Cover Page
Cover Page - USD ($) | 12 Months Ended | ||
Sep. 30, 2020 | Nov. 20, 2020 | Mar. 31, 2020 | |
Entity Information [Line Items] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Sep. 30, 2020 | ||
Document Transition Report | false | ||
Entity File Number | 001-34033 | ||
Entity Registrant Name | DIGI INTERNATIONAL INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 41-1532464 | ||
Entity Address, Address Line One | 9350 Excelsior Blvd. | ||
Entity Address, Address Line Two | Suite 700 | ||
Entity Address, City or Town | Hopkins | ||
Entity Address, State or Province | MN | ||
Entity Address, Postal Zip Code | 55343 | ||
City Area Code | 952 | ||
Local Phone Number | 912-3444 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 272,901,608 | ||
Entity Common Stock, Shares Outstanding | 29,241,998 | ||
Entity Central Index Key | 0000854775 | ||
Current Fiscal Year End Date | --09-30 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
NASDAQ - ALL MARKETS [Member] | |||
Entity Information [Line Items] | |||
Title of 12(b) Security | Common Stock, par value $.01 per share | ||
Trading Symbol | DGII | ||
Security Exchange Name | NASDAQ |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 | |
Revenue: | |||
Revenue | $ 279,271 | $ 254,203 | $ 226,893 |
Cost of sales: | |||
Amortization | 4,487 | 2,963 | 2,871 |
Total cost of sales | 135,299 | 135,168 | 117,839 |
Gross profit | 143,972 | 119,035 | 109,054 |
Operating expenses: | |||
Sales and marketing | 52,761 | 45,801 | 44,517 |
Research and development | 43,765 | 37,564 | 33,178 |
General and administrative | 36,012 | 25,685 | 28,276 |
Restructuring charge (reversal) | 117 | (87) | 301 |
Total operating expenses | 132,655 | 108,963 | 106,272 |
Operating income | 11,317 | 10,072 | 2,782 |
Other (expense) income, net: | |||
Interest income | 304 | 733 | 445 |
Interest expense | (3,592) | (102) | (25) |
Other (expense) income, net | (566) | 442 | 48 |
Total other (expense) income, net | (3,854) | 1,073 | 468 |
Income before income taxes | 7,463 | 11,145 | 3,250 |
Income tax (benefit) expense | (948) | 1,187 | 1,619 |
Net income | $ 8,411 | $ 9,958 | $ 1,631 |
Net income per common share: | |||
Basic | $ 0.29 | $ 0.36 | $ 0.06 |
Diluted net income per common share: | |||
Diluted | $ 0.28 | $ 0.35 | $ 0.06 |
Weighted average common shares: | |||
Basic (shares) | 28,849 | 27,905 | 27,083 |
Diluted (shares) | 29,546 | 28,554 | 27,652 |
Product | |||
Revenue: | |||
Revenue | $ 248,374 | $ 224,530 | $ 201,737 |
Cost of sales: | |||
Cost of sales | 118,322 | 118,855 | 104,639 |
Service | |||
Revenue: | |||
Revenue | 30,897 | 29,673 | 25,156 |
Cost of sales: | |||
Cost of sales | $ 12,490 | $ 13,350 | $ 10,329 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 | ||
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 8,411 | $ 9,958 | $ 1,631 | |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translation adjustment | 1,698 | (2,003) | (865) | |
Change in net unrealized gain (loss) on investments | 0 | 19 | (31) | |
Less income tax (expense) benefit | 0 | (5) | 6 | |
Reclassification of realized loss on investments included in net income (1) | [1] | 0 | 0 | 31 |
Less income tax benefit (2) | [2] | 0 | 0 | (8) |
Other comprehensive income (loss), net of tax | 1,698 | (1,989) | (867) | |
Comprehensive income | $ 10,109 | $ 7,969 | $ 764 | |
[1] | Recorded in Other (expense) income, net in our Consolidated Statements of Operations. | |||
[2] | Recorded in Income tax (benefit) expense in our Consolidated Statements of Operations. |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2020 | Sep. 30, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 54,129 | $ 92,792 |
Accounts receivable, net | 59,227 | 56,417 |
Inventories | 51,568 | 39,764 |
Other current assets | 5,134 | 3,574 |
Total current assets | 170,058 | 192,547 |
Property, equipment and improvements, net | 11,507 | 13,857 |
Identifiable intangible assets, net | 121,248 | 30,667 |
Goodwill | 210,135 | 153,422 |
Deferred tax assets | 389 | 7,330 |
Operating lease right-of-use assets | 14,334 | 0 |
Other non-current assets | 1,011 | 875 |
Total assets | 528,682 | 398,698 |
Current liabilities: | ||
Current portion of long-term debt | 1,972 | 0 |
Accounts payable | 28,067 | 21,183 |
Accrued compensation | 9,372 | 8,733 |
Unearned revenue | 7,691 | 5,025 |
Contingent consideration on acquired businesses | 4,228 | 5,407 |
Current portion of operating lease liabilities | 2,527 | 0 |
Other current liabilities | 7,373 | 4,110 |
Total current liabilities | 61,230 | 44,458 |
Income taxes payable | 1,958 | 1,192 |
Deferred tax liabilities | 17,171 | 261 |
Long-term Debt | 58,980 | 0 |
Operating lease liabilities | 16,193 | 0 |
Other non-current liabilities | 1,650 | 3,809 |
Total liabilities | 157,182 | 49,720 |
Commitments and Contingencies (see Note 17) | ||
Stockholders’ equity: | ||
Preferred stock, $.01 par value; 2,000,000 shares authorized; none issued and outstanding | 0 | 0 |
Common stock, $.01 par value; 60,000,000 shares authorized; 35,512,843 and 34,608,003 shares issued | 355 | 346 |
Additional paid-in capital | 279,741 | 266,567 |
Retained earnings | 170,330 | 161,919 |
Accumulated other comprehensive loss | (23,817) | (25,515) |
Treasury stock, at cost, 6,353,094 and 6,367,428 shares | (55,109) | (54,339) |
Total stockholders’ equity | 371,500 | 348,978 |
Total liabilities and stockholders’ equity | $ 528,682 | $ 398,698 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2020 | Sep. 30, 2019 |
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 | 35,512,843 | 34,608,003 |
Treasury stock, shares | 6,353,094 | 6,367,428 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 | |
Operating activities: | |||
Net income | $ 8,411 | $ 9,958 | $ 1,631 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |||
Depreciation of property, equipment and improvements | 4,545 | 4,578 | 3,349 |
Amortization of identifiable intangible assets | 14,754 | 8,818 | 9,435 |
Stock-based compensation | 7,237 | 5,655 | 4,854 |
Deferred income tax benefit | (3,357) | (799) | (376) |
Gain on sale of property, equipment and improvements | 0 | (4,392) | (622) |
Change in fair value of contingent consideration | (128) | 1,190 | 1,377 |
Provision for bad debt and product returns | 2,135 | 635 | 1,120 |
Provision for inventory obsolescence | 2,630 | 1,874 | 2,056 |
Other, net | 366 | (156) | 368 |
Changes in operating assets and liabilities (net of acquisitions): | |||
Accounts receivable | 5,539 | (6,589) | (16,004) |
Inventories | (11,133) | (1,062) | (11,344) |
Other assets | (704) | (866) | (1,412) |
Income taxes | (1,100) | (103) | 697 |
Accounts payable | 3,205 | 8,232 | 2,728 |
Accrued expenses | 2,078 | 1,991 | (635) |
Net cash provided by (used in) operating activities | 34,478 | 28,964 | (2,778) |
Investing activities: | |||
Proceeds from maturities of marketable securities | 0 | 4,750 | 32,032 |
Proceeds from sale of business | 0 | 0 | 2,000 |
Acquisition of businesses, net of cash acquired | (136,098) | 0 | (56,258) |
Proceeds from sale of property and equipment | 0 | 10,096 | 731 |
Purchase of property, equipment, improvements and certain other intangible assets | (899) | (9,335) | (1,842) |
Net cash (used in) provided by investing activities | (136,997) | 5,511 | (23,337) |
Financing activities: | |||
Proceeds from long-term debt | 119,018 | 0 | 0 |
Payments on long-term debt | (55,893) | 0 | 0 |
Acquisition earn-out payments | (4,698) | (3,748) | 0 |
Proceeds from stock option plan transactions | 5,902 | 4,874 | 5,460 |
Proceeds from employee stock purchase plan transactions | 1,065 | 1,058 | 1,115 |
Taxes paid for net share settlement of share-based payment awards | (1,791) | (1,071) | (748) |
Net cash provided by financing activities | 63,603 | 1,113 | 5,827 |
Effect of exchange rate changes on cash and cash equivalents | 253 | (810) | 80 |
Net (decrease) increase in cash and cash equivalents | (38,663) | 34,778 | (20,208) |
Cash and cash equivalents, beginning of period | 92,792 | 58,014 | 78,222 |
Cash and cash equivalents, end of period | 54,129 | 92,792 | 58,014 |
Supplemental disclosures of cash flow information: | |||
Interest paid | 3,009 | 1 | 10 |
Income taxes paid, net | 3,686 | 2,048 | 1,235 |
Supplemental schedule of non-cash investing and financing activities: | |||
Accrual for property, equipment, improvements and certain other intangibles assets | (26) | 0 | (78) |
Transfer of inventory to property, equipment and improvements | (1,363) | (1,064) | (2,159) |
Liability related to acquisition of business | $ (5,100) | $ 0 | $ (2,300) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment [Member] | Common Stock | Treasury Stock | Additional Paid-in Capital | Additional Paid-in CapitalCumulative Effect, Period of Adoption, Adjustment [Member] | Retained Earnings | Retained EarningsCumulative Effect, Period of Adoption, Adjustment [Member] | Accumulated Other Comprehensive Loss |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Cumulative-effect adjustment from adoption of ASU 2016-09 | $ 319,029 | $ 19 | $ 330 | $ (54,533) | $ 245,528 | $ 52 | $ 150,363 | $ (33) | $ (22,659) |
Beginning balance at Sep. 30, 2017 | 319,029 | 19 | $ 330 | $ (54,533) | 245,528 | 52 | 150,363 | (33) | (22,659) |
Beginning balance (in shares) at Sep. 30, 2017 | 33,008 | 6,437 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Cumulative-effect adjustment from adoption of ASU 2016-09 | 330,493 | $ 19 | $ 338 | $ (54,216) | 255,936 | $ 52 | 151,961 | $ (33) | (23,526) |
Net income | 1,631 | 1,631 | |||||||
Other comprehensive income (loss) | (867) | (867) | |||||||
Employee stock purchase issuances (in shares) | (126) | ||||||||
Employee stock purchase issuances | 1,115 | $ 1,065 | 50 | ||||||
Repurchase of common stock (in shares) | 74 | ||||||||
Repurchase of common stock | (748) | $ (748) | |||||||
Issuance of stock under stock award plans (in shares) | 805 | ||||||||
Issuance of stock under stock award plans | 5,460 | $ 8 | 5,452 | ||||||
Stock-based compensation expense | 4,854 | 4,854 | |||||||
Ending balance (in shares) at Sep. 30, 2018 | 33,813 | 6,385 | |||||||
Ending balance at Sep. 30, 2018 | 330,493 | $ 338 | $ (54,216) | 255,936 | 151,961 | (23,526) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Cumulative-effect adjustment from adoption of ASU 2016-09 | 330,493 | 338 | (54,216) | 255,936 | 151,961 | (23,526) | |||
Cumulative-effect adjustment from adoption of ASU 2016-09 | 348,978 | $ 346 | $ (54,339) | 266,567 | 161,919 | (25,515) | |||
Net income | 9,958 | 9,958 | |||||||
Other comprehensive income (loss) | (1,989) | (1,989) | |||||||
Employee stock purchase issuances (in shares) | (111) | ||||||||
Employee stock purchase issuances | 1,058 | $ 948 | 110 | ||||||
Repurchase of common stock (in shares) | 93 | ||||||||
Repurchase of common stock | (1,071) | $ (1,071) | |||||||
Issuance of stock under stock award plans (in shares) | 795 | ||||||||
Issuance of stock under stock award plans | 4,874 | $ 8 | 4,866 | ||||||
Stock-based compensation expense | 5,655 | 5,655 | |||||||
Ending balance (in shares) at Sep. 30, 2019 | 34,608 | 6,367 | |||||||
Ending balance at Sep. 30, 2019 | 348,978 | $ 346 | $ (54,339) | 266,567 | 161,919 | (25,515) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Cumulative-effect adjustment from adoption of ASU 2016-09 | 348,978 | 346 | (54,339) | 266,567 | 161,919 | (25,515) | |||
Cumulative-effect adjustment from adoption of ASU 2016-09 | 348,978 | $ 355 | $ (55,109) | 279,741 | 170,330 | (23,817) | |||
Net income | 8,411 | 8,411 | |||||||
Other comprehensive income (loss) | 1,698 | 1,698 | |||||||
Employee stock purchase issuances (in shares) | (118) | ||||||||
Employee stock purchase issuances | 1,065 | $ 1,021 | 44 | ||||||
Repurchase of common stock (in shares) | 104 | ||||||||
Repurchase of common stock | (1,791) | $ (1,791) | |||||||
Issuance of stock under stock award plans (in shares) | 905 | ||||||||
Issuance of stock under stock award plans | 5,902 | $ 9 | 5,893 | ||||||
Stock-based compensation expense | 7,237 | 7,237 | |||||||
Ending balance (in shares) at Sep. 30, 2020 | 35,513 | 6,353 | |||||||
Ending balance at Sep. 30, 2020 | 371,500 | $ 355 | $ (55,109) | 279,741 | 170,330 | (23,817) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Cumulative-effect adjustment from adoption of ASU 2016-09 | $ 371,500 | $ 355 | $ (55,109) | $ 279,741 | $ 170,330 | $ (23,817) |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Business Description We are a leading global provider of business and mission-critical and IoT connectivity products, services and solutions. We help our customers create next-generation connected products to deploy, monitor and manage critical communications infrastructures and compliance standards in demanding environments with high levels of security and reliability. We have two reportable operating segments: (i) IoT Products & Services; and (ii) IoT Solutions. Principles of Consolidation The consolidated financial statements include our accounts and the accounts of our wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Reclassifications The subcategories within total revenue and total cost of sales were redefined in 2019 into "Product" and "Service". Fiscal 2018 hardware product and services and solutions amounts have been reclassified to conform to our fiscal 2020 and fiscal 2019 presentation. Accounting Estimates The preparation of the consolidated financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts in the consolidated financial statements and accompanying notes. Actual results could differ significantly from those estimates. Cash Equivalents Cash equivalents consist of money market accounts and other highly liquid investments purchased with an original maturity of three months or less. The carrying amounts approximate fair value due to the short maturities of these investments. We maintain our cash and cash equivalents in bank accounts which may exceed federally insured limits at times. We have not experienced any losses in these accounts. Marketable Securities Marketable securities previously consisted of certificates of deposit, commercial paper, corporate bonds and government municipal bonds. All marketable securities were accounted for as available-for-sale and were carried at fair value on our Consolidated Balance Sheets with unrealized gains and losses recorded in accumulated other comprehensive loss within stockholders’ equity. In order to estimate the fair value for each security in our investment portfolio, we obtained quoted market prices and trading activity for each security when available. We obtained relevant information from our investment advisor and, if warranted, we may have reviewed the financial solvency of certain security issuers. We regularly monitored and evaluated the value of our marketable securities. When assessing marketable securities for other-than-temporary declines in value, we considered several factors. These factors included: how significant the decline in value is as a percentage of the original cost, how long the market value of the investment has been less than its original cost, the underlying factors contributing to a decline in the prices of securities in a single asset class, the performance of the issuer’s stock price in relation to the stock price of its competitors within the industry, expected market volatility, analyst recommendations, the views of external investment managers, any news or financial information that has been released specific to the investee and the outlook for the overall industry in which the issuer operates. If events and circumstances indicate that a decline in the value of a security had occurred and is other-than-temporary, we would record a charge to other income, net. Accounts Receivable Accounts receivable are stated at the amount we expect to collect. This amount is net of an allowance for doubtful accounts for estimated losses resulting from the inability of our customers to make required payments and a reserve for future credit returns and pricing adjustments. The following factors are considered when determining the collectability of specific customer accounts: customer creditworthiness, past transaction history with the customer, and changes in customer payment terms or practices. In addition, overall historical collection experience, current economic industry trends, and a review of the current status of trade accounts receivable are considered when determining the required allowance for doubtful accounts. Based on 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) our assessment, we provide for estimated uncollectible amounts through a charge to earnings and a credit to our allowance for doubtful accounts. Balances that remain outstanding after we have used reasonable collection efforts are written off through a charge to the allowance for doubtful accounts and a credit to accounts receivable. Estimated reserves for future credit returns and pricing adjustments are established based on an analysis of historical patterns of credit returns and price adjustments compared to received credit returns and distribution sales for the current period. Estimated reserves for future credit returns and price adjustments are charged against revenue in the same period as the corresponding sales are recorded. Estimated sales returns for our distributor stock rotation program are accounted for under the guidance of Accounting Standard Codification (ASC) 845 Nonmonetary Transactions . Inventories Inventories are valued at the lower of cost or net realizable value using the first-in, first-out (FIFO) method. Appropriate consideration is given to deterioration, obsolescence and other factors in evaluating net realizable value. Property, Equipment and Improvements, Net Property, equipment and improvements are carried at cost, net of accumulated depreciation. Depreciation is provided by charges to operations using the straight-line method over the estimated asset useful lives. Furniture and fixtures, purchased software and other equipment are depreciated over a period of three years to ten years. Building improvements and buildings are depreciated over ten years and thirty-nine years, respectively. Leasehold improvements are depreciated over the shorter of the lease term or the estimated useful life of the asset. Long-lived assets to be held and used, such as property, equipment and improvements, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Expenditures for maintenance and repairs are charged to operations as incurred, while major renewals and betterments are capitalized. The assets and related accumulated depreciation accounts are adjusted for asset retirements and disposals with the resulting gain or loss included in operations. Identifiable Intangible Assets Purchased proven technology, license agreements, covenants not to compete and other identifiable intangible assets are recorded at fair value when acquired in a business acquisition, or at cost when not purchased in a business acquisition. All other identifiable intangible assets are amortized on a straight-line basis over their estimated useful lives of three years to 14.5 years. Useful lives for identifiable intangible assets are estimated at the time of acquisition based on the periods of time from which we expect to derive benefits from the identifiable intangible assets. Amortization of purchased and core technology is included in cost of sales in the Consolidated Statements of Operations. Amortization of all other acquired identifiable intangible assets is charged to operating expenses as a component of general and administrative expense. Identifiable intangible assets are reviewed for impairment whenever events or circumstances indicate that undiscounted expected future cash flows are not sufficient to recover the carrying value amount. Impairment losses, if any, are recorded in the period the impairment is identified. There were no impairments identified in fiscal 2020, 2019 or 2018. Goodwill Goodwill represents the excess of cost over the fair value of identifiable assets acquired. Goodwill is quantitatively tested for impairment on an annual basis as of June 30, or more frequently if events or circumstances occur which could indicate impairment. We have two reportable operating segments, our IoT Products & Services segment and our IoT Solutions segment (see Note 4 to the consolidated financial statements). As a result, we concluded that the IoT Products & Services segment and the IoT Solutions segment constitute separate reporting units for purposes of the ASC 350-20-35 "Goodwill Measurement of Impairment" assessment and both units were tested individually for impairment. For our quantitative goodwill impairment tests, we determine the estimated fair value of each reporting unit and compare it to the carrying value of the reporting unit, including goodwill. If the carrying amount of a reporting unit is higher than its estimated fair value, then an impairment loss must be recognized for the excess. Fair values for both reporting units were each estimated on a standalone basis using a weighted combination of the income approach and market approach. 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 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 our prior acquisitions. 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. Results of our Fiscal 2020 Annual Impairment Test We had a total of $157.1 million of goodwill for the IoT Products & Services reporting unit and $49.6 million of goodwill for the IoT Solutions reporting unit as of June 30, 2020. At June 30, 2020, fair value exceeded the carrying value by more than 10% for both reporting units. 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 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 $338.2 million as of June 30, 2020. This implied a range of control premiums of 17.0% to 29.1%. 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 fourth quarter of fiscal 2020, we assessed various qualitative factors to determine whether or not an additional goodwill impairment assessment was required as of September 30, 2020, and we concluded that no additional impairment assessment was required. Assumptions and estimates to determine fair values under the income and market approaches are complex and often subjective. They can be affected by a variety of factors. These include external factors such as industry and economic trends. They also include internal factors such as changes in our business strategy and our internal forecasts. Changes in circumstances or a potential event could negatively affect the estimated fair values. We will continue to monitor potential COVID-19 industry and demand impacts as this could potentially affect our cash flows and market capitalization. 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. Contingent Consideration We measure our contingent consideration liabilities recognized in connection with business combinations at fair value on a recurring basis using significant unobservable inputs classified within Level 3 of the fair value hierarchy as defined in ASC 820 "Fair Value Measurement". We used a probability-weighted discounted cash flow approach as a valuation technique to determine the fair value of the contingent consideration on the acquisition date. At each subsequent reporting period, the fair value is re-measured with the change in fair value recognized in general and administrative expense in our Consolidated Statements of Operations. Amounts, if any, paid to the seller in excess of the amount recorded on the acquisition date will be classified as cash flows used in operating activities. Payments to the seller not exceeding the acquisition-date fair value of the contingent consideration will be classified as cash flows used in financing activities. Warranties In general, we warrant our hardware products to be free from defects in material and workmanship under normal use and service. The warranty periods generally range from one year to five years. We typically have the option to either repair or replace hardware products we deem defective with regard to material or workmanship. Estimated warranty costs are accrued in the period that the related revenue is recognized based upon an estimated average per unit repair or replacement cost applied to 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) the estimated number of units under warranty. These estimates are based upon historical warranty incidents and are evaluated on an ongoing basis to ensure the adequacy of the warranty accrual. We also warrant our software or firmware incorporated into our products generally for a period of one year and offer to provide a bug fix or software patch within a reasonable period. We have not accrued specifically for this warranty and have not had claims specifically related to software or firmware. We are not responsible for, and do not warrant that, custom software versions, created by OEM customers based upon our software source code, will function in a particular way, will conform to any specifications or are fit for any particular purpose. Further, we do not indemnify these customers from any third-party liability as it relates to or arises from any customization or modifications made by the OEM customer. Treasury Stock We record treasury stock at cost. Treasury stock may be acquired from employees for tax withholding purposes related to vesting of restricted stock awards as part of our stock-based compensation program. 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 (“Direct/OEM”) customers. Product revenue generally is recognized upon shipment of the product to a customer. Sales to authorized domestic distributors and Direct/OEM customers typically are made with certain rights of return and price adjustment provisions. Estimated reserves for future credit returns and pricing adjustments are established based on an analysis of historical patterns of credit returns and price adjustments compared to received credit returns and distribution sales for the current period. Estimated reserves for future credit 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 credit returns and pricing adjustments could result in a material change to our consolidated results of operations or financial position. Estimated sales returns for our distributor stock rotation program are accounted for under the guidance of ASC 845 Nonmonetary Transactions . Equipment revenue from SmartSense by Digi ® within our IoT Solutions segment is recognized upon shipment of the equipment to a customer. Installation service charges from these sales are recorded when the product is installed. Subscription and Support Services Revenue We 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 and is included in our IoT Products & Services segment. Digi Support Services revenues are recognized over the life of the support contract and included in our IoT Products & Services segment. Some of Digi Support Services revenue is for training and this revenue is recognized as the services are performed. Our SmartSense by Digi ® subscription revenue is recorded on a monthly basis. These subscriptions are generally in a range from one year 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. 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 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, which are included in our IoT Products & Services segment 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 From time to time we have contracts from customers with multiple performance obligations. Our hardware products may be combined with our Digi Remote Manager ® PaaS offering as well as other support services in an individual contract. Our 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. Research and Development Research and development costs are expensed when incurred. Research and development costs include compensation, allocation of corporate costs, depreciation, utilities, professional services and prototypes. Software and firmware development costs are expensed as incurred until the point that both the technological feasibility and the proven marketability of the product are established. To date, the time period between the establishment of technological feasibility and completion of software development has been short and no significant development costs have been incurred during that period. Accordingly, we have not capitalized any software development costs to date. Income Taxes Deferred income taxes are recognized for the tax consequences in future years of differences between the tax basis of assets and liabilities and their financial reporting amounts at each year end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Income tax expense is equal to the tax payable for the period and the change during the period in deferred tax assets and liabilities as well as changes in income tax reserves. We maintain valuation allowances unless it is more likely than not that all or a portion of the deferred tax assets will be realized. Changes in valuation allowances from period to period are included in our tax provision in the period of change. We recognize the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. Stock-Based Compensation Stock-based compensation expense represents the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of the award. This cost must be recognized over the period during which an employee is required to provide the service (usually the vesting period). Foreign Currency Translation Financial position and results of operations of our international subsidiaries are measured using local currencies as the functional currency. Assets and liabilities of these operations are translated at the exchange rates in effect at the end of each reporting period. For our international subsidiaries, our statements of operations accounts are translated at the weighted average rates of exchange prevailing during each reporting period. Translation adjustments arising from the use of differing currency exchange rates from period to period are included in accumulated other comprehensive loss in stockholders’ equity. Gains and losses on foreign currency exchange transactions, as well as translation gains or losses on transactions denominated in currencies other than an entity’s functional currency, are reflected in the statement of operations. During fiscal 2020, 2019 and 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 2018 there were net transaction (losses) gains of $(0.6) million, $0.4 million and $0.1 million, respectively that were recorded in other income, net. We manage our net asset or net liability position for U.S. dollar accounts in our foreign locations to reduce our foreign currency risk. We have not implemented a formal hedging strategy. Comprehensive Income Our comprehensive income is comprised of net income, foreign currency translation adjustments and unrealized gains and losses on available-for-sale marketable securities. These items are charged or credited to the accumulated other comprehensive loss account in stockholders’ equity. Net Income Per Common Share Basic net income per common share is calculated based on the weighted average number of common shares outstanding during the period. Diluted net income per common share is computed by dividing net income by the weighted average number of common and potentially dilutive common shares outstanding during the period. Potentially dilutive common shares of our stock result from common stock options and restricted stock units. We use the treasury stock method to calculate the weighted-average shares used in the diluted earnings per share computation. Under this method the proceeds from exercise of an option, any amount of compensation cost for future service that we have not yet recognized, and the amount of estimated tax benefits that would be recorded in paid-in capital when the option is exercised are assumed to have been used to repurchase shares in the current period. The following table is a reconciliation of the numerators and denominators in the net income per common share calculations (in thousands, except per common share data): Fiscal year ended September 30, 2020 2019 2018 Numerator: Net income $ 8,411 $ 9,958 $ 1,631 Denominator: Denominator basic net income per common share — weighted average shares outstanding 28,849 27,905 27,083 Effect of dilutive securities: Stock options and restricted stock units 697 649 569 Denominator diluted net income per common share — adjusted weighted average shares 29,546 28,554 27,652 Net income per common share, basic $ 0.29 $ 0.36 $ 0.06 Net income per common share, diluted $ 0.28 $ 0.35 $ 0.06 Because their effect would be anti-dilutive at period end, certain potentially dilutive shares related to stock options to purchase common shares were excluded in the above computation of diluted earnings per share because the options’ exercise prices were greater than the average market price of our common shares. At September 30, 2020, 2019 and 2018, such excluded stock options were 1,143,411, 744,513 and 925,063, respectively. Recent Accounting Developments Adopted In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-02, Leases (Topic 842) , which provides for comprehensive changes to lease accounting. The standard requires that a lessee recognize a lease obligation liability and a right-to-use asset for virtually all leases, subsequently amortized over the lease term. We adopted this standard in the first quarter of fiscal 2020, following the modified retrospective application approach that applies the new standard to all applicable leases existing at the date of initial application and not restating comparative periods. We have completed our implementation efforts. These efforts included identification and analysis of our lease portfolio, analysis and evaluation of the new reporting and disclosure requirements of the new guidance, and an evaluation of our lease- 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) related processes and internal controls. The adoption of this standard resulted in the recognition of a right-of-use asset included in other non-current assets of approximately $14.1 million. It also resulted in a lease liability of approximately $17.9 million included in other current liabilities and other non-current liabilities. Both of these were recorded on our Consolidated Balance Sheet in the first quarter of fiscal 2020. In adopting the new standard, we elected the package of practical expedients permitted under the transition guidance, as well as the practical expedient not to separate non-lease components from lease components. We also elected the practical expedient to use hindsight in determining the lease term when considering options to extend or terminate a lease, options to purchase the underlying asset, and in assessing the impairment of right-of-use assets. The adoption of this standard did not have a significant impact on our Consolidated Statements of Operations or Consolidated Statements of Cash Flows. We have identified new and updated existing internal controls and processes to support measurement, recognition and disclosure under this new standard. Such changes were not deemed to be material to our overall system of internal control over financial reporting. Not Yet Adopted In August 2018, FASB issued ASU 2018-13, Fair Value Measurement - Disclosure Framework (Topic 820). The updated guidance changes the disclosure requirements on fair value measurements. We will adopt this standard in the first quarter of fiscal 2021. We do not expect this standard to have a material impact on our consolidated financial statements. In June 2016, FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments . The amendments in this update replace the incurred loss impairment methodology in current U.S. GAAP with a methodology that reflects expected credit losses. This update is intended to provide financial statement users with more decision-useful information about the expected credit losses. We will adopt this standard in the first quarter of fiscal 2021, following the modified-retrospective approach. We do not expect this standard to have a material impact on our consolidated financial statements. |
Acquisitions
Acquisitions | 12 Months Ended |
Sep. 30, 2020 | |
Business Combinations [Abstract] | |
ACQUISITIONS | ACQUISITIONS Fiscal 2020 Acquisition Acquisition of Opengear, Inc. On December 13, 2019, we completed our acquisition of Opengear, Inc. ("Opengear"), a New Jersey-based provider of secure IT infrastructure products and software. Opengear results are included in our consolidated financial statements within our IoT Products & Services segment. The terms of the acquisition included an upfront cash payment as well as contingent consideration comprised of future earn-out payments. We funded the closing of the acquisition with cash of $148.1 million comprised of cash on hand and proceeds from our credit facility (see Note 8 to the consolidated financial statements). The earn-out payments are based on revenue performance from Opengear for the twelve-month periods ended December 31, 2019 and ending December 31, 2020. The cumulative amount of these earn-outs for the periods ended December 31, 2019 and December 31, 2020, will not exceed $5.0 million and $10.0 million, respectively. We paid the first installment of $0.9 million for the period ended December 31, 2019 during the third quarter of fiscal 2020. The fair value of the remaining contingent consideration was $4.2 million at September 30, 2020 (see Note 8 to the consolidated financial statements). For tax purposes, this acquisition is treated as a stock acquisition. The goodwill therefore is not deductible. We believe this is a complementary acquisition for us as it significantly enhances our IoT Products & Services segment by providing secure, resilient access and automation to critical IT infrastructure. The Opengear acquisition has been accounted for using the acquisition method of accounting. This requires, among other things, that assets acquired and liabilities assumed pursuant to the purchase agreement be recognized at fair value as of the acquisition date. 2. ACQUISITIONS (CONTINUED) The following table summarizes the final fair values of Opengear assets acquired and liabilities assumed as of the acquisition date (in thousands): Cash $ 148,058 Contingent consideration 5,100 Total $ 153,158 Fair value of net tangible assets acquired $ 19,217 Identifiable intangible assets: Customer relationships 79,000 Purchased and core technology 18,100 Trademarks 8,000 Deferred tax liability on identifiable intangible assets (27,401) Goodwill 56,242 Total $ 153,158 The Consolidated Balance Sheet as of September 30, 2020 reflects the final allocation of the purchase price to the assets acquired and liabilities assumed based on their estimated fair values at the date of acquisition. Included in the fair value of net tangible assets acquired are $1.4 million of right-of-use assets included in other non-current assets and $1.7 million of lease liability included in other current and non-current liabilities associated with Opengear's operating leases. The weighted average useful life for all the identifiable intangibles listed above is estimated to be 13.4 years. For purposes of determining fair value, the existing customer relationships identified above are assumed to have a useful life of 14.5 years, purchased and core technology is assumed to have useful life of 9.0 years and trademarks are assumed to have a useful life of 12.0 years. Useful lives for identifiable intangible assets are estimated at the time of acquisition based on the periods of time from which we expect to derive benefits from the identifiable intangible assets. The identifiable intangible assets are amortized using the straight-line method. This reflects the pattern in which the assets are expected to be consumed. Costs directly related to the acquisition of $0.3 million incurred in the fourth quarter of fiscal 2019 and $2.7 million incurred in fiscal 2020 have been charged directly to operations and are included in general and administrative expenses in our Consolidated Statements of Operations. These acquisition costs include legal, accounting, integration, valuation and investment banking fees. The following consolidated pro forma information is presented as if the acquisition had occurred on October 1, 2018 (in thousands): Fiscal year ended September 30, 2020 2019 Net sales $ 294,167 $ 308,986 Net income $ 14,366 $ 10,417 Net income per share - basic $ 0.50 $ 0.37 Net income per share - diluted $ 0.49 $ 0.36 Pro forma net income has been adjusted to include interest expense related to debt incurred as a result of the acquisition as well as amortization on the fair value of the intangibles acquired. It also has been adjusted to assume the acquisition-related costs of $3.1 million were incurred as of the first quarter of fiscal 2019. Given the success of our efforts to rapidly integrate the workforce, customer offerings, technology, and reporting capabilities of Opengear with that of our other components in our IoT Products & Services business, along with the inherent complementary synergies gained from doing so, it is impractical for us to present Opengear specific results otherwise required by GAAP. 2. ACQUISITIONS (CONTINUED) Fiscal 2018 Acquisitions Acquisition of Accelerated Concepts, Inc. On January 22, 2018, we purchased all the outstanding stock of Accelerated Concepts, Inc. ("Accelerated"), a Tampa-based provider of secure, enterprise-grade, cellular (LTE) networking equipment for primary and backup connectivity applications, for cash of $16.4 million (excluding cash acquired of $0.2 million) and future earn-out payments. Purchase accounting related to the acquisition of Accelerated was finalized during the fourth quarter of fiscal 2018. The earn-out payments were scheduled to be paid in two installments and the payment amount, if any, was to 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 and the second installment was based on revenues from January 22, 2019 through January 21, 2020. If certain revenue thresholds were met, the cumulative amount of these earn-outs could have been $6.5 million. In April 2019, we paid $3.5 million for the first installment. In April 2020, we paid $2.4 million for the remaining contingent consideration (see Note 8 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. Purchase accounting related to the acquisition was finalized during the first quarter of fiscal 2019. |
Goodwill and other Identifiable
Goodwill and other Identifiable Intangible Assets | 12 Months Ended |
Sep. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER IDENTIFIABLE INTANGIBLE ASSETS, NET | GOODWILL AND OTHER IDENTIFIABLE INTANGIBLE ASSETS, NET Identifiable Intangible Assets, Net Amortizable identifiable intangible assets, net as of September 30, 2020 and 2019 were comprised of the following (in thousands): September 30, 2020 September 30, 2019 Gross Accum. Net Gross Accum. Net Purchased and core technology $ 76,011 $ (55,482) $ 20,529 $ 57,699 $ (50,986) $ 6,713 License agreements 112 (112) — 102 (74) 28 Patents and trademarks 22,836 (13,535) 9,301 14,577 (11,970) 2,607 Customer relationships 125,500 (34,232) 91,268 46,315 (25,266) 21,049 Non-compete agreements 600 (450) 150 600 (330) 270 Order backlog — — — 1,800 (1,800) — Total $ 225,059 $ (103,811) $ 121,248 $ 121,093 $ (90,426) $ 30,667 Amortization expense is included in our Consolidated Statements of Operations in cost of sales and general and administrative expense. Amortization expense in cost of sales includes amortization for purchased and core technology and certain patents and trademarks. Amortization expense for fiscal years 2020, 2019 and 2018 was as follows (in thousands): Fiscal year Total 2020 $ 14,754 2019 $ 8,818 2018 $ 9,435 3. GOODWILL AND OTHER IDENTIFIABLE INTANGIBLE ASSETS, NET (CONTINUED) Estimated amortization expense for the next five years is as follows (in thousands): Fiscal year Total 2021 $ 15,558 2022 $ 14,714 2023 $ 12,518 2024 $ 11,815 2025 $ 8,358 Goodwill The changes in the carrying amount of goodwill by reportable segments are (in thousands): IoT IoT Total Balance on September 30, 2018 $ 104,358 $ 50,177 $ 154,535 Foreign currency translation adjustment (839) (274) (1,113) Balance on September 30, 2019 $ 103,519 $ 49,903 $ 153,422 Acquisition 56,242 — 56,242 Foreign currency translation adjustment 604 (133) 471 Balance at September 30, 2020 $ 160,365 $ 49,770 $ 210,135 No goodwill impairment has been recorded in any period presented. |
Segment Information and Major C
Segment Information and Major Customers | 12 Months Ended |
Sep. 30, 2020 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION AND MAJOR CUSTOMERS | SEGMENT INFORMATION AND MAJOR CUSTOMERS We have two reportable operating segments for purposes of ASC 280-10-50 “Segment Reporting”: (i) IoT Products & Services and (ii) IoT Solutions. This determination was made by considering both qualitative and quantitative information. The qualitative information included, but was not limited to, the following: the nature of the products and services and customers differ between the two segments, discrete financial information is available through gross profit for both segments and the Chief Operating Decision Maker is reviewing both segments’ financial information (through gross profit) separately to make decisions about the allocation of resources. IoT Products & Services Our IoT Products & Services segment is composed of the following communications products and development services: • Cellular routers; • OEM Solutions which include Radio frequency ("RF") products which include our Digi XBee ® Networking solutions as well as other RF solutions, embedded products which include Digi Connect ® , ConnectCore ® and Rabbit ® embedded systems on module and single board computers; • Infrastructure management products which include console and serial servers and USB connected products; • Console Servers which is comprised of our Network Resilience Platform and includes Smart Out-of-Band and NetOps Console Servers managed by our Lighthouse software. • Digi Wireless Design Services; • Digi Remote Manager ® ; and • Digi Support Services which offers various levels of technical services for development assistance, consulting and training. 4. SEGMENT INFORMATION AND MAJOR CUSTOMERS (CONTINUED) IoT Solutions Our IoT Solutions segment offers wireless temperature and other condition-based monitoring services as well as employee task management services. These solutions are focused on these vertical markets: food service, healthcare (primarily pharmacies) and supply chain. The solutions are marketed as SmartSense by Digi ® . We have formed, expanded and enhanced the IoT Solutions segment through acquisition. We measure our segment results primarily by reference to revenue and gross profit. IoT Solutions revenue includes product, service and subscription revenue. . Summary operating results for each of our segments were as follows (in thousands): Fiscal year ended September 30, 2020 2019 2018 Revenue IoT Products & Services $ 249,530 $ 215,287 $ 201,506 IoT Solutions 29,741 38,916 25,387 Total revenue $ 279,271 $ 254,203 $ 226,893 Gross profit IoT Products & Services $ 129,349 $ 100,522 $ 97,895 IoT Solutions 14,623 18,513 11,159 Total gross profit $ 143,972 $ 119,035 $ 109,054 Depreciation and amortization IoT Products & Services $ 11,521 $ 6,102 $ 6,040 IoT Solutions 7,778 7,294 6,744 Total depreciation and amortization $ 19,299 $ 13,396 $ 12,784 Total expended for property, plant and equipment was as follows (in thousands): Fiscal year ended September 30, 2020 2019 2018 IoT Products & Services $ 878 $ 8,863 $ 1,773 IoT Solutions 21 472 69 Total expended for property, plant and equipment $ 899 $ 9,335 $ 1,842 Total assets for each of our segments were as follows (in thousands): As of September 30, 2020 2019 IoT Products & Services $ 387,578 $ 215,651 IoT Solutions 86,975 90,255 Unallocated* 54,129 92,792 Total assets $ 528,682 $ 398,698 *Unallocated consists of cash and cash equivalents. 4. SEGMENT INFORMATION AND MAJOR CUSTOMERS (CONTINUED) Net property, equipment and improvements by geographic location were as follows (in thousands): As of September 30, 2020 2019 United States $ 11,297 $ 13,400 International, primarily Europe 210 457 Total net property, equipment and improvements $ 11,507 $ 13,857 Our U.S. export sales represented 25.1%, 28.5% and 30.1% of revenue for the fiscal years ended September 30, 2020, 2019 and 2018. No single customer exceeded 10% of revenue for any of the periods presented. At September 30, 2020, we had one customer, whose accounts receivable balance represented 17.2% of total accounts receivable. At September 30, 2019, we had one customer, whose accounts receivable balance represented 14.7% of total accounts receivable. |
Sale of Building
Sale of Building | 12 Months Ended |
Sep. 30, 2020 | |
Discontinued Operations and Disposal Groups [Abstract] | |
SALE OF BUILDING | SALE OF BUILDINGOn 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. As a result of this sale, 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 fiscal year ended September 30, 2019, we paid $5.8 million for leasehold improvements to build out our new headquarters space. These improvements are being depreciated over 10 years, which is the estimated useful life of the improvements. |
Selected Balance Sheet Data
Selected Balance Sheet Data | 12 Months Ended |
Sep. 30, 2020 | |
Selected Balance Sheet Data [Abstract] | |
SELECTED BALANCE SHEET DATA | SELECTED BALANCE SHEET DATA (in thousands) As of September 30, 2020 2019 Accounts receivable, net: Accounts receivable $ 65,027 $ 60,062 Less allowance for doubtful accounts 3,778 968 Less reserve for future credit returns and pricing adjustments 2,022 2,677 Total accounts receivable, net $ 59,227 $ 56,417 Inventories: Raw materials $ 14,009 $ 12,308 Work in process — 565 Finished goods 37,559 26,891 Total inventories $ 51,568 $ 39,764 Property, equipment and improvements, net: Land $ 570 $ 570 Buildings 2,338 2,338 Improvements 7,844 7,646 Equipment 17,153 17,440 Purchased software 3,770 4,030 Furniture and fixtures 3,236 2,963 Subscriber assets 5,104 3,750 Total property, equipment and improvements, gross 40,015 38,737 Less accumulated depreciation and amortization 28,508 24,880 Total property, equipment and improvements, net $ 11,507 $ 13,857 |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Sep. 30, 2020 | |
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). There were no transfers into or out of our Level 2 financial assets during fiscal 2020. The following tables provide information by level for financial assets and liabilities that are measured at fair value on a recurring basis (in thousands): Fair Value Measurements at September 30, 2020 using: Total carrying Quoted price in Significant other Significant Liabilities: Contingent consideration on acquired business $ 4,228 $ — $ — $ 4,228 Total liabilities measured at fair value $ 4,228 $ — $ — $ 4,228 Fair Value Measurements at September 30, 2019 using: Total carrying Quoted price in Significant other Significant Assets: Money market $ 56,700 $ 56,700 $ — $ — Total assets measured at fair value $ 56,700 $ 56,700 $ — $ — Liabilities: Contingent consideration on acquired businesses $ 5,407 $ — $ — $ 5,407 Total liabilities measured at fair value $ 5,407 $ — $ — $ 5,407 In connection with the October 2015 acquisition of Bluenica, we may be required to make contingent payments over a period of up to 4 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. We paid $0.5 million in fiscal 2017, no payments in fiscal 2018, $2.2 million in fiscal 2019 and the final installment of $2.9 million in fiscal 2020. In connection with the November 2016 acquisition of 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 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 upon acquisition. No contingent consideration was earned. In connection with our acquisition of Accelerated, we agreed to make contingent payments, based upon certain sales thresholds of Accelerated products (see Note 2 to the consolidated financial statements). The fair values of the liability for contingent consideration recognized upon acquisition of Accelerated on January 22, 2018 was $2.3 million. We paid the first installment of $3.5 million in fiscal 2019 and the final installment of $2.4 million in the third quarter of fiscal 2020. In connection with our acquisition of Opengear, we agreed to make contingent payments, based upon certain revenue thresholds (see Note 2 to the consolidated financial statements). We paid the first installment of $0.9 million during the third quarter of fiscal 2020. The fair value of the remaining liability for contingent consideration for the acquisition of Opengear was $4.2 million at September 30, 2020. 7. FAIR VALUE MEASUREMENTS (CONTINUED) The following table presents a reconciliation of the contingent consideration liability measured at fair value on a recurring basis using significant unobservable inputs (Level 3) (in thousands): Fiscal year ended September 30, 2020 2019 Fair value at beginning of period $ 5,407 $ 10,065 Purchase price contingent consideration 5,100 — Contingent consideration payments (6,151) (5,848) Change in fair value of contingent consideration (128) 1,190 Fair value at end of period $ 4,228 $ 5,407 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 September 30, 2020 based on the probability of achieving the specified revenue thresholds of 72% for Opengear. As of September 30, 2020, contingent consideration associated with the acquisition of Opengear remains subject to future performance through December 31, 2020. |
Debt
Debt | 12 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
DEBT | INDEBTEDNESS In connection with our acquisition of Opengear, we entered into a syndicated credit agreement with BMO Harris Bank N.A. ("BMO") on December 13, 2019. This agreement provides us with committed credit facilities (the "Credit Facility") totaling $150 million. The Credit Facility includes: (i) a $50 million term loan (the "Term Loan") and (ii) a $100 million revolving loan (the "Revolving Loan"). Prior to May 4, 2020, borrowings under the Credit Facility bore interest rates based on an underlying variable benchmark plus applicable margin based on our total leverage ("ABR"); this interest rate was reset quarterly. Effective May 4, 2020, borrowings under the Credit Facility bear a variable interest rate of LIBOR plus an applicable margin spread from 3.25% to 1.25%. The amount of the applicable margin spread is a function of our leverage ratio and is reset monthly. In addition to paying interest on the outstanding balance under the Credit Facility, we are required to pay a commitment fee on the non-utilized commitments thereunder which is also reported in interest expense. Our weighted average interest rate at September 30, 2020 was 0.7%. We also incurred debt issuance costs under the Credit Facility of $2.6 million in the first quarter of fiscal 2020. These issuance costs are being amortized using the straight-line method over the term of the loan and reported in interest expense. Amounts under the Term Loan will be repaid in quarterly installments on the last day of each fiscal quarter. Amortization is 5% in the first two years, 7.5% in the next two years and 10% in the final year. The remaining outstanding balance will mature on December 13, 2024. The Revolving Loan is due in a lump sum payment at maturity on December 13, 2024. The fair values of the Term Loan and Revolving Loan approximated carrying value at September 30, 2020. The following table is a summary of our long-term indebtedness at September 30, 2020 (in thousands): Revolving loan $ 15,000 Term loan 48,125 Total loans 63,125 Less unamortized issuance costs (2,173) Less current maturities of long-term debt (1,972) Total long-term debt, net of current portion $ 58,980 8. INDEBTEDNESS (CONTINUED) The following table is a summary of future maturities of our aggregate long-term debt at September 30, 2020 (in thousands): 2021 $ 2,500 2022 3,438 2023 3,750 2024 4,687 2025 48,750 Total long-term debt $ 63,125 Covenants and Security Interest The agreements governing the Credit Facility contain a number of covenants. Among other thing, these covenants require us to maintain certain financial ratios (net leverage ratio and minimum fixed charge ratio). At September 30, 2020, we were in compliance with our debt covenants. Amounts borrowed under the Credit Facility are secured by substantially all of our assets. Paycheck Protection Program Loan |
Product Warranty Obligation
Product Warranty Obligation | 12 Months Ended |
Sep. 30, 2020 | |
Product Warranties Disclosures [Abstract] | |
PRODUCT WARRANTY OBLIGATION | PRODUCT WARRANTY OBLIGATION The following table summarizes the activity associated with the product warranty accrual (in thousands) and is listed on our Consolidated Balance Sheets within current liabilities: Balance at Warranties Settlements Balance at Fiscal year October 1 accrued made September 30 2020 $ 1,012 $ 666 $ (736) $ 942 2019 $ 1,172 $ 305 $ (465) $ 1,012 2018 $ 987 $ 759 $ (574) $ 1,172 |
Leases
Leases | 12 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
LEASES | LEASES All of our leases are operating leases and primarily consist of leases for office space. For any lease with an initial term in excess of twelve months, the related lease assets and lease liabilities are recognized on our Consolidated Balance Sheets as either operating or financing leases at the inception of an agreement where it is determined that a lease exists. We have lease agreements that contain both lease and non-lease components. We have elected to combine lease and non-lease components for all classes of assets. Leases with an initial term of twelve months or less are not recorded on our Consolidated Balance Sheets. Instead we recognize lease expense for these leases on a straight-line basis over the lease term. Operating lease assets represent the right to use an underlying asset for the lease term and operating lease liabilities represent the obligation to make lease payments. These assets and liabilities are recognized based on the present value of future payments over the lease term at the commencement date. We generally use a collateralized incremental borrowing rate based on information available at the commencement date, including the lease term, in determining the present value of future payments. When determining our right-of-use asset, we generally do not include options to extend or terminate the lease unless it is reasonably certain that the option will be exercised. Our leases typically require payment of real estate taxes and common area maintenance and insurance. These components comprise the majority of our variable lease cost and are excluded from the present value of our lease obligations. Fixed payments may contain predetermined fixed rent escalations. We recognize the related rent expense on a straight-line basis from the commencement date to the end of the lease term. 10. LEASES (CONTINUED) The following table shows the supplemental balance sheet information related to our leases (in thousands): Balance Sheet Location September 30, 2020 Assets Operating leases Other non-current assets $ 14,334 Total lease assets $ 14,334 Liabilities Operating leases Other current liabilities $ 2,527 Operating leases Other non-current liabilities 16,193 Total lease liabilities $ 18,720 The following were the components of our lease cost (in thousands): Statement of Operations Location Fiscal year ended Operating lease cost Cost of goods sold and SG&A $ 3,341 Variable lease cost Cost of goods sold and SG&A 744 Short-term lease cost Cost of goods sold and SG&A 175 Total lease cost $ 4,260 The following table presents supplemental information related to operating leases (in thousands): Fiscal year ended Cash paid for amounts included in the measurement of operating lease liabilities $ 2,893 Right-of-use assets obtained in exchange for new operating lease liabilities $ 1,073 September 30, 2020 Weighted average remaining lease term - operating leases 5.6 years Weighted average discount rate - operating leases 4.80 % The table below reconciles the undiscounted cash flows for each of the first five years as well as all the remaining years to the operating lease liabilities recorded on the Consolidated Balance Sheet as of September 30, 2020 (in thousands): Fiscal year Amount 2021 $ 3,335 2022 2,932 2023 2,669 2024 2,452 2025 2,348 Thereafter 9,219 Total future undiscounted lease payments 22,955 Less imputed interest (4,235) Total reported lease liability $ 18,720 In July 2020, we signed a lease agreement for ten years in Sandy, Utah. We have $4.8 million of future minimum lease obligations under this new lease for 35,466 square feet of office space. Included in this agreement is $1.0 million of tenant improvement allowance. This agreement is not included on our Consolidated Balance Sheet nor in the above table as the lessor has not made the underlying asset available for use. 10. LEASES (CONTINUED) As follows, aggregate annual future minimum rental commitments under operating leases with noncancelable terms of more than one year at September 30, 2019 were reported under previous lease accounting standards (in thousands): Fiscal year Amount 2020 $ 2,596 2021 2,575 2022 2,314 2023 2,056 2024 2,095 Thereafter 11,361 Total minimum payments required $ 22,997 |
Restructuring
Restructuring | 12 Months Ended |
Sep. 30, 2020 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING | RESTRUCTURING 2020 Restructuring In second quarter of fiscal 2020, we recorded and re-aligned our product management group within IoT Products & Services segment and eliminated two employment positions. We recorded $38 thousand for employee termination charges. This was fully paid during the second quarter of fiscal 2020. In the third quarter of fiscal 2020, we recorded $95 thousand of restructuring for employee termination charges primarily within our IoT Solutions segment. This resulted in the elimination of 22 employment positions. This restructuring was completed in the fourth quarter of fiscal 2020. Manufacturing Transition As announced in April 2018, we transferred the manufacturing functions of our Eden Prairie, Minnesota operations facility to existing contract manufacture suppliers. As a result, 53 employment positions in total were eliminated, resulting in restructuring charges amounting to approximately $0.5 million for employee costs during the third and fourth quarters of fiscal 2018 in our IoT Product and Services segment. The payments associated with these charges were completed in the first half of fiscal 2019. 2017 Restructuring In May 2017, we approved a restructuring plan primarily impacting our France location, which is now closed. We also eliminated certain employment positions 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 in fiscal 2017, which included $2.3 million of employee costs and $0.2 million of contract termination costs during the third quarter of fiscal 2017 in our IoT Product and Services segment. These actions resulted in an elimination of 10 employment positions in the U.S. and 8 employment positions in France. The payments associated with these charges were completed during the first half of fiscal 2019. 11. RESTRUCTURING (CONTINUED) Below is a summary of the restructuring charges and other activity within the restructuring accrual (in thousands): 2020 Restructuring Manufacturing Transition 2017 Restructuring Employee Termination Costs Employee Termination Costs Employee Termination Costs Other Total Balance at September 30, 2017 $ — $ — $ 1,528 $ 128 $ 1,656 Restructuring charge — 504 — — 504 Payments — (357) (1,035) (161) (1,553) Reversals — — (244) 41 (203) Foreign currency fluctuation — — 44 5 49 Balance at September 30, 2018 $ — $ 147 $ 293 $ 13 $ 453 Payments — (108) (233) (18) (359) Reversals — (39) (53) 5 (87) Foreign currency fluctuation — — (7) — (7) Balance at September 30, 2019 $ — $ — $ — $ — $ — Restructuring charge 133 — — — 133 Payments (117) — — — (117) Reversals (16) — — — (16) Balance at September 30, 2020 $ — $ — $ — $ — $ — |
Revenue
Revenue | 12 Months Ended |
Sep. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE | REVENUE Revenue Disaggregation The following summarizes our revenue by geographic location of our customers: Fiscal year ended September 30, ($ in thousands) 2020 2019 2018 North America, primarily the United States $ 213,487 $ 184,022 $ 161,924 Europe, Middle East & Africa 40,076 39,896 39,211 Rest of world 25,708 30,285 25,758 Total revenue $ 279,271 $ 254,203 $ 226,893 The following summarizes our revenue by the timing of revenue recognition: Fiscal year ended September 30, ($ in thousands) 2020 2019 2018 Transferred at a point in time $ 253,371 $ 231,387 $ 212,448 Transferred over time 25,900 22,816 14,445 Total revenue $ 279,271 $ 254,203 $ 226,893 Contract Balances Contract Assets Contract assets consist of subscriber assets. These subscriber assets relate to fees in certain contracts that we charge our customers so they can begin using equipment. In these cases, we retain the ownership of the equipment that the customer uses. The total net book value of subscriber assets was $2.0 million at September 30, 2020 and $2.1 million at September 30, 2019 and is included in property, equipment and improvements, net. Depreciation expense for these subscriber assets was 12. REVENUE (CONTINUED) $1.5 million, $1.1 million and $0.5 million for fiscal 2020, 2019 and 2018, respectively. We depreciate the cost of this equipment over its useful life (typically three years). Contract Liabilities The timing of revenue recognition may differ from the timing of invoicing to customers. Customers are invoiced for subscription services in advance on a monthly, quarterly or annual basis. Contract liabilities consist of unearned revenue related to annual or multi-year contracts for subscription services and related implementation fees for our IoT Solutions segment and our Digi Remote Manager ® services in our IoT Products & Services segment. Changes in unearned revenue were: Fiscal year ended September 30, ($ in thousands) 2020 Unearned revenue, beginning of period $ 5,025 Billings 35,213 Revenue recognized (30,897) Unearned revenue, end of period $ 9,341 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 September 30, 2020 approximately $14.0 million of revenue is expected to be recognized from remaining performance obligations for subscriptions contracts. We expect to recognize revenue on approximately $10.0 million of remaining performance obligations over the next twelve months. Revenue from the remaining performance obligations we expect to recognize over a range of two years to seven years. |
Income Taxes
Income Taxes | 12 Months Ended |
Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The components of income before income taxes are (in thousands): Fiscal year ended September 30, 2020 2019 2018 United States $ 3,756 $ 7,981 $ (2,427) International 3,707 3,164 5,677 Income before income taxes $ 7,463 $ 11,145 $ 3,250 The components of the income tax (benefit) expense are (in thousands): Fiscal year ended September 30, 2020 2019 2018 Current: Federal $ 709 $ 950 $ 526 State 572 290 57 Foreign 1,128 746 1,412 Deferred: U.S. (2,911) (825) (536) Foreign (446) 26 160 Income tax (benefit) expense $ (948) $ 1,187 $ 1,619 13. INCOME TAXES (CONTINUED) Net deferred tax (liability) asset consists of (in thousands): As of September 30, 2020 2019 Non-current deferred tax asset $ 389 $ 7,330 Non-current deferred tax liability (17,171) (261) Net deferred tax (liability) asset $ (16,782) $ 7,069 Depreciation and amortization $ (1,037) $ (480) Lease asset (3,415) — Lease liability 4,477 — Inventories 979 536 Compensation costs 3,698 3,675 Other accruals 3,985 3,870 Tax credit carryforwards 6,021 4,911 Valuation allowance (4,372) (3,810) Identifiable intangible assets (27,118) (1,633) Net deferred tax (liability) asset $ (16,782) $ 7,069 As of September 30, 2020, we had $3.1 million of tax carryforwards (net of reserves) related to federal and state research and development tax credits. We also had $2.9 million of carryforwards consisting of a U.S. capital loss of $2.6 million, non-U.S. net operating losses of $0.2 million and foreign tax credits of $0.1 million. The majority of our federal research and development tax credits have a 20-year carryforward period. The state research and development tax credits have a 15-year carryforward period. The majority of our non-U.S. net operating losses have an unlimited carryforward period. Our non-U.S. tax credit carryforwards will expire in 2034. Our U.S. capital loss carryforward will expire in fiscal tax year 2021. Our valuation allowance for certain U.S. and foreign locations was $4.4 million at September 30, 2020 and $3.8 million at September 30, 2019. The increase in valuation allowance is primarily the result of prior period adjustments to the valuation allowance and state research and development credits generated. The deferred tax assets realized could vary if there are differences in the timing or amount of future reversals of existing deferred tax liabilities or changes in the amounts of future taxable income. If future taxable income projections are not realized, an additional valuation allowance may be required. This would be reflected as income tax expense at the time that any such change in future taxable income is determined. 13. INCOME TAXES (CONTINUED) The reconciliation of the statutory federal income tax amount to our income tax (benefit) expense is (in thousands): Fiscal year ended September 30, 2020 2019 2018 Statutory income tax amount $ 1,567 $ 2,341 $ 809 Increase (decrease) resulting from: State taxes, net of federal benefits 392 196 (71) Manufacturing deduction — — (364) Transaction costs 143 — 79 Employee stock purchase plan 127 59 56 Foreign operations 431 225 318 Non-deductible executive compensation 115 171 27 Change in valuation allowance 173 520 (994) Utilization of research and development tax credits (2,881) (2,173) (1,971) One-time transition tax — — 250 Deferred balance sheet remeasure — 9 2,727 ASU 2016-09 excess stock compensation (673) (56) 643 Contingent consideration (27) 250 388 Changes from provision to return (111) (511) (554) Adjustment of tax contingency reserves 151 146 193 U.S. deduction for foreign export sales (355) (146) — Global intangible low-taxed income 31 162 — Other, net (31) (6) 83 Income tax (benefit) expense $ (948) $ 1,187 $ 1,619 The Tax Cuts & Jobs Act of 2017 was enacted in the U.S. on December 22, 2017. We applied the guidance in Staff Accounting Bulletin ("SAB") 118 when accounting for the enactment-date income tax effects of this act in fiscal 2018. At September 30, 2018 we had not fully completed our accounting for the enactment effects of this act. We, however, had recorded a provisional estimate of the tax expense related to the effects on our existing deferred tax balances and the one-time transition tax which totaled $3.0 million in fiscal 2018. In the first quarter of fiscal 2019 we completed our accounting for the enactment date income tax effects of this act, and there were no significant adjustments to the provisional amounts recorded in fiscal 2018. In addition, certain provisions of this act became effective for us in fiscal 2019. The estimated tax impacts of these provisions are included in our effective tax rate for the current period. A reconciliation of the beginning and ending amount of unrecognized tax benefits is (in thousands): Fiscal year ended September 30, 2020 2019 2018 Unrecognized tax benefits at beginning of fiscal year $ 1,713 $ 1,561 $ 1,335 Increases related to: Prior year income tax positions 756 9 39 Current year income tax positions 425 314 315 Decreases related to: Prior year income tax positions — (34) — Settlements (7) — — Expiration of statute of limitations (287) (137) (128) Unrecognized tax benefits at end of fiscal year $ 2,600 $ 1,713 $ 1,561 13. INCOME TAXES (CONTINUED) The total amount of unrecognized tax benefits ("UTB") at September 30, 2020 that, if recognized, would affect our effective tax rate was $2.4 million. We expect that it is reasonably possible that the total amounts of UTB will decrease by approximately $0.1 million over the next 12 months due to the expiration of various statutes of limitations. Of the $2.6 million of UTB, $1.9 million is included in non-current income taxes payable and $0.7 million is included with non-current deferred tax assets on the Consolidated Balance Sheets at September 30, 2020. We recognize interest and penalties related to income tax matters in income tax expense. During fiscal 2020 and 2019, there were insignificant amounts of interest and penalties related to income tax matters in income tax expense. We accrued interest and penalties related to unrecognized tax benefits of $0.1 million at both September 30, 2020 and 2019. These accrued interest and penalties are included in our non-current income taxes payable on our Consolidated Balance Sheets. We operate in multiple tax jurisdictions both in the U.S. and outside of the U.S. and face audits from various tax authorities regarding transfer pricing, tax credits, and other matters. Accordingly we must determine the appropriate allocation of income to each of these jurisdictions. This determination requires us to make several estimates and assumptions. Tax audits associated with the allocation of this income, and other complex issues, may require an extended period of time to resolve and may result in adjustments to our income tax balances in those years that are material to our Consolidated Balance Sheets and results of operations. We file a U.S. federal income tax return and income tax returns in various states and foreign jurisdictions. With few exceptions, we are no longer subject to state and local or non-U.S. income tax examinations by tax authorities for years before fiscal year 2016. We are currently under U.S. federal examination for fiscal years 2017 and 2018, and there is very limited audit activity of our income tax returns in U.S. state jurisdictions or international jurisdictions. At September 30, 2020, the majority of undistributed foreign earnings are taxed under the one time transition tax and the global intangible low-taxed income ("GILTI") provision of the Tax Cuts and Jobs Act of 2017. Additionally, the previously un-taxed accumulated undistributed foreign earnings from prior fiscal years are still permanently reinvested and, as such, we have not accrued additional U.S. tax. It is our position that the earnings of our foreign subsidiaries are to be reinvested indefinitely to fund current operations and provide for future international expansion opportunities and only repatriate earnings to the extent that U.S. taxes have already been recorded. As of September 30, 2020, we are permanently reinvested with respect to previously non-taxed accumulated earnings in all jurisdictions. Although we have no current need to repatriate historical foreign earnings that have not been taxed in the U.S., if we change our assertion from indefinitely reinvesting undistributed foreign earnings, we would have to accrue applicable taxes. The amount of any taxes and the application of any tax credits would be determined based on the income tax laws at the time of such repatriation. Under current tax law, we estimate the unrecognized tax liability to be immaterial. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Sep. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
STOCK-BASED COMPENSATION | STOCK-BASED COMPENSATION Stock-based awards were granted under the 2020 Omnibus Incentive Plan (the "2020 Plan") beginning January 29, 2020. Prior to that date such awards made in fiscal 2020 were granted under the 2019 Omnibus Incentive Plan (the "2019 Plan"). Upon stockholder approval of the 2020 Plan, we ceased granting awards under the 2019 Plan. Shares subject to awards under the 2019 Plan or any prior plans that are forfeited, canceled, returned to us for failure to satisfy vesting requirements, settled in cash or otherwise terminated without payment also will be available for grant under the 2020 Plan. The authority to grant options under the 2020 Plan and to set other terms and conditions rests with the Compensation Committee of the Board of Directors. The 2020 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 2020 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 2020 Plan is scheduled to expire on January 28, 2030. Options under the 2020 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 RSUs 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 September 30, 2020, there were approximately 1,209,150 shares available for future grants under the 2020 Plan. 14. STOCK-BASED COMPENSATION (CONTINUED) The 2019 Plan, under which grants ceased upon approval of the 2020 Plan, authorized the issuance of up to 1,500,000 common shares in connection with awards of stock options, stock appreciation rights, restricted stock, restricted stock units, performance-based full value awards or other stock-based awards. Eligible participants included our employees, our affiliates, non-employee directors of our Company and any consultant or advisor who is a natural person and provided services to us or our affiliates. Options that have been granted under the 2019 Plan typically vested over a four-year period and expired if unexercised after seven years from the date of grant. RSUs that were granted to directors typically vested in one year. RSUs that were granted to executives and employees typically vested in December over a four-year period. Awards may no longer be granted under the 2019 Plan as grants ceased upon approval of the 2020 Plan effective January 29, 2020 at the Annual Meeting of Stockholders. The exercise price of options and the grant date price of restricted stock units was determined by our Compensation Committee but could be less than the fair market value of our common stock based on the closing price on the date of grant. Our equity plans and corresponding forms of award agreements generally have provisions allowing employees to elect to satisfy tax withholding obligations through the delivery of shares, having us retain a portion of shares issuable under the award or paying cash to us for the withholding. During fiscal 2020, 2019 and 2018 our employees forfeited 103,492, 93,128 and 74,204 shares, respectively in order to satisfy $1.8 million, $1.1 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. We sponsor an Employee Stock Purchase Plan, as amended and restated as of December 10, 2019, October 29, 2013, December 4, 2009 and November 27, 2006 (the "Purchase Plan"), covering all domestic employees with at least 90 days of continuous service and who are customarily employed at least 20 hours per week. The Purchase Plan allows eligible participants the right to purchase common stock on a quarterly basis at the lower of 85% of the market price at the beginning or end of each three-month offering period. The most recent amendments to the Purchase Plan, ratified by our stockholders on January 29, 2020, increased the total number of shares to 3,425,000 that may be purchased under the plan. Employee contributions to the Purchase Plan were $1.1 million, $1.1 million and $1.1 million in fiscal 2020, 2019 and 2018, respectively. Pursuant to the Purchase Plan, 117,826, 111,036, and 125,446 shares of common stock were issued to employees during fiscal 2020, 2019 and 2018, respectively. Shares are issued under the Purchase Plan from treasury stock. As of September 30, 2020, 711,714 shares of common stock were available for future issuances under the Purchase Plan. Stock-based compensation expense is included in the consolidated results of operations as (in thousands): Fiscal year ended September 30, 2020 2019 2018 Cost of sales $ 291 $ 174 $ 195 Sales and marketing 2,318 1,708 1,492 Research and development 1,197 996 516 General and administrative 3,431 2,777 2,651 Stock-based compensation before income taxes 7,237 5,655 4,854 Income tax benefit (1,523) (1,174) (1,017) Stock-based compensation after income taxes $ 5,714 $ 4,481 $ 3,837 14. STOCK-BASED COMPENSATION (CONTINUED) Stock Options Below is a summary of our stock options as of September 30, 2020 and changes during the twelve months then ended (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, 2019 3,348 $10.85 Granted 796 16.56 Exercised (583) 10.12 Forfeited / Canceled (168) 13.16 Balance at September 30, 2020 3,393 $12.20 3.9 $ 12,790 Exercisable at September 30, 2020 2,115 $10.80 2.9 $ 10,207 (1) The aggregate intrinsic value represents the total pre-tax intrinsic value, based on our closing stock price of $15.63 as of September 30, 2020, which would have been received by the option holders had all option holders exercised their options as of that date. The intrinsic value of an option is the amount by which the fair value of the underlying stock exceeds its exercise price. The total intrinsic value of all options exercised during each of the twelve months ended September 30, 2020, 2019 and 2018 was $3.7 million, $2.1 million and $1.2 million, respectively. The table below shows the weighted average fair value, which was determined based upon the fair value of each option on the grant date utilizing the Black-Scholes option-pricing model and the related assumptions: Fiscal year ended September 30, 2020 2019 2018 Weighted average per option grant date fair value $ 6.17 $ 4.48 $ 3.98 Assumptions used for option grants: Risk free interest rate 0.37% - 1.73% 1.60% - 2.93% 2.12% - 2.89% Expected term 6.00 years 6.00 years 6.00 years Expected volatility 36% - 44% 33% - 35% 33% - 34% Weighted average volatility 36% 34% 33% Expected dividend yield 0% 0% 0% The fair value of each option award granted during the periods presented was estimated using the Black-Scholes option valuation model that uses the assumptions noted in the above table. Expected volatilities are based on the historical volatility of our stock. We use historical data to estimate option exercise and employee termination information within the valuation model. The expected term of options granted is derived from the vesting period and historical information and represents the period of time that options granted are expected to be outstanding. The risk-free rate used is the zero-coupon U.S. Treasury bond rate in effect at the time of the grant whose maturity equals the expected term of the option. As of September 30, 2020, the total unrecognized compensation cost related to non-vested stock-based compensation arrangements, net of expected forfeitures, was $6.0 million. The related weighted average period over which this cost is expected to be recognized was approximately 2.8 years. 14. STOCK-BASED COMPENSATION (CONTINUED) As of September 30, 2020, the weighted average exercise price and remaining life of the stock options were (in thousands, except remaining life and exercise price): Options Outstanding Options Exercisable Range of Exercise Prices Options Outstanding Weighted Average Remaining Contractual Life (In Years) Weighted Average Exercise Price Number of Shares Vested Weighted Average Exercise Price $7.40 - $9.03 485 2.33 $ 8.22 485 $ 8.22 $9.04 - $10.33 542 3.61 $ 10.04 427 $ 9.98 $10.35 - $11.23 602 3.42 $ 10.94 405 $ 10.86 $11.24 - $12.63 620 3.79 $ 12.08 448 $ 12.17 $12.64 - $13.92 573 4.48 $ 13.65 339 $ 13.53 $13.93 - $17.94 536 6.05 $ 17.62 11 $ 14.75 $17.95 - $18.20 35 6.14 $ 18.20 — $ — $7.40 - $18.20 3,393 3.98 $ 12.20 2,115 $ 10.80 The total grant date fair value of shares vested was $3.7 million, $3.5 million and $3.3 million in each of fiscal 2020, 2019 and 2018, respectively. Non-vested Restricted Stock Units Below is a summary of our non-vested restricted stock units as of September 30, 2020 and changes during the twelve months then ended (in thousands, except per common share amounts): Number of Awards Weighted Average Grant Date Fair Value Nonvested at September 30, 2019 888 $ 11.65 Granted 516 $ 14.86 Vested (322) $ 11.78 Canceled (110) $ 12.53 Nonvested at September 30, 2020 972 $ 13.20 |
Common Stock Repurchase
Common Stock Repurchase | 12 Months Ended |
Sep. 30, 2020 | |
Common Stock Repurchase [Abstract] | |
COMMON STOCK REPURCHASE | COMMON STOCK REPURCHASE Common Stock Repurchase Program 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. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Sep. 30, 2020 | |
Retirement Benefits [Abstract] | |
EMPLOYEE BENEFIT PLANS | EMPLOYEE BENEFIT PLANS We currently have a savings and profit sharing plan pursuant to Section 401(k) of the Internal Revenue Code (the Code), whereby eligible employees may contribute up to 25% of their pre-tax earnings subject to certain limits under law. Prior to May 3, 2020, we provided a match of 100% on the first 3% of each employee’s bi-weekly contribution and a 50% match on the next 2% of each employee’s bi-weekly contribution. In addition, we may make contributions to the plan at the discretion of the Board of Directors. Effective May 3, 2020 we indefinitely suspended the employer matching contributions in 16. EMPLOYEE BENEFIT PLANS (CONTINUED) the United States and Canada. We provided matching contributions of $1.7 million for fiscal 2020, $1.8 million for fiscal 2019 and $1.6 million for fiscal 2018. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Sep. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
CONTINGENCIES | CONTINGENCIES Leases We lease certain of our buildings and equipment under noncancelable lease agreements. Please refer to Note 10 to our consolidated financial statements for additional information. Litigation 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 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, which may include, but are not limited to, patent infringement and intellectual property claims. While we are unable to predict the outcome of any potential claims or litigation due to the inherent unpredictability of these matters, we believe that it is possible that we could, in the future, incur judgments or enter into settlements of claims that could have a material adverse effect on our operations in any particular period. |
Quarterly Financial Data
Quarterly Financial Data | 12 Months Ended |
Sep. 30, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Data | QUARTERLY FINANCIAL DATA (UNAUDITED) (in thousands, except per common share data) Quarter ended Dec. 31 March 31 June 30 Sept. 30 Fiscal 2020 Revenue $ 62,317 $ 73,447 $ 70,338 $ 73,169 Gross profit $ 30,464 $ 38,641 $ 37,349 $ 37,518 Net income (1) $ 208 $ 2,004 $ 1,766 $ 4,433 Net income per common share - basic $ 0.01 $ 0.07 $ 0.06 $ 0.15 Net income per common share - diluted $ 0.01 $ 0.07 $ 0.06 $ 0.15 Fiscal 2019 Revenue $ 62,313 $ 65,764 $ 61,166 $ 64,960 Gross profit $ 29,783 $ 30,329 $ 28,328 $ 30,595 Net income $ 4,682 $ 1,342 $ 1,648 $ 2,286 Net income per common share - basic $ 0.17 $ 0.05 $ 0.06 $ 0.08 Net income per common share - diluted $ 0.17 $ 0.05 $ 0.06 $ 0.08 |
Subsequent Event
Subsequent Event | 12 Months Ended |
Sep. 30, 2020 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENT | SUBSEQUENT EVENTS Restructuring On October 7, 2020, our Board of Directors approved a reorganization of our IoT Products & Services business segment ("the plan"). The plan aligns the business segment's organization around product lines. Under the plan, we expect to eliminate 19. SUBSEQUENT EVENTS (CONTINUED) approximately 20 employment positions during the first quarter ending December 31, 2020. In connection with the plan, we expect to incur total restructuring charges in the range of $0.8 million to $0.9 million relating to cash severance expenses during the first fiscal quarter ended December 31, 2020. |
Schedule II - Valuation and Qua
Schedule II - Valuation and Qualifying Accounts | 12 Months Ended | |
Sep. 30, 2020 | ||
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | ||
Schedule II- Valuation and Qualifying Accounts | SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS DIGI INTERNATIONAL INC. (in thousands) Additions Description Balance at beginning of period Charged to costs and expenses Charged to Other Accounts Deductions Balance at end of period Valuation allowance - deferred tax assets September 30, 2020 $ 3,810 $ 670 $ — $ 108 $ 4,372 September 30, 2019 $ 3,291 $ 529 $ — $ 10 $ 3,810 September 30, 2018 $ 5,952 $ 521 $ — $ 3,182 $ 3,291 Valuation account - doubtful accounts September 30, 2020 $ 968 $ 2,534 $ — $ (276) (2) $ 3,778 September 30, 2019 $ 785 $ 635 $ — $ 452 (2) $ 968 September 30, 2018 $ 341 $ 729 $ 40 (1) $ 325 (2) $ 785 Reserve for future credit returns and pricing adjustments September 30, 2020 $ 2,677 $ 17,816 $ — $ 19,017 $ 1,476 September 30, 2019 $ 2,560 $ 12,640 $ — $ 12,523 $ 2,677 September 30, 2018 $ 2,169 $ 10,715 $ — $ 10,324 $ 2,560 (1) Established through purchase accounting relating to the acquisition of TempAlert (2) Uncollectible accounts charged against allowance, net of recoveries | [1],[2] |
[1] | Recorded in Income tax (benefit) expense in our Consolidated Statements of Operations. | |
[2] | Uncollectible accounts charged against allowance, net of recoveries |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of ConsolidationThe consolidated financial statements include our accounts and the accounts of our wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. |
Reclassifications | Reclassifications The subcategories within total revenue and total cost of sales were redefined in 2019 into "Product" and "Service". Fiscal 2018 hardware product and services and solutions amounts have been reclassified to conform to our fiscal 2020 and fiscal 2019 presentation. |
Accounting Estimates | Accounting Estimates The preparation of the consolidated financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts in the consolidated financial statements and accompanying notes. Actual results could differ significantly from those estimates. |
Cash Equivalents | Cash Equivalents Cash equivalents consist of money market accounts and other highly liquid investments purchased with an original maturity of three months or less. The carrying amounts approximate fair value due to the short maturities of these investments. We maintain our cash and cash equivalents in bank accounts which may exceed federally insured limits at times. We have not experienced any losses in these accounts. |
Marketable Securities | Marketable Securities Marketable securities previously consisted of certificates of deposit, commercial paper, corporate bonds and government municipal bonds. All marketable securities were accounted for as available-for-sale and were carried at fair value on our Consolidated Balance Sheets with unrealized gains and losses recorded in accumulated other comprehensive loss within stockholders’ equity. In order to estimate the fair value for each security in our investment portfolio, we obtained quoted market prices and trading activity for each security when available. We obtained relevant information from our investment advisor and, if warranted, we may have reviewed the financial solvency of certain security issuers. We regularly monitored and evaluated the value of our marketable securities. When assessing marketable securities for other-than-temporary declines in value, we considered several factors. These factors included: how significant the decline in value is as a percentage of the original cost, how long the market value of the investment has been less than its original cost, the underlying factors contributing to a decline in the prices of securities in a single asset class, the performance of the issuer’s stock price in relation to the stock price of its competitors within the industry, expected market volatility, analyst recommendations, the views of external investment managers, any news or financial information that has been released specific to the investee and the outlook for the overall industry in which the issuer operates. If events and circumstances indicate that a decline in the value of a security had occurred and is other-than-temporary, we would record a charge to other income, net. |
Accounts Receivable | Accounts Receivable Accounts receivable are stated at the amount we expect to collect. This amount is net of an allowance for doubtful accounts for estimated losses resulting from the inability of our customers to make required payments and a reserve for future credit returns and pricing adjustments. The following factors are considered when determining the collectability of specific customer accounts: customer creditworthiness, past transaction history with the customer, and changes in customer payment terms or practices. In addition, overall historical collection experience, current economic industry trends, and a review of the current status of trade accounts receivable are considered when determining the required allowance for doubtful accounts. Based on our assessment, we provide for estimated uncollectible amounts through a charge to earnings and a credit to our allowance for doubtful accounts. Balances that remain outstanding after we have used reasonable collection efforts are written off through a charge to the allowance for doubtful accounts and a credit to accounts receivable. Estimated reserves for future credit returns and pricing adjustments are established based on an analysis of historical patterns of credit returns and price adjustments compared to received credit returns and distribution sales for the current period. Estimated reserves for future credit returns and price adjustments are charged against revenue in the same period as the corresponding sales are recorded. Estimated sales returns for our distributor stock rotation program are accounted for under the guidance of Accounting Standard Codification (ASC) 845 Nonmonetary Transactions |
Inventories | InventoriesInventories are valued at the lower of cost or net realizable value using the first-in, first-out (FIFO) method. Appropriate consideration is given to deterioration, obsolescence and other factors in evaluating net realizable value. |
Property, Equipment and Improvements, Net | Property, Equipment and Improvements, Net Property, equipment and improvements are carried at cost, net of accumulated depreciation. Depreciation is provided by charges to operations using the straight-line method over the estimated asset useful lives. Furniture and fixtures, purchased software and other equipment are depreciated over a period of three years to ten years. Building improvements and buildings are depreciated over ten years and thirty-nine years, respectively. Leasehold improvements are depreciated over the shorter of the lease term or the estimated useful life of the asset. Long-lived assets to be held and used, such as property, equipment and improvements, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. |
Identifiable Intangible Assets | Identifiable Intangible Assets Purchased proven technology, license agreements, covenants not to compete and other identifiable intangible assets are recorded at fair value when acquired in a business acquisition, or at cost when not purchased in a business acquisition. All other identifiable intangible assets are amortized on a straight-line basis over their estimated useful lives of three years to 14.5 years. Useful lives for identifiable intangible assets are estimated at the time of acquisition based on the periods of time from which we expect to derive benefits from the identifiable intangible assets. Amortization of purchased and core technology is included in cost of sales in the Consolidated Statements of Operations. Amortization of all other acquired identifiable intangible assets is charged to operating expenses as a component of general and administrative expense. |
Goodwill | Goodwill Goodwill represents the excess of cost over the fair value of identifiable assets acquired. Goodwill is quantitatively tested for impairment on an annual basis as of June 30, or more frequently if events or circumstances occur which could indicate impairment. We have two reportable operating segments, our IoT Products & Services segment and our IoT Solutions segment (see Note 4 to the consolidated financial statements). As a result, we concluded that the IoT Products & Services segment and the IoT Solutions segment constitute separate reporting units for purposes of the ASC 350-20-35 "Goodwill Measurement of Impairment" assessment and both units were tested individually for impairment. For our quantitative goodwill impairment tests, we determine the estimated fair value of each reporting unit and compare it to the carrying value of the reporting unit, including goodwill. If the carrying amount of a reporting unit is higher than its estimated fair value, then an impairment loss must be recognized for the excess. Fair values for both reporting units were each estimated on a standalone basis using a weighted combination of the income approach and market approach. 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 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 our prior acquisitions. 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. |
Contingent Consideration | Contingent Consideration We measure our contingent consideration liabilities recognized in connection with business combinations at fair value on a recurring basis using significant unobservable inputs classified within Level 3 of the fair value hierarchy as defined in ASC 820 "Fair Value Measurement". We used a probability-weighted discounted cash flow approach as a valuation technique to determine the fair value of the contingent consideration on the acquisition date. At each subsequent reporting period, the fair value is re-measured with the change in fair value recognized in general and administrative expense in our Consolidated Statements of Operations. Amounts, if any, paid to the seller in excess of the amount recorded on the acquisition date will be classified as cash flows used in operating activities. Payments to the seller not exceeding the acquisition-date fair value of the contingent consideration will be classified as cash flows used in financing activities. |
Warranties | Warranties In general, we warrant our hardware products to be free from defects in material and workmanship under normal use and service. The warranty periods generally range from one year to five years. We typically have the option to either repair or replace hardware products we deem defective with regard to material or workmanship. Estimated warranty costs are accrued in the period that the related revenue is recognized based upon an estimated average per unit repair or replacement cost applied to 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) the estimated number of units under warranty. These estimates are based upon historical warranty incidents and are evaluated on an ongoing basis to ensure the adequacy of the warranty accrual. We also warrant our software or firmware incorporated into our products generally for a period of one year and offer to provide a bug fix or software patch within a reasonable period. We have not accrued specifically for this warranty and have not had claims specifically related to software or firmware. We are not responsible for, and do not warrant that, custom software versions, created by OEM customers based upon our software source code, will function in a particular way, will conform to any specifications or are fit for any particular purpose. Further, we do not indemnify these customers from any third-party liability as it relates to or arises from any customization or modifications made by the OEM customer. |
Treasury stock | Treasury Stock We record treasury stock at cost. Treasury stock may be acquired from employees for tax withholding purposes related to vesting of restricted stock awards as part of our stock-based compensation program. |
Revenue Recognition | 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 (“Direct/OEM”) customers. Product revenue generally is recognized upon shipment of the product to a customer. Sales to authorized domestic distributors and Direct/OEM customers typically are made with certain rights of return and price adjustment provisions. Estimated reserves for future credit returns and pricing adjustments are established based on an analysis of historical patterns of credit returns and price adjustments compared to received credit returns and distribution sales for the current period. Estimated reserves for future credit 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 credit returns and pricing adjustments could result in a material change to our consolidated results of operations or financial position. Estimated sales returns for our distributor stock rotation program are accounted for under the guidance of ASC 845 Nonmonetary Transactions . Equipment revenue from SmartSense by Digi ® within our IoT Solutions segment is recognized upon shipment of the equipment to a customer. Installation service charges from these sales are recorded when the product is installed. Subscription and Support Services Revenue We 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 and is included in our IoT Products & Services segment. Digi Support Services revenues are recognized over the life of the support contract and included in our IoT Products & Services segment. Some of Digi Support Services revenue is for training and this revenue is recognized as the services are performed. Our SmartSense by Digi ® subscription revenue is recorded on a monthly basis. These subscriptions are generally in a range from one year 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. 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 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, which are included in our IoT Products & Services segment 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 From time to time we have contracts from customers with multiple performance obligations. Our hardware products may be combined with our Digi Remote Manager ® PaaS offering as well as other support services in an individual contract. Our SmartSense by Digi ® |
Research and Development | Research and Development Research and development costs are expensed when incurred. Research and development costs include compensation, allocation of corporate costs, depreciation, utilities, professional services and prototypes. Software and firmware development costs are expensed as incurred until the point that both the technological feasibility and the proven marketability of the product are established. To date, the time period between the establishment of technological feasibility and completion of software development has been short and no significant development costs have been incurred during that period. Accordingly, we have not capitalized any software development costs to date. |
Income Taxes | Income Taxes Deferred income taxes are recognized for the tax consequences in future years of differences between the tax basis of assets and liabilities and their financial reporting amounts at each year end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Income tax expense is equal to the tax payable for the period and the change during the period in deferred tax assets and liabilities as well as changes in income tax reserves. We maintain valuation allowances unless it is more likely than not that all or a portion of the deferred tax assets will be realized. Changes in valuation allowances from period to period are included in our tax provision in the period of change. We recognize the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. |
Stock-Based Compensation | Stock-Based Compensation Stock-based compensation expense represents the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of the award. This cost must be recognized over the period during which an employee is required to provide the service (usually the vesting period). |
Foreign Currency Translation | Foreign Currency Translation Financial position and results of operations of our international subsidiaries are measured using local currencies as the functional currency. Assets and liabilities of these operations are translated at the exchange rates in effect at the end of each reporting period. For our international subsidiaries, our statements of operations accounts are translated at the weighted average rates of exchange prevailing during each reporting period. Translation adjustments arising from the use of differing currency exchange rates from period to period are included in accumulated other comprehensive loss in stockholders’ equity. Gains and losses on foreign currency exchange transactions, as well as translation gains or losses on transactions denominated in currencies other than an entity’s functional currency, are reflected in the statement of operations. During fiscal 2020, 2019 and |
Comprehensive Income | Comprehensive Income Our comprehensive income is comprised of net income, foreign currency translation adjustments and unrealized gains and losses on available-for-sale marketable securities. These items are charged or credited to the accumulated other comprehensive loss account in stockholders’ equity. |
Net Income Per Common Share | Net Income Per Common Share Basic net income per common share is calculated based on the weighted average number of common shares outstanding during the period. Diluted net income per common share is computed by dividing net income by the weighted average number of common and potentially dilutive common shares outstanding during the period. Potentially dilutive common shares of our stock result from common stock options and restricted stock units. We use the treasury stock method to calculate the weighted-average shares used in the diluted earnings per share computation. Under this method the proceeds from exercise of an option, any amount of compensation cost for future service that we have not yet recognized, and the amount of estimated tax benefits that would be recorded in paid-in capital when the option is exercised are assumed to have been used to repurchase shares in the current period. |
Recent Accounting Developments | Recent Accounting Developments Adopted In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-02, Leases (Topic 842) , which provides for comprehensive changes to lease accounting. The standard requires that a lessee recognize a lease obligation liability and a right-to-use asset for virtually all leases, subsequently amortized over the lease term. We adopted this standard in the first quarter of fiscal 2020, following the modified retrospective application approach that applies the new standard to all applicable leases existing at the date of initial application and not restating comparative periods. We have completed our implementation efforts. These efforts included identification and analysis of our lease portfolio, analysis and evaluation of the new reporting and disclosure requirements of the new guidance, and an evaluation of our lease- 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) related processes and internal controls. The adoption of this standard resulted in the recognition of a right-of-use asset included in other non-current assets of approximately $14.1 million. It also resulted in a lease liability of approximately $17.9 million included in other current liabilities and other non-current liabilities. Both of these were recorded on our Consolidated Balance Sheet in the first quarter of fiscal 2020. In adopting the new standard, we elected the package of practical expedients permitted under the transition guidance, as well as the practical expedient not to separate non-lease components from lease components. We also elected the practical expedient to use hindsight in determining the lease term when considering options to extend or terminate a lease, options to purchase the underlying asset, and in assessing the impairment of right-of-use assets. The adoption of this standard did not have a significant impact on our Consolidated Statements of Operations or Consolidated Statements of Cash Flows. We have identified new and updated existing internal controls and processes to support measurement, recognition and disclosure under this new standard. Such changes were not deemed to be material to our overall system of internal control over financial reporting. Not Yet Adopted In August 2018, FASB issued ASU 2018-13, Fair Value Measurement - Disclosure Framework (Topic 820). The updated guidance changes the disclosure requirements on fair value measurements. We will adopt this standard in the first quarter of fiscal 2021. We do not expect this standard to have a material impact on our consolidated financial statements. In June 2016, FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments . The amendments in this update replace the incurred loss impairment methodology in current U.S. GAAP with a methodology that reflects expected credit losses. This update is intended to provide financial statement users with more decision-useful information about the expected credit losses. We will adopt this standard in the first quarter of fiscal 2021, following the modified-retrospective approach. We do not expect this standard to have a material impact on our consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Schedule of Calculation of Numerator and Denominator in Earnings Per Share | The following table is a reconciliation of the numerators and denominators in the net income per common share calculations (in thousands, except per common share data): Fiscal year ended September 30, 2020 2019 2018 Numerator: Net income $ 8,411 $ 9,958 $ 1,631 Denominator: Denominator basic net income per common share — weighted average shares outstanding 28,849 27,905 27,083 Effect of dilutive securities: Stock options and restricted stock units 697 649 569 Denominator diluted net income per common share — adjusted weighted average shares 29,546 28,554 27,652 Net income per common share, basic $ 0.29 $ 0.36 $ 0.06 Net income per common share, diluted $ 0.28 $ 0.35 $ 0.06 |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Business Combinations [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the final fair values of Opengear assets acquired and liabilities assumed as of the acquisition date (in thousands): Cash $ 148,058 Contingent consideration 5,100 Total $ 153,158 Fair value of net tangible assets acquired $ 19,217 Identifiable intangible assets: Customer relationships 79,000 Purchased and core technology 18,100 Trademarks 8,000 Deferred tax liability on identifiable intangible assets (27,401) Goodwill 56,242 Total $ 153,158 |
Business Acquisition, Pro Forma Information | The following consolidated pro forma information is presented as if the acquisition had occurred on October 1, 2018 (in thousands): Fiscal year ended September 30, 2020 2019 Net sales $ 294,167 $ 308,986 Net income $ 14,366 $ 10,417 Net income per share - basic $ 0.50 $ 0.37 Net income per share - diluted $ 0.49 $ 0.36 |
Goodwill and other Identifiab_2
Goodwill and other Identifiable Intangible Assets (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Amortizable Identifiable Intangible Assets | Amortizable identifiable intangible assets, net as of September 30, 2020 and 2019 were comprised of the following (in thousands): September 30, 2020 September 30, 2019 Gross Accum. Net Gross Accum. Net Purchased and core technology $ 76,011 $ (55,482) $ 20,529 $ 57,699 $ (50,986) $ 6,713 License agreements 112 (112) — 102 (74) 28 Patents and trademarks 22,836 (13,535) 9,301 14,577 (11,970) 2,607 Customer relationships 125,500 (34,232) 91,268 46,315 (25,266) 21,049 Non-compete agreements 600 (450) 150 600 (330) 270 Order backlog — — — 1,800 (1,800) — Total $ 225,059 $ (103,811) $ 121,248 $ 121,093 $ (90,426) $ 30,667 |
Schedule of Amortization Expense | Amortization expense for fiscal years 2020, 2019 and 2018 was as follows (in thousands): Fiscal year Total 2020 $ 14,754 2019 $ 8,818 2018 $ 9,435 |
Schedule of Estimated Future Amortization Expense Related to Identifiable Intangible Assets | Estimated amortization expense for the next five years is as follows (in thousands): Fiscal year Total 2021 $ 15,558 2022 $ 14,714 2023 $ 12,518 2024 $ 11,815 2025 $ 8,358 |
Schedule of Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill by reportable segments are (in thousands): IoT IoT Total Balance on September 30, 2018 $ 104,358 $ 50,177 $ 154,535 Foreign currency translation adjustment (839) (274) (1,113) Balance on September 30, 2019 $ 103,519 $ 49,903 $ 153,422 Acquisition 56,242 — 56,242 Foreign currency translation adjustment 604 (133) 471 Balance at September 30, 2020 $ 160,365 $ 49,770 $ 210,135 |
Segment Information and Major_2
Segment Information and Major Customers (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Summary operating results for each of our segments were as follows (in thousands): Fiscal year ended September 30, 2020 2019 2018 Revenue IoT Products & Services $ 249,530 $ 215,287 $ 201,506 IoT Solutions 29,741 38,916 25,387 Total revenue $ 279,271 $ 254,203 $ 226,893 Gross profit IoT Products & Services $ 129,349 $ 100,522 $ 97,895 IoT Solutions 14,623 18,513 11,159 Total gross profit $ 143,972 $ 119,035 $ 109,054 Depreciation and amortization IoT Products & Services $ 11,521 $ 6,102 $ 6,040 IoT Solutions 7,778 7,294 6,744 Total depreciation and amortization $ 19,299 $ 13,396 $ 12,784 |
Payments to Acquire Property, Plant and Equipment by Segment | Total expended for property, plant and equipment was as follows (in thousands): Fiscal year ended September 30, 2020 2019 2018 IoT Products & Services $ 878 $ 8,863 $ 1,773 IoT Solutions 21 472 69 Total expended for property, plant and equipment $ 899 $ 9,335 $ 1,842 |
Schedule of Total Assets by Segment | Total assets for each of our segments were as follows (in thousands): As of September 30, 2020 2019 IoT Products & Services $ 387,578 $ 215,651 IoT Solutions 86,975 90,255 Unallocated* 54,129 92,792 Total assets $ 528,682 $ 398,698 *Unallocated consists of cash and cash equivalents. |
Schedule of Net Property, Equipment and Improvements by Geographical Location | Net property, equipment and improvements by geographic location were as follows (in thousands): As of September 30, 2020 2019 United States $ 11,297 $ 13,400 International, primarily Europe 210 457 Total net property, equipment and improvements $ 11,507 $ 13,857 |
Selected Balance Sheet Data (Ta
Selected Balance Sheet Data (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Selected Balance Sheet Data [Abstract] | |
Schedule of Selected Balance Sheet Data | SELECTED BALANCE SHEET DATA (in thousands) As of September 30, 2020 2019 Accounts receivable, net: Accounts receivable $ 65,027 $ 60,062 Less allowance for doubtful accounts 3,778 968 Less reserve for future credit returns and pricing adjustments 2,022 2,677 Total accounts receivable, net $ 59,227 $ 56,417 Inventories: Raw materials $ 14,009 $ 12,308 Work in process — 565 Finished goods 37,559 26,891 Total inventories $ 51,568 $ 39,764 Property, equipment and improvements, net: Land $ 570 $ 570 Buildings 2,338 2,338 Improvements 7,844 7,646 Equipment 17,153 17,440 Purchased software 3,770 4,030 Furniture and fixtures 3,236 2,963 Subscriber assets 5,104 3,750 Total property, equipment and improvements, gross 40,015 38,737 Less accumulated depreciation and amortization 28,508 24,880 Total property, equipment and improvements, net $ 11,507 $ 13,857 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Assets Measured on Recurring Basis | The following tables provide information by level for financial assets and liabilities that are measured at fair value on a recurring basis (in thousands): Fair Value Measurements at September 30, 2020 using: Total carrying Quoted price in Significant other Significant Liabilities: Contingent consideration on acquired business $ 4,228 $ — $ — $ 4,228 Total liabilities measured at fair value $ 4,228 $ — $ — $ 4,228 Fair Value Measurements at September 30, 2019 using: Total carrying Quoted price in Significant other Significant Assets: Money market $ 56,700 $ 56,700 $ — $ — Total assets measured at fair value $ 56,700 $ 56,700 $ — $ — Liabilities: Contingent consideration on acquired businesses $ 5,407 $ — $ — $ 5,407 Total liabilities measured at fair value $ 5,407 $ — $ — $ 5,407 |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation | The following table presents a reconciliation of the contingent consideration liability measured at fair value on a recurring basis using significant unobservable inputs (Level 3) (in thousands): Fiscal year ended September 30, 2020 2019 Fair value at beginning of period $ 5,407 $ 10,065 Purchase price contingent consideration 5,100 — Contingent consideration payments (6,151) (5,848) Change in fair value of contingent consideration (128) 1,190 Fair value at end of period $ 4,228 $ 5,407 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Debt [Table Text Block] | The following table is a summary of our long-term indebtedness at September 30, 2020 (in thousands): Revolving loan $ 15,000 Term loan 48,125 Total loans 63,125 Less unamortized issuance costs (2,173) Less current maturities of long-term debt (1,972) Total long-term debt, net of current portion $ 58,980 |
Schedule of Maturities of Long-term Debt [Table Text Block] | The following table is a summary of future maturities of our aggregate long-term debt at September 30, 2020 (in thousands): 2021 $ 2,500 2022 3,438 2023 3,750 2024 4,687 2025 48,750 Total long-term debt $ 63,125 |
Product Warranty Obligation (Ta
Product Warranty Obligation (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Product Warranties Disclosures [Abstract] | |
Schedule of Product Warranty Accrual | The following table summarizes the activity associated with the product warranty accrual (in thousands) and is listed on our Consolidated Balance Sheets within current liabilities: Balance at Warranties Settlements Balance at Fiscal year October 1 accrued made September 30 2020 $ 1,012 $ 666 $ (736) $ 942 2019 $ 1,172 $ 305 $ (465) $ 1,012 2018 $ 987 $ 759 $ (574) $ 1,172 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
Supplemental Balance Sheet Information | The following table shows the supplemental balance sheet information related to our leases (in thousands): Balance Sheet Location September 30, 2020 Assets Operating leases Other non-current assets $ 14,334 Total lease assets $ 14,334 Liabilities Operating leases Other current liabilities $ 2,527 Operating leases Other non-current liabilities 16,193 Total lease liabilities $ 18,720 |
Components of Lease Cost | The following were the components of our lease cost (in thousands): Statement of Operations Location Fiscal year ended Operating lease cost Cost of goods sold and SG&A $ 3,341 Variable lease cost Cost of goods sold and SG&A 744 Short-term lease cost Cost of goods sold and SG&A 175 Total lease cost $ 4,260 |
Supplemental Disclosures Leases | The following table presents supplemental information related to operating leases (in thousands): Fiscal year ended Cash paid for amounts included in the measurement of operating lease liabilities $ 2,893 Right-of-use assets obtained in exchange for new operating lease liabilities $ 1,073 September 30, 2020 Weighted average remaining lease term - operating leases 5.6 years Weighted average discount rate - operating leases 4.80 % |
Operating Lease Liability Maturity | The table below reconciles the undiscounted cash flows for each of the first five years as well as all the remaining years to the operating lease liabilities recorded on the Consolidated Balance Sheet as of September 30, 2020 (in thousands): Fiscal year Amount 2021 $ 3,335 2022 2,932 2023 2,669 2024 2,452 2025 2,348 Thereafter 9,219 Total future undiscounted lease payments 22,955 Less imputed interest (4,235) Total reported lease liability $ 18,720 |
Schedule of Future Minimum Rental Payments for Operating Leases | As follows, aggregate annual future minimum rental commitments under operating leases with noncancelable terms of more than one year at September 30, 2019 were reported under previous lease accounting standards (in thousands): Fiscal year Amount 2020 $ 2,596 2021 2,575 2022 2,314 2023 2,056 2024 2,095 Thereafter 11,361 Total minimum payments required $ 22,997 |
Restructuring (Tables)
Restructuring (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Reserve | Below is a summary of the restructuring charges and other activity within the restructuring accrual (in thousands): 2020 Restructuring Manufacturing Transition 2017 Restructuring Employee Termination Costs Employee Termination Costs Employee Termination Costs Other Total Balance at September 30, 2017 $ — $ — $ 1,528 $ 128 $ 1,656 Restructuring charge — 504 — — 504 Payments — (357) (1,035) (161) (1,553) Reversals — — (244) 41 (203) Foreign currency fluctuation — — 44 5 49 Balance at September 30, 2018 $ — $ 147 $ 293 $ 13 $ 453 Payments — (108) (233) (18) (359) Reversals — (39) (53) 5 (87) Foreign currency fluctuation — — (7) — (7) Balance at September 30, 2019 $ — $ — $ — $ — $ — Restructuring charge 133 — — — 133 Payments (117) — — — (117) Reversals (16) — — — (16) Balance at September 30, 2020 $ — $ — $ — $ — $ — |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following summarizes our revenue by geographic location of our customers: Fiscal year ended September 30, ($ in thousands) 2020 2019 2018 North America, primarily the United States $ 213,487 $ 184,022 $ 161,924 Europe, Middle East & Africa 40,076 39,896 39,211 Rest of world 25,708 30,285 25,758 Total revenue $ 279,271 $ 254,203 $ 226,893 The following summarizes our revenue by the timing of revenue recognition: Fiscal year ended September 30, ($ in thousands) 2020 2019 2018 Transferred at a point in time $ 253,371 $ 231,387 $ 212,448 Transferred over time 25,900 22,816 14,445 Total revenue $ 279,271 $ 254,203 $ 226,893 |
Contract with Customer, Asset and Liability | Changes in unearned revenue were: Fiscal year ended September 30, ($ in thousands) 2020 Unearned revenue, beginning of period $ 5,025 Billings 35,213 Revenue recognized (30,897) Unearned revenue, end of period $ 9,341 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Taxes | The components of income before income taxes are (in thousands): Fiscal year ended September 30, 2020 2019 2018 United States $ 3,756 $ 7,981 $ (2,427) International 3,707 3,164 5,677 Income before income taxes $ 7,463 $ 11,145 $ 3,250 |
Schedule of Components of Income Tax Provision | The components of the income tax (benefit) expense are (in thousands): Fiscal year ended September 30, 2020 2019 2018 Current: Federal $ 709 $ 950 $ 526 State 572 290 57 Foreign 1,128 746 1,412 Deferred: U.S. (2,911) (825) (536) Foreign (446) 26 160 Income tax (benefit) expense $ (948) $ 1,187 $ 1,619 |
Schedule of Net Deferred Tax Asset | Net deferred tax (liability) asset consists of (in thousands): As of September 30, 2020 2019 Non-current deferred tax asset $ 389 $ 7,330 Non-current deferred tax liability (17,171) (261) Net deferred tax (liability) asset $ (16,782) $ 7,069 Depreciation and amortization $ (1,037) $ (480) Lease asset (3,415) — Lease liability 4,477 — Inventories 979 536 Compensation costs 3,698 3,675 Other accruals 3,985 3,870 Tax credit carryforwards 6,021 4,911 Valuation allowance (4,372) (3,810) Identifiable intangible assets (27,118) (1,633) Net deferred tax (liability) asset $ (16,782) $ 7,069 |
Schedule of Effective Income Tax Rate Reconciliation | The reconciliation of the statutory federal income tax amount to our income tax (benefit) expense is (in thousands): Fiscal year ended September 30, 2020 2019 2018 Statutory income tax amount $ 1,567 $ 2,341 $ 809 Increase (decrease) resulting from: State taxes, net of federal benefits 392 196 (71) Manufacturing deduction — — (364) Transaction costs 143 — 79 Employee stock purchase plan 127 59 56 Foreign operations 431 225 318 Non-deductible executive compensation 115 171 27 Change in valuation allowance 173 520 (994) Utilization of research and development tax credits (2,881) (2,173) (1,971) One-time transition tax — — 250 Deferred balance sheet remeasure — 9 2,727 ASU 2016-09 excess stock compensation (673) (56) 643 Contingent consideration (27) 250 388 Changes from provision to return (111) (511) (554) Adjustment of tax contingency reserves 151 146 193 U.S. deduction for foreign export sales (355) (146) — Global intangible low-taxed income 31 162 — Other, net (31) (6) 83 Income tax (benefit) expense $ (948) $ 1,187 $ 1,619 |
Schedule of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is (in thousands): Fiscal year ended September 30, 2020 2019 2018 Unrecognized tax benefits at beginning of fiscal year $ 1,713 $ 1,561 $ 1,335 Increases related to: Prior year income tax positions 756 9 39 Current year income tax positions 425 314 315 Decreases related to: Prior year income tax positions — (34) — Settlements (7) — — Expiration of statute of limitations (287) (137) (128) Unrecognized tax benefits at end of fiscal year $ 2,600 $ 1,713 $ 1,561 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Stock-Based Compensation Expense | Stock-based compensation expense is included in the consolidated results of operations as (in thousands): Fiscal year ended September 30, 2020 2019 2018 Cost of sales $ 291 $ 174 $ 195 Sales and marketing 2,318 1,708 1,492 Research and development 1,197 996 516 General and administrative 3,431 2,777 2,651 Stock-based compensation before income taxes 7,237 5,655 4,854 Income tax benefit (1,523) (1,174) (1,017) Stock-based compensation after income taxes $ 5,714 $ 4,481 $ 3,837 |
Schedule of Stock Option Activity | Below is a summary of our stock options as of September 30, 2020 and changes during the twelve months then ended (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, 2019 3,348 $10.85 Granted 796 16.56 Exercised (583) 10.12 Forfeited / Canceled (168) 13.16 Balance at September 30, 2020 3,393 $12.20 3.9 $ 12,790 Exercisable at September 30, 2020 2,115 $10.80 2.9 $ 10,207 |
Schedule of Valuation Assumptions | The table below shows the weighted average fair value, which was determined based upon the fair value of each option on the grant date utilizing the Black-Scholes option-pricing model and the related assumptions: Fiscal year ended September 30, 2020 2019 2018 Weighted average per option grant date fair value $ 6.17 $ 4.48 $ 3.98 Assumptions used for option grants: Risk free interest rate 0.37% - 1.73% 1.60% - 2.93% 2.12% - 2.89% Expected term 6.00 years 6.00 years 6.00 years Expected volatility 36% - 44% 33% - 35% 33% - 34% Weighted average volatility 36% 34% 33% Expected dividend yield 0% 0% 0% |
Schedule of Weighted Average Exercise Price Range and Remaining Contractual Life | As of September 30, 2020, the weighted average exercise price and remaining life of the stock options were (in thousands, except remaining life and exercise price): Options Outstanding Options Exercisable Range of Exercise Prices Options Outstanding Weighted Average Remaining Contractual Life (In Years) Weighted Average Exercise Price Number of Shares Vested Weighted Average Exercise Price $7.40 - $9.03 485 2.33 $ 8.22 485 $ 8.22 $9.04 - $10.33 542 3.61 $ 10.04 427 $ 9.98 $10.35 - $11.23 602 3.42 $ 10.94 405 $ 10.86 $11.24 - $12.63 620 3.79 $ 12.08 448 $ 12.17 $12.64 - $13.92 573 4.48 $ 13.65 339 $ 13.53 $13.93 - $17.94 536 6.05 $ 17.62 11 $ 14.75 $17.95 - $18.20 35 6.14 $ 18.20 — $ — $7.40 - $18.20 3,393 3.98 $ 12.20 2,115 $ 10.80 |
Schedule of Nonvested Restricted Stock Units | Below is a summary of our non-vested restricted stock units as of September 30, 2020 and changes during the twelve months then ended (in thousands, except per common share amounts): Number of Awards Weighted Average Grant Date Fair Value Nonvested at September 30, 2019 888 $ 11.65 Granted 516 $ 14.86 Vested (322) $ 11.78 Canceled (110) $ 12.53 Nonvested at September 30, 2020 972 $ 13.20 |
Quarterly Financial Data (Table
Quarterly Financial Data (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Data (Unaudited) | (in thousands, except per common share data) Quarter ended Dec. 31 March 31 June 30 Sept. 30 Fiscal 2020 Revenue $ 62,317 $ 73,447 $ 70,338 $ 73,169 Gross profit $ 30,464 $ 38,641 $ 37,349 $ 37,518 Net income (1) $ 208 $ 2,004 $ 1,766 $ 4,433 Net income per common share - basic $ 0.01 $ 0.07 $ 0.06 $ 0.15 Net income per common share - diluted $ 0.01 $ 0.07 $ 0.06 $ 0.15 Fiscal 2019 Revenue $ 62,313 $ 65,764 $ 61,166 $ 64,960 Gross profit $ 29,783 $ 30,329 $ 28,328 $ 30,595 Net income $ 4,682 $ 1,342 $ 1,648 $ 2,286 Net income per common share - basic $ 0.17 $ 0.05 $ 0.06 $ 0.08 Net income per common share - diluted $ 0.17 $ 0.05 $ 0.06 $ 0.08 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Property, Equipment and Improvements, Net) (Details) | 12 Months Ended |
Sep. 30, 2020 | |
Furniture and Fixtures | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property, equipment and improvements depreciation life | 3 years |
Furniture and Fixtures | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property, equipment and improvements depreciation life | 10 years |
Building Improvements | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property, equipment and improvements depreciation life | 10 years |
Buildings | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property, equipment and improvements depreciation life | 39 years |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Identifiable Intangible Assets) (Details) | 12 Months Ended |
Sep. 30, 2020 | |
Minimum | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated useful life | 3 years |
Maximum | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated useful life | 14 years 6 months |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Goodwill) (Details) $ in Thousands | 12 Months Ended | |||
Sep. 30, 2020USD ($)segment | Jun. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | |
Goodwill [Line Items] | ||||
Number of reportable segments | segment | 2 | |||
Goodwill | $ 210,135 | $ 153,422 | $ 154,535 | |
Market Capitalization | $ 338,200 | |||
Maximum | Measurement Input, Control Premium [Member] | ||||
Goodwill [Line Items] | ||||
Goodwill Valuation Implied Control Premium | 29.10% | |||
Minimum | Measurement Input, Control Premium [Member] | ||||
Goodwill [Line Items] | ||||
Goodwill Valuation Implied Control Premium | 17.00% | |||
IoT Products & Services | ||||
Goodwill [Line Items] | ||||
Goodwill | $ 157,100 | |||
IoT Solutions | ||||
Goodwill [Line Items] | ||||
Goodwill | $ 49,600 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies (Warranty) (Details) | 12 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Warranty period products, minimum | 1 year |
Warranty period products, maximum | 5 years |
Warranty period software, maximum | 1 year |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies (Revenue Recognition) (Details) - Subscription and Circulation | 12 Months Ended |
Sep. 30, 2020 | |
Minimum | |
Customer With Contract, Length Of Contract | 1 year |
Maximum | |
Customer With Contract, Length Of Contract | 5 years |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies (Foreign Currency Translation) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 | |
Accounting Policies [Abstract] | |||
Foreign currency net transaction gains | $ (0.6) | $ 0.4 | $ 0.1 |
Summary of Significant Accou_10
Summary of Significant Accounting Policies (Net Income Per Common Share) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 | ||
Accounting Policies [Abstract] | ||||||||||||
Net income | $ 4,433 | $ 1,766 | $ 2,004 | $ 208 | [1] | $ 2,286 | $ 1,648 | $ 1,342 | $ 4,682 | $ 8,411 | $ 9,958 | $ 1,631 |
Denominator for basic net income per common share — weighted average shares outstanding | 28,849,000 | 27,905,000 | 27,083,000 | |||||||||
Effect of dilutive securities: | ||||||||||||
Stock options and restricted stock units | 697,000 | 649,000 | 569,000 | |||||||||
Denominator for diluted net income per common share — adjusted weighted average shares | 29,546,000 | 28,554,000 | 27,652,000 | |||||||||
Net income per common share: | ||||||||||||
Basic | $ 0.15 | $ 0.06 | $ 0.07 | $ 0.01 | $ 0.08 | $ 0.06 | $ 0.05 | $ 0.17 | $ 0.29 | $ 0.36 | $ 0.06 | |
Diluted net income per common share: | ||||||||||||
Diluted | $ 0.15 | $ 0.06 | $ 0.07 | $ 0.01 | $ 0.08 | $ 0.06 | $ 0.05 | $ 0.17 | $ 0.28 | $ 0.35 | $ 0.06 | |
Antidilutive securities excluded from computation of earnings per share | 1,143,411 | 744,513 | 925,063 | |||||||||
[1] | During fiscal 2020, we recorded a discrete tax benefit of $1.0 million in the first quarter of fiscal 2020 resulting from excess tax benefits recognized on stock compensation and an adjustment of our state deferred tax rate due to the Opengear acquisition. |
Summary of Significant Accou_11
Summary of Significant Accounting Policies (Adoption of ASC 842) (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Oct. 01, 2019 | Sep. 30, 2019 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Operating lease right-of-use assets | $ 14,334 | $ 0 | |
Operating lease liabilities | $ 16,193 | $ 0 | |
ASU 2016-02 | Other non-current assets | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Operating lease right-of-use assets | $ 14,100 | ||
ASU 2016-02 | Other non-current liabilities | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Operating lease liabilities | $ 17,900 |
Acquisitions Details (Details)
Acquisitions Details (Details) | Dec. 13, 2019USD ($) | Jan. 22, 2018USD ($) | Oct. 20, 2017USD ($) | Apr. 30, 2019USD ($) | Jun. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2020USD ($) | Dec. 31, 2019USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Dec. 31, 2020USD ($) |
Business Acquisition [Line Items] | |||||||||||
Change in fair value of contingent consideration | $ (128,000) | $ 1,190,000 | $ 1,377,000 | ||||||||
Operating lease right-of-use assets | $ 0 | 14,334,000 | 0 | ||||||||
Operating lease liabilities | 0 | 16,193,000 | 0 | ||||||||
Opengear | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Cash paid at closing | $ 148,058,000 | ||||||||||
Weighted average useful life identifiable intangibles | 13 years 4 months 24 days | ||||||||||
Opengear | General and Administrative | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Acquisition costs | 300,000 | $ 2,700,000 | |||||||||
Accelerated Concepts | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Cash paid at closing | $ 16,400,000 | ||||||||||
Cash acquired | $ 200,000 | ||||||||||
Earn-out payment installment period | 2 | ||||||||||
TempAlert | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Cash paid at closing | $ 40,700,000 | ||||||||||
Cash acquired | $ 600,000 | ||||||||||
Maximum | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Useful life identifiable intangibles | 14 years 6 months | ||||||||||
Earn-out payments | Accelerated Concepts | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Earn-out payment maximum | $ 6,500,000 | ||||||||||
Change in fair value of contingent consideration | $ 3,500,000 | ||||||||||
Earn-out payments | Maximum | Opengear | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Earn-out payment maximum | $ 5,000,000 | ||||||||||
Earn-out payments | Maximum | Forecast | Opengear | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Earn-out payment maximum | $ 10,000,000 | ||||||||||
Customer Relationships | Opengear | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Useful life identifiable intangibles | 14 years 6 months | ||||||||||
Purchased and Core Technology | Opengear | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Useful life identifiable intangibles | 9 years | ||||||||||
Trademarks | Opengear | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Useful life identifiable intangibles | 12 years | ||||||||||
Other non-current assets | Opengear | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Operating lease right-of-use assets | $ 1,400,000 | ||||||||||
Other current liabilities and other non-current liabilities | Opengear | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Operating lease liabilities | $ 1,700,000 | ||||||||||
Contingent Consideration | Opengear | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Change in fair value of contingent consideration | $ 900,000 | ||||||||||
Contingent Consideration | Accelerated Concepts | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Change in fair value of contingent consideration | $ 2,400,000 | 3,500,000 | |||||||||
Contingent Consideration | TempAlert | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Change in fair value of contingent consideration | $ 0 | ||||||||||
Estimate of Fair Value Measurement | Fair Value, Measurements, Recurring | Contingent Consideration | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Contingent consideration fair value | $ 5,407,000 | $ 4,228,000 | $ 5,407,000 | ||||||||
Estimate of Fair Value Measurement | Fair Value, Measurements, Recurring | Contingent Consideration | Opengear | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Contingent consideration fair value | 4,200,000 | ||||||||||
Estimate of Fair Value Measurement | Fair Value, Measurements, Recurring | Contingent Consideration | Accelerated Concepts | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Contingent consideration fair value | $ 2,300,000 | ||||||||||
Estimate of Fair Value Measurement | Fair Value, Measurements, Recurring | Contingent Consideration | TempAlert | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Contingent consideration fair value | $ 0 |
Acquisitions (Assets Acquired a
Acquisitions (Assets Acquired and Liabilities Assumed) (Details) - USD ($) $ in Thousands | Dec. 13, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 210,135 | $ 153,422 | $ 154,535 | |
Opengear | ||||
Business Acquisition [Line Items] | ||||
Cash | $ 148,058 | |||
Contingent consideration | 5,100 | |||
Total consideration transferred | 153,158 | |||
Fair value of net tangible assets acquired | 19,217 | |||
Deferred tax liability on identifiable intangible assets | (27,401) | |||
Goodwill | 56,242 | |||
Total assets acquired and liabilities assumed | 153,158 | |||
Customer Relationships | Opengear | ||||
Business Acquisition [Line Items] | ||||
Identifiable intangible assets | 79,000 | |||
Purchased and Core Technology | Opengear | ||||
Business Acquisition [Line Items] | ||||
Identifiable intangible assets | 18,100 | |||
Trademarks | Opengear | ||||
Business Acquisition [Line Items] | ||||
Identifiable intangible assets | $ 8,000 |
Acquisitions Supplemental Pro F
Acquisitions Supplemental Pro Forma Information (Details) - Opengear - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2018 | Sep. 30, 2020 | Sep. 30, 2019 | |
Business Acquisition [Line Items] | |||
Net sales | $ 294,167 | $ 308,986 | |
Net income | $ 14,366 | $ 10,417 | |
Net income per share - basic | $ 0.50 | $ 0.37 | |
Net income per share - diluted | $ 0.49 | $ 0.36 | |
Acquisition-related costs | |||
Business Acquisition [Line Items] | |||
Acquisition costs | $ 3,100 |
Goodwill and other Identifiab_3
Goodwill and other Identifiable Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Sep. 30, 2019 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 225,059 | $ 121,093 |
Accumulated amortization | (103,811) | (90,426) |
Net | 121,248 | 30,667 |
Purchased and Core Technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 76,011 | 57,699 |
Accumulated amortization | (55,482) | (50,986) |
Net | 20,529 | 6,713 |
License Agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 112 | 102 |
Accumulated amortization | (112) | (74) |
Net | 0 | 28 |
Patents and Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 22,836 | 14,577 |
Accumulated amortization | (13,535) | (11,970) |
Net | 9,301 | 2,607 |
Customer Relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 125,500 | 46,315 |
Accumulated amortization | (34,232) | (25,266) |
Net | 91,268 | 21,049 |
Non-compete Agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 600 | 600 |
Accumulated amortization | (450) | (330) |
Net | 150 | 270 |
Order backlog | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 0 | 1,800 |
Accumulated amortization | 0 | (1,800) |
Net | $ 0 | $ 0 |
Goodwill and other Identifiab_4
Goodwill and other Identifiable Intangible Assets (Amortization Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 | |
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expense | $ 14,754 | $ 8,818 | $ 9,435 |
2021 | 15,558 | ||
2022 | 14,714 | ||
2023 | 12,518 | ||
2024 | 11,815 | ||
2025 | 8,358 | ||
Cost of Sales and General and Administrative Expense [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expense | $ 14,754 | $ 8,818 | $ 9,435 |
Goodwill and other Identifiab_5
Goodwill and other Identifiable Intangible Assets (Goodwill) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Goodwill [Line Items] | ||
Goodwill | $ 153,422 | $ 154,535 |
Acquisition | 56,242 | |
Foreign currency translation adjustment | 471 | (1,113) |
Goodwill | 210,135 | 153,422 |
IoT Solutions | ||
Goodwill [Line Items] | ||
Goodwill | 49,903 | 50,177 |
Acquisition | 0 | |
Foreign currency translation adjustment | (133) | (274) |
Goodwill | 49,770 | 49,903 |
IoT Products and Services | ||
Goodwill [Line Items] | ||
Goodwill | 103,519 | 104,358 |
Acquisition | 56,242 | |
Foreign currency translation adjustment | 604 | (839) |
Goodwill | $ 160,365 | $ 103,519 |
Segment Information and Major_3
Segment Information and Major Customers Summary of Operating Results by Segment (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Sep. 30, 2020USD ($) | Jun. 30, 2020USD ($) | Mar. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2020USD ($)segment | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | |
Segment Reporting Information [Line Items] | |||||||||||
Number of reportable segments | segment | 2 | ||||||||||
Revenue | $ 73,169 | $ 70,338 | $ 73,447 | $ 62,317 | $ 64,960 | $ 61,166 | $ 65,764 | $ 62,313 | $ 279,271 | $ 254,203 | $ 226,893 |
Gross profit | $ 37,518 | $ 37,349 | $ 38,641 | $ 30,464 | $ 30,595 | $ 28,328 | $ 30,329 | $ 29,783 | 143,972 | 119,035 | 109,054 |
Depreciation and amortization | 19,299 | 13,396 | 12,784 | ||||||||
IoT Products & Services | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 249,530 | 215,287 | 201,506 | ||||||||
Gross profit | 129,349 | 100,522 | 97,895 | ||||||||
Depreciation and amortization | 11,521 | 6,102 | 6,040 | ||||||||
IoT Solutions | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 29,741 | 38,916 | 25,387 | ||||||||
Gross profit | 14,623 | 18,513 | 11,159 | ||||||||
Depreciation and amortization | $ 7,778 | $ 7,294 | $ 6,744 |
Segment Information and Major_4
Segment Information and Major Customers Expended for Property, Plant and Equipment by Segment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 | |
Segment Reporting Information [Line Items] | |||
Expended for property, plant and equipment | $ 899 | $ 9,335 | $ 1,842 |
IoT Products & Services | |||
Segment Reporting Information [Line Items] | |||
Expended for property, plant and equipment | 878 | 8,863 | 1,773 |
IoT Solutions | |||
Segment Reporting Information [Line Items] | |||
Expended for property, plant and equipment | $ 21 | $ 472 | $ 69 |
Segment Information and Major_5
Segment Information and Major Customers Total Assets by Segment (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Sep. 30, 2019 |
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total Assets | $ 528,682 | $ 398,698 |
IoT Products & Services | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total Assets | 387,578 | 215,651 |
IoT Solutions | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total Assets | 86,975 | 90,255 |
Unallocated | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total Assets | $ 54,129 | $ 92,792 |
Segment Information and Major_6
Segment Information and Major Customers Net Property, Equipment and Improvements by Geographic Area (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Sep. 30, 2019 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net property, equipment and improvements | $ 11,507 | $ 13,857 |
North America, primarily United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net property, equipment and improvements | 11,297 | 13,400 |
International, primarily Europe | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net property, equipment and improvements | $ 210 | $ 457 |
Segment Information and Major_7
Segment Information and Major Customers Geographic revenue (Details) $ in Thousands | Sep. 30, 2020customer | Sep. 30, 2019customer | Sep. 30, 2020USD ($)customer | Jun. 30, 2020USD ($) | Mar. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Sep. 30, 2019USD ($)customer | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2020USD ($)customer | Sep. 30, 2019USD ($)customer | Sep. 30, 2018USD ($)customer |
Segment Reporting Information [Line Items] | |||||||||||||
Revenue | $ | $ 73,169 | $ 70,338 | $ 73,447 | $ 62,317 | $ 64,960 | $ 61,166 | $ 65,764 | $ 62,313 | $ 279,271 | $ 254,203 | $ 226,893 | ||
Number of customer representing over ten percent of revenue | 0 | 0 | 0 | ||||||||||
Number of customer representing over ten percent of consolidated accounts receivable | 1 | 1 | 1 | 1 | 1 | 1 | |||||||
Accounts Receivable | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Percentage of concentration | 17.20% | 14.70% | |||||||||||
United States | U.S. Export Net Sales | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Percentage of concentration | 25.10% | 28.50% | 30.10% |
Sale of Building (Details)
Sale of Building (Details) $ in Thousands | Oct. 02, 2018USD ($)ft² | Dec. 31, 2018USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Gain on sale | $ 0 | $ 4,392 | $ 622 | ||
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 building | $ 10,000 | ||||
Gain on sale | $ 4,400 | ||||
Gain on sale, net of deferred tax | $ 3,400 | ||||
Leasehold Improvements | Hopkins, MN | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Payments for leasehold improvements | $ 5,800 | ||||
Useful life | 10 years |
Selected Balance Sheet Data (De
Selected Balance Sheet Data (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Sep. 30, 2019 |
Accounts receivable, net: | ||
Accounts receivable | $ 65,027 | $ 60,062 |
Less allowance for doubtful accounts | 3,778 | 968 |
Less reserve for future credit returns and pricing adjustments | 2,022 | 2,677 |
Total accounts receivable, net | 59,227 | 56,417 |
Inventories: | ||
Raw materials | 14,009 | 12,308 |
Work in process | 0 | 565 |
Finished goods | 37,559 | 26,891 |
Total Inventories | 51,568 | 39,764 |
Property, Plant and Equipment, Net | ||
Total property, equipment and improvements, gross | 40,015 | 38,737 |
Less accumulated depreciation and amortization | 28,508 | 24,880 |
Total property, equipment and improvements, net | 11,507 | 13,857 |
Land | ||
Property, Plant and Equipment, Net | ||
Total property, equipment and improvements, gross | 570 | 570 |
Buildings | ||
Property, Plant and Equipment, Net | ||
Total property, equipment and improvements, gross | 2,338 | 2,338 |
Improvements | ||
Property, Plant and Equipment, Net | ||
Total property, equipment and improvements, gross | 7,844 | 7,646 |
Equipment | ||
Property, Plant and Equipment, Net | ||
Total property, equipment and improvements, gross | 17,153 | 17,440 |
Purchased Software | ||
Property, Plant and Equipment, Net | ||
Total property, equipment and improvements, gross | 3,770 | 4,030 |
Furniture and Fixtures | ||
Property, Plant and Equipment, Net | ||
Total property, equipment and improvements, gross | 3,236 | 2,963 |
Subscriber assets | ||
Property, Plant and Equipment, Net | ||
Total property, equipment and improvements, gross | $ 5,104 | $ 3,750 |
(Financial Assets and Liabiliti
(Financial Assets and Liabilities) (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 |
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 | $ 56,700 | ||
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 | 0 | ||
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 | 4,228 | 5,407 | $ 10,065 |
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 | ||
Total liabilities measured at fair value | 4,228 | 5,407 | |
Contingent consideration on acquired business | 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 on acquired business | 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 on acquired business | 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 | 4,228 | 5,407 | |
Money Market Funds | Fair Value, Inputs, Level 1 | Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash equivalents | 56,700 | ||
Money Market Funds | Fair Value, Inputs, Level 2 | Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash equivalents | 0 | ||
Money Market Funds | Fair Value, Inputs, Level 3 | Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash equivalents | 0 | ||
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 | 56,700 | ||
Total liabilities measured at fair value | 4,228 | 5,407 | |
Estimate of Fair Value Measurement | Contingent consideration on acquired business | Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Contingent consideration fair value | $ 4,228 | 5,407 | |
Estimate of Fair Value Measurement | Money Market Funds | Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash equivalents | $ 56,700 |
Fair Value Measurements (Reconc
Fair Value Measurements (Reconciliation of Liability) (Details) - Fair Value, Inputs, Level 3 - USD ($) $ in Thousands | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Fair value at beginning of period | $ 5,407 | $ 10,065 |
Purchase price contingent consideration | 5,100 | 0 |
Contingent consideration payments | (6,151) | (5,848) |
Change in fair value of contingent consideration | (128) | 1,190 |
Fair value at end of period | $ 4,228 | $ 5,407 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) | Oct. 05, 2015 | Jun. 30, 2020 | Sep. 30, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2017 | Jan. 22, 2018 | Nov. 01, 2016 |
Estimate of Fair Value Measurement | Contingent consideration on acquired business | Fair Value, Measurements, Recurring | |||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||
Contingent consideration fair value | $ 4,228,000 | $ 5,407,000 | |||||||
Estimate of Fair Value Measurement | Bluenica Corporation | Contingent consideration on acquired business | Fair Value, Measurements, Recurring | |||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||
Contingent consideration fair value | $ 10,400,000 | ||||||||
Estimate of Fair Value Measurement | FreshTemp | Contingent consideration on acquired business | 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 on acquired business | Fair Value, Measurements, Recurring | |||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||
Contingent consideration fair value | 0 | ||||||||
Estimate of Fair Value Measurement | Accelerated Concepts | Contingent consideration on acquired business | Fair Value, Measurements, Recurring | |||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||
Contingent consideration fair value | $ 2,300,000 | ||||||||
Estimate of Fair Value Measurement | Opengear | Contingent consideration on acquired business | Fair Value, Measurements, Recurring | |||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||
Contingent consideration fair value | 4,200,000 | ||||||||
Change in fair value of contingent consideration | (128,000) | 1,190,000 | $ 1,377,000 | ||||||
Fair Value, Inputs, Level 3 | |||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||
Contingent consideration fair value | 4,228,000 | 5,407,000 | 10,065,000 | ||||||
Contingent consideration on acquired business | Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3 | |||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||
Contingent consideration fair value | 4,228,000 | 5,407,000 | |||||||
Bluenica Corporation | |||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||
Business Combination, Contingent Liability, Payout Period | 4 years | ||||||||
Bluenica Corporation | Contingent consideration on acquired business | |||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||
Change in fair value of contingent consideration | $ 2,900,000 | 2,200,000 | $ 0 | $ 500,000 | |||||
FreshTemp | Contingent consideration on acquired business | |||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||
Change in fair value of contingent consideration | 200,000 | ||||||||
TempAlert | Contingent consideration on acquired business | |||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||
Change in fair value of contingent consideration | $ 0 | ||||||||
Accelerated Concepts | Contingent consideration on acquired business | |||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||
Change in fair value of contingent consideration | $ 2,400,000 | $ 3,500,000 | |||||||
Opengear | Maximum | Fair Value, Inputs, Level 3 | |||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||
Fair value inputs probability of payment | 72.00% | ||||||||
Opengear | Contingent consideration on acquired business | |||||||||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||||||||
Change in fair value of contingent consideration | $ 900,000 |
Debt - Schedule of Long-Term De
Debt - Schedule of Long-Term Debt (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Sep. 30, 2019 |
Debt Instrument [Line Items] | ||
Total loans | $ 63,125 | |
Less unamortized issuance costs | (2,173) | |
Long-term Debt, Current Maturities | (1,972) | $ 0 |
Total long-term debt, net of current portion | 58,980 | |
Revolving loan | ||
Debt Instrument [Line Items] | ||
Total loans | 15,000 | |
Term loan | ||
Debt Instrument [Line Items] | ||
Total loans | $ 48,125 |
Debt Schedule of Maturities of
Debt Schedule of Maturities of Long-term Debt (Details) $ in Thousands | Sep. 30, 2020USD ($) |
Debt Disclosure [Abstract] | |
2021 | $ 2,500 |
2022 | 3,438 |
2023 | 3,750 |
2024 | 4,687 |
2025 | 48,750 |
Total long-term debt | $ 63,125 |
Debt - Narrative (Details)
Debt - Narrative (Details) - USD ($) $ in Thousands | May 04, 2020 | Apr. 14, 2020 | Jun. 30, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 13, 2019 |
Line of Credit Facility [Line Items] | |||||||
Maximum borrowing capacity | $ 150,000 | ||||||
Weighted average interest rate on debt | 0.70% | ||||||
Debt issuance costs | 2,600 | ||||||
Proceeds from long-term debt | $ 119,018 | $ 0 | $ 0 | ||||
Debt Instrument [Line Items] | |||||||
Proceeds from long-term debt | 119,018 | 0 | 0 | ||||
Repayments of long-term debt | $ 55,893 | $ 0 | $ 0 | ||||
Paycheck Protection Program loan | |||||||
Line of Credit Facility [Line Items] | |||||||
Proceeds from long-term debt | $ 9,000 | ||||||
Debt Instrument [Line Items] | |||||||
Proceeds from long-term debt | $ 9,000 | ||||||
Repayments of long-term debt | $ 9,000 | ||||||
LIBOR | Maximum | |||||||
Line of Credit Facility [Line Items] | |||||||
Debt Instrument, Basis Spread on Variable Rate | 3.25% | ||||||
LIBOR | Minimum | |||||||
Line of Credit Facility [Line Items] | |||||||
Debt Instrument, Basis Spread on Variable Rate | 1.25% | ||||||
Term loan | |||||||
Line of Credit Facility [Line Items] | |||||||
Maximum borrowing capacity | 50,000 | ||||||
Revolving loan | |||||||
Line of Credit Facility [Line Items] | |||||||
Maximum borrowing capacity | $ 100,000 | ||||||
Year one | Term loan | |||||||
Line of Credit Facility [Line Items] | |||||||
Amortization percentage of quarterly installments | 5.00% | ||||||
Year two | Term loan | |||||||
Line of Credit Facility [Line Items] | |||||||
Amortization percentage of quarterly installments | 5.00% | ||||||
Year three | Term loan | |||||||
Line of Credit Facility [Line Items] | |||||||
Amortization percentage of quarterly installments | 7.50% | ||||||
Year four | Term loan | |||||||
Line of Credit Facility [Line Items] | |||||||
Amortization percentage of quarterly installments | 7.50% | ||||||
Year five | Term loan | |||||||
Line of Credit Facility [Line Items] | |||||||
Amortization percentage of quarterly installments | 10.00% |
Product Warranty Obligation (De
Product Warranty Obligation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 | |
Standard Product Warranty Accrual [Roll Forward] | |||
Beginning balance | $ 1,012 | $ 1,172 | $ 987 |
Warranties issued | 666 | 305 | 759 |
Settlements made | (736) | (465) | (574) |
Ending balance | $ 942 | $ 1,012 | $ 1,172 |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Sep. 30, 2019 |
Assets and Liabilities, Lessee [Abstract] | ||
Total lease assets | $ 14,334 | $ 0 |
Total lease assets | 14,334 | |
Current portion of operating lease liabilities | 2,527 | 0 |
Operating lease non-current liability | 16,193 | $ 0 |
Total lease liabilities | $ 18,720 |
Leases - Lease Cost (Details)
Leases - Lease Cost (Details) $ in Thousands | 12 Months Ended |
Sep. 30, 2020USD ($) | |
Lease, Cost [Abstract] | |
Operating lease cost | $ 3,341 |
Variable lease cost | 744 |
Short-term lease cost | 175 |
Total lease cost | $ 4,260 |
Leases - Other Information (Det
Leases - Other Information (Details) $ in Thousands | 12 Months Ended |
Sep. 30, 2020USD ($) | |
Cash paid for leases [Abstract] | |
Cash paid for amounts included in the measurement of operating lease liabilities | $ 2,893 |
Right Of Use Asset Obtained In Exchange for Lease Liability [Abstract] | |
Right-of-use assets obtained in exchange for new operating lease liabilities | $ 1,073 |
Weighted average remaining lease term [Abstract] | |
Weighted average remaining lease term- operating leases | 5 years 7 months 6 days |
Weighted Average Discount Rate Leases [Abstract] | |
Weighted average discount rate - operating leases | 4.80% |
Leases - Maturity of Operating
Leases - Maturity of Operating Lease Liability (Details) $ in Thousands | Sep. 30, 2020USD ($) |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | |
2021 | $ 3,335 |
2022 | 2,932 |
2023 | 2,669 |
2024 | 2,452 |
2025 | 2,348 |
Thereafter | 9,219 |
Total future undiscounted lease payments | 22,955 |
Less imputed interest | (4,235) |
Total reported lease liability | $ 18,720 |
Leases - Leases - Disclosures R
Leases - Leases - Disclosures Related To Periods Prior To Adoption Of New Lease Standard Minimum Lease Payments (Details) $ in Thousands | Sep. 30, 2019USD ($) |
Leases, Operating [Abstract] | |
2020 | $ 2,596 |
2021 | 2,575 |
2022 | 2,314 |
2023 | 2,056 |
2024 | 2,095 |
Thereafter | 11,361 |
Total minimum payments required | $ 22,997 |
Leases Narrative (Details)
Leases Narrative (Details) $ in Thousands | 12 Months Ended |
Sep. 30, 2020USD ($)ft² | |
Leases [Abstract] | |
Lease agreement term, lease not yet commenced | 10 years |
Operating lease payment due, lease not yet commenced | $ 4,800 |
Tenant improvement allowance, lease not yet commenced | $ 1,000 |
Area of lease not yet commenced | ft² | 35,466 |
Restructuring (Details)
Restructuring (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
May 31, 2017USD ($)employee | Jun. 30, 2020USD ($)employee | Mar. 31, 2020USD ($)employee | Sep. 30, 2018USD ($)employee | Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | |
Restructuring Reserve [Roll Forward] | |||||||
Restructuring reserve, beginning balance | $ 0 | $ 453 | $ 1,656 | ||||
Restructuring charge | 133 | 504 | |||||
Payments for restructuring | (117) | (359) | (1,553) | ||||
Restructuring reversals | (16) | (87) | (203) | ||||
Restructuring foreign currency fluctuation | (7) | 49 | |||||
Restructuring reserve, ending balance | $ 453 | 0 | 0 | 453 | |||
Employee Severance | 2020 Restructuring | |||||||
Restructuring Reserve [Roll Forward] | |||||||
Restructuring reserve, beginning balance | 0 | 0 | 0 | ||||
Restructuring charge | 133 | 0 | |||||
Payments for restructuring | (117) | 0 | 0 | ||||
Restructuring reversals | (16) | 0 | 0 | ||||
Restructuring foreign currency fluctuation | 0 | 0 | |||||
Restructuring reserve, ending balance | 0 | 0 | 0 | 0 | |||
Employee Severance | Manufacturing Transition | |||||||
Restructuring Reserve [Roll Forward] | |||||||
Restructuring reserve, beginning balance | 0 | 147 | 0 | ||||
Restructuring charge | 0 | 504 | |||||
Payments for restructuring | 0 | (108) | (357) | ||||
Restructuring reversals | 0 | (39) | 0 | ||||
Restructuring foreign currency fluctuation | 0 | 0 | |||||
Restructuring reserve, ending balance | 147 | 0 | 0 | 147 | |||
Employee Severance | 2017 Restructuring | |||||||
Restructuring Reserve [Roll Forward] | |||||||
Restructuring reserve, beginning balance | 0 | 293 | 1,528 | ||||
Restructuring charge | 0 | 0 | |||||
Payments for restructuring | 0 | (233) | (1,035) | ||||
Restructuring reversals | 0 | (53) | (244) | ||||
Restructuring foreign currency fluctuation | (7) | 44 | |||||
Restructuring reserve, ending balance | 293 | 0 | 0 | 293 | |||
Facility Closing | 2017 Restructuring | |||||||
Restructuring Reserve [Roll Forward] | |||||||
Restructuring reserve, beginning balance | 0 | 13 | 128 | ||||
Restructuring charge | 0 | 0 | |||||
Payments for restructuring | 0 | (18) | (161) | ||||
Restructuring reversals | 0 | 5 | 41 | ||||
Restructuring foreign currency fluctuation | 0 | 5 | |||||
Restructuring reserve, ending balance | $ 13 | $ 0 | $ 0 | $ 13 | |||
IoT Products & Services | 2020 Restructuring | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Number of positions eliminated | employee | 2 | ||||||
IoT Products & Services | Manufacturing Transition | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Number of positions eliminated | employee | 53 | ||||||
IoT Products & Services | 2017 Restructuring | |||||||
Restructuring Reserve [Roll Forward] | |||||||
Restructuring charge | $ 2,500 | ||||||
IoT Products & Services | Employee Severance | 2020 Restructuring | |||||||
Restructuring Reserve [Roll Forward] | |||||||
Restructuring charge | $ 38 | ||||||
IoT Products & Services | Employee Severance | Manufacturing Transition | |||||||
Restructuring Reserve [Roll Forward] | |||||||
Restructuring charge | $ 500 | ||||||
IoT Products & Services | Employee Severance | 2017 Restructuring | |||||||
Restructuring Reserve [Roll Forward] | |||||||
Restructuring charge | 2,300 | ||||||
IoT Products & Services | Contract Termination | 2017 Restructuring | |||||||
Restructuring Reserve [Roll Forward] | |||||||
Restructuring charge | $ 200 | ||||||
IoT Products & Services | UNITED STATES | 2017 Restructuring | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Number of positions eliminated | employee | 10 | ||||||
IoT Products & Services | FRANCE | 2017 Restructuring | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Number of positions eliminated | employee | 8 | ||||||
IoT Solutions | 2020 Restructuring | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Number of positions eliminated | employee | 22 | ||||||
IoT Solutions | Employee Severance | 2020 Restructuring | |||||||
Restructuring Reserve [Roll Forward] | |||||||
Restructuring charge | $ 95 |
Revenue - Disaggregation of Rev
Revenue - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | $ 73,169 | $ 70,338 | $ 73,447 | $ 62,317 | $ 64,960 | $ 61,166 | $ 65,764 | $ 62,313 | $ 279,271 | $ 254,203 | $ 226,893 |
North America, primarily United States | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | 213,487 | 184,022 | 161,924 | ||||||||
Europe, Middle East & Africa | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | 40,076 | 39,896 | 39,211 | ||||||||
Rest of world | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | 25,708 | 30,285 | 25,758 | ||||||||
Transferred at a point in time | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | 253,371 | 231,387 | 212,448 | ||||||||
Transferred over time | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | $ 25,900 | $ 22,816 | $ 14,445 |
Revenue - Additional Informatio
Revenue - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 | |
Disaggregation of Revenue [Line Items] | |||
Depreciation expense | $ 1.5 | $ 1.1 | $ 0.5 |
Period of amortization | 3 years | ||
Equipment | |||
Disaggregation of Revenue [Line Items] | |||
Contract assets | $ 2 | $ 2.1 |
Revenue - Unearned Revenue (Det
Revenue - Unearned Revenue (Details) $ in Thousands | 12 Months Ended |
Sep. 30, 2020USD ($) | |
Unearned Revenue [Roll Forward] | |
Unearned revenue, beginning of period | $ 5,025 |
Billings | 35,213 |
Revenue recognized | (30,897) |
Unearned revenue, end of period | $ 9,341 |
Revenue - Performance Obligatio
Revenue - Performance Obligations (Details) $ in Millions | Sep. 30, 2020USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 14 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-10-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 10 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-10-01 | Minimum | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Performance obligation time period | 2 years |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-10-01 | Maximum | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Performance obligation time period | 7 years |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | ||
Valuation allowance | $ 3,810 | $ 4,372 |
Income tax provision for Tax Cuts & Jobs Act of 2017 | $ 3,000 | |
Tax Credit Carryforward [Line Items] | ||
U.S. capital loss carryforward | 2,900 | |
United States Federal Tax Jurisdiction | ||
Tax Credit Carryforward [Line Items] | ||
Federal and state research and development tax credits | 3,100 | |
U.S. capital loss carryforward | 2,600 | |
Deferred Tax Assets, Other Tax Carryforwards | 100 | |
Foreign Tax Authority | ||
Tax Credit Carryforward [Line Items] | ||
Non-U.S. operating losses | $ 200 |
Income Taxes (Income Taxes) (De
Income Taxes (Income Taxes) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |||
United States | $ 3,756 | $ 7,981 | $ (2,427) |
International | 3,707 | 3,164 | 5,677 |
Income before income taxes | $ 7,463 | $ 11,145 | $ 3,250 |
Income Taxes (Income Tax Provis
Income Taxes (Income Tax Provision) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 | |
Current: | |||
Federal | $ 709 | $ 950 | $ 526 |
State | 572 | 290 | 57 |
Foreign | 1,128 | 746 | 1,412 |
Deferred: | |||
U.S. | (2,911) | (825) | (536) |
Foreign | (446) | 26 | 160 |
Income tax (benefit) expense | $ (948) | $ 1,187 | $ 1,619 |
Income Taxes (Deferred Tax Asse
Income Taxes (Deferred Tax Assets) (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Sep. 30, 2019 |
Income Tax Disclosure [Abstract] | ||
Non-current deferred tax asset | $ 389 | $ 7,330 |
Non-current deferred tax liability | (17,171) | (261) |
Net deferred tax (liability) asset | (16,782) | 7,069 |
Depreciation and amortization | (1,037) | (480) |
Lease asset | (3,415) | 0 |
Lease liability | 4,477 | 0 |
Inventories | 979 | 536 |
Compensation costs | 3,698 | 3,675 |
Other accruals | 3,985 | 3,870 |
Tax credit carryforwards | 6,021 | 4,911 |
Valuation allowance | (4,372) | (3,810) |
Identifiable intangible assets | (27,118) | (1,633) |
Net deferred tax (liability) asset | $ (16,782) | $ 7,069 |
Income Taxes (Effective Income
Income Taxes (Effective Income Tax Rate Reconciliation) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |||
Statutory income tax amount | $ 1,567 | $ 2,341 | $ 809 |
State taxes, net of federal benefits | 392 | 196 | (71) |
Manufacturing deduction | 0 | 0 | (364) |
Transaction costs | 143 | 0 | 79 |
Employee stock purchase plan | 127 | 59 | 56 |
Foreign operations | 431 | 225 | 318 |
Non-deductible executive compensation | 115 | 171 | 27 |
Change in valuation allowance | 173 | 520 | (994) |
Utilization of research and development tax credits | (2,881) | (2,173) | (1,971) |
One-time transition tax | 0 | 0 | 250 |
Deferred balance sheet remeasure | 0 | 9 | 2,727 |
ASU 2016-09 excess stock compensation | (673) | (56) | 643 |
Contingent consideration | (27) | 250 | 388 |
Changes from provision to return | (111) | (511) | (554) |
Adjustment of tax contingency reserves | 151 | 146 | 193 |
U.S. deduction for foreign export sales | (355) | (146) | 0 |
Global intangible low-taxed income | 31 | 162 | 0 |
Other, net | (31) | (6) | 83 |
Income tax (benefit) expense | $ (948) | $ 1,187 | $ 1,619 |
Income Taxes (Unrecognized Tax
Income Taxes (Unrecognized Tax Benefits) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Unrecognized tax benefits, beginning balance | $ 1,713 | $ 1,561 | $ 1,335 |
Increases related to prior year income tax positions | 756 | 9 | 39 |
Increases related to current year income tax positions | 425 | 314 | 315 |
Decreases related to prior year income tax positions | 0 | (34) | 0 |
Decreases related to settlements | (7) | 0 | 0 |
Decreases related to expiration of statute of limitations | (287) | (137) | (128) |
Unrecognized tax benefits, ending balance | $ 2,600 | $ 1,713 | $ 1,561 |
Income Taxes (Unrecognized Ta_2
Income Taxes (Unrecognized Tax Benefits, Additional Information) (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2017 |
Income Tax Contingency [Line Items] | ||||
Unrecognized tax benefits that would impact effective tax rate | $ 2,400 | |||
Unrecognized tax benefits | 2,600 | $ 1,713 | $ 1,561 | $ 1,335 |
Accrued income tax penalties and interest for unrecognized tax benefits | 100 | $ 100 | ||
Noncurrent income taxes payable | ||||
Income Tax Contingency [Line Items] | ||||
Unrecognized tax benefits | 1,900 | |||
Noncurrent deferred tax assets | ||||
Income Tax Contingency [Line Items] | ||||
Unrecognized tax benefits | 700 | |||
Maximum | ||||
Income Tax Contingency [Line Items] | ||||
Decrease in unrecognized tax benefits that is reasonably possible | $ 100 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 | Jan. 29, 2020 | Feb. 04, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based Payment Arrangement, Shares Withheld for Tax Withholding Obligation | 103,492 | 93,128 | 74,204 | ||
Share-based Payment Arrangement, Decrease for Tax Withholding Obligation | $ 1,800 | $ 1,100 | $ 700 | ||
Proceeds from employee stock purchase plan transactions | 1,065 | 1,058 | 1,115 | ||
Total intrinsic value of all options exercised | 3,700 | 2,100 | 1,200 | ||
Total grant date fair value of shares vested | 3,700 | 3,500 | 3,300 | ||
Stock Options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Total unrecognized compensation cost nonvested awards | $ 6,000 | ||||
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] | |||||
Weighted average period, unrecognized compensation cost, nonvested awards | 1 year 4 months 24 days | ||||
Total unrecognized compensation cost, restricted stock units | $ 9,600 | ||||
Employee Stock | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of continuous days of service | 90 days | ||||
Number of hours per week employed | 20 hours | ||||
Percent of market value | 85.00% | ||||
Offering period | 3 months | ||||
Proceeds from employee stock purchase plan transactions | $ 1,100 | $ 1,100 | $ 1,100 | ||
Common shares issued to employees | 117,826 | 111,036 | 125,446 | ||
Shares available for future issuance | 711,714 | ||||
The 2020 Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares available for future grants | 1,209,150 | ||||
Number of shares authorized | 1,500,000 | ||||
The 2020 Plan | Stock Options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Expiration period | 7 years | ||||
Vesting period | 4 years | ||||
The 2019 Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares authorized | 1,500,000 | ||||
The 2019 Plan | Stock Options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Expiration period | 7 years | ||||
Vesting period | 4 years | ||||
The Purchase Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares authorized | 3,425,000 | ||||
Director | The 2020 Plan | Restricted Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period | 1 year | ||||
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 2020 Plan | Restricted Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period | 4 years | ||||
Executives and Employees | The 2019 Plan | Restricted Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period | 4 years |
Stock-Based Compensation (Stock
Stock-Based Compensation (Stock-Based Compensation Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock-based compensation before income taxes | $ 7,237 | $ 5,655 | $ 4,854 |
Income tax benefit | (1,523) | (1,174) | (1,017) |
Stock-based compensation after income taxes | 5,714 | 4,481 | 3,837 |
Cost of Sales | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock-based compensation before income taxes | 291 | 174 | 195 |
Sales and Marketing | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock-based compensation before income taxes | 2,318 | 1,708 | 1,492 |
Research and Development | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock-based compensation before income taxes | 1,197 | 996 | 516 |
General and Administrative | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock-based compensation before income taxes | $ 3,431 | $ 2,777 | $ 2,651 |
Stock-Based Compensation (Optio
Stock-Based Compensation (Options and Common Shares Reserved for Grant) (Details) - Stock Options $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended |
Sep. 30, 2020USD ($)$ / sharesshares | |
Options Outstanding [Roll Forward] | |
Options Outstanding, Beginning Balance | shares | 3,348 |
Options Outstanding, Granted | shares | 796 |
Options Outstanding, Exercised | shares | (583) |
Options Outstanding, Forfeited / Cancelled | shares | (168) |
Options Outstanding, Ending Balance | shares | 3,393 |
Options Outstanding, Exercisable | shares | 2,115 |
Weighted Average Exercise Price [Roll Forward] | |
Weighted Average Exercise Price, Beginning Balance | $ 10.85 |
Weighted Average Exercise Price, Granted | 16.56 |
Weighted Average Exercise Price, Exercised | 10.12 |
Weighted Average Exercise Price, Forfeited / Cancelled | 13.16 |
Weighted Average Exercise Price, Ending Balance | 12.20 |
Weighted Average Exercise Price, Exercisable | $ 10.80 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | |
Weighted Average Remaining Contractual Term, Outstanding | 3 years 10 months 24 days |
Weighted Average Remaining Contractual Term, Exercisable | 2 years 10 months 24 days |
Aggregate Intrinsic Value, Outstanding | $ | $ 12,790 |
Aggregate Intrinsic Value, Exercisable | $ | $ 10,207 |
Closing Stock Price | $ 15.63 |
Stock-Based Compensation (Fair
Stock-Based Compensation (Fair Value Assumptions) (Details) - Stock Options - $ / shares | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted average per option grant date fair value | $ 6.17 | $ 4.48 | $ 3.98 |
Assumptions Used For Options Grants [Abstract] | |||
Risk free interest rate, minimum | 0.37% | 1.60% | 2.12% |
Risk free interest rate, maximum | 1.73% | 2.93% | 2.89% |
Expected term | 6 years | 6 years | 6 years |
Expected volatility rate, minimum | 36.00% | 33.00% | 33.00% |
Expected volatility rate, maximum | 44.00% | 35.00% | 34.00% |
Weighted average volatility | 36.00% | 34.00% | 33.00% |
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Stock-Based Compensation (Exerc
Stock-Based Compensation (Exercise Price Range) (Details) - Stock Options shares in Thousands | 12 Months Ended |
Sep. 30, 2020$ / sharesshares | |
$7.40 - $9.03 | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise Price Range, Lower Range | $ 7.40 |
Exercise Price Range, Upper Range | $ 9.03 |
Options Outstanding | shares | 485 |
Weighted Average Remaining Contractual Term | 2 years 3 months 29 days |
Weighted Average Exercise Price, Options Outstanding | $ 8.22 |
Number of Shares Vested, Options Exercisable | shares | 485 |
Weighted Average Exercise Price, Options Exercisable | $ 8.22 |
$9.04 - $10.33 | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise Price Range, Lower Range | 9.04 |
Exercise Price Range, Upper Range | $ 10.33 |
Options Outstanding | shares | 542 |
Weighted Average Remaining Contractual Term | 3 years 7 months 9 days |
Weighted Average Exercise Price, Options Outstanding | $ 10.04 |
Number of Shares Vested, Options Exercisable | shares | 427 |
Weighted Average Exercise Price, Options Exercisable | $ 9.98 |
$10.35 - $11.23 | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise Price Range, Lower Range | 10.35 |
Exercise Price Range, Upper Range | $ 11.23 |
Options Outstanding | shares | 602 |
Weighted Average Remaining Contractual Term | 3 years 5 months 1 day |
Weighted Average Exercise Price, Options Outstanding | $ 10.94 |
Number of Shares Vested, Options Exercisable | shares | 405 |
Weighted Average Exercise Price, Options Exercisable | $ 10.86 |
$11.24 - $12.63 | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise Price Range, Lower Range | 11.24 |
Exercise Price Range, Upper Range | $ 12.63 |
Options Outstanding | shares | 620 |
Weighted Average Remaining Contractual Term | 3 years 9 months 14 days |
Weighted Average Exercise Price, Options Outstanding | $ 12.08 |
Number of Shares Vested, Options Exercisable | shares | 448 |
Weighted Average Exercise Price, Options Exercisable | $ 12.17 |
$12.64 - $13.92 | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise Price Range, Lower Range | 12.64 |
Exercise Price Range, Upper Range | $ 13.92 |
Options Outstanding | shares | 573 |
Weighted Average Remaining Contractual Term | 4 years 5 months 23 days |
Weighted Average Exercise Price, Options Outstanding | $ 13.65 |
Number of Shares Vested, Options Exercisable | shares | 339 |
Weighted Average Exercise Price, Options Exercisable | $ 13.53 |
$13.93 - $17.94 | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise Price Range, Lower Range | 13.93 |
Exercise Price Range, Upper Range | $ 17.94 |
Options Outstanding | shares | 536 |
Weighted Average Remaining Contractual Term | 6 years 18 days |
Weighted Average Exercise Price, Options Outstanding | $ 17.62 |
Number of Shares Vested, Options Exercisable | shares | 11 |
Weighted Average Exercise Price, Options Exercisable | $ 14.75 |
$17.95 - $18.20 | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise Price Range, Lower Range | 17.95 |
Exercise Price Range, Upper Range | $ 18.20 |
Options Outstanding | shares | 35 |
Weighted Average Remaining Contractual Term | 6 years 1 month 20 days |
Weighted Average Exercise Price, Options Outstanding | $ 18.20 |
Number of Shares Vested, Options Exercisable | shares | 0 |
Weighted Average Exercise Price, Options Exercisable | $ 0 |
$7.40 - $18.20 | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise Price Range, Lower Range | 7.40 |
Exercise Price Range, Upper Range | $ 18.20 |
Options Outstanding | shares | 3,393 |
Weighted Average Remaining Contractual Term | 3 years 11 months 23 days |
Weighted Average Exercise Price, Options Outstanding | $ 12.20 |
Number of Shares Vested, Options Exercisable | shares | 2,115 |
Weighted Average Exercise Price, Options Exercisable | $ 10.80 |
Stock-Based Compensation (Non-V
Stock-Based Compensation (Non-Vested Options) (Details) - Restricted Stock Units shares in Thousands | 12 Months Ended |
Sep. 30, 2020$ / sharesshares | |
Nonvested Number of Restricted Stock Units [Roll Forward] | |
Number of Restricted Stock Units, Beginning Balance | shares | 888 |
Number of Restricted Stock Units, Granted | shares | 516 |
Number of Restricted Stock Units, Vested | shares | (322) |
Number of Restricted Stock Units, Canceled | shares | (110) |
Number of Restricted Stock Units, Ending Balance | shares | 972 |
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 | $ 11.65 |
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Granted | $ / shares | 14.86 |
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Vested | $ / shares | 11.78 |
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Canceled | $ / shares | 12.53 |
Restricted Stock Units, Weighted Average Grant Date Fair Value per Common Share, Ending Balance | $ / shares | $ 13.20 |
Common Stock Repurchase (Detail
Common Stock Repurchase (Details) - May 2018 authorized repurchase program - USD ($) | 12 Months Ended | |
Sep. 30, 2020 | Apr. 24, 2018 | |
Stock repurchase program, authorized amount | $ 20,000,000 | |
Shares repurchased | 0 |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 | |
Defined Contribution Plan Disclosure [Line Items] | |||
Matching contributions, amount | $ 1.7 | $ 1.8 | $ 1.6 |
Defined contribution plan | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Maximum annual contribution per employee percentage | 25.00% | ||
Defined contribution plan | Full Employer Match | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Employers percent of matching contributions | 100.00% | ||
Percent of employees' gross pay for employer match | 3.00% | ||
Defined contribution plan | Half Employer Match | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Employers percent of matching contributions | 50.00% | ||
Percent of employees' gross pay for employer match | 2.00% |
Contingencies Contingencies (De
Contingencies Contingencies (Details) $ in Millions | 12 Months Ended |
Sep. 30, 2020CAD ($) | |
DimOnOff Inc. | |
Loss Contingencies [Line Items] | |
Damages sought | $ 1 |
Quarterly Financial Data (Detai
Quarterly Financial Data (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 | ||
Quarterly Financial Information Disclosure [Abstract] | ||||||||||||
Total revenues | $ 73,169 | $ 70,338 | $ 73,447 | $ 62,317 | $ 64,960 | $ 61,166 | $ 65,764 | $ 62,313 | $ 279,271 | $ 254,203 | $ 226,893 | |
Gross profit | 37,518 | 37,349 | 38,641 | 30,464 | 30,595 | 28,328 | 30,329 | 29,783 | 143,972 | 119,035 | 109,054 | |
Net (loss) income | $ 4,433 | $ 1,766 | $ 2,004 | $ 208 | [1] | $ 2,286 | $ 1,648 | $ 1,342 | $ 4,682 | $ 8,411 | $ 9,958 | $ 1,631 |
Net (loss) income per common share, basic (USD per share) | $ 0.15 | $ 0.06 | $ 0.07 | $ 0.01 | $ 0.08 | $ 0.06 | $ 0.05 | $ 0.17 | $ 0.29 | $ 0.36 | $ 0.06 | |
Net (loss) income per common share, diluted (USD per share) | $ 0.15 | $ 0.06 | $ 0.07 | $ 0.01 | $ 0.08 | $ 0.06 | $ 0.05 | $ 0.17 | $ 0.28 | $ 0.35 | $ 0.06 | |
[1] | During fiscal 2020, we recorded a discrete tax benefit of $1.0 million in the first quarter of fiscal 2020 resulting from excess tax benefits recognized on stock compensation and an adjustment of our state deferred tax rate due to the Opengear acquisition. |
Quarterly Financial Data - Addi
Quarterly Financial Data - Additional Information (Details) $ in Millions | 3 Months Ended |
Dec. 31, 2019USD ($) | |
Quarterly Financial Information Disclosure [Abstract] | |
Net discrete tax expense (benefits) | $ (1) |
Subsequent Event (Details)
Subsequent Event (Details) $ in Thousands | Oct. 07, 2020USD ($)employee | Sep. 30, 2020USD ($) | Sep. 30, 2018USD ($) |
Subsequent Event [Line Items] | |||
Restructuring Charges | $ 133 | $ 504 | |
Subsequent Event | 2021 Restructuring | IoT Products & Services | |||
Subsequent Event [Line Items] | |||
Number of positions eliminated | employee | 20 | ||
Subsequent Event | 2021 Restructuring | IoT Products & Services | Employee Severance | Minimum | |||
Subsequent Event [Line Items] | |||
Restructuring Charges | $ 800 | ||
Subsequent Event | 2021 Restructuring | IoT Products & Services | Employee Severance | Maximum | |||
Subsequent Event [Line Items] | |||
Restructuring Charges | $ 900 |
Schedule II - Valuation and Q_2
Schedule II - Valuation and Qualifying Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 | |||
Valuation allowance - deferred tax assets | |||||
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items] | |||||
Balance at beginning of period | $ 3,810 | $ 3,291 | $ 5,952 | ||
Charged to costs and expenses | 670 | 529 | 521 | ||
Charged to Other Accounts | 0 | 0 | 0 | ||
Deductions | 108 | 10 | 3,182 | ||
Balance at end of period | 4,372 | 3,810 | 3,291 | ||
Valuation account - doubtful accounts | |||||
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items] | |||||
Balance at beginning of period | 968 | 785 | 341 | ||
Charged to costs and expenses | 2,534 | 635 | 729 | ||
Charged to Other Accounts | 0 | 0 | 40 | [1] | |
Deductions | [2] | (276) | 452 | 325 | |
Balance at end of period | 3,778 | 968 | 785 | ||
Reserve for future credit returns and pricing adjustments | |||||
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items] | |||||
Balance at beginning of period | 2,677 | 2,560 | 2,169 | ||
Charged to costs and expenses | 17,816 | 12,640 | 10,715 | ||
Charged to Other Accounts | 0 | 0 | 0 | ||
Deductions | 19,017 | 12,523 | 10,324 | ||
Balance at end of period | $ 1,476 | $ 2,677 | $ 2,560 | ||
[1] | Established through purchase accounting relating to the acquisition of TempAlert | ||||
[2] | Uncollectible accounts charged against allowance, net of recoveries |