Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Mar. 31, 2019 | Apr. 30, 2019 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | DIGI INTERNATIONAL INC. | |
Entity Central Index Key | 0000854775 | |
Current Fiscal Year End Date | --09-30 | |
Entity Filer Category | Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q2 | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 28,059,217 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Mar. 31, 2019 | Mar. 31, 2018 | [1] | Mar. 31, 2019 | Mar. 31, 2018 | [1] | |
Revenue: | ||||||
Total Revenue | $ 65,764 | $ 54,548 | $ 128,077 | $ 99,503 | ||
Cost of sales: | ||||||
Amortization of intangibles | 725 | 770 | 1,465 | 1,377 | ||
Total cost of sales | 35,435 | 27,714 | 67,965 | 50,710 | ||
Gross profit | 30,329 | 26,834 | 60,112 | 48,793 | ||
Operating expenses: | ||||||
Sales and marketing | 11,534 | 11,175 | 23,191 | 20,935 | ||
Research and development | 9,569 | 8,617 | 19,087 | 16,368 | ||
General and administrative | 8,441 | 6,224 | 11,558 | 12,671 | ||
Restructuring reversal | 0 | 0 | (67) | 0 | ||
Total operating expenses | 29,544 | 26,016 | 53,769 | 49,974 | ||
Operating income (loss) | 785 | 818 | 6,343 | (1,181) | ||
Other income (expense), net: | ||||||
Interest income | 144 | 38 | 352 | 246 | ||
Interest expense | (2) | (4) | (94) | (7) | ||
Other income (expense), net | 257 | (527) | 305 | (572) | ||
Total other income (expense), net | 399 | (493) | 563 | (333) | ||
Income (loss) before income taxes | 1,184 | 325 | 6,906 | (1,514) | ||
Income tax (benefit) expense | (158) | 451 | 882 | 3,099 | ||
Net income (loss) | $ 1,342 | $ (126) | $ 6,024 | $ (4,613) | ||
Basic net income (loss) per common share: | ||||||
Net income (loss), basic (USD per share) | $ 0.05 | $ 0 | $ 0.22 | $ (0.17) | ||
Diluted net income (loss) per common share | ||||||
Net income (loss), diluted (USD per share) | $ 0.05 | $ 0 | $ 0.21 | $ (0.17) | ||
Weighted average common shares: | ||||||
Basic (shares) | 27,866 | 27,084 | 27,687 | 26,914 | ||
Diluted (shares) | 28,438 | 27,084 | 28,289 | 26,914 | ||
Product | ||||||
Revenue: | ||||||
Revenue | $ 52,097 | $ 47,588 | $ 102,909 | $ 86,042 | ||
Cost of sales: | ||||||
Cost of sales excluding amortization | 28,496 | 23,080 | 54,309 | 42,290 | ||
Services and Solutions | ||||||
Revenue: | ||||||
Revenue | 13,667 | 6,960 | 25,168 | 13,461 | ||
Cost of sales: | ||||||
Cost of sales excluding amortization | $ 6,214 | $ 3,864 | $ 12,191 | $ 7,043 | ||
[1] | Prior period information has been restated for the adoption of ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which we adopted on October 1, 2018. |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||||
Mar. 31, 2019 | Mar. 31, 2018 | [1] | Mar. 31, 2019 | Mar. 31, 2018 | [1] | ||
Statement of Comprehensive Income [Abstract] | |||||||
Net income (loss) | $ 1,342 | $ (126) | $ 6,024 | $ (4,613) | |||
Other comprehensive (loss) income, net of tax: | |||||||
Foreign currency translation adjustment | (83) | 1,787 | (1,652) | 2,058 | |||
Change in net unrealized gain (loss) on investments | 9 | (19) | 14 | (40) | |||
Less income tax (expense) benefit | (2) | 5 | (4) | 8 | |||
Reclassification of realized loss on investments included in net income | [2] | 0 | 31 | 0 | 31 | ||
Less income tax benefit | [3] | 0 | (8) | 0 | (8) | ||
Other comprehensive (loss) income, net of tax | (76) | 1,796 | (1,642) | 2,049 | |||
Comprehensive income (loss) | $ 1,266 | $ 1,670 | $ 4,382 | $ (2,564) | |||
[1] | Prior period information has been restated for the adoption of ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which we adopted on October 1, 2018. | ||||||
[2] | Recorded in Other income (expense), net in our Condensed Consolidated Statements of Operations. | ||||||
[3] | Recorded in Income tax (benefit) expense in our Condensed Consolidated Statements of Operations. |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2019 | Sep. 30, 2018 | |
Current assets: | |||
Cash and cash equivalents | $ 69,593 | $ 58,014 | [1] |
Marketable securities | 2,497 | 4,736 | [1] |
Accounts receivable, net | 53,493 | 49,819 | [1] |
Inventories | 44,035 | 41,644 | [1] |
Other current assets | 5,549 | 2,613 | [1] |
Assets held for sale | 0 | 5,220 | [1] |
Total current assets | 175,167 | 162,046 | [1] |
Property, equipment and improvements, net | 13,926 | 8,354 | [1] |
Intangible assets, net | 34,807 | 39,320 | [1] |
Goodwill | 154,049 | 154,535 | [1] |
Deferred tax assets | 5,236 | 6,600 | [1] |
Other non-current assets | 350 | 1,291 | [1] |
Total assets | 383,535 | 372,146 | [1] |
Current liabilities: | |||
Accounts payable | 14,628 | 12,911 | [1] |
Accrued compensation | 6,991 | 8,190 | [1] |
Unearned revenue | 6,576 | 3,177 | [1] |
Contingent consideration on acquired businesses | 8,527 | 5,890 | [1] |
Other current liabilities | 4,369 | 5,405 | [1] |
Total current liabilities | 41,091 | 35,573 | [1] |
Income taxes payable | 759 | 851 | [1] |
Deferred tax liabilities | 317 | 334 | [1] |
Contingent consideration on acquired businesses | 0 | 4,175 | [1] |
Other non-current liabilities | 530 | 720 | [1] |
Total liabilities | 42,697 | 41,653 | [1] |
Contingencies (see Note 13) | |||
Stockholders' equity: | |||
Preferred stock, $.01 par value; 2,000,000 shares authorized; none issued and outstanding | 0 | 0 | [1] |
Common stock, $.01 par value; 60,000,000 shares authorized; 34,471,378 and 33,812,838 shares issued | 345 | 338 | [1] |
Additional paid-in capital | 262,392 | 255,936 | [1] |
Retained earnings | 157,985 | 151,961 | [1] |
Accumulated other comprehensive loss | (25,168) | (23,526) | [1] |
Treasury stock, at cost, 6,412,682 and 6,385,336 shares | (54,716) | (54,216) | [1] |
Total stockholders' equity | 340,838 | 330,493 | [1] |
Total liabilities and stockholders' equity | $ 383,535 | $ 372,146 | [1] |
[1] | Prior period information has been restated for the adoption of ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which we adopted on October 1, 2018. |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Mar. 31, 2019 | Sep. 30, 2018 |
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 | 34,471,378 | 33,812,838 |
Treasury stock, shares | 6,412,682 | 6,385,336 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |||
Mar. 31, 2019 | Mar. 31, 2018 | |||
Operating activities: | ||||
Net income (loss) | $ 6,024 | $ (4,613) | [1] | |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||||
Depreciation of property, equipment and improvements | 2,217 | 1,546 | [1] | |
Amortization of intangible assets | 4,609 | 4,287 | [1] | |
Stock-based compensation | 2,707 | 2,378 | [1] | |
Deferred income tax provision | 1,338 | 2,808 | [1] | |
Gain on sale of property and equipment | (4,395) | 5 | [1] | |
Change in fair value of contingent consideration | 810 | (425) | [1] | |
Provision for bad debt and product returns | 568 | 395 | [1] | |
Provision for inventory obsolescence | 900 | 900 | [1] | |
Restructuring reversal | (67) | 0 | [1] | |
Other | (116) | 25 | [1] | |
Changes in operating assets and liabilities (net of acquisitions) | (8,393) | (12,287) | [1] | |
Net cash provided by (used in) operating activities | 6,202 | (4,981) | [1] | |
Investing activities: | ||||
Proceeds from maturities and sales of marketable securities | 2,252 | 29,513 | [1] | |
Proceeds from sale of business | 0 | 2,000 | [1] | |
Acquisition of businesses, net of cash acquired | 0 | (56,588) | [1] | |
Proceeds from sale of property and equipment | 10,047 | 0 | [1] | |
Purchase of property, equipment, improvements and certain other intangible assets | (7,346) | (785) | [1] | |
Net cash provided by (used in) investing activities | 4,953 | (25,860) | [1] | |
Financing activities: | ||||
Acquisition earn-out payments | (2,348) | 0 | [1] | |
Proceeds from stock option plan transactions | 3,751 | 3,427 | [1] | |
Proceeds from employee stock purchase plan transactions | 549 | 618 | [1] | |
Purchases of common stock | (1,044) | (681) | [1] | |
Net cash provided by financing activities | 908 | 3,364 | [1] | |
Effect of exchange rate changes on cash and cash equivalents | (484) | 1,646 | [1] | |
Net increase (decrease) in cash and cash equivalents | 11,579 | (25,831) | [1] | |
Cash and cash equivalents, beginning of period | [1] | 58,014 | 78,222 | |
Cash and cash equivalents, end of period | 69,593 | 52,391 | [1] | |
Supplemental schedule of non-cash investing and financing activities | ||||
Transfer of inventory to property, equipment and improvements | (654) | (827) | [1] | |
Liability related to acquisition of business | 0 | (2,300) | [1] | |
Accrual for purchase of property, equipment, improvements and certain other intangible assets | $ (20) | $ (27) | [1] | |
[1] | Prior period information has been restated for the adoption of ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which we adopted on October 1, 2018. |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) Condensed 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 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Cumulative-effect adjustment from adoption of ASU 2016-09 | ASU 2016-09 | $ 19 | $ 52 | $ (33) | ||||||
Beginning balance (in shares) at Sep. 30, 2017 | 33,008 | 6,437 | |||||||
Beginning balance at Sep. 30, 2017 | 319,029 | [1] | $ 330 | $ (54,533) | 245,528 | 150,363 | [1] | $ (22,659) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income (loss) | [1] | (4,613) | (4,613) | ||||||
Other comprehensive income (loss) | 2,049 | [1] | 2,049 | ||||||
Employee stock purchase issuances (in shares) | (74) | ||||||||
Employee stock purchase issuances | 618 | $ 631 | (13) | ||||||
Repurchase of common stock (in shares) | 68 | ||||||||
Repurchase of common stock | (681) | $ (681) | |||||||
Issuance of stock under stock award plans (in shares) | 573 | ||||||||
Issuance of stock under stock award plans | 3,427 | $ 6 | 3,421 | ||||||
Stock-based compensation expense | 2,378 | 2,378 | |||||||
Ending balance (in shares) at Mar. 31, 2018 | 33,581 | 6,431 | |||||||
Ending balance at Mar. 31, 2018 | 322,226 | [1] | $ 336 | $ (54,583) | 251,366 | 145,717 | [1] | (20,610) | |
Beginning balance (in shares) at Sep. 30, 2018 | 33,813 | 6,385 | |||||||
Beginning balance at Sep. 30, 2018 | 330,493 | [1] | $ 338 | $ (54,216) | 255,936 | 151,961 | [1] | (23,526) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income (loss) | 6,024 | 6,024 | |||||||
Other comprehensive income (loss) | (1,642) | (1,642) | |||||||
Employee stock purchase issuances (in shares) | (63) | ||||||||
Employee stock purchase issuances | 549 | $ 544 | 5 | ||||||
Repurchase of common stock (in shares) | 91 | ||||||||
Repurchase of common stock | (1,044) | $ (1,044) | |||||||
Issuance of stock under stock award plans (in shares) | 658 | ||||||||
Issuance of stock under stock award plans | 3,751 | $ 7 | 3,744 | ||||||
Stock-based compensation expense | 2,707 | 2,707 | |||||||
Ending balance (in shares) at Mar. 31, 2019 | 34,471 | 6,413 | |||||||
Ending balance at Mar. 31, 2019 | $ 340,838 | $ 345 | $ (54,716) | $ 262,392 | $ 157,985 | $ (25,168) | |||
[1] | Prior period information has been restated for the adoption of ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which we adopted on October 1, 2018. |
Basis of Presentation of Unaudi
Basis of Presentation of Unaudited Interim Condensed Consolidated Financial Statements and Significant Accounting Policies | 6 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
BASIS OF PRESENTATION OF UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND SIGNIFICANTACCOUNTING POLICIES | BASIS OF PRESENTATION OF UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The unaudited condensed consolidated financial statements of Digi International Inc. (“we”, “us”, “our”, “Digi” or “the Company”) have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission applicable to interim financial statements. While these financial statements reflect all normal recurring adjustments that are, in the opinion of management, necessary for fair presentation of the results of the interim period, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles (“GAAP”) for complete financial statements. These financial statements should be read in conjunction with the financial statement disclosures in our Annual Report on Form 10-K for the year ended September 30, 2018 (the “2018 Financial Statements”). We use the same accounting policies in preparing quarterly and annual financial statements. The quarterly results of operations are not necessarily indicative of the results to be expected for the full year. Significant Accounting Policies Update Effective October 1, 2018, we adopted Accounting Standard Update (“ASU”) 2014-09, Revenue from Contracts with Customers (Topic 606) as discussed below. All amounts and disclosures set forth in this Form 10-Q have been updated to comply with the new standards, as indicated by the “as adjusted” footnote. Except for the accounting policy for revenue recognition that was updated as a result of adopting ASU 2014-09, there have been no other changes to our significant accounting policies described in our 2018 Financial Statements. Revenue Recognition We recognize hardware product revenue upon transfer of control of goods or services to customers in an amount that reflects the consideration we expect to receive in exchange for those goods or services. We determine the amount of revenue to be recognized through application of the following steps: • Identification of the contract, or contracts with a customer; • Identification of the performance obligations in the contract; • Determination of the transaction price; • Allocation of the transaction price to the performance obligations in the contract; and • Recognition of revenue when or as we satisfy the performance obligations. Hardware Product Revenue and SmartSense by Digi ™ Equipment Revenue and Associated Installation Fees Our hardware product revenue is derived primarily from the sale of wired and wireless hardware products to our distributors and Direct/Original Equipment Manufacturer (“OEM”) customers. Product revenue generally is recognized upon shipment of product to customers. Sales to authorized domestic distributors and Direct/OEM customers 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 sales are recorded. Material differences between the historical trends used to determine estimated reserves and actual returns and pricing adjustments could result in a material change to our consolidated results of operations or financial position. We have applied consistent methodologies for estimating reserves for future returns and pricing adjustments for all periods presented. Our SmartSense by Digi ™ equipment revenue is recorded as an up-front sale at its stand-alone selling price because the customer could utilize our equipment with other monitoring services or could use our monitoring services with hardware purchased from other vendors. Our installation charges are recorded when the product is installed. 1. BASIS OF PRESENTATION OF UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Subscription and Support Services Revenue Our SmartSense by Digi ™ subscription revenue is recorded on a monthly basis. These subscriptions are generally in a range from one to 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 derive service revenue from our Digi Remote Manager ® , a platform-as-a-service (“PaaS”) offering, whereby customers pay for services consumed based on the number of devices being managed or monitored. This revenue is recognized over the life of the service term. Digi Support Services revenues are recognized over the life of the support contract. Some of Digi Support Services revenue is for training and this revenue is recognized as the services are performed. Professional Services Revenue Professional services revenue is derived from our Digi Wireless Design Services contracts on either on a time-and-materials or a fixed-fee basis. These revenues are recognized as the services are performed for time-and-materials contracts, or when milestones are achieved and accepted by the customer for fixed-fee contracts. Contracts with Multiple Performance Obligations SmartSense by Digi ™ revenues typically are derived from contracts with multiple performance obligations. These obligations may include: delivery of monitoring equipment that the customer either purchases out-right or uses while we retain ownership, monitoring services, providing condition alerts of assets being monitored, and recertification of sensor equipment. When we retain ownership of the equipment, we charge an implementation fee to the customer so they can begin using the equipment. In these instances, all revenue derived from the above obligations is recognized over the subscription term of the contract. If the customer purchases the equipment out-right, that portion of the revenue is recognized at the stand-alone selling price at the time the equipment is shipped and all other revenue is recognized over the subscription term of the contract. We have made an accounting policy election to exclude from the measurement of our revenues any sales or similar taxes we collect from customers. Recently Issued Accounting Pronouncements Adopted In January 2017, the Financial Accounting Standards Board (“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 our fiscal year ending September 30, 2021. Early adoption is permitted. This ASU was early adopted by us on October 1, 2018 and did not have an impact on our consolidated financial statements. In May 2017, FASB issued ASU 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting . ASU 2017-09 provided 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 are to be applied prospectively to an award modified on or after the adoption date. This ASU was effective for us this first fiscal quarter ending December 31, 2018. This ASU was adopted by us on October 1, 2018 and did not have an impact 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 was effective for us this first fiscal quarter ending December 31, 2018. This ASU was adopted by us on October 1, 2018 and did not have an impact 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 requires equity investments in unconsolidated entities (other than those 1. BASIS OF PRESENTATION OF UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 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 also simplify the impairment assessment of equity investments without readily determinable fair values. This ASU also has changed the presentation and disclosure requirements for financial instruments. In addition, this ASU has clarified 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 were effective for our first fiscal quarter ending December 31, 2018. This ASU was adopted by us on October 1, 2018 and did not have an impact on our consolidated financial statements. In May 2014, FASB issued ASU 2014-09, Revenue from Contracts with Customers (“Topic 606”) . This standard requires that revenue is recognized for 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. It also establishes timing associated with recognizing revenues and amortizing costs, associated with contracts. FASB has issued several amendments to ASU 2014-09, including clarifications on disclosure of prior-period performance obligations and remaining performance obligations. The guidance permits two methods of adoption, one of which is to retrospectively adjust results for each prior reporting period presented. We elected to adopt the standard using this method effective October 1, 2018. We have described how we recognize revenue in the aforementioned revenue recognition policy. Relative to the amortization of costs there are two impacts to our financial statements. First, in instances where we retain ownership of equipment a customer uses, we charge an implementation fee to the customer so they can begin using the equipment. We amortize this cost of the equipment over its useful life (typically three years). Second, we capitalize and amortize commissions paid to sales personnel or agents on service contracts. If the commissions earned during an accounting period exceed our capitalization threshold, they will be amortized over the calculated average expected life of the pool of contracts closed during that period. To ease our transition in the adoption of Topic 606, we have elected several practical expedients outlined in the new accounting guidance: • We have not disclosed the remaining transaction price for reporting periods prior to the first quarter of fiscal 2019. • For completed contracts that have variable consideration, we will use the as-invoiced amount for all of our time and materials contracts and contracts relating to Digi Remote Manager ® in instances where the contracts do not include free service. • We will expense incremental costs of obtaining a contract when incurred if the amortization period of the asset is one year or less. The adoption of the standard related to the new revenue recognition impacted our reported results as follows: Three months ended March 31, 2018 (in thousands, except per common share data) As Reported Impact of Adoption As Adjusted Revenue: Product $ 47,588 $ — $ 47,588 Services and solutions 7,203 (243 ) 6,960 Total revenue 54,791 (243 ) 54,548 Cost of sales: Cost of product 23,080 — 23,080 Cost of services and solutions 4,287 (423 ) 3,864 Amortization of intangibles 770 — 770 Total cost of sales 28,137 (423 ) 27,714 Gross profit 26,654 180 26,834 Operating expenses 26,151 (135 ) 26,016 Operating income $ 503 $ 315 $ 818 Net (loss) income $ (357 ) $ 231 $ (126 ) Diluted (loss) income per share $ (0.01 ) $ 0.01 $ — 1. BASIS OF PRESENTATION OF UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Six months ended March 31, 2018 (in thousands, except per common share data) As Reported Impact of Adoption As Adjusted Revenue: Product $ 86,042 $ — $ 86,042 Services and solutions 13,946 (485 ) 13,461 Total revenue 99,988 (485 ) 99,503 Cost of sales: Cost of product 42,290 — 42,290 Cost of services and solutions 7,730 (687 ) 7,043 Amortization of intangibles 1,377 — 1,377 Total cost of sales 51,397 (687 ) 50,710 Gross profit 48,591 202 48,793 Operating expenses 50,211 (237 ) 49,974 Operating (loss) income $ (1,620 ) $ 439 $ (1,181 ) Net (loss) income $ (4,926 ) $ 313 $ (4,613 ) Diluted (loss) income per share $ (0.18 ) $ 0.01 $ (0.17 ) September 30, 2018 (in thousands) As Reported Impact of Adoption As Adjusted Accounts receivable, net $ 50,817 $ (998 ) $ 49,819 Property, equipment and improvements, net $ 6,270 $ 2,084 $ 8,354 Deferred tax assets $ 6,665 $ (65 ) $ 6,600 Unearned revenue current $ 2,579 $ 598 $ 3,177 Other non-current liabilities $ 510 $ 210 $ 720 Retained earnings $ 151,748 $ 213 $ 151,961 Adoption of the standards related to revenue recognition had no impact to total cash provided by or used in operating, financing or investing on our historical Condensed Consolidated Statements of Cash Flows. Not Yet Adopted In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, which clarifies the accounting for implementation costs in cloud computing arrangements. ASU 2018-15 is effective for us in the first quarter ending December 31, 2020. Early adoption is permitted. We are evaluating when to adopt, and the impact of the adopting, ASU 2018-15 on our consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement - Disclosure Framework (Topic 820). The updated guidance improves the disclosure requirements on fair value measurements. The updated guidance is effective for us in the first quarter ending December 31, 2020. Early adoption is permitted for any removed or modified disclosures. We are evaluating when to adopt and the impact of adopting, ASU 2018-13 on 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 us in 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. 1. BASIS OF PRESENTATION OF UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 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 us in the first quarter ending December 31, 2020. Entities may early adopt beginning after December 15, 2018. We are evaluating the impact of adopting ASU 2016-13 on our consolidated financial statements. In February 2016, FASB issued ASU 2016-02, Leases (Topic 842) , which amends the existing guidance and requires lessees to recognize lease assets and lease liabilities on the balance sheet for leases with a term longer than 12 months that are classified as operating leases under previous authoritative guidance. The lease liability will be equal to the present value of lease payments and the right-of-use asset will be based on the lease liability, subject to adjustment for certain items. In July 2018, FASB issued two additional amendments that affect this guidance described in the following updates ASU 2018-10, Codification Improvements to Topic 842, Leases and ASU 2018-11, Leases (Topic 842): Targeted Improvements . The amendments in ASU 2018-10 affect narrow aspects of the guidance issued in ASU 2016-02. The amendments in ASU 2018-11 provide an alternative (and optional) transition method that allows entities to apply the transition provisions in ASU 2016-02 at the adoption date instead of at the earliest comparative period presented in the financial statements. ASU 2016-02 is effective for us, using the modified retrospective approach, the first fiscal quarter ending December 31, 2019. Early adoption is permitted. As noted above, ASU 2018-11 provides for an additional and optional transition method. We plan to apply the optional transition method at the adoption date and are evaluating the impact of adopting ASU 2016-02 on our consolidated financial statements. |
Acquisition
Acquisition | 6 Months Ended |
Mar. 31, 2019 | |
Business Combinations [Abstract] | |
ACQUISITIONS | 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, for cash of $16.4 million (excluding cash acquired of $0.2 million ) and future earn-out payments. Accelerated’s results have been included in our consolidated financial statements within the IoT Products and Services segment since the date of acquisition. Purchase accounting related to the acquisition of Accelerated was finalized during the fourth quarter of fiscal 2018. 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 was 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”). If certain revenue thresholds are met, the cumulative amount of these earn-outs will be $4.5 million . 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 $5.4 million at March 31, 2019 , which includes $3.5 million to be paid for the 2018 period (see Note 6 to the consolidated financial statements). 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 for cash of $40.7 million (excluding cash acquired of $0.6 million ) and future earn-out payments. TempAlert’s results have been included in our consolidated financial statements within the IoT Solutions segment since the date of acquisition. Purchase accounting related to the acquisition was finalized during the first quarter of fiscal 2019. The first earn-out payments was schedules to be paid after December 31, 2018 and the second earn-out payment is scheduled to be paid after December 31, 2019 which is the end of the earn-out periods. No payment was earned for the period ended December 31, 2018. The cumulative amount of the remaining earn-outs for the periods ended December 31, 2019, will not exceed $45.0 million . The fair value of the remaining contingent consideration was zero at March 31, 2019 (see Note 6 to the consolidated financial statements). |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | EARNINGS PER SHARE The following table is a reconciliation of the numerators and denominators in the net income (loss) per common share calculations (in thousands, except per common share data): Three months ended March 31, Six months ended March 31, 2019 2018 2019 2018 Numerator: Net income (loss) $ 1,342 $ (126 ) $ 6,024 $ (4,613 ) Denominator: Denominator for basic net income (loss) per common share — weighted average shares outstanding 27,866 27,084 27,687 26,914 Effect of dilutive securities: Stock options and restricted stock units 572 — 602 — Denominator for diluted net income (loss) per common share — adjusted weighted average shares 28,438 27,084 28,289 26,914 Net income (loss) per common share, basic $ 0.05 $ — $ 0.22 $ (0.17 ) Net income (loss) per common share, diluted $ 0.05 $ — $ 0.21 $ (0.17 ) *Prior period information has been restated for the adoption of ASU No. 2014-09, “ Revenue from Contracts with Customers (Topic 606), ” which we adopted on October 1, 2018. For the three months ended March 31, 2019 and 2018 , there were 633,752 and 1,458,297 potentially dilutive shares, respectively, and for the six months ended March 31, 2019 and 2018 , there were 683,752 and 1,988,673 potentially dilutive shares, respectively, related to stock options to purchase common shares that were not included in the above computation of diluted earnings per common share since the options’ exercise prices were greater than the average market price of our common shares. In addition, due to the net loss for the three and six month periods ended March 31, 2018 , there were 275,522 and 333,801 , respectively, common stock options and restricted stock units that were not included in the above computation of diluted earnings per share. |
Selected Balance Sheet Data
Selected Balance Sheet Data | 6 Months Ended |
Mar. 31, 2019 | |
Selected Balance Sheet Data [Abstract] | |
SELECTED BALANCE SHEET DATA | SELECTED BALANCE SHEET DATA The following table shows selected balance sheet data (in thousands): March 31, September 30, 2018 Accounts receivable, net: Accounts receivable $ 57,502 $ 53,164 Less allowance for doubtful accounts 1,271 785 Less reserve for future returns and pricing adjustments 2,738 2,560 Accounts receivable, net $ 53,493 $ 49,819 Inventories: Raw materials $ 17,008 $ 22,047 Work in process 1,119 525 Finished goods 25,908 19,072 Inventories $ 44,035 $ 41,644 *Prior period information has been restated for the adoption of ASU No. 2014-09, “ Revenue from Contracts with Customers (Topic 606), ” which we adopted on October 1, 2018. |
Marketable Securities
Marketable Securities | 6 Months Ended |
Mar. 31, 2019 | |
Marketable Securities [Abstract] | |
MARKETABLE SECURITIES | MARKETABLE SECURITIES Our marketable securities historically consist of certificates of deposit, commercial paper, corporate bonds and government municipal bonds. As of March 31, 2019 , all of our securities that we held were trading below our amortized cost basis. We determined each decline in value to be temporary in nature. At March 31, 2019 our marketable securities were (in thousands): Amortized Cost (1) Unrealized Gains Unrealized Losses Fair Value (1) Current marketable securities: Certificates of deposit $ 2,503 $ — $ (6 ) $ 2,497 Total marketable securities $ 2,503 $ — $ (6 ) $ 2,497 (1) Included in amortized cost and fair value is purchased and accrued interest of $3 . At September 30, 2018 our marketable securities were (in thousands): Amortized Cost (1) Unrealized Gains Unrealized Losses Fair Value (1) Current marketable securities: Certificates of deposit $ 4,756 $ — $ (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 . The following tables show the fair values and gross unrealized losses of our available-for-sale marketable securities that have been in a continuous unrealized loss position deemed to be temporary, aggregated by investment category (in thousands): March 31, 2019 Less than 12 Months More than 12 Months Fair Value Unrealized Losses Fair Value Unrealized Losses Certificates of deposit $ — $ — $ 2,497 $ (6 ) Total $ — $ — $ 2,497 $ (6 ) 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 ) |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS Financial assets and liabilities are classified in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement: Level 1 (unadjusted quoted prices in active markets for identical assets or liabilities); Level 2 (observable market inputs, other than quoted prices included in Level 1); and Level 3 (unobservable inputs that cannot be corroborated by observable market data). The following tables provide information by level for financial assets and liabilities that are measured at fair value on a recurring basis (in thousands): Total Fair Value at Fair Value Measurements Using Inputs Considered as March 31, 2019 Level 1 Level 2 Level 3 Assets: Money market $ 27,883 $ 27,883 $ — $ — Certificates of deposit 2,497 — 2,497 — Total assets measured at fair value $ 30,380 $ 27,883 $ 2,497 $ — Liabilities: Contingent consideration on acquired businesses $ 8,527 $ — $ — $ 8,527 Total liabilities measured at fair value $ 8,527 $ — $ — $ 8,527 Total Fair Value at Fair Value Measurements Using Inputs Considered as September 30, 2018 Level 1 Level 2 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 businesses $ 10,065 $ — $ — $ 10,065 Total liabilities measured at fair value $ 10,065 $ — $ — $ 10,065 In connection with the October 2015 acquisition of Bluenica Corporation (“Bluenica”), we may be 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 consideration recognized was $10.4 million upon acquisition and was $3.2 million at March 31, 2019 . We paid $0.5 million in fiscal 2017, no payments in fiscal 2018 and $2.2 million in the second quarter of fiscal 2019. In connection with the November 2016 acquisition of FreshTemp, LLC (“FreshTemp”), we were 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 for consideration recognized upon acquisition was $1.3 million . We made a final payment of $0.2 million during the first quarter of fiscal 2019. In connection our acquisition of TempAlert, we agreed 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 (see Note 2 to the consolidated financial statements). The fair value of the liability for contingent consideration was zero , both upon acquisition and at March 31, 2019 . In connection with our acquisition of Accelerated, we agreed to make contingent payments, based upon certain thresholds (see Note 2 to the consolidated financial statements). The fair values of the liability for contingent consideration recognized upon acquisition of Accelerated and at March 31, 2019 were $2.3 million and $5.4 million , respectively. The increase was a result of Accelerated outperforming initial revenue expectations. 6. 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): Three months ended March 31, Six months ended March 31, 2019 2018 2019 2018 Fair value at beginning of period $ 10,147 $ 5,981 $ 10,065 $ 6,388 Purchase price contingent consideration — 2,300 — 2,300 Contingent consideration payments (2,187 ) — (2,348 ) — Change in fair value of contingent consideration 567 (18 ) 810 (425 ) Fair value at end of period $ 8,527 $ 8,263 $ 8,527 $ 8,263 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 at March 31, 2019 based on the probability of achieving the specified revenue thresholds at a range of 95.0% to 100.0% for Bluenica, 0% for TempAlert, and 70.0% for Accelerated. A significant change in our estimates of achieving the relevant targets could materially change the fair value of the contingent consideration liability. |
Goodwill and Other Identifiable
Goodwill and Other Identifiable Intangible Assets, Net | 6 Months Ended |
Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER IDENTIFIABLE INTANGIBLE ASSETS, NET | GOODWILL AND OTHER INTANGIBLE ASSETS, NET Amortizable intangible assets were (in thousands): March 31, 2019 September 30, 2018 Gross carrying amount Accum. amort. Net Gross carrying amount Accum. amort. Net Purchased and core technology $ 58,011 $ (49,938 ) $ 8,073 $ 58,102 $ (48,693 ) $ 9,409 License agreements 102 (60 ) 42 102 (46 ) 56 Patents and trademarks 15,835 (12,777 ) 3,058 15,701 (12,242 ) 3,459 Customer relationships 46,530 (23,226 ) 23,304 46,605 (21,049 ) 25,556 Non-compete agreements 600 (270 ) 330 600 (210 ) 390 Order backlog 1,800 (1,800 ) — 1,800 (1,350 ) 450 Total $ 122,878 $ (88,071 ) $ 34,807 $ 122,910 $ (83,590 ) $ 39,320 Amortization expense was $2.1 million and $2.6 million for the three month periods ended March 31, 2019 and 2018, respectively, and $4.6 million and $4.3 million for the six month periods ended March 31, 2019 and 2018 , respectively. Amortization expense is recorded on our consolidated statements of operations within cost of sales and in general and administrative expense. Estimated amortization expense related to intangible assets for the remainder of fiscal 2019 and the five succeeding fiscal years is (in thousands): 2019 (six months) $ 4,193 2020 8,237 2021 7,430 2022 6,568 2023 4,392 2024 3,701 7. GOODWILL AND OTHER IDENTIFIABLE INTANGIBLE ASSETS, NET (CONTINUED) The changes in the carrying amount of goodwill by reportable segments are (in thousands): Six Months Ended March 31, 2019 IoT Products and Services IoT Solutions Total Beginning balance, October 1 $ 104,358 $ 50,177 $ 154,535 Acquisitions — — — Foreign currency translation adjustment (122 ) (364 ) (486 ) Ending balance, March 31 $ 104,236 $ 49,813 $ 154,049 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. As we have two reportable operating segments, we concluded that the IoT Solutions segment and the IoT Products & Services segment each constitute a separate reporting unit for purposes of the ASC 350-20-35 “Goodwill Measurement of Impairment” assessment. As such, both units were tested individually for impairment. Our test for potential goodwill impairment is a two-step approach. We first assess qualitative factors to determine whether the existence of events or circumstances to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying value. If we determine based on this assessment that it is more likely than not that the fair value of a reporting units is less than its carrying amount, we perform the goodwill impairment test. This test requires us to determine the fair value of the reporting unit and compare it to the carrying amount, including goodwill, of such reporting unit. If the fair value exceeds the carrying amount, no impairment loss is recognized. However, if the carrying amount of the reporting unit exceeds its fair value, the goodwill of the reporting units is impaired and an impairment loss would be recognized. 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 IoT 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. No goodwill impairment charges were recorded. Implied fair values for both reporting units were each calculated on a standalone basis using a weighted combination of the income approach and market approach. The income approach indicates the fair value of a business based on the value of the cash flows the business or asset can be expected to generate in the future. A commonly used variation of the income approach used to value a business is the discounted cash flow (“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. 7. GOODWILL AND OTHER IDENTIFIABLE INTANGIBLE ASSETS, NET (CONTINUED) 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. During the second quarter of fiscal 2019 , we assessed various qualitative factors to determine whether or not an additional goodwill impairment assessment was required as of March 31, 2019 . We concluded that no additional impairment assessment was required. Should the facts and circumstances surrounding our assumptions change, the first step of our goodwill impairment analysis may fail. Assumptions and estimates to determine fair values are complex and often subjective. They can be affected by a variety of factors, including external factors such as industry and economic trends, and internal factors such as changes in our business strategy and our internal forecasts. For example, if our future operating results do not meet current forecasts or if we experience a sustained decline in our market capitalization that is determined to be indicative of a reduction in fair value of one or more of our reporting units, we may be required to record future impairment charges for goodwill. An impairment could have a material effect on our consolidated balance sheet and results of operations. We have had no goodwill impairment losses since the adoption of ASC 350, Intangibles-Goodwill and Others, in fiscal 2003. |
Sale of Building
Sale of Building | 6 Months Ended |
Mar. 31, 2019 | |
Discontinued Operations and Disposal Groups [Abstract] | |
SALE OF BUILDING | SALE OF BUILDING 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 sale 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 Condensed Consolidated Balance Sheet. As a result, we recorded a $1.1 million tax benefit in the fourth quarter of fiscal 2018 because we were able to use credit loss carryforwards which previously had a valuation allowance. We recorded a gain of $4.4 million ( $3.4 million net of tax) in the first quarter of fiscal 2019, which is recorded in general and administrative expense. During the six months ended March 31, 2019 , we paid $6.1 million for leasehold improvements to build out our new headquarters space. These improvements will be depreciated over 10 years, which is the estimated useful life of the improvements. |
Segment Information
Segment Information | 6 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | SEGMENT INFORMATION We have two reportable operating segments: (1) IoT Products & Services, and (2) IoT Solutions. Summary operating results for each of our segments were as follows (in thousands): Three months ended March 31, Six months ended March 31, 2019 2018 2019 2018 Revenue IoT Products & Services $ 56,039 $ 49,825 $ 109,333 $ 90,705 IoT Solutions 9,725 4,723 18,744 8,798 Total revenue $ 65,764 $ 54,548 $ 128,077 $ 99,503 Operating income (loss) IoT Products & Services $ 3,450 $ 4,689 $ 10,852 $ 5,953 IoT Solutions (2,665 ) (3,871 ) (4,509 ) (7,134 ) Total operating income (loss) $ 785 $ 818 $ 6,343 $ (1,181 ) Depreciation and amortization IoT Products & Services $ 1,378 $ 1,729 $ 3,320 $ 2,578 IoT Solutions 1,775 1,651 3,506 3,255 Total depreciation and amortization $ 3,153 $ 3,380 $ 6,826 $ 5,833 *Prior period information has been restated for the adoption of ASU No. 2014-09, “ Revenue from Contracts with Customers (Topic 606), ” which we adopted on October 1, 2018. 9. SEGMENT INFORMATION (CONTINUED) Total expended for property, plant and equipment was as follows (in thousands): Six months ended March 31, 2019 2018 Expended for property, equipment and improvements IoT Products & Services $ 7,289 $ 785 IoT Solutions* 57 — Total expended for property, plant and equipment $ 7,346 $ 785 * Excluded from this amount is $654 and $827 of transfers of inventory to property plant and equipment for the six months ended March 31, 2019 and 2018, respectively. Total assets for each of our segments were as follows (in thousands): March 31, 2019 September 30, 2018 Assets IoT Products & Services $ 216,601 $ 209,574 IoT Solutions 94,844 99,822 Unallocated** 72,090 62,750 Total assets $ 383,535 $ 372,146 *Prior period information has been restated for the adoption of ASU No. 2014-09, “ Revenue from Contracts with Customers (Topic 606), ” which we adopted on October 1, 2018. **Unallocated consists of cash and cash equivalents and current marketable securities. |
Revenue Revenue
Revenue Revenue | 6 Months Ended |
Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE | REVENUE Revenue Disaggregation The following summarizes our revenue by geographic location of our customers: Three months ended March 31, Six months ended March 31, ($ in thousands) 2019 2018 2019 2018 North America, primarily the United States $ 48,869 $ 39,169 $ 95,204 $ 68,506 Europe, Middle East & Africa 10,764 9,504 20,868 19,660 Other 6,131 5,875 12,005 11,337 Total revenue $ 65,764 $ 54,548 $ 128,077 $ 99,503 *Prior period information has been restated for the adoption of ASU No. 2014-09, “ Revenue from Contracts with Customers (Topic 606), ” which we adopted on October 1, 2018. Net sales of services and solutions disaggregated by product group: Three months ended March 31, Six months ended March 31, ($ in thousands) 2019 2018 2019 2018 IoT Products & Services Segment Hardware product $ 52,097 $ 47,588 $ 102,909 $ 86,042 Services 3,942 2,237 6,424 4,663 Total IoT Products & Services Segment 56,039 49,825 109,333 90,705 IoT Solutions Segment Solutions 9,725 4,723 18,744 8,798 Total Revenue $ 65,764 $ 54,548 $ 128,077 $ 99,503 *Prior period information has been restated for the adoption of ASU No. 2014-09, “ Revenue from Contracts with Customers (Topic 606), ” which we adopted on October 1, 2018. 10. REVENUE (CONTINUED) Contract Balances Contract Assets Contract assets consist of subscriber assets. These subscriber assets relate to an implementation fee in certain contracts that we charge our customers so they can begin using the equipment. In this case, we retain the ownership of this equipment that the customer uses. Total subscriber assets of $2.3 million and $2.1 million as of March 31, 2019 and September 30, 2018 , respectively, are included in property, equipment and improvements, net. Amortization expense for these subscriber assets was $0.2 million and $0.1 million for the three month periods ended March 31, 2019 and March 31, 2018 , respectively and $0.4 million and $0.1 million for the six month periods ended March 31, 2019 and March 31, 2018 , respectively. We amortize the cost of this equipment over its useful life (typically three years ). Contract Liabilities The timing of revenue recognition may differ from the timing of invoicing to customers. Customers are invoiced for subscription services in advance on a monthly, quarterly or annual basis. Contract liabilities consist of unearned revenue related to annual or multi-year contracts for subscription services and related implementation fees for our IoT Solutions segment and our Digi Remote Manager ® services in our IoT Products & Services segment. Changes in unearned revenue were as follows: Six months ended ($ in thousands) 2019 Unearned revenue, beginning of period* $ 3,933 Billings 13,613 Revenue recognized (10,497 ) Unearned revenue, end of period $ 7,049 *Prior period information has been restated for the adoption of ASU No. 2014-09, “ Revenue from Contracts with Customers (Topic 606), ” which we adopted on October 1, 2018. Remaining Transaction Price Transaction price allocated to the remaining performance obligations represents contracted revenue that has not been recognized, which includes unearned revenue and unbilled amounts that will be recognized as revenue in future periods. As of March 31, 2019 approximately $7.3 million of revenue is expected to be recognized from remaining performance obligations for subscriptions contracts. We expect to recognize revenue on approximately $3.8 million of remaining performance obligations over the next twelve months. Revenue from the remaining performance obligations we expect to recognize revenue over a range of two to five years. |
Income Taxes
Income Taxes | 6 Months Ended |
Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES Our income tax expense was $0.9 million for the six months ended March 31, 2019 . Included in this expense was a net tax benefit discretely related to the six months ended March 31, 2019 of $0.3 million , primarily a result of expiring statute of limitations of uncertain tax benefits as well as excess tax benefits recognized on stock compensation. For the six months ended March 31, 2019 , our effective tax rate before items discretely related to the period was less than the U.S. statutory rate due primarily to certain income tax credits generated in the U.S. Income tax expense was $3.1 million for the six months ended March 31, 2018 . Included in this expense was a net tax expense discretely related to the six months ended March 31, 2018 of $3.0 million , primarily as a result of new U.S. tax legislation that was enacted during the first quarter of fiscal 2018. For the six months ended March 31, 2018 , our effective tax rate before items discretely related to the period was less than the U.S. statutory rate primarily due to the mix of income between taxing jurisdictions, certain of which had lower statutory tax rates than the U.S., and certain tax credits generated in the U.S. Our effective tax rate will vary based on a variety of factors, including overall profitability, the geographical mix of income before taxes and related statutory tax rate in each jurisdiction, and tax items discretely related to the period, such as settlements of audits. We expect that we may record other benefits or expenses in the future that are specific to a particular quarter such as 11. INCOME TAXES (CONTINUED) expiration of statutes of limitation, the completion of tax audits, or legislation that is enacted for both U.S. and foreign jurisdictions. A reconciliation of the beginning and ending amount of unrecognized tax benefits is (in thousands): Unrecognized tax benefits as of September 30, 2018 $ 1,561 Decreases related to: Prior year income tax positions (31 ) Expiration of statute of limitations (56 ) Unrecognized tax benefits as of March 31, 2019 $ 1,474 The total amount of unrecognized tax benefits that, if recognized, would affect our effective tax rate is $1.3 million , after considering the impact of interest and deferred benefit items. We expect that the total amount of unrecognized tax benefits will decrease by approximately $0.1 million over the next 12 months. |
Product Warranty Obligation
Product Warranty Obligation | 6 Months Ended |
Mar. 31, 2019 | |
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 included on our Condensed Consolidated Balance Sheets within current liabilities: Balance at Warranties Settlements Balance at Period January 1 issued made March 31 Three months ended March 31, 2019 $ 1,140 $ 144 $ (175 ) $ 1,109 Three months ended March 31, 2018 $ 1,164 $ 362 $ (178 ) $ 1,348 Balance at Warranties Settlements Balance at Period October 1 issued made March 31 Six months ended March 31, 2019 $ 1,172 $ 216 $ (279 ) $ 1,109 Six months ended March 31, 2018 $ 987 $ 716 $ (355 ) $ 1,348 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Lease Commitments In October 2018, we signed a thirteen -year lease agreement with minimum lease obligations of $14.8 million with Colfin Midwest NNN Investor, LLC for 59,497 square feet of office space. This is now our new headquarters location in Hopkins, Minnesota, which is approximately three miles from our previous headquarters. In April 2019, subsequent to the end of the quarter, we received $3.3 million for a tenant improvement allowance. We have entered into various operating lease agreements for office facilities and equipment, the last of which expires in fiscal 2032 . 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 March 31, 2019 under noncancelable operating leases (in thousands): Fiscal year Amount 2019 (six months) $ 995 2020 2,541 2021 2,495 2022 2,224 2023 2,054 2024 2,101 Thereafter 11,056 Total minimum payments required $ 23,466 13. COMMITMENTS AND CONTINGENCIES (CONTINUED) Contingencies In November 2018, DimOnOff Inc., a company headquartered in Quebec City, Quebec, Canada (“DimOnOff”), which sells control systems in the building automation and street lighting markets sued us and a former distributor from whom DimOnOff purchased certain of our products. The suit was brought in the Superior Court of the Province of Quebec in the District of Quebec (Canada) and alleges certain Digi products it purchased and incorporated into street lighting systems in a Canadian city were defective causing some of the street lights to malfunction. It alleges damages in of just over CAD 1.0 million . We intend to defend ourselves against DimOnOff’s claims. At this time we cannot assess the likelihood or amount of any potential loss. In addition to the matter discussed above, in the normal course of business, we are subject to various claims and litigation. There can be no assurance that any claims by third parties, if proven to have merit, will not materially adversely affect our business, liquidity or financial condition. |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Mar. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK-BASED COMPENSATION | STOCK-BASED COMPENSATION Stock-based awards were granted under the 2019 Omnibus Incentive Plan (the “2019 Plan”) beginning February 4, 2019 and, prior to that, were granted under the 2018 Omnibus Incentive Plan (the “2018 Plan”). Upon stockholder approval of the 2019 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 2019 Plan. The authority to grant options under the 2019 Plan and to set other terms and conditions rests with the Compensation Committee of the Board of Directors. The 2019 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 2019 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. The 2019 Plan is scheduled to expire on February 3, 2029. Options under the 2019 Plan can be granted as either incentive stock options or non-statutory stock options. The exercise price of options and the grant date price of restricted stock units is determined by our Compensation Committee but will not be less than the fair market value of our common stock based on the closing price as of the date of grant. Upon exercise of options or settlement of vested restricted stock units, we issue new shares of stock. As of March 31, 2019 , there were approximately 1,524,170 shares available for future grants under the 2019 Plan. Our equity plans and corresponding forms of award agreements generally have provisions allowing employees to elect to satisfy tax withholding obligations through the delivery of shares, having us retain a portion of shares issuable under the award or paying cash to us for the withholding. During the six months ended March 31, 2019 and 2018 , our employees forfeited 91,040 shares and 68,611 shares, respectively in order to satisfy $1.0 million and $0.7 million , respectively of withholding tax obligations related to stock-based compensation, pursuant to terms of awards under our board and shareholder-approved compensation plans for each respective period. Employee contributions to the Employee Stock Purchase Plan (the “Purchase Plan”) were $0.5 million and $0.6 million during the six month periods ended March 31, 2019 and 2018 , respectively. Pursuant to the Purchase Plan, 63,694 and 74,381 common shares were issued to employees during the six months ended March 31, 2019 and 2018 , respectively. Shares are issued under the Purchase Plan from treasury stock. As of March 31, 2019 , 251,882 common shares were available for future issuances under the Purchase Plan. 14. STOCK-BASED COMPENSATION (CONTINUED) Stock-based compensation expense is included in the consolidated results of operations as follows (in thousands): Three months ended March 31, Six months ended March 31, 2019 2018 2019 2018 Cost of sales $ 25 $ 46 $ 80 $ 96 Sales and marketing 466 391 819 725 Research and development 269 167 469 175 General and administrative 533 721 1,339 1,382 Stock-based compensation before income taxes 1,293 1,325 2,707 2,378 Income tax benefit (263 ) (277 ) (557 ) (498 ) Stock-based compensation after income taxes $ 1,030 $ 1,048 $ 2,150 $ 1,880 Stock Options The following table summarizes our stock option activity (in thousands, except per common share amounts): Options Outstanding Weighted Average Exercised Price Weighted Average Contractual Term (in years) Aggregate Intrinsic Value (1) Balance at September 30, 2018 3,526 $10.49 Granted 590 10.92 Exercised (410 ) 9.14 Forfeited / Canceled (301 ) 12.64 Balance at March 31, 2019 3,405 $10.67 4.3 $ 7,154 Exercisable at March 31, 2019 2,192 $10.29 3.3 $ 5,434 (1) The aggregate intrinsic value represents the total pre-tax intrinsic value, based on our closing stock price of $12.67 as of March 31, 2019 , which would have been received by the option holders had all option holders exercised their options as of that date. The intrinsic value of an option is the amount by which the fair value of the underlying stock exceeds its exercise price. The total intrinsic value of all options exercised during the six months ended March 31, 2019 was $1.6 million and during the six months ended March 31, 2018 was $0.5 million . 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: Six months ended March 31, 2019 2018 Weighted average per option grant date fair value $4.36 $3.72 Assumptions used for option grants: Risk free interest rate 2.56% - 2.93% 2.12% - 2.58% Expected term 6.00 years 6.00 years Expected volatility 33% - 34% 33% - 34% Weighted average volatility 33% 33% Expected dividend yield 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. 14. STOCK-BASED COMPENSATION (CONTINUED) As of March 31, 2019 , the total unrecognized compensation cost related to non-vested stock options was $4.8 million and the related weighted average period over which it is expected to be recognized is approximately 2.8 years. Non-vested Restricted Stock Units A summary of our non-vested restricted stock units as of March 31, 2019 and changes during the six 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, 2018 674 $ 11.05 Granted 534 $ 11.60 Vested (248 ) $ 10.42 Canceled (115 ) $ 12.31 Nonvested at March 31, 2019 845 $ 11.41 As of March 31, 2019 , the total unrecognized compensation cost related to non-vested restricted stock units was $8.5 million , and the related weighted average period over which it is expected to be recognized is approximately 1.8 years. |
Restructuring (Notes)
Restructuring (Notes) | 6 Months Ended |
Mar. 31, 2019 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING | RESTRUCTURING Below is a summary of the restructuring charges and other activity (in thousands) all within our IoT Products and Services segment: Manufacturing Transition 2017 Restructuring Employee Employee Other Total Balance at September 30, 2018 $ 147 $ 293 $ 13 $ 453 Payments (108 ) (233 ) (18 ) (359 ) Reversals (19 ) (53 ) 5 (67 ) Foreign currency fluctuation — (7 ) — (7 ) Balance at March 31, 2019 $ 20 $ — $ — $ 20 Manufacturing Transition As announced on April 3, 2018, we transferred the manufacturing functions of our Eden Prairie, Minnesota operations facility to existing contract manufacture suppliers. As a result, approximately 53 employment positions were eliminated, resulting in restructuring charges of 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 the third quarter of fiscal 2019. This manufacturing transition is expected to result in total annualized savings of between $3.0 million to $5.0 million . 2017 Restructuring In May 2017, we approved a restructuring plan primarily impacting our France location, which is now closed. We also eliminated certain employee costs in the U.S. The restructuring was the 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 were completed in the first half of fiscal 2019. |
Common Stock Repurchase
Common Stock Repurchase | 6 Months Ended |
Mar. 31, 2019 | |
Common Stock Repurchase [Abstract] | |
COMMON STOCK REPURCHASE | COMMON STOCK REPURCHASE On April 24, 2018 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, 2019. There were no shares repurchased under this program as of March 31, 2019 . |
Basis of Presentation of Unau_2
Basis of Presentation of Unaudited Interim Condensed Consolidated Financial Statements and Significant Accounting Policies (Policies) | 6 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Revenue from Contract with Customer | Revenue Recognition We recognize hardware product revenue upon transfer of control of goods or services to customers in an amount that reflects the consideration we expect to receive in exchange for those goods or services. We determine the amount of revenue to be recognized through application of the following steps: • Identification of the contract, or contracts with a customer; • Identification of the performance obligations in the contract; • Determination of the transaction price; • Allocation of the transaction price to the performance obligations in the contract; and • Recognition of revenue when or as we satisfy the performance obligations. Hardware Product Revenue and SmartSense by Digi ™ Equipment Revenue and Associated Installation Fees Our hardware product revenue is derived primarily from the sale of wired and wireless hardware products to our distributors and Direct/Original Equipment Manufacturer (“OEM”) customers. Product revenue generally is recognized upon shipment of product to customers. Sales to authorized domestic distributors and Direct/OEM customers 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 sales are recorded. Material differences between the historical trends used to determine estimated reserves and actual returns and pricing adjustments could result in a material change to our consolidated results of operations or financial position. We have applied consistent methodologies for estimating reserves for future returns and pricing adjustments for all periods presented. Our SmartSense by Digi ™ equipment revenue is recorded as an up-front sale at its stand-alone selling price because the customer could utilize our equipment with other monitoring services or could use our monitoring services with hardware purchased from other vendors. Our installation charges are recorded when the product is installed. 1. BASIS OF PRESENTATION OF UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Subscription and Support Services Revenue Our SmartSense by Digi ™ subscription revenue is recorded on a monthly basis. These subscriptions are generally in a range from one to 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 derive service revenue from our Digi Remote Manager ® , a platform-as-a-service (“PaaS”) offering, whereby customers pay for services consumed based on the number of devices being managed or monitored. This revenue is recognized over the life of the service term. Digi Support Services revenues are recognized over the life of the support contract. Some of Digi Support Services revenue is for training and this revenue is recognized as the services are performed. Professional Services Revenue Professional services revenue is derived from our Digi Wireless Design Services contracts on either on a time-and-materials or a fixed-fee basis. These revenues are recognized as the services are performed for time-and-materials contracts, or when milestones are achieved and accepted by the customer for fixed-fee contracts. Contracts with Multiple Performance Obligations SmartSense by Digi ™ revenues typically are derived from contracts with multiple performance obligations. These obligations may include: delivery of monitoring equipment that the customer either purchases out-right or uses while we retain ownership, monitoring services, providing condition alerts of assets being monitored, and recertification of sensor equipment. When we retain ownership of the equipment, we charge an implementation fee to the customer so they can begin using the equipment. In these instances, all revenue derived from the above obligations is recognized over the subscription term of the contract. If the customer purchases the equipment out-right, that portion of the revenue is recognized at the stand-alone selling price at the time the equipment is shipped and all other revenue is recognized over the subscription term of the contract. We have made an accounting policy election to exclude from the measurement of our revenues any sales or similar taxes we collect from customers. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements Adopted In January 2017, the Financial Accounting Standards Board (“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 our fiscal year ending September 30, 2021. Early adoption is permitted. This ASU was early adopted by us on October 1, 2018 and did not have an impact on our consolidated financial statements. In May 2017, FASB issued ASU 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting . ASU 2017-09 provided 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 are to be applied prospectively to an award modified on or after the adoption date. This ASU was effective for us this first fiscal quarter ending December 31, 2018. This ASU was adopted by us on October 1, 2018 and did not have an impact 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 was effective for us this first fiscal quarter ending December 31, 2018. This ASU was adopted by us on October 1, 2018 and did not have an impact 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 requires equity investments in unconsolidated entities (other than those 1. BASIS OF PRESENTATION OF UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 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 also simplify the impairment assessment of equity investments without readily determinable fair values. This ASU also has changed the presentation and disclosure requirements for financial instruments. In addition, this ASU has clarified 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 were effective for our first fiscal quarter ending December 31, 2018. This ASU was adopted by us on October 1, 2018 and did not have an impact on our consolidated financial statements. In May 2014, FASB issued ASU 2014-09, Revenue from Contracts with Customers (“Topic 606”) . This standard requires that revenue is recognized for 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. It also establishes timing associated with recognizing revenues and amortizing costs, associated with contracts. FASB has issued several amendments to ASU 2014-09, including clarifications on disclosure of prior-period performance obligations and remaining performance obligations. The guidance permits two methods of adoption, one of which is to retrospectively adjust results for each prior reporting period presented. We elected to adopt the standard using this method effective October 1, 2018. We have described how we recognize revenue in the aforementioned revenue recognition policy. Relative to the amortization of costs there are two impacts to our financial statements. First, in instances where we retain ownership of equipment a customer uses, we charge an implementation fee to the customer so they can begin using the equipment. We amortize this cost of the equipment over its useful life (typically three years). Second, we capitalize and amortize commissions paid to sales personnel or agents on service contracts. If the commissions earned during an accounting period exceed our capitalization threshold, they will be amortized over the calculated average expected life of the pool of contracts closed during that period. To ease our transition in the adoption of Topic 606, we have elected several practical expedients outlined in the new accounting guidance: • We have not disclosed the remaining transaction price for reporting periods prior to the first quarter of fiscal 2019. • For completed contracts that have variable consideration, we will use the as-invoiced amount for all of our time and materials contracts and contracts relating to Digi Remote Manager ® in instances where the contracts do not include free service. • We will expense incremental costs of obtaining a contract when incurred if the amortization period of the asset is one year or less. The adoption of the standard related to the new revenue recognition impacted our reported results as follows: Three months ended March 31, 2018 (in thousands, except per common share data) As Reported Impact of Adoption As Adjusted Revenue: Product $ 47,588 $ — $ 47,588 Services and solutions 7,203 (243 ) 6,960 Total revenue 54,791 (243 ) 54,548 Cost of sales: Cost of product 23,080 — 23,080 Cost of services and solutions 4,287 (423 ) 3,864 Amortization of intangibles 770 — 770 Total cost of sales 28,137 (423 ) 27,714 Gross profit 26,654 180 26,834 Operating expenses 26,151 (135 ) 26,016 Operating income $ 503 $ 315 $ 818 Net (loss) income $ (357 ) $ 231 $ (126 ) Diluted (loss) income per share $ (0.01 ) $ 0.01 $ — 1. BASIS OF PRESENTATION OF UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Six months ended March 31, 2018 (in thousands, except per common share data) As Reported Impact of Adoption As Adjusted Revenue: Product $ 86,042 $ — $ 86,042 Services and solutions 13,946 (485 ) 13,461 Total revenue 99,988 (485 ) 99,503 Cost of sales: Cost of product 42,290 — 42,290 Cost of services and solutions 7,730 (687 ) 7,043 Amortization of intangibles 1,377 — 1,377 Total cost of sales 51,397 (687 ) 50,710 Gross profit 48,591 202 48,793 Operating expenses 50,211 (237 ) 49,974 Operating (loss) income $ (1,620 ) $ 439 $ (1,181 ) Net (loss) income $ (4,926 ) $ 313 $ (4,613 ) Diluted (loss) income per share $ (0.18 ) $ 0.01 $ (0.17 ) September 30, 2018 (in thousands) As Reported Impact of Adoption As Adjusted Accounts receivable, net $ 50,817 $ (998 ) $ 49,819 Property, equipment and improvements, net $ 6,270 $ 2,084 $ 8,354 Deferred tax assets $ 6,665 $ (65 ) $ 6,600 Unearned revenue current $ 2,579 $ 598 $ 3,177 Other non-current liabilities $ 510 $ 210 $ 720 Retained earnings $ 151,748 $ 213 $ 151,961 Adoption of the standards related to revenue recognition had no impact to total cash provided by or used in operating, financing or investing on our historical Condensed Consolidated Statements of Cash Flows. Not Yet Adopted In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, which clarifies the accounting for implementation costs in cloud computing arrangements. ASU 2018-15 is effective for us in the first quarter ending December 31, 2020. Early adoption is permitted. We are evaluating when to adopt, and the impact of the adopting, ASU 2018-15 on our consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement - Disclosure Framework (Topic 820). The updated guidance improves the disclosure requirements on fair value measurements. The updated guidance is effective for us in the first quarter ending December 31, 2020. Early adoption is permitted for any removed or modified disclosures. We are evaluating when to adopt and the impact of adopting, ASU 2018-13 on 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 us in 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. 1. BASIS OF PRESENTATION OF UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 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 us in the first quarter ending December 31, 2020. Entities may early adopt beginning after December 15, 2018. We are evaluating the impact of adopting ASU 2016-13 on our consolidated financial statements. In February 2016, FASB issued ASU 2016-02, Leases (Topic 842) , which amends the existing guidance and requires lessees to recognize lease assets and lease liabilities on the balance sheet for leases with a term longer than 12 months that are classified as operating leases under previous authoritative guidance. The lease liability will be equal to the present value of lease payments and the right-of-use asset will be based on the lease liability, subject to adjustment for certain items. In July 2018, FASB issued two additional amendments that affect this guidance described in the following updates ASU 2018-10, Codification Improvements to Topic 842, Leases and ASU 2018-11, Leases (Topic 842): Targeted Improvements . The amendments in ASU 2018-10 affect narrow aspects of the guidance issued in ASU 2016-02. The amendments in ASU 2018-11 provide an alternative (and optional) transition method that allows entities to apply the transition provisions in ASU 2016-02 at the adoption date instead of at the earliest comparative period presented in the financial statements. ASU 2016-02 is effective for us, using the modified retrospective approach, the first fiscal quarter ending December 31, 2019. Early adoption is permitted. As noted above, ASU 2018-11 provides for an additional and optional transition method. We plan to apply the optional transition method at the adoption date and are evaluating the impact of adopting ASU 2016-02 on our consolidated financial statements. |
Basis of Presentation of Unau_3
Basis of Presentation of Unaudited Interim Condensed Consolidated Financial Statements and Significant Accounting Policies (Tables) | 6 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles [Table Text Block] | The adoption of the standard related to the new revenue recognition impacted our reported results as follows: Three months ended March 31, 2018 (in thousands, except per common share data) As Reported Impact of Adoption As Adjusted Revenue: Product $ 47,588 $ — $ 47,588 Services and solutions 7,203 (243 ) 6,960 Total revenue 54,791 (243 ) 54,548 Cost of sales: Cost of product 23,080 — 23,080 Cost of services and solutions 4,287 (423 ) 3,864 Amortization of intangibles 770 — 770 Total cost of sales 28,137 (423 ) 27,714 Gross profit 26,654 180 26,834 Operating expenses 26,151 (135 ) 26,016 Operating income $ 503 $ 315 $ 818 Net (loss) income $ (357 ) $ 231 $ (126 ) Diluted (loss) income per share $ (0.01 ) $ 0.01 $ — 1. BASIS OF PRESENTATION OF UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Six months ended March 31, 2018 (in thousands, except per common share data) As Reported Impact of Adoption As Adjusted Revenue: Product $ 86,042 $ — $ 86,042 Services and solutions 13,946 (485 ) 13,461 Total revenue 99,988 (485 ) 99,503 Cost of sales: Cost of product 42,290 — 42,290 Cost of services and solutions 7,730 (687 ) 7,043 Amortization of intangibles 1,377 — 1,377 Total cost of sales 51,397 (687 ) 50,710 Gross profit 48,591 202 48,793 Operating expenses 50,211 (237 ) 49,974 Operating (loss) income $ (1,620 ) $ 439 $ (1,181 ) Net (loss) income $ (4,926 ) $ 313 $ (4,613 ) Diluted (loss) income per share $ (0.18 ) $ 0.01 $ (0.17 ) September 30, 2018 (in thousands) As Reported Impact of Adoption As Adjusted Accounts receivable, net $ 50,817 $ (998 ) $ 49,819 Property, equipment and improvements, net $ 6,270 $ 2,084 $ 8,354 Deferred tax assets $ 6,665 $ (65 ) $ 6,600 Unearned revenue current $ 2,579 $ 598 $ 3,177 Other non-current liabilities $ 510 $ 210 $ 720 Retained earnings $ 151,748 $ 213 $ 151,961 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of Calculation of Numerator and Denominator in Earnings Per Share | The following table is a reconciliation of the numerators and denominators in the net income (loss) per common share calculations (in thousands, except per common share data): Three months ended March 31, Six months ended March 31, 2019 2018 2019 2018 Numerator: Net income (loss) $ 1,342 $ (126 ) $ 6,024 $ (4,613 ) Denominator: Denominator for basic net income (loss) per common share — weighted average shares outstanding 27,866 27,084 27,687 26,914 Effect of dilutive securities: Stock options and restricted stock units 572 — 602 — Denominator for diluted net income (loss) per common share — adjusted weighted average shares 28,438 27,084 28,289 26,914 Net income (loss) per common share, basic $ 0.05 $ — $ 0.22 $ (0.17 ) Net income (loss) per common share, diluted $ 0.05 $ — $ 0.21 $ (0.17 ) *Prior period information has been restated for the adoption of ASU No. 2014-09, “ Revenue from Contracts with Customers (Topic 606), ” which we adopted on October 1, 2018. |
Selected Balance Sheet Data (Ta
Selected Balance Sheet Data (Tables) | 6 Months Ended |
Mar. 31, 2019 | |
Selected Balance Sheet Data [Abstract] | |
Schedule of Selected Balance Sheet Data | The following table shows selected balance sheet data (in thousands): March 31, September 30, 2018 Accounts receivable, net: Accounts receivable $ 57,502 $ 53,164 Less allowance for doubtful accounts 1,271 785 Less reserve for future returns and pricing adjustments 2,738 2,560 Accounts receivable, net $ 53,493 $ 49,819 Inventories: Raw materials $ 17,008 $ 22,047 Work in process 1,119 525 Finished goods 25,908 19,072 Inventories $ 44,035 $ 41,644 *Prior period information has been restated for the adoption of ASU No. 2014-09, “ Revenue from Contracts with Customers (Topic 606), ” which we adopted on October 1, 2018. |
Marketable Securities (Tables)
Marketable Securities (Tables) | 6 Months Ended |
Mar. 31, 2019 | |
Marketable Securities [Abstract] | |
Debt Securities, Available-for-sale [Table Text Block] | At March 31, 2019 our marketable securities were (in thousands): Amortized Cost (1) Unrealized Gains Unrealized Losses Fair Value (1) Current marketable securities: Certificates of deposit $ 2,503 $ — $ (6 ) $ 2,497 Total marketable securities $ 2,503 $ — $ (6 ) $ 2,497 (1) Included in amortized cost and fair value is purchased and accrued interest of $3 . At September 30, 2018 our marketable securities were (in thousands): Amortized Cost (1) Unrealized Gains Unrealized Losses Fair Value (1) Current marketable securities: Certificates of deposit $ 4,756 $ — $ (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 . |
Debt Securities, Available-for-sale, Unrealized Loss Position, Fair Value [Table Text Block] | The following tables show the fair values and gross unrealized losses of our available-for-sale marketable securities that have been in a continuous unrealized loss position deemed to be temporary, aggregated by investment category (in thousands): March 31, 2019 Less than 12 Months More than 12 Months Fair Value Unrealized Losses Fair Value Unrealized Losses Certificates of deposit $ — $ — $ 2,497 $ (6 ) Total $ — $ — $ 2,497 $ (6 ) 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 ) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Assets Measured on Recurring Basis | The following tables provide information by level for financial assets and liabilities that are measured at fair value on a recurring basis (in thousands): Total Fair Value at Fair Value Measurements Using Inputs Considered as March 31, 2019 Level 1 Level 2 Level 3 Assets: Money market $ 27,883 $ 27,883 $ — $ — Certificates of deposit 2,497 — 2,497 — Total assets measured at fair value $ 30,380 $ 27,883 $ 2,497 $ — Liabilities: Contingent consideration on acquired businesses $ 8,527 $ — $ — $ 8,527 Total liabilities measured at fair value $ 8,527 $ — $ — $ 8,527 Total Fair Value at Fair Value Measurements Using Inputs Considered as September 30, 2018 Level 1 Level 2 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 businesses $ 10,065 $ — $ — $ 10,065 Total liabilities measured at fair value $ 10,065 $ — $ — $ 10,065 |
Fair Value of Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation | The following table presents a reconciliation of the contingent consideration liability measured at fair value on a recurring basis using significant unobservable inputs (Level 3) (in thousands): Three months ended March 31, Six months ended March 31, 2019 2018 2019 2018 Fair value at beginning of period $ 10,147 $ 5,981 $ 10,065 $ 6,388 Purchase price contingent consideration — 2,300 — 2,300 Contingent consideration payments (2,187 ) — (2,348 ) — Change in fair value of contingent consideration 567 (18 ) 810 (425 ) Fair value at end of period $ 8,527 $ 8,263 $ 8,527 $ 8,263 |
Goodwill and Other Identifiab_2
Goodwill and Other Identifiable Intangible Assets, Net (Tables) | 6 Months Ended |
Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Amortizable Intangible Assets | Amortizable intangible assets were (in thousands): March 31, 2019 September 30, 2018 Gross carrying amount Accum. amort. Net Gross carrying amount Accum. amort. Net Purchased and core technology $ 58,011 $ (49,938 ) $ 8,073 $ 58,102 $ (48,693 ) $ 9,409 License agreements 102 (60 ) 42 102 (46 ) 56 Patents and trademarks 15,835 (12,777 ) 3,058 15,701 (12,242 ) 3,459 Customer relationships 46,530 (23,226 ) 23,304 46,605 (21,049 ) 25,556 Non-compete agreements 600 (270 ) 330 600 (210 ) 390 Order backlog 1,800 (1,800 ) — 1,800 (1,350 ) 450 Total $ 122,878 $ (88,071 ) $ 34,807 $ 122,910 $ (83,590 ) $ 39,320 |
Schedule of Estimated Future Amortization Expense Related to Intangible Assets | Estimated amortization expense related to intangible assets for the remainder of fiscal 2019 and the five succeeding fiscal years is (in thousands): 2019 (six months) $ 4,193 2020 8,237 2021 7,430 2022 6,568 2023 4,392 2024 3,701 |
Schedule of Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill by reportable segments are (in thousands): Six Months Ended March 31, 2019 IoT Products and Services IoT Solutions Total Beginning balance, October 1 $ 104,358 $ 50,177 $ 154,535 Acquisitions — — — Foreign currency translation adjustment (122 ) (364 ) (486 ) Ending balance, March 31 $ 104,236 $ 49,813 $ 154,049 |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Summary operating results for each of our segments were as follows (in thousands): Three months ended March 31, Six months ended March 31, 2019 2018 2019 2018 Revenue IoT Products & Services $ 56,039 $ 49,825 $ 109,333 $ 90,705 IoT Solutions 9,725 4,723 18,744 8,798 Total revenue $ 65,764 $ 54,548 $ 128,077 $ 99,503 Operating income (loss) IoT Products & Services $ 3,450 $ 4,689 $ 10,852 $ 5,953 IoT Solutions (2,665 ) (3,871 ) (4,509 ) (7,134 ) Total operating income (loss) $ 785 $ 818 $ 6,343 $ (1,181 ) Depreciation and amortization IoT Products & Services $ 1,378 $ 1,729 $ 3,320 $ 2,578 IoT Solutions 1,775 1,651 3,506 3,255 Total depreciation and amortization $ 3,153 $ 3,380 $ 6,826 $ 5,833 *Prior period information has been restated for the adoption of ASU No. 2014-09, “ Revenue from Contracts with Customers (Topic 606), ” which we adopted on October 1, 2018. |
Payments to Acquire Property, Plant and Equipment by Segment | Total expended for property, plant and equipment was as follows (in thousands): Six months ended March 31, 2019 2018 Expended for property, equipment and improvements IoT Products & Services $ 7,289 $ 785 IoT Solutions* 57 — Total expended for property, plant and equipment $ 7,346 $ 785 |
Reconciliation of Assets from Segment to Consolidated | Total assets for each of our segments were as follows (in thousands): March 31, 2019 September 30, 2018 Assets IoT Products & Services $ 216,601 $ 209,574 IoT Solutions 94,844 99,822 Unallocated** 72,090 62,750 Total assets $ 383,535 $ 372,146 *Prior period information has been restated for the adoption of ASU No. 2014-09, “ Revenue from Contracts with Customers (Topic 606), ” which we adopted on October 1, 2018. **Unallocated consists of cash and cash equivalents and current marketable securities. |
Revenue (Tables)
Revenue (Tables) | 6 Months Ended |
Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | Net sales of services and solutions disaggregated by product group: Three months ended March 31, Six months ended March 31, ($ in thousands) 2019 2018 2019 2018 IoT Products & Services Segment Hardware product $ 52,097 $ 47,588 $ 102,909 $ 86,042 Services 3,942 2,237 6,424 4,663 Total IoT Products & Services Segment 56,039 49,825 109,333 90,705 IoT Solutions Segment Solutions 9,725 4,723 18,744 8,798 Total Revenue $ 65,764 $ 54,548 $ 128,077 $ 99,503 *Prior period information has been restated for the adoption of ASU No. 2014-09, “ Revenue from Contracts with Customers (Topic 606), ” which we adopted on October 1, 2018. The following summarizes our revenue by geographic location of our customers: Three months ended March 31, Six months ended March 31, ($ in thousands) 2019 2018 2019 2018 North America, primarily the United States $ 48,869 $ 39,169 $ 95,204 $ 68,506 Europe, Middle East & Africa 10,764 9,504 20,868 19,660 Other 6,131 5,875 12,005 11,337 Total revenue $ 65,764 $ 54,548 $ 128,077 $ 99,503 *Prior period information has been restated for the adoption of ASU No. 2014-09, “ Revenue from Contracts with Customers (Topic 606), ” which we adopted on October 1, 2018. |
Contract with Customer, Asset and Liability | Changes in unearned revenue were as follows: Six months ended ($ in thousands) 2019 Unearned revenue, beginning of period* $ 3,933 Billings 13,613 Revenue recognized (10,497 ) Unearned revenue, end of period $ 7,049 *Prior period information has been restated for the adoption of ASU No. 2014-09, “ Revenue from Contracts with Customers (Topic 606), ” which we adopted on October 1, 2018. |
Income Taxes (Tables)
Income Taxes (Tables) | 6 Months Ended |
Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Schedule of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is (in thousands): Unrecognized tax benefits as of September 30, 2018 $ 1,561 Decreases related to: Prior year income tax positions (31 ) Expiration of statute of limitations (56 ) Unrecognized tax benefits as of March 31, 2019 $ 1,474 |
Product Warranty Obligation (Ta
Product Warranty Obligation (Tables) | 6 Months Ended |
Mar. 31, 2019 | |
Product Warranties Disclosures [Abstract] | |
Schedule of Product Warranty Accrual | The following table summarizes the activity associated with the product warranty accrual (in thousands) and is included on our Condensed Consolidated Balance Sheets within current liabilities: Balance at Warranties Settlements Balance at Period January 1 issued made March 31 Three months ended March 31, 2019 $ 1,140 $ 144 $ (175 ) $ 1,109 Three months ended March 31, 2018 $ 1,164 $ 362 $ (178 ) $ 1,348 Balance at Warranties Settlements Balance at Period October 1 issued made March 31 Six months ended March 31, 2019 $ 1,172 $ 216 $ (279 ) $ 1,109 Six months ended March 31, 2018 $ 987 $ 716 $ (355 ) $ 1,348 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 6 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases | The following schedule reflects future minimum rental commitments at March 31, 2019 under noncancelable operating leases (in thousands): Fiscal year Amount 2019 (six months) $ 995 2020 2,541 2021 2,495 2022 2,224 2023 2,054 2024 2,101 Thereafter 11,056 Total minimum payments required $ 23,466 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Mar. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Stock-Based Compensation Expense | Stock-based compensation expense is included in the consolidated results of operations as follows (in thousands): Three months ended March 31, Six months ended March 31, 2019 2018 2019 2018 Cost of sales $ 25 $ 46 $ 80 $ 96 Sales and marketing 466 391 819 725 Research and development 269 167 469 175 General and administrative 533 721 1,339 1,382 Stock-based compensation before income taxes 1,293 1,325 2,707 2,378 Income tax benefit (263 ) (277 ) (557 ) (498 ) Stock-based compensation after income taxes $ 1,030 $ 1,048 $ 2,150 $ 1,880 |
Schedule of Stock Option Activity | The following table summarizes our stock option activity (in thousands, except per common share amounts): Options Outstanding Weighted Average Exercised Price Weighted Average Contractual Term (in years) Aggregate Intrinsic Value (1) Balance at September 30, 2018 3,526 $10.49 Granted 590 10.92 Exercised (410 ) 9.14 Forfeited / Canceled (301 ) 12.64 Balance at March 31, 2019 3,405 $10.67 4.3 $ 7,154 Exercisable at March 31, 2019 2,192 $10.29 3.3 $ 5,434 (1) The aggregate intrinsic value represents the total pre-tax intrinsic value, based on our closing stock price of $12.67 as of March 31, 2019 , which would have been received by the option holders had all option holders exercised their options as of that date. The intrinsic value of an option is the amount by which the fair value of the underlying stock exceeds its exercise price. |
Schedule of Valuation Assumptions | The table below shows the weighted average fair value, which was determined based upon the fair value of each option on the grant date utilizing the Black-Scholes option-pricing model and the related assumptions: Six months ended March 31, 2019 2018 Weighted average per option grant date fair value $4.36 $3.72 Assumptions used for option grants: Risk free interest rate 2.56% - 2.93% 2.12% - 2.58% Expected term 6.00 years 6.00 years Expected volatility 33% - 34% 33% - 34% Weighted average volatility 33% 33% Expected dividend yield 0 0 |
Schedule of Nonvested Restricted Stock Units | A summary of our non-vested restricted stock units as of March 31, 2019 and changes during the six 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, 2018 674 $ 11.05 Granted 534 $ 11.60 Vested (248 ) $ 10.42 Canceled (115 ) $ 12.31 Nonvested at March 31, 2019 845 $ 11.41 |
Restructuring (Tables)
Restructuring (Tables) | 6 Months Ended |
Mar. 31, 2019 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Reserve | Below is a summary of the restructuring charges and other activity (in thousands) all within our IoT Products and Services segment: Manufacturing Transition 2017 Restructuring Employee Employee Other Total Balance at September 30, 2018 $ 147 $ 293 $ 13 $ 453 Payments (108 ) (233 ) (18 ) (359 ) Reversals (19 ) (53 ) 5 (67 ) Foreign currency fluctuation — (7 ) — (7 ) Balance at March 31, 2019 $ 20 $ — $ — $ 20 |
Basis of Presentation of Unau_4
Basis of Presentation of Unaudited Interim Condensed Consolidated Financial Statements and Significant Accounting Policies - Additional Information (Details) | 6 Months Ended |
Mar. 31, 2019 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |
Period of amortization | 3 years |
Minimum | Subscription Revenue | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |
Length of contract | 1 year |
Maximum | Subscription Revenue | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |
Length of contract | 5 years |
Basis of Presentation of Unau_5
Basis of Presentation of Unaudited Interim Condensed Consolidated Financial Statements and Significant Accounting Policies - ASC 606 Income Statement (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | |||
Revenue: | ||||||
Total Revenue | $ 65,764 | $ 54,548 | [1] | $ 128,077 | $ 99,503 | [1] |
Cost of sales: | ||||||
Amortization of intangibles | 725 | 770 | [1] | 1,465 | 1,377 | [1] |
Total cost of sales | 35,435 | 27,714 | [1] | 67,965 | 50,710 | [1] |
Gross profit | 30,329 | 26,834 | [1] | 60,112 | 48,793 | [1] |
Operating expenses | 29,544 | 26,016 | [1] | 53,769 | 49,974 | [1] |
Operating income (loss) | 785 | 818 | [1] | 6,343 | (1,181) | [1] |
Net (loss) income | $ 1,342 | $ (126) | [1] | $ 6,024 | $ (4,613) | [1] |
Diluted (loss) income (USD per share) | $ 0.05 | $ 0 | [1] | $ 0.21 | $ (0.17) | [1] |
Product | ||||||
Revenue: | ||||||
Revenue | $ 52,097 | $ 47,588 | [1] | $ 102,909 | $ 86,042 | [1] |
Cost of sales: | ||||||
Cost of sales excluding amortization | 28,496 | 23,080 | [1] | 54,309 | 42,290 | [1] |
Services and Solutions | ||||||
Revenue: | ||||||
Revenue | 13,667 | 6,960 | [1] | 25,168 | 13,461 | [1] |
Cost of sales: | ||||||
Cost of sales excluding amortization | $ 6,214 | 3,864 | [1] | $ 12,191 | 7,043 | [1] |
As Reported | ||||||
Revenue: | ||||||
Total Revenue | 54,791 | 99,988 | ||||
Cost of sales: | ||||||
Amortization of intangibles | 770 | 1,377 | ||||
Total cost of sales | 28,137 | 51,397 | ||||
Gross profit | 26,654 | 48,591 | ||||
Operating expenses | 26,151 | 50,211 | ||||
Operating income (loss) | 503 | (1,620) | ||||
Net (loss) income | $ (357) | $ (4,926) | ||||
Diluted (loss) income (USD per share) | $ (0.01) | $ (0.18) | ||||
As Reported | Product | ||||||
Revenue: | ||||||
Revenue | $ 47,588 | $ 86,042 | ||||
Cost of sales: | ||||||
Cost of sales excluding amortization | 23,080 | 42,290 | ||||
As Reported | Services and Solutions | ||||||
Revenue: | ||||||
Revenue | 7,203 | 13,946 | ||||
Cost of sales: | ||||||
Cost of sales excluding amortization | 4,287 | 7,730 | ||||
ASU 2014-09 | ||||||
Revenue: | ||||||
Total Revenue | 54,548 | 99,503 | ||||
Cost of sales: | ||||||
Amortization of intangibles | 770 | 1,377 | ||||
Total cost of sales | 27,714 | 50,710 | ||||
Gross profit | 26,834 | 48,793 | ||||
Operating expenses | 26,016 | 49,974 | ||||
Operating income (loss) | 818 | (1,181) | ||||
Net (loss) income | $ (126) | $ (4,613) | ||||
Diluted (loss) income (USD per share) | $ 0 | $ (0.17) | ||||
ASU 2014-09 | Product | ||||||
Revenue: | ||||||
Revenue | $ 47,588 | $ 86,042 | ||||
Cost of sales: | ||||||
Cost of sales excluding amortization | 23,080 | 42,290 | ||||
ASU 2014-09 | Services and Solutions | ||||||
Revenue: | ||||||
Revenue | 6,960 | 13,461 | ||||
Cost of sales: | ||||||
Cost of sales excluding amortization | 3,864 | 7,043 | ||||
ASU 2014-09 | Impact of Adoption | ||||||
Revenue: | ||||||
Total Revenue | (243) | (485) | ||||
Cost of sales: | ||||||
Amortization of intangibles | 0 | 0 | ||||
Total cost of sales | (423) | (687) | ||||
Gross profit | 180 | 202 | ||||
Operating expenses | (135) | (237) | ||||
Operating income (loss) | 315 | 439 | ||||
Net (loss) income | $ 231 | $ 313 | ||||
Diluted (loss) income (USD per share) | $ 0.01 | $ 0.01 | ||||
ASU 2014-09 | Impact of Adoption | Product | ||||||
Revenue: | ||||||
Revenue | $ 0 | $ 0 | ||||
Cost of sales: | ||||||
Cost of sales excluding amortization | 0 | 0 | ||||
ASU 2014-09 | Impact of Adoption | Services and Solutions | ||||||
Revenue: | ||||||
Revenue | (243) | (485) | ||||
Cost of sales: | ||||||
Cost of sales excluding amortization | $ (423) | $ (687) | ||||
[1] | Prior period information has been restated for the adoption of ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which we adopted on October 1, 2018. |
Basis of Presentation of Unau_6
Basis of Presentation of Unaudited Interim Condensed Consolidated Financial Statements and Significant Accounting Policies - ASC 606 Balance Sheet (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Sep. 30, 2018 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Accounts receivable, net | $ 53,493 | $ 49,819 | [1] |
Property, equipment and improvements, net | 13,926 | 8,354 | [1] |
Deferred tax assets | 5,236 | 6,600 | [1] |
Unearned revenue current | 3,177 | ||
Other non-current liabilities | 530 | 720 | [1] |
Retained earnings | $ 157,985 | 151,961 | [1] |
As Reported | |||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Accounts receivable, net | 50,817 | ||
Property, equipment and improvements, net | 6,270 | ||
Deferred tax assets | 6,665 | ||
Unearned revenue current | 2,579 | ||
Other non-current liabilities | 510 | ||
Retained earnings | 151,748 | ||
Impact of Adoption | ASU 2014-09 | |||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Accounts receivable, net | (998) | ||
Property, equipment and improvements, net | 2,084 | ||
Deferred tax assets | (65) | ||
Unearned revenue current | 598 | ||
Other non-current liabilities | 210 | ||
Retained earnings | $ 213 | ||
[1] | Prior period information has been restated for the adoption of ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which we adopted on October 1, 2018. |
Acquisition (Details)
Acquisition (Details) | Jan. 22, 2018USD ($) | Oct. 20, 2017USD ($) | Mar. 31, 2019USD ($) | Mar. 31, 2018USD ($) | [1] | Jun. 30, 2018USD ($) | Dec. 31, 2019USD ($) | Sep. 30, 2018USD ($) |
Business Acquisition [Line Items] | ||||||||
Contingent consideration paid | $ 810,000 | $ (425,000) | ||||||
Accelerated | ||||||||
Business Acquisition [Line Items] | ||||||||
Cash paid at closing | $ 16,400,000 | |||||||
Cash acquired | $ 200,000 | |||||||
Earn-out payment installments | 2 | |||||||
TempAlert | ||||||||
Business Acquisition [Line Items] | ||||||||
Cash paid at closing | $ 40,700,000 | |||||||
Cash acquired | 600,000 | |||||||
Earn-out payments | Accelerated | ||||||||
Business Acquisition [Line Items] | ||||||||
Earn-out payment maximum | $ 4,500,000 | |||||||
Additional earn-out payment | Accelerated | ||||||||
Business Acquisition [Line Items] | ||||||||
Earn-out payment maximum | 2,000,000 | |||||||
Fair Value, Measurements, Recurring | Contingent Consideration | Estimate of Fair Value Measurement | ||||||||
Business Acquisition [Line Items] | ||||||||
Contingent consideration fair value | 8,527,000 | $ 10,065,000 | ||||||
Fair Value, Measurements, Recurring | Contingent Consideration | Estimate of Fair Value Measurement | Accelerated | ||||||||
Business Acquisition [Line Items] | ||||||||
Contingent consideration fair value | $ 2,300,000 | 5,400,000 | ||||||
Contingent consideration paid | $ 3,500,000 | |||||||
Fair Value, Measurements, Recurring | Contingent Consideration | Estimate of Fair Value Measurement | TempAlert | ||||||||
Business Acquisition [Line Items] | ||||||||
Contingent consideration fair value | $ 0 | $ 0 | ||||||
Forecast | Earn-out payments | TempAlert | ||||||||
Business Acquisition [Line Items] | ||||||||
Earn-out payment maximum | $ 45,000,000 | |||||||
[1] | Prior period information has been restated for the adoption of ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which we adopted on October 1, 2018. |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | |||
Numerator: | ||||||
Net income (loss) | $ 1,342 | $ (126) | [1] | $ 6,024 | $ (4,613) | [1] |
Denominator: | ||||||
Denominator for basic net income (loss) per common share — weighted average shares outstanding | 27,866,000 | 27,084,000 | [1] | 27,687,000 | 26,914,000 | [1] |
Effect of dilutive securities: | ||||||
Stock options and restricted stock units | 572,000 | 0 | [1] | 602,000 | 0 | [1] |
Denominator for diluted net income (loss) per common share — adjusted weighted average shares | 28,438,000 | 27,084,000 | [1] | 28,289,000 | 26,914,000 | [1] |
Basic net income (loss) per common share: | ||||||
Net income (loss), basic (USD per share) | $ 0.05 | $ 0 | [1] | $ 0.22 | $ (0.17) | [1] |
Diluted net income (loss) per common share | ||||||
Net income (loss), diluted (USD per share) | $ 0.05 | $ 0 | [1] | $ 0.21 | $ (0.17) | [1] |
Potentially dilutive securities excluded from computation of earnings per share | 633,752 | 1,458,297 | 683,752 | 1,988,673 | ||
Excluded incremental common shares related to common stock options and restricted stock units | 275,522 | 333,801 | ||||
[1] | Prior period information has been restated for the adoption of ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which we adopted on October 1, 2018. |
Selected Balance Sheet Data (De
Selected Balance Sheet Data (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Sep. 30, 2018 | [1] |
Accounts receivable, net: | |||
Accounts receivable | $ 57,502 | $ 53,164 | |
Less allowance for doubtful accounts | 1,271 | 785 | |
Less reserve for future returns and pricing adjustments | 2,738 | 2,560 | |
Accounts receivable, net | 53,493 | 49,819 | |
Inventories: | |||
Raw materials | 17,008 | 22,047 | |
Work in process | 1,119 | 525 | |
Finished goods | 25,908 | 19,072 | |
Inventories | $ 44,035 | $ 41,644 | |
[1] | Prior period information has been restated for the adoption of ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which we adopted on October 1, 2018. |
Marketable Securities (Fair Val
Marketable Securities (Fair Value to Amortized Cost) (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Sep. 30, 2018 | ||
Debt Securities, Available-for-sale [Line Items] | ||||
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax | $ 0 | $ 0 | ||
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Loss, before Tax | (6) | (20) | ||
Debt Securities, Available-for-sale | 2,497 | [1] | 4,736 | [2] |
Debt Securities, Available-for-sale, Amortized Cost | 2,503 | [1] | 4,756 | [2] |
Available-for-sale Securities, Purchased and accrued interest | 3 | 6 | ||
Current Assets | Certificates of Deposit | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax | 0 | 0 | ||
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Loss, before Tax | (6) | (20) | ||
Debt Securities, Available-for-sale | 2,497 | [1] | 4,736 | [2] |
Debt Securities, Available-for-sale, Amortized Cost | $ 2,503 | [1] | $ 4,756 | [2] |
[1] | Included in amortized cost and fair value is purchased and accrued interest of $3 | |||
[2] | Included in amortized cost and fair value is purchased and accrued interest of $6. |
Marketable Securities (Fair V_2
Marketable Securities (Fair Value and Gross Unrealized Losses for AFS) (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Sep. 30, 2018 |
Debt Securities, Available-for-sale [Line Items] | ||
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months | $ 0 | $ 0 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | 0 | 0 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer | 2,497 | 4,736 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | (6) | (20) |
Certificates of Deposit | ||
Debt Securities, Available-for-sale [Line Items] | ||
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months | 0 | 0 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | 0 | 0 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer | 2,497 | 4,736 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | $ (6) | $ (20) |
Fair Value Measurements (Financ
Fair Value Measurements (Financial Assets and Liabilities) (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Available-for-sale marketable securities | $ 2,497 | [1] | $ 4,736 | [2] | ||||
Fair Value, Inputs, Level 1 | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Total assets measured at fair value | 27,883 | 24,318 | ||||||
Total liabilities measured at fair value | 0 | 0 | ||||||
Fair Value, Inputs, Level 2 | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Total assets measured at fair value | 2,497 | 4,736 | ||||||
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 | 8,527 | $ 10,147 | 10,065 | $ 8,263 | $ 5,981 | $ 6,388 | ||
Fair Value, Inputs, Level 3 | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Total assets measured at fair value | 0 | 0 | ||||||
Total liabilities measured at fair value | 8,527 | 10,065 | ||||||
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 | 8,527 | 10,065 | ||||||
Money market | Fair Value, Inputs, Level 1 | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Cash equivalents | 27,883 | 24,318 | ||||||
Money market | Fair Value, Inputs, Level 2 | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Cash equivalents | 0 | 0 | ||||||
Money market | Fair Value, Inputs, Level 3 | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Cash equivalents | 0 | 0 | ||||||
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 | 2,497 | 4,736 | ||||||
Certificates of Deposit | Fair Value, Inputs, Level 3 | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Available-for-sale marketable securities | 0 | 0 | ||||||
Estimate of Fair Value Measurement | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Total assets measured at fair value | 30,380 | 29,054 | ||||||
Total liabilities measured at fair value | 8,527 | 10,065 | ||||||
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 | 8,527 | 10,065 | ||||||
Estimate of Fair Value Measurement | Money market | Fair Value, Measurements, Recurring | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Cash equivalents | 27,883 | 24,318 | ||||||
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 | $ 2,497 | $ 4,736 | ||||||
[1] | Included in amortized cost and fair value is purchased and accrued interest of $3 | |||||||
[2] | Included in amortized cost and fair value is purchased and accrued interest of $6. |
Fair Value Measurements (Reconc
Fair Value Measurements (Reconciliation of Liability) (Details) - Fair Value, Inputs, Level 3 - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Fair value at beginning of period | $ 10,147 | $ 5,981 | $ 10,065 | $ 6,388 |
Purchase price contingent consideration | 0 | 2,300 | 0 | 2,300 |
Contingent consideration payments | (2,187) | 0 | (2,348) | 0 |
Change in fair value of contingent consideration | 567 | (18) | 810 | (425) |
Fair value at end of period | $ 8,527 | $ 8,263 | $ 8,527 | $ 8,263 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) | Oct. 05, 2015 | Dec. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Jan. 22, 2018 | Dec. 31, 2017 | Oct. 20, 2017 | Nov. 01, 2016 | |
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Payment for contingent consideration | $ 2,348,000 | $ 0 | [1] | ||||||||
Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Contingent consideration fair value | $ 10,147,000 | 8,527,000 | $ 8,263,000 | $ 10,065,000 | $ 6,388,000 | $ 5,981,000 | |||||
Contingent Consideration | Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 1 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Contingent consideration fair value | 0 | 0 | |||||||||
Contingent Consideration | Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Contingent consideration fair value | 0 | 0 | |||||||||
Contingent Consideration | Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Contingent consideration fair value | $ 8,527,000 | 10,065,000 | |||||||||
Bluenica Corporation | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Earn-out payment installment period | 4 years | ||||||||||
Bluenica Corporation | Minimum | Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Fair value inputs probability of payment | 95.00% | ||||||||||
Bluenica Corporation | Maximum | Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Fair value inputs probability of payment | 100.00% | ||||||||||
Bluenica Corporation | Contingent Consideration | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Payment for contingent consideration | $ 2,200,000 | ||||||||||
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 | Contingent Consideration | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Payment for contingent consideration | $ 200,000 | ||||||||||
TempAlert | Maximum | Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Fair value inputs probability of payment | 0.00% | ||||||||||
Accelerated | Maximum | Fair Value, Inputs, Level 3 | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Fair value inputs probability of payment | 70.00% | ||||||||||
Estimate of Fair Value Measurement | Contingent Consideration | Fair Value, Measurements, Recurring | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Contingent consideration fair value | $ 8,527,000 | $ 10,065,000 | |||||||||
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 | 3,200,000 | |||||||||
Estimate of Fair Value Measurement | FreshTemp | Contingent Consideration | Fair Value, Measurements, Recurring | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Contingent consideration fair value | $ 1,300,000 | ||||||||||
Estimate of Fair Value Measurement | TempAlert | Contingent Consideration | Fair Value, Measurements, Recurring | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Contingent consideration fair value | 0 | $ 0 | |||||||||
Estimate of Fair Value Measurement | Accelerated | Contingent Consideration | Fair Value, Measurements, Recurring | |||||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||||
Contingent consideration fair value | $ 5,400,000 | $ 2,300,000 | |||||||||
[1] | Prior period information has been restated for the adoption of ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which we adopted on October 1, 2018. |
Goodwill and Other Identifiab_3
Goodwill and Other Identifiable Intangible Assets, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | Sep. 30, 2018 | |||
Finite-Lived Intangible Assets [Line Items] | |||||||
Gross carrying amount | $ 122,878 | $ 122,878 | $ 122,910 | ||||
Accumulated amortization | (88,071) | (88,071) | (83,590) | ||||
Net | 34,807 | 34,807 | 39,320 | [1] | |||
Amortization expense | 4,609 | $ 4,287 | [1] | ||||
Purchased and Core Technology | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Gross carrying amount | 58,011 | 58,011 | 58,102 | ||||
Accumulated amortization | (49,938) | (49,938) | (48,693) | ||||
Net | 8,073 | 8,073 | 9,409 | ||||
License Agreements | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Gross carrying amount | 102 | 102 | 102 | ||||
Accumulated amortization | (60) | (60) | (46) | ||||
Net | 42 | 42 | 56 | ||||
Patents and Trademarks | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Gross carrying amount | 15,835 | 15,835 | 15,701 | ||||
Accumulated amortization | (12,777) | (12,777) | (12,242) | ||||
Net | 3,058 | 3,058 | 3,459 | ||||
Customer Relationships | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Gross carrying amount | 46,530 | 46,530 | 46,605 | ||||
Accumulated amortization | (23,226) | (23,226) | (21,049) | ||||
Net | 23,304 | 23,304 | 25,556 | ||||
Non-compete Agreements | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Gross carrying amount | 600 | 600 | 600 | ||||
Accumulated amortization | (270) | (270) | (210) | ||||
Net | 330 | 330 | 390 | ||||
Order backlog | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Gross carrying amount | 1,800 | 1,800 | 1,800 | ||||
Accumulated amortization | (1,800) | (1,800) | (1,350) | ||||
Net | 0 | 0 | $ 450 | ||||
Cost of Sales and General and Administrative Expense | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Amortization expense | $ 2,100 | $ 2,600 | $ 4,600 | $ 4,300 | |||
[1] | Prior period information has been restated for the adoption of ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which we adopted on October 1, 2018. |
Goodwill and Other Identifiab_4
Goodwill and Other Identifiable Intangible Assets, Net (Additional Information) (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | |
Goodwill [Line Items] | ||||
Goodwill | $ 154,049 | $ 154,535 | [1] | |
Market Capitalization | $ 359,600 | |||
IoT Products & Services Segment | ||||
Goodwill [Line Items] | ||||
Goodwill | 104,236 | 104,358 | $ 104,600 | |
Reporting Unit, Percentage of Fair Value in Excess of Carrying Amount | 36.00% | |||
IoT Solutions Segment | ||||
Goodwill [Line Items] | ||||
Goodwill | $ 49,813 | $ 50,177 | $ 50,000 | |
Reporting Unit, Percentage of Fair Value in Excess of Carrying Amount | 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% | |||
[1] | Prior period information has been restated for the adoption of ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which we adopted on October 1, 2018. |
Goodwill and Other Identifiab_5
Goodwill and Other Identifiable Intangible Assets, Net (Amortization Expense) (Details) $ in Thousands | Mar. 31, 2019USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2019 (six months) | $ 4,193 |
2020 | 8,237 |
2021 | 7,430 |
2022 | 6,568 |
2023 | 4,392 |
2024 | $ 3,701 |
Goodwill and Other Identifiab_6
Goodwill and Other Identifiable Intangible Assets, Net (Goodwill Rollforward) (Details) $ in Thousands | 6 Months Ended | |
Mar. 31, 2019USD ($) | ||
Goodwill [Roll Forward] | ||
Beginning balance | $ 154,535 | [1] |
Acquisitions | 0 | |
Foreign currency translation adjustment | (486) | |
Ending balance | 154,049 | |
IoT Solutions Segment | ||
Goodwill [Roll Forward] | ||
Beginning balance | 50,177 | |
Acquisitions | 0 | |
Foreign currency translation adjustment | (364) | |
Ending balance | 49,813 | |
IoT Products & Services Segment | ||
Goodwill [Roll Forward] | ||
Beginning balance | 104,358 | |
Acquisitions | 0 | |
Foreign currency translation adjustment | (122) | |
Ending balance | $ 104,236 | |
[1] | Prior period information has been restated for the adoption of ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which we adopted on October 1, 2018. |
Sale of Building (Details)
Sale of Building (Details) $ in Thousands | Oct. 02, 2018USD ($)ft² | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Mar. 31, 2019USD ($) | Mar. 31, 2018USD ($) | [1] | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||
Assets held for sale | $ 5,220 | [1] | $ 0 | |||||
Gain on sale | 4,395 | $ (5) | ||||||
Minnetonka, MN | ||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||
Area of real estate sold (in sqft) | ft² | 130,000 | |||||||
Proceeds from sale of buildings | $ 10,000 | |||||||
Assets held for sale | [1] | 5,200 | ||||||
Tax benefit related to sale of building | $ 1,100 | |||||||
Gain on sale | $ 4,400 | |||||||
Gain on sale, net of deferred tax | $ 3,400 | |||||||
Hopkins, MN | ||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||
Payment for leasehold improvements | $ 6,100 | |||||||
Leasehold Improvements | Hopkins, MN | ||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||
Useful life | 10 years | |||||||
[1] | Prior period information has been restated for the adoption of ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which we adopted on October 1, 2018. |
Segment Information (Details)
Segment Information (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Mar. 31, 2019USD ($) | Mar. 31, 2018USD ($) | Mar. 31, 2019USD ($)segment | Mar. 31, 2018USD ($) | [1] | ||
Segment Reporting Information [Line Items] | ||||||
Number of Reportable Segments | segment | 2 | |||||
Total Revenue | $ 65,764 | $ 54,548 | [1] | $ 128,077 | $ 99,503 | |
Operating income (loss) | 785 | 818 | [1] | 6,343 | (1,181) | |
Depreciation and amortization | 3,153 | 3,380 | 6,826 | 5,833 | ||
IoT Products & Services Segment | ||||||
Segment Reporting Information [Line Items] | ||||||
Total Revenue | 56,039 | 49,825 | 109,333 | 90,705 | ||
Operating income (loss) | 3,450 | 4,689 | 10,852 | 5,953 | ||
Depreciation and amortization | 1,378 | 1,729 | 3,320 | 2,578 | ||
IoT Solutions Segment | ||||||
Segment Reporting Information [Line Items] | ||||||
Total Revenue | 9,725 | 4,723 | 18,744 | 8,798 | ||
Operating income (loss) | (2,665) | (3,871) | (4,509) | (7,134) | ||
Depreciation and amortization | $ 1,775 | $ 1,651 | $ 3,506 | $ 3,255 | ||
[1] | Prior period information has been restated for the adoption of ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which we adopted on October 1, 2018. |
Segment Information Expended fo
Segment Information Expended for Property, Plant and Equipment (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | ||
Segment Reporting Information [Line Items] | |||
Expended of property, equipment, improvements and certain other intangible assets | $ 7,346 | $ 785 | [1] |
IoT Products & Services Segment | |||
Segment Reporting Information [Line Items] | |||
Expended of property, equipment, improvements and certain other intangible assets | 7,289 | 785 | |
IoT Solutions Segment | |||
Segment Reporting Information [Line Items] | |||
Expended of property, equipment, improvements and certain other intangible assets | $ 57 | $ 0 | |
[1] | Prior period information has been restated for the adoption of ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which we adopted on October 1, 2018. |
Segment Information Total Asset
Segment Information Total Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Sep. 30, 2018 | [1] | |
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Assets | $ 383,535 | $ 372,146 | ||
IoT Products & Services Segment | ||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Assets | 216,601 | 209,574 | ||
IoT Solutions Segment | ||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Assets | 94,844 | 99,822 | ||
Unallocated | ||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Assets | [2] | $ 72,090 | $ 62,750 | |
[1] | Prior period information has been restated for the adoption of ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which we adopted on October 1, 2018. | |||
[2] | Unallocated consists of cash and cash equivalents and current marketable securities. |
Revenue - Disaggregation of Rev
Revenue - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | |||
Disaggregation of Revenue [Line Items] | ||||||
Total Revenue | $ 65,764 | $ 54,548 | [1] | $ 128,077 | $ 99,503 | [1] |
North America, primarily the United States | ||||||
Disaggregation of Revenue [Line Items] | ||||||
Total Revenue | 48,869 | 39,169 | 95,204 | 68,506 | ||
Europe, Middle East & Africa | ||||||
Disaggregation of Revenue [Line Items] | ||||||
Total Revenue | 10,764 | 9,504 | 20,868 | 19,660 | ||
Other locations | ||||||
Disaggregation of Revenue [Line Items] | ||||||
Total Revenue | 6,131 | 5,875 | 12,005 | 11,337 | ||
IoT Products & Services Segment | ||||||
Disaggregation of Revenue [Line Items] | ||||||
Total Revenue | 56,039 | 49,825 | 109,333 | 90,705 | [1] | |
IoT Products & Services Segment | Hardware product | ||||||
Disaggregation of Revenue [Line Items] | ||||||
Total Revenue | 52,097 | 47,588 | 102,909 | 86,042 | ||
IoT Products & Services Segment | Services | ||||||
Disaggregation of Revenue [Line Items] | ||||||
Total Revenue | 3,942 | 2,237 | 6,424 | 4,663 | ||
IoT Solutions Segment | ||||||
Disaggregation of Revenue [Line Items] | ||||||
Total Revenue | 9,725 | 4,723 | 18,744 | 8,798 | [1] | |
IoT Solutions Segment | Solutions | ||||||
Disaggregation of Revenue [Line Items] | ||||||
Total Revenue | $ 9,725 | $ 4,723 | $ 18,744 | $ 8,798 | ||
[1] | Prior period information has been restated for the adoption of ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which we adopted on October 1, 2018. |
Revenue - Additional Informatio
Revenue - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | Sep. 30, 2018 | |
Disaggregation of Revenue [Line Items] | |||||
Period of amortization | 3 years | 3 years | |||
Amortization | $ 0.2 | $ 0.1 | $ 0.4 | $ 0.1 | |
Minimum | |||||
Disaggregation of Revenue [Line Items] | |||||
Remaining performance obligation, period | 2 years | 2 years | |||
Maximum | |||||
Disaggregation of Revenue [Line Items] | |||||
Remaining performance obligation, period | 5 years | 5 years | |||
Equipment | |||||
Disaggregation of Revenue [Line Items] | |||||
Contract assets | $ 2.3 | $ 2.3 | $ 2.1 |
Revenue - Unearned Revenue (Det
Revenue - Unearned Revenue (Details) $ in Thousands | 6 Months Ended | |
Mar. 31, 2019USD ($) | ||
Unearned Revenue [Roll Forward] | ||
Unearned revenue, beginning of period | $ 3,933 | [1] |
Billings | 13,613 | |
Revenue recognized | (10,497) | |
Unearned revenue, end of period | $ 7,049 | |
[1] | Prior period information has been restated for the adoption of ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which we adopted on October 1, 2018. |
Revenue - Performance Obligatio
Revenue - Performance Obligations (Details) $ in Millions | Mar. 31, 2019USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 3.8 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: (nil) | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 7.3 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Mar. 31, 2019 | Mar. 31, 2018 | [1] | Mar. 31, 2019 | Mar. 31, 2018 | ||
Income Tax Disclosure [Abstract] | ||||||
Income tax expense (benefit) | $ (158) | $ 451 | $ 882 | $ 3,099 | [1] | |
Income tax expense (benefit) specific to the period | $ (300) | $ 3,000 | ||||
[1] | Prior period information has been restated for the adoption of ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which we adopted on October 1, 2018. |
Income Taxes (Unrecognized Tax
Income Taxes (Unrecognized Tax Benefits) (Details) $ in Thousands | 6 Months Ended |
Mar. 31, 2019USD ($) | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |
Unrecognized tax benefits, beginning balance | $ 1,561 |
Decreases resulting from prior year tax positions | (31) |
Decreases related to expiration of statute of limitations | (56) |
Unrecognized tax benefits, ending balance | 1,474 |
Unrecognized tax benefits that would impact effective tax rate | 1,300 |
Decrease in Unrecognized Tax Benefits is Reasonably Possible | $ 100 |
Product Warranty Obligation (De
Product Warranty Obligation (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | |
Standard Product Warranty Accrual [Roll Forward] | ||||
Beginning balance | $ 1,140 | $ 1,164 | $ 1,172 | $ 987 |
Warranties issued | 144 | 362 | 216 | 716 |
Settlements made | (175) | (178) | (279) | (355) |
Ending balance | $ 1,109 | $ 1,348 | $ 1,109 | $ 1,348 |
Commitments and Contingencies A
Commitments and Contingencies Addition Information (Details) $ in Thousands | 1 Months Ended | ||
Apr. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Oct. 31, 2018USD ($)ft² | |
Subsequent Event [Line Items] | |||
Total minimum payments due | $ 23,466 | ||
Hopkins, MN | |||
Subsequent Event [Line Items] | |||
Term of contract | 13 years | ||
Total minimum payments due | $ 14,800 | ||
Area of real estate | ft² | 59,497 | ||
Hopkins, MN | Subsequent Event | |||
Subsequent Event [Line Items] | |||
Proceeds from tenant improvement allowance | $ (3,300) |
Commitments and Contingencies L
Commitments and Contingencies Lease Commitments (Details) $ in Thousands | Mar. 31, 2019USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2019 (six months) | $ 995 |
2020 | 2,541 |
2021 | 2,495 |
2022 | 2,224 |
2023 | 2,054 |
2024 | 2,101 |
Thereafter | 11,056 |
Total minimum payments due | $ 23,466 |
Commitments and Contingencies C
Commitments and Contingencies Contingencies (Details) $ in Millions | 6 Months Ended |
Mar. 31, 2019CAD ($) | |
DimOnOff Inc. | |
Loss Contingencies [Line Items] | |
Damages sought | $ 1 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) $ in Thousands | 6 Months Ended | |||
Mar. 31, 2019 | Mar. 31, 2018 | Feb. 04, 2019 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares Paid for Tax Withholding for Share Based Compensation | 91,040 | 68,611 | ||
Tax withholding for share-based compensation | $ 1,000 | $ 700 | ||
Employee contributions | 549 | 618 | [1] | |
Total intrinsic value of all options exercised | 1,600 | 500 | ||
Stock Options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total unrecognized compensation cost nonvested awards | $ 4,800 | |||
Weighted average period, unrecognized compensation cost, nonvested awards | 2 years 9 months 18 days | |||
Restricted Stock Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total unrecognized compensation cost nonvested restricted stock units | $ 8,500 | |||
Weighted average period, unrecognized compensation cost, nonvested awards | 1 year 9 months 18 days | |||
The 2019 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 | 1,524,170 | |||
The 2019 Plan | Stock Options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 4 years | |||
Expiration period | 7 years | |||
The Purchase Plan | The Purchase Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Employee contributions | $ 500 | $ 600 | ||
Common shares issued to employees | 63,694 | 74,381 | ||
Shares available for future issuance | 251,882 | |||
Director | The 2019 Plan | Restricted Stock Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 1 year | |||
Executives and Employees | The 2019 Plan | Restricted Stock Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 4 years | |||
[1] | Prior period information has been restated for the adoption of ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which we adopted on October 1, 2018. |
Stock-Based Compensation (Stock
Stock-Based Compensation (Stock-Based Compensation Expense) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation before income taxes | $ 1,293 | $ 1,325 | $ 2,707 | $ 2,378 |
Income tax benefit | (263) | (277) | (557) | (498) |
Stock-based compensation after income taxes | 1,030 | 1,048 | 2,150 | 1,880 |
Cost of Sales | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation before income taxes | 25 | 46 | 80 | 96 |
Sales and Marketing | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation before income taxes | 466 | 391 | 819 | 725 |
Research and Development | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation before income taxes | 269 | 167 | 469 | 175 |
General and Administrative | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation before income taxes | $ 533 | $ 721 | $ 1,339 | $ 1,382 |
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 | 6 Months Ended | |
Mar. 31, 2019USD ($)$ / sharesshares | ||
Options Outstanding [Roll Forward] | ||
Options Outstanding, Beginning Balance (in shares) | shares | 3,526 | |
Options Outstanding, Granted (in shares) | shares | 590 | |
Options Outstanding, Exercised (in shares) | shares | (410) | |
Options Outstanding, Forfeited / Canceled (in shares) | shares | (301) | |
Options Outstanding, Ending Balance (in shares) | shares | 3,405 | |
Options Outstanding, Exercisable (in shares) | shares | 2,192 | |
Weighted Average Exercise Price [Roll Forward] | ||
Weighted Average Exercise Price, Beginning Balance | $ 10.49 | |
Weighted Average Exercise Price, Granted | 10.92 | |
Weighted Average Exercise Price, Exercised | 9.14 | |
Weighted Average Exercise Price, Forfeited / Canceled | 12.64 | |
Weighted Average Exercise Price, Ending Balance | 10.67 | |
Weighted Average Exercise Price, Exercisable | $ 10.29 | |
Weighted Average Remaining Contractual Term [Abstract] | ||
Weighted Average Remaining Contractual Term, Outstanding | 4 years 3 months 18 days | |
Weighted Average Remaining Contractual Term, Exercisable | 3 years 3 months 18 days | |
Aggregate Intrinsic Value [Abstract] | ||
Aggregate Intrinsic Value, Outstanding | $ | $ 7,154 | [1] |
Aggregate Intrinsic Value, Exercisable | $ | $ 5,434 | [1] |
Closing Stock Price | $ 12.67 | |
[1] | The aggregate intrinsic value represents the total pre-tax intrinsic value, based on our closing stock price of $12.67 as of March 31, 2019, which would have been received by the option holders had all option holders exercised their options as of that date. The intrinsic value of an option is the amount by which the fair value of the underlying stock exceeds its exercise price. |
Stock-Based Compensation (Fair
Stock-Based Compensation (Fair Value Assumptions) (Details) - Stock Options - $ / shares | 6 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted average per option grant date fair value | $ 4.36 | $ 3.72 |
Assumptions Used For Options Grants [Abstract] | ||
Risk free interest rate, minimum | 2.56% | 2.12% |
Risk free interest rate, maximum | 2.93% | 2.58% |
Expected term | 6 years | 6 years |
Expected volatility rate, minimum | 33.00% | 33.00% |
Expected volatility rate, maximum | 34.00% | 34.00% |
Weighted average volatility | 33.00% | 33.00% |
Expected dividend yield | 0.00% | 0.00% |
Stock-Based Compensation (Non-V
Stock-Based Compensation (Non-Vested Options) (Details) - Restricted Stock Units shares in Thousands | 6 Months Ended |
Mar. 31, 2019$ / sharesshares | |
Nonvested Number of Restricted Stock Units [Roll Forward] | |
Number of Restricted Stock Units, Beginning Balance | shares | 674 |
Number of Restricted Stock Units, Granted | shares | 534 |
Number of Restricted Stock Units, Vested | shares | (248) |
Number of Restricted Stock Units, Canceled | shares | (115) |
Number of Restricted Stock Units, Ending Balance | shares | 845 |
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 | $ 11.05 |
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Granted | $ / shares | 11.60 |
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Vested | $ / shares | 10.42 |
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Canceled | $ / shares | 12.31 |
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Ending Balance | $ / shares | $ 11.41 |
Restructuring (Details)
Restructuring (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | [1] | |
Restructuring Reserve [Roll Forward] | |||
Reversals | $ (67) | $ 0 | |
IoT Products & Services Segment | |||
Restructuring Reserve [Roll Forward] | |||
Restructuring Reserve | 453 | ||
Payments | (359) | ||
Reversals | (67) | ||
Foreign currency fluctuation | (7) | ||
Restructuring Reserve | 20 | ||
IoT Products & Services Segment | Employee Termination Costs | Manufacturing Transition | |||
Restructuring Reserve [Roll Forward] | |||
Restructuring Reserve | 147 | ||
Payments | (108) | ||
Reversals | (19) | ||
Foreign currency fluctuation | 0 | ||
Restructuring Reserve | 20 | ||
IoT Products & Services Segment | Employee Termination Costs | 2017 Restructuring | |||
Restructuring Reserve [Roll Forward] | |||
Restructuring Reserve | 293 | ||
Payments | (233) | ||
Reversals | (53) | ||
Foreign currency fluctuation | (7) | ||
Restructuring Reserve | 0 | ||
IoT Products & Services Segment | Contract Termination Costs | 2017 Restructuring | |||
Restructuring Reserve [Roll Forward] | |||
Restructuring Reserve | 13 | ||
Payments | (18) | ||
Reversals | 5 | ||
Foreign currency fluctuation | 0 | ||
Restructuring Reserve | $ 0 | ||
[1] | Prior period information has been restated for the adoption of ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which we adopted on October 1, 2018. |
Restructuring - Additional Info
Restructuring - Additional Information (Details) - IoT Products & Services Segment $ in Millions | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended |
May 31, 2017employee | Jun. 30, 2017USD ($) | Sep. 30, 2018USD ($)employee | Sep. 30, 2019USD ($) | |
Manufacturing Transition | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Number of employees eliminated | employee | 53 | |||
2017 Restructuring | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charge | $ 2.5 | |||
Employee Termination Costs | Manufacturing Transition | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charge | $ 0.5 | |||
Employee Termination Costs | 2017 Restructuring | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charge | 2.3 | |||
Contract Termination Costs | 2017 Restructuring | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charge | $ 0.2 | |||
Forecast | Minimum | Manufacturing Transition | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Effect on future earnings | $ 3 | |||
Forecast | Maximum | Manufacturing Transition | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Effect on future earnings | $ 5 | |||
United States | 2017 Restructuring | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Number of employees eliminated | employee | 10 | |||
France | 2017 Restructuring | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Number of employees eliminated | employee | 8 |
Common Stock Repurchase (Detail
Common Stock Repurchase (Details) - May 2018 Repurchase program - USD ($) | 6 Months Ended | |
Mar. 31, 2019 | Apr. 24, 2018 | |
Stock repurchase program, authorized amount | $ 20,000,000 | |
Shares repurchased | 0 |