 0 | 195 | |||||||
Payments for restructuring | 0 | 0 | (195) | |||||||
Restructuring reversals | 0 | 0 | ||||||||
Restructuring foreign currency fluctuation | 0 | 0 | 0 | |||||||
Restructuring reserve, ending balance | $ 0 | 0 | $ 0 | $ 0 | $ 0 | $ 0 | ||||
UNITED STATES | 2016 Restructuring | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Number of positions eliminated | employee | 5 | |||||||||
UNITED STATES | Employee Severance | 2016 Restructuring | ||||||||||
Restructuring Reserve [Roll Forward] | ||||||||||
Restructuring charge | $ 100 | |||||||||
GERMANY | 2016 Restructuring | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Number of positions eliminated | employee | 10 | |||||||||
Restructuring Reserve [Roll Forward] | ||||||||||
Restructuring charge | $ 700 | |||||||||
GERMANY | Employee Severance | 2016 Restructuring | ||||||||||
Restructuring Reserve [Roll Forward] | ||||||||||
Restructuring charge | 500 | |||||||||
GERMANY | Facility Closing | 2016 Restructuring | ||||||||||
Restructuring Reserve [Roll Forward] | ||||||||||
Restructuring charge | $ 200 | |||||||||
IoT Products & Services | Manufacturing Transition | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Number of positions eliminated | employee | 51 | |||||||||
IoT Products & Services | 2017 Restructuring | ||||||||||
Restructuring Reserve [Roll Forward] | ||||||||||
Restructuring charge | 2,500 | |||||||||
IoT Products & Services | Employee Severance | Manufacturing Transition | ||||||||||
Restructuring Reserve [Roll Forward] | ||||||||||
Restructuring charge | $ 500 | |||||||||
IoT Products & Services | Employee Severance | 2017 Restructuring | ||||||||||
Restructuring Reserve [Roll Forward] | ||||||||||
Restructuring charge | 2,300 | |||||||||
IoT Products & Services | Facility Closing | 2017 Restructuring | ||||||||||
Restructuring Reserve [Roll Forward] | ||||||||||
Restructuring charge | $ 200 | |||||||||
IoT Products & Services | UNITED STATES | 2017 Restructuring | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Number of positions eliminated | employee | 10 | |||||||||
IoT Products & Services | FRANCE | 2017 Restructuring | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Number of positions eliminated | employee | 8 | |||||||||
Minimum | Forecast | IoT Products & Services | Manufacturing Transition | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Effect on future earnings | 3,000 | |||||||||
Maximum | Forecast | IoT Products & Services | Manufacturing Transition | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Effect on future earnings | $ 5,000 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Dec. 31, 2016 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Tax Credit Carryforward [Line Items] | ||||||||||
U.S. capital loss carryforward | $ 3,500 | $ 3,500 | ||||||||
Valuation allowance | 3,291 | $ 5,952 | 3,291 | $ 5,952 | ||||||
Net discrete tax expense (benefits) | (1,500) | $ 100 | $ 200 | $ 2,800 | (200) | $ (700) | $ (100) | 1,500 | (1,000) | $ (1,500) |
Income tax provision | 1,487 | 125 | 3,212 | |||||||
Release of valuation allowance | 1,317 | 0 | $ 0 | |||||||
Release of valuation allowance related to sale of corporate headquarters | 1,100 | |||||||||
Accrued income tax penalties and interest for unrecognized tax benefits | 100 | $ 100 | 100 | $ 100 | ||||||
Accumulated undistributed foreign earnings | 4,000 | 4,000 | ||||||||
United States Federal Tax Jurisdiction | ||||||||||
Tax Credit Carryforward [Line Items] | ||||||||||
Federal and state research and development tax credits | 3,600 | 3,600 | ||||||||
U.S. capital loss carryforward | 3,200 | 3,200 | ||||||||
Foreign Tax Authority | ||||||||||
Tax Credit Carryforward [Line Items] | ||||||||||
Non-U.S. operating losses | $ 300 | 300 | ||||||||
ASU 2016-09 | ||||||||||
Tax Credit Carryforward [Line Items] | ||||||||||
Tax deficiency from exercise of stock options | 600 | |||||||||
Tax Cuts and Jobs Act of 2017 [Member] | ||||||||||
Tax Credit Carryforward [Line Items] | ||||||||||
Income tax provision | 3,000 | |||||||||
Tax Cuts and Jobs Act of 2017, Remeasurement Of Deferred Tax [Member] | ||||||||||
Tax Credit Carryforward [Line Items] | ||||||||||
Income tax provision | 2,700 | |||||||||
Tax Cuts and Jobs Act of 2017, One Time Transition Tax For Foreign Subsidiaries [Member] | ||||||||||
Tax Credit Carryforward [Line Items] | ||||||||||
Income tax provision | $ 300 |
Income Taxes (Income Taxes) (De
Income Taxes (Income Taxes) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | |||
United States | $ (2,887) | $ 5,170 | $ 9,841 |
International | 5,677 | 4,321 | 6,849 |
Income from continuing operations, before income taxes | $ 2,790 | $ 9,491 | $ 16,690 |
Income Taxes (Income Tax Provis
Income Taxes (Income Tax Provision) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Current: | |||
Federal | $ 526 | $ 312 | $ (141) |
State | 57 | 165 | 139 |
Foreign | 1,412 | 1,756 | 2,099 |
Deferred: | |||
U.S. | (668) | (1,454) | 1,260 |
Foreign | 160 | (654) | (145) |
Income tax provision | $ 1,487 | $ 125 | $ 3,212 |
Income Taxes (Deferred Tax Asse
Income Taxes (Deferred Tax Assets) (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Sep. 30, 2017 |
Income Tax Disclosure [Abstract] | ||
Non-current deferred tax asset | $ 6,665 | $ 9,211 |
Non-current deferred tax liability | (334) | (534) |
Net deferred tax asset | 6,331 | 8,677 |
Uncollectible accounts and other reserves | 1,000 | 1,063 |
Depreciation and amortization | (369) | (673) |
Inventories | 740 | 824 |
Compensation costs | 3,388 | 5,863 |
Tax carryforwards | 7,063 | 7,514 |
Valuation allowance | (3,291) | (5,952) |
Identifiable intangible assets | (2,298) | (581) |
Other | 98 | 619 |
Net deferred tax asset | $ 6,331 | $ 8,677 |
Income Taxes (Effective Income
Income Taxes (Effective Income Tax Rate Reconciliation) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | |||
Statutory income tax amount | $ 1,001 | $ 2,917 | $ 5,548 |
State taxes, net of federal benefits | (312) | (125) | 204 |
Manufacturing deduction | (364) | (150) | (450) |
Meals and entertainment | 82 | 63 | 55 |
Transaction costs | 79 | 0 | 0 |
Employee stock purchase plan | 56 | 79 | 83 |
Foreign operations | (3) | 218 | 276 |
Valuation allowance - current year increase | 275 | 159 | (43) |
Utilization of tax credits | (1,609) | (1,168) | (1,116) |
Valuation allowance | (1,317) | 0 | 0 |
Discrete tax benefits | (765) | (954) | (1,461) |
One-time transition tax | 250 | 0 | 0 |
Deferred balance sheet remeasure | 2,727 | 0 | 0 |
ASU 2016-09 excess stock compensation | 643 | 0 | 0 |
Contingent consideration | 388 | (1,172) | (154) |
Adjustment of tax contingency reserves | 315 | 257 | 202 |
Other, net | 41 | 1 | 68 |
Income tax provision | $ 1,487 | $ 125 | $ 3,212 |
Income Taxes (Unrecognized Tax
Income Taxes (Unrecognized Tax Benefits) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Unrecognized tax benefits, beginning balance | $ 1,335 | $ 1,708 | $ 1,618 |
Increases related to prior year income tax positions | 39 | 21 | 107 |
Increases related to current year income tax positions | 315 | 257 | 240 |
Decreases related to prior year income tax positions | 0 | 0 | (71) |
Decreases related to settlements | 0 | 0 | (30) |
Decreases related to expiration of statute of limitations | (128) | (651) | (156) |
Unrecognized tax benefits, ending balance | $ 1,561 | $ 1,335 | $ 1,708 |
Income Taxes (Unrecognized Ta_2
Income Taxes (Unrecognized Tax Benefits, Additional Information) (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2015 |
Income Tax Contingency [Line Items] | ||||
Unrecognized tax benefits that would impact effective tax rate | $ 1,400 | |||
Unrecognized tax benefits | 1,561 | $ 1,335 | $ 1,708 | $ 1,618 |
Accrued income tax penalties and interest for unrecognized tax benefits | 100 | $ 100 | ||
Noncurrent income taxes payable | ||||
Income Tax Contingency [Line Items] | ||||
Unrecognized tax benefits | 800 | |||
Noncurrent deferred tax assets | ||||
Income Tax Contingency [Line Items] | ||||
Unrecognized tax benefits | $ 800 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) $ in Thousands | Jan. 25, 2010 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | Jan. 29, 2018 | Feb. 01, 2016 | Jan. 27, 2014 | Jan. 28, 2013 | Dec. 04, 2009 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Proceeds from employee stock purchase plan transactions | $ 1,115 | $ 685 | $ 896 | ||||||
Shares Paid for Tax Withholding for Share Based Compensation | 74,204 | 49,684 | 47,464 | ||||||
Adjustments Related to Tax Withholding for Share-based Compensation | $ 700 | $ 700 | $ 600 | ||||||
Proceeds from stock option plan transactions | 5,460 | 3,502 | 7,191 | ||||||
Total intrinsic value of all options exercised | 1,200 | 900 | 1,900 | ||||||
Total grant date fair value of shares vested | 3,300 | 2,400 | 2,900 | ||||||
Stock Options | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Total unrecognized compensation cost nonvested awards | $ 4,400 | ||||||||
Weighted average period, unrecognized compensation cost, nonvested awards | 2 years 10 months | ||||||||
Restricted Stock Units | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Weighted average period, unrecognized compensation cost, nonvested awards | 1 year 4 months | ||||||||
Total unrecognized compensation cost, restricted stock units | $ 5,300 | ||||||||
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 | 1,313,651 | ||||||||
The 2018 Plan | Stock Options | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Expiration period | 7 years | ||||||||
Vesting period | 4 years | ||||||||
The 2016 Plan | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Number of shares authorized | 1,500,000 | ||||||||
The 2016 Plan | Stock Options | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Expiration period | 7 years | ||||||||
Vesting period | 4 years | ||||||||
The 2014 Plan | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Number of shares authorized | 2,250,000 | ||||||||
The 2014 Plan | Stock Options | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Expiration period | 8 years | ||||||||
Vesting period | 4 years | ||||||||
The 2013 Plan | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Number of shares authorized | 1,750,000 | ||||||||
The 2013 Plan | Stock Options | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Expiration period | 8 years | ||||||||
Vesting period | 4 years | ||||||||
The Omnibus Plan | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Number of shares authorized | 5,750,000 | ||||||||
Number of additional shares authorized | 2,500,000 | ||||||||
The Purchase Plan | The Purchase Plan | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Number of shares authorized | 2,800,000 | ||||||||
Proceeds from employee stock purchase plan transactions | $ 1,100 | $ 700 | $ 900 | ||||||
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 | ||||||||
Common shares issued to employees | 125,446 | 72,594 | 103,915 | ||||||
Shares available for future issuance | 315,576 | ||||||||
Director | The 2018 Plan | Restricted Stock Units | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Vesting period | 1 year | ||||||||
Director | The 2016 Plan | Restricted Stock Units | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Vesting period | 1 year | ||||||||
Director | The 2014 Plan | Restricted Stock Units | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Vesting period | 1 year | ||||||||
Director | The 2013 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 | ||||||||
Executives and Employees | The 2016 Plan | Restricted Stock Units | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Vesting period | 4 years | ||||||||
Executives and Employees | The 2014 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 | 12 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock-based compensation before income taxes | $ 4,854 | $ 4,659 | $ 3,649 |
Income tax benefit | (1,017) | (1,536) | (1,185) |
Stock-based compensation after income taxes | 3,837 | 3,123 | 2,464 |
Cost of Sales | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock-based compensation before income taxes | 195 | 213 | 215 |
Sales and Marketing | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock-based compensation before income taxes | 1,492 | 1,348 | 921 |
Research and Development | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock-based compensation before income taxes | 516 | 656 | 590 |
General and Administrative | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock-based compensation before income taxes | $ 2,651 | $ 2,442 | $ 1,923 |
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 | 12 Months Ended |
Sep. 30, 2018USD ($)$ / sharesshares | |
Options Outstanding [Roll Forward] | |
Options Outstanding, Beginning Balance | shares | 3,902 |
Options Outstanding, Granted | shares | 863 |
Options Outstanding, Exercised | shares | (597) |
Options Outstanding, Forfeited / Cancelled | shares | (642) |
Options Outstanding, Ending Balance | shares | 3,526 |
Options Outstanding, Exercisable | shares | 2,245 |
Weighted Average Exercise Price [Roll Forward] | |
Weighted Average Exercise Price, Beginning Balance | $ 10.54 |
Weighted Average Exercise Price, Granted | 10.92 |
Weighted Average Exercise Price, Exercised | 9.14 |
Weighted Average Exercise Price, Forfeited / Cancelled | 12.64 |
Weighted Average Exercise Price, Ending Balance | 10.49 |
Weighted Average Exercise Price, Exercisable | $ 10.09 |
Weighted Average Remaining Contractual Term [Abstract] | |
Weighted Average Remaining Contractual Term, Outstanding | 4 years 2 months 12 days |
Weighted Average Remaining Contractual Term, Exercisable | 3 years 4 months |
Aggregate Intrinsic Value [Abstract] | |
Aggregate Intrinsic Value, Outstanding | $ | $ 10,470 |
Aggregate Intrinsic Value, Exercisable | $ | $ 7,558 |
Closing Stock Price | $ 13.45 |
Stock-Based Compensation (Fair
Stock-Based Compensation (Fair Value Assumptions) (Details) - Stock Options - $ / shares | 12 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted average per option grant date fair value | $ 3.98 | $ 4.63 | $ 3.90 |
Assumptions Used For Options Grants [Abstract] | |||
Risk free interest rate, minimum | 2.12% | 1.46% | 1.22% |
Risk free interest rate, maximum | 2.89% | 1.96% | 1.85% |
Expected term | 6 years | 6 years | 6 years |
Expected volatility rate, minimum | 33.00% | 33.00% | 32.00% |
Expected volatility rate, maximum | 34.00% | 34.00% | 33.00% |
Weighted average volatility | 33.00% | 34.00% | 32.00% |
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Stock-Based Compensation (Exerc
Stock-Based Compensation (Exercise Price Range) (Details) - Stock Options shares in Thousands | 12 Months Ended |
Sep. 30, 2018$ / sharesshares | |
$7.40 - $8.30 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price Range, Lower Range | $ 7.40 |
Exercise Price Range, Upper Range | $ 8.30 |
Options Outstanding | shares | 694 |
Weighted Average Remaining Contractual Term | 3 years 1 month 28 days |
Weighted Average Exercise Price, Options Outstanding | $ 8 |
Number of Shares Vested, Options Exercisable | shares | 604 |
Weighted Average Exercise Price, Options Exercisable | $ 7.97 |
$8.31 - $9.68 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price Range, Lower Range | 8.31 |
Exercise Price Range, Upper Range | $ 9.68 |
Options Outstanding | shares | 551 |
Weighted Average Remaining Contractual Term | 3 years 3 months 7 days |
Weighted Average Exercise Price, Options Outstanding | $ 9.39 |
Number of Shares Vested, Options Exercisable | shares | 515 |
Weighted Average Exercise Price, Options Exercisable | $ 9.42 |
$9.69 - $10.33 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price Range, Lower Range | 9.69 |
Exercise Price Range, Upper Range | $ 10.33 |
Options Outstanding | shares | 644 |
Weighted Average Remaining Contractual Term | 5 years 4 months 17 days |
Weighted Average Exercise Price, Options Outstanding | $ 10.14 |
Number of Shares Vested, Options Exercisable | shares | 129 |
Weighted Average Exercise Price, Options Exercisable | $ 9.89 |
$10.34 - $10.81 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price Range, Lower Range | 10.34 |
Exercise Price Range, Upper Range | $ 10.81 |
Options Outstanding | shares | 554 |
Weighted Average Remaining Contractual Term | 3 years 9 months 15 days |
Weighted Average Exercise Price, Options Outstanding | $ 10.63 |
Number of Shares Vested, Options Exercisable | shares | 421 |
Weighted Average Exercise Price, Options Exercisable | $ 10.72 |
$10.82 - $12.63 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price Range, Lower Range | 10.82 |
Exercise Price Range, Upper Range | $ 12.63 |
Options Outstanding | shares | 523 |
Weighted Average Remaining Contractual Term | 4 years 4 months 10 days |
Weighted Average Exercise Price, Options Outstanding | $ 12 |
Number of Shares Vested, Options Exercisable | shares | 379 |
Weighted Average Exercise Price, Options Exercisable | $ 11.99 |
$12.64 - $13.50 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price Range, Lower Range | 12.64 |
Exercise Price Range, Upper Range | $ 13.50 |
Options Outstanding | shares | 548 |
Weighted Average Remaining Contractual Term | 5 years 6 months 18 days |
Weighted Average Exercise Price, Options Outstanding | $ 13.50 |
Number of Shares Vested, Options Exercisable | shares | 185 |
Weighted Average Exercise Price, Options Exercisable | $ 13.50 |
$7.40 - $14.75 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price Range, Lower Range | 13.51 |
Exercise Price Range, Upper Range | $ 14.75 |
Options Outstanding | shares | 12 |
Weighted Average Remaining Contractual Term | 2 years 9 months 26 days |
Weighted Average Exercise Price, Options Outstanding | $ 14.75 |
Number of Shares Vested, Options Exercisable | shares | 12 |
Weighted Average Exercise Price, Options Exercisable | $ 14.75 |
$7.40 - $14.75 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price Range, Lower Range | 7.40 |
Exercise Price Range, Upper Range | $ 14.75 |
Options Outstanding | shares | 3,526 |
Weighted Average Remaining Contractual Term | 4 years 2 months 23 days |
Weighted Average Exercise Price, Options Outstanding | $ 10.49 |
Number of Shares Vested, Options Exercisable | shares | 2,245 |
Weighted Average Exercise Price, Options Exercisable | $ 10.09 |
Stock-Based Compensation (Non-V
Stock-Based Compensation (Non-Vested Options) (Details) - Restricted Stock Units shares in Thousands | 12 Months Ended |
Sep. 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 | 415 |
Number of Restricted Stock Units, Vested | shares | (207) |
Number of Restricted Stock Units, Canceled | shares | (100) |
Number of Restricted Stock Units, Ending Balance | shares | 674 |
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 | 10.77 |
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 | 11.21 |
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Ending Balance | $ / shares | $ 11.05 |
Common Stock Repurchase (Detail
Common Stock Repurchase (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||
Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | Apr. 24, 2018 | May 02, 2017 | Apr. 26, 2016 | |
Shares repurchased, value | $ 748,000 | $ 938,000 | $ 550,000 | ||||
May 2018 authorized repurchase program | |||||||
Stock repurchase program, authorized amount | $ 20,000,000 | ||||||
Shares repurchased | 0 | ||||||
May 2017 authorized repurchase program | |||||||
Stock repurchase program, authorized amount | $ 20,000,000 | ||||||
Shares repurchased | 28,691 | ||||||
Shares repurchased, value | $ 300,000 | ||||||
April 2016 authorized repurchase program | |||||||
Stock repurchase program, authorized amount | $ 15,000,000 | ||||||
Shares repurchased | 0 |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Defined Contribution Plan Disclosure [Line Items] | |||
Matching contributions, amount | $ 1.6 | $ 1.4 | $ 1.4 |
Defined contribution plan | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Maximum annual contribution per employee percentage | 25.00% | ||
Defined contribution plan | Full Employer Match | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Employers percent of matching contributions | 100.00% | ||
Percent of employees' gross pay for employer match | 3.00% | ||
Defined contribution plan | Half Employer Match | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Employers percent of matching contributions | 50.00% | ||
Percent of employees' gross pay for employer match | 2.00% |
Commitments (Details)
Commitments (Details) $ in Thousands | Sep. 30, 2018USD ($) |
Leases, Operating [Abstract] | |
2,019 | $ 1,986 |
2,020 | 1,675 |
2,021 | 1,235 |
2,022 | 1,054 |
2,023 | 833 |
Thereafter | 1,836 |
Total minimum payments required | $ 8,619 |
Commitments - Additional Inform
Commitments - Additional Information (Details) - USD ($) $ in Thousands | Oct. 31, 2018 | Sep. 30, 2018 |
Operating Leased Assets [Line Items] | ||
Minimum lease obligations | $ 8,619 | |
Subsequent Event | ||
Operating Leased Assets [Line Items] | ||
Term of lease | 13 years | |
Minimum lease obligations | $ 15,900 |
Commitments (Rent Expense) (Det
Commitments (Rent Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Leases, Operating [Abstract] | |||
Rentals | $ 1,735 | $ 1,342 | $ 1,613 |
Less: sublease rentals | 0 | 0 | (46) |
Total rental expense | $ 1,735 | $ 1,342 | $ 1,567 |
Quarterly Financial Data (Detai
Quarterly Financial Data (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||||||||||
Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | ||||||||||
Quarterly Financial Information Disclosure [Abstract] | ||||||||||||||||||||
Revenue | $ 65,662 | $ 62,716 | $ 54,791 | $ 45,197 | $ 45,105 | $ 45,739 | $ 45,615 | $ 45,175 | $ 228,366 | $ 181,634 | $ 203,005 | |||||||||
Gross profit | 30,963 | 29,329 | 26,654 | 21,937 | 21,334 | 22,485 | 21,902 | 21,453 | 108,883 | 87,174 | 99,680 | |||||||||
Net (loss) income | $ 3,608 | [1],[2] | $ 2,621 | [1],[2] | $ (357) | [1],[2] | $ (4,569) | [1],[2] | $ 4,343 | [1],[2] | $ 1,335 | [1],[2] | $ 1,331 | [1],[2] | $ 2,357 | [1],[2] | $ 1,303 | $ 9,366 | $ 16,708 | |
Net (loss) income per common share, basic (USD per share) | $ 0.13 | $ 0.10 | $ (0.01) | $ (0.17) | $ 0.16 | $ 0.05 | $ 0.05 | $ 0.09 | $ 0.05 | $ 0.35 | $ 0.65 | |||||||||
Net (loss) income per common share, diluted (USD per share) | $ 0.13 | $ 0.09 | $ (0.01) | $ (0.17) | $ 0.16 | $ 0.05 | $ 0.05 | $ 0.09 | $ 0.05 | $ 0.35 | $ 0.64 | [3] | ||||||||
[1] | During fiscal 2018, we recorded net tax expenses of $1.5 million and in fiscal 2017, we recorded net tax benefits of $1.0 million, respectively. We recorded tax expense of $2.8 million in the first quarter of fiscal 2018, $0.2 million in the second quarter of fiscal 2018 and $0.1 million in the third quarter of fiscal 2018 resulting from new U.S. tax legislation that was enacted during the first quarter of fiscal 2018 and the adoption of ASU 2016-09 relating to the accounting for the tax effects of stock compensation. In the fourth quarter of fiscal 2018, we recorded a net tax benefit of $1.5 million for the release of a valuation allowance against U.S. federal capital loss carryforward due to expected capital gains tax in fiscal 2019 resulting from the sale of our corporate headquarters building in October 2018 (see Note 18 to the Consolidated Financial Statements) along with U.S., state and foreign prior year true-up provision to return.We recorded a benefit of $0.1 million in the first quarter of fiscal 2017 resulting from reversal of income tax reserves due to the expiration of the statutes of limitation from various U.S. and foreign tax jurisdictions. In the third quarter of fiscal 2017, we recorded a tax benefit of $0.7 million from reversal of income tax reserves due to the expiration of the statutes of limitation from various U.S. and foreign tax jurisdictions. In the fourth quarter of fiscal 2017, we recorded a net tax benefit of $0.2 million, primarily from the reversal of income tax reserves due to the expiration of the statutes of limitation from various U.S. and foreign tax jurisdictions and state and foreign prior year true-up provision to return. | |||||||||||||||||||
[2] | For continuing operations, we recorded business restructuring charges of $0.2 million ($0.1 million after tax) in the third quarter of fiscal 2018 and $0.1 million ($0.1 million after tax) in the fourth quarter of fiscal 2018. We also recorded business restructuring charges of $2.5 million ($1.6 million after tax) in the third quarter of fiscal 2017. | |||||||||||||||||||
[3] | Earnings per share presented are calculated by line item and may not add due to the use of rounded amounts. |
Quarterly Financial Data - Addi
Quarterly Financial Data - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Dec. 31, 2016 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | ||||||||||
Net discrete tax expense (benefits) | $ (1,500) | $ 100 | $ 200 | $ 2,800 | $ (200) | $ (700) | $ (100) | $ 1,500 | $ (1,000) | $ (1,500) |
Restructuring charge | 100 | 200 | 2,500 | $ 504 | $ 2,515 | $ 753 | ||||
Restructuring accrual, net of tax | $ 100 | $ 100 | $ 1,600 |
Subsequent Event (Details)
Subsequent Event (Details) $ in Thousands | Oct. 02, 2018USD ($)ft² | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Oct. 31, 2018USD ($)ft² |
Subsequent Event [Line Items] | |||||||
Assets held for sale | $ 5,220 | $ 5,220 | $ 0 | ||||
Tax benefit related to disposal | 1,100 | ||||||
Gain on sale of property, equipment and improvements | 622 | $ 0 | $ 0 | ||||
Minimum lease obligations | $ 8,619 | $ 8,619 | |||||
Subsequent Event | |||||||
Subsequent Event [Line Items] | |||||||
Term of lease | 13 years | ||||||
Minimum lease obligations | $ 15,900 | ||||||
Area of lease (in sqft) | ft² | 59,497 | ||||||
Minnetonka, MN | Subsequent Event | |||||||
Subsequent Event [Line Items] | |||||||
Area of real estate sold (in sqft) | ft² | 130,000 | ||||||
Proceeds from sale of building | $ 10,000 | ||||||
Forecast | |||||||
Subsequent Event [Line Items] | |||||||
Gain on sale of property, equipment and improvements | $ 4,500 | ||||||
Gain on sale of property, equipment and improvements, net of deferred taxes | $ 3,400 |
Schedule II - Valuation and Q_2
Schedule II - Valuation and Qualifying Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | |||||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2016 | ||||
Valuation allowance - deferred tax assets | ||||||
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items] | ||||||
Balance at beginning of period | $ 5,952 | $ 5,914 | $ 862 | |||
Charged to costs and expenses | 521 | 136 | 5,260 | |||
Charged to Other Accounts | 0 | 0 | 0 | |||
Deductions | 3,182 | 98 | 208 | |||
Balance at end of period | 3,291 | 5,952 | 5,914 | |||
Valuation account - doubtful accounts | ||||||
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items] | ||||||
Balance at beginning of period | 341 | 209 | 285 | |||
Charged to costs and expenses | 729 | 127 | 10 | |||
Charged to Other Accounts | 40 | [1] | 20 | [2] | 0 | |
Deductions | [3] | 37 | 15 | 86 | ||
Balance at end of period | 1,073 | 341 | 209 | |||
Reserve for future returns and pricing adjustments | ||||||
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items] | ||||||
Balance at beginning of period | 2,169 | 1,991 | 1,817 | |||
Charged to costs and expenses | 10,715 | 10,447 | 9,946 | |||
Charged to Other Accounts | 0 | 0 | 0 | |||
Deductions | 10,324 | 10,269 | 9,772 | |||
Balance at end of period | $ 2,560 | $ 2,169 | $ 1,991 | |||
[1] | Established through purchase accounting relating to the acquisition of TempAlert | |||||
[2] | Established through purchase accounting relating to the acquisition of SMART Temps® | |||||
[3] | Uncollectible accounts charged against allowance, net of recoveries |