Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Mar. 04, 2020 | Jun. 30, 2019 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | ZIXI | ||
Entity Registrant Name | ZIX CORP | ||
Entity Central Index Key | 0000855612 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Interactive Data Current | Yes | ||
Security Exchange Name | NASDAQ | ||
Entity File Number | 0-17995 | ||
Entity Tax Identification Number | 75-2216818 | ||
Entity Address, Address Line One | 2711 N. Haskell Avenue | ||
Entity Address, Address Line Two | Suite 2200, LB 36 | ||
Entity Address, City or Town | Dallas | ||
Entity Address, State or Province | TX | ||
Entity Address, Postal Zip Code | 75204-2960 | ||
City Area Code | 214 | ||
Local Phone Number | 370-2000 | ||
Title of 12(b) Security | Common Stock $0.01 Par Value | ||
Entity Incorporation, State or Country Code | TX | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 55,641,885 | ||
Entity Public Float | $ 498,353,887 | ||
Documents Incorporated by Reference | Portions of the Registrant’s 2020 Proxy Statement are incorporated by reference into Part III of this Form 10-K. |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 13,349 | $ 27,109 |
Receivables, net | 10,081 | 3,188 |
Prepaid and other current assets | 4,984 | 3,176 |
Total current assets | 28,414 | 33,473 |
Property and equipment, net | 8,591 | 3,924 |
Operating lease assets | 10,128 | |
Intangible assets, net | 145,876 | 15,251 |
Goodwill | 171,209 | 13,783 |
Deferred tax assets | 36,535 | 28,785 |
Deferred costs and other assets | 11,968 | 9,424 |
Total assets | 412,721 | 104,640 |
Current liabilities: | ||
Accounts payable | 14,400 | 769 |
Accrued expenses | 13,732 | 9,747 |
Deferred revenue | 40,757 | 30,622 |
Current portion of long-term debt | 1,850 | |
Operating lease liabilities, current | 2,947 | |
Finance lease liabilities, current | 1,338 | |
Total current liabilities | 75,024 | 41,138 |
Long-term liabilities: | ||
Deferred revenue | 2,524 | 1,539 |
Deferred rent | 1,016 | |
Noncurrent operating lease liabilities | 8,389 | |
Noncurrent finance lease liabilities | 716 | |
Long-term debt | 178,250 | |
Total long-term liabilities | 189,879 | 2,555 |
Total liabilities | 264,903 | 43,693 |
Commitments and contingencies (Note 17) | ||
Preferred stock: | ||
Convertible preferred stock | 106,527 | |
Stockholders’ equity: | ||
Preferred stock, $1 par value, 10,000,000 shares authorized; none issued and outstanding | ||
Common stock, $0.01 par value, 175,000,000 shares authorized; 83,393,514 issued and 55,640,397 outstanding in 2019 and 81,715,330 issued and 54,186,180 outstanding in 2018 | 780 | 779 |
Additional paid-in capital | 391,605 | 384,940 |
Treasury stock, at cost; 27,753,117 common shares in 2019 and 27,529,150 common shares in 2018 | (110,298) | (108,392) |
Accumulated deficit | (240,995) | (216,364) |
Accumulated other comprehensive (loss) income | 199 | (16) |
Total stockholders’ equity | 41,291 | 60,947 |
Total liabilities, preferred stock and stockholders’ equity | 412,721 | $ 104,640 |
Series A Convertible Preferred Stock [Member] | ||
Preferred stock: | ||
Convertible preferred stock | $ 106,527 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 |
Preferred stock, par value | $ 1 | $ 1 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 175,000,000 | 175,000,000 |
Common stock, shares issued | 83,393,514 | 81,715,330 |
Common stock, shares outstanding | 55,640,397 | 54,186,180 |
Treasury stock, shares | 27,753,117 | 27,529,150 |
Series A Convertible Preferred Stock [Member] | ||
Convertible Preferred stock, par value | $ 1 | $ 1 |
Convertible Preferred stock, shares designated | 100,206 | 0 |
Convertible Preferred stock, shares issued | 100,206 | 0 |
Convertible Preferred stock, shares outstanding | 100,206 | 0 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Statement [Abstract] | |||
Revenues | $ 173,428 | $ 70,478 | $ 65,663 |
Cost of revenue | 76,908 | 15,186 | 12,602 |
Gross margin | 96,520 | 55,292 | 53,061 |
Operating expenses: | |||
Research and development expenses | 20,431 | 11,323 | 10,980 |
Selling, general and administrative expenses | 85,230 | 33,999 | 31,871 |
Operating (loss) income | (9,141) | 9,970 | 10,210 |
Other income (expense): | |||
Investment and other income | 121 | 754 | 339 |
Interest (expense) | (10,105) | ||
Total other (expense) income | (9,984) | 754 | 339 |
Income (loss) before income taxes | (19,125) | 10,724 | 10,549 |
Income tax benefit (expense) | 4,478 | 4,720 | (18,606) |
Net income (loss) | (14,647) | 15,444 | (8,057) |
Deemed and accrued dividends on preferred stock | 9,984 | ||
Net income (loss) attributable to common stockholders | $ (24,631) | $ 15,444 | $ (8,057) |
Basic income (loss) per share attributable to common stockholders | $ (0.46) | $ 0.29 | $ (0.15) |
Diluted income (loss) per common share attributable to common stockholders | $ (0.46) | $ 0.29 | $ (0.15) |
Basic weighted average common shares outstanding | 53,025,152 | 52,591,714 | 53,430,492 |
Diluted weighted average common shares outstanding | 53,025,152 | 53,481,295 | 53,430,492 |
Other comprehensive income (loss), net of tax: | |||
Foreign currency translation adjustments | $ 215 | $ (16) | |
Comprehensive income (loss) | $ (14,432) | $ 15,428 | $ (8,057) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Series A Convertible Preferred Stock [Member] | Series B Convertible Preferred Stock [Member] | Under ASC 605 [Member] | Cumulative Effect Adjustment [Member] | Preferred Stock [Member] | Preferred Stock [Member]Series A Convertible Preferred Stock [Member] | Preferred Stock [Member]Series B Convertible Preferred Stock [Member] | Common Stock [Member] | Common Stock [Member]Under ASC 605 [Member] | Additional Paid-In Capital [Member] | Additional Paid-In Capital [Member]Under ASC 605 [Member] | Treasury Stock [Member] | Treasury Stock [Member]Under ASC 605 [Member] | Accumulated Deficit [Member] | Accumulated Deficit [Member]Series A Convertible Preferred Stock [Member] | Accumulated Deficit [Member]Series B Convertible Preferred Stock [Member] | Accumulated Deficit [Member]Under ASC 605 [Member] | Accumulated Deficit [Member]Cumulative Effect Adjustment [Member] | Accumulated Other Comprehensive Income (Loss) [Member] |
Beginning balance at Dec. 31, 2016 | $ 49,070 | $ 769 | $ 374,386 | $ (97,770) | $ (228,315) | |||||||||||||||
Beginning balance, shares at Dec. 31, 2016 | 78,913,266 | |||||||||||||||||||
Issuance of common stock upon exercise of stock options | $ 4,206 | $ 9 | 4,197 | |||||||||||||||||
Issuance of common stock upon exercise of stock options, shares | 932,303 | 932,303 | ||||||||||||||||||
Issuance of common stock upon vesting of restricted stock units, net, shares | 126,167 | |||||||||||||||||||
Issuance of common stock upon vesting of performance stock units, net, shares | 20,999 | |||||||||||||||||||
Issuance of restricted common stock, net, shares | 645,623 | |||||||||||||||||||
Issuance of restricted performance common stock, net, shares | 71,612 | |||||||||||||||||||
Employee stock-based compensation costs | $ 2,112 | 2,874 | (762) | |||||||||||||||||
Treasury repurchase program | (3,811) | (3,811) | ||||||||||||||||||
Net income (loss) | (8,057) | (8,057) | ||||||||||||||||||
Ending balance at Dec. 31, 2017 | $ 43,520 | $ 778 | $ 381,457 | $ (102,343) | $ (236,372) | |||||||||||||||
Ending balance, shares at Dec. 31, 2017 | 80,709,970 | |||||||||||||||||||
Cumulative effect adjustment from changes in accounting standards at Dec. 31, 2017 | $ 4,564 | $ 4,564 | ||||||||||||||||||
Ending balances, as adjusted at Dec. 31, 2017 | 48,084 | $ 778 | 381,457 | (102,343) | (231,808) | |||||||||||||||
Issuance of common stock upon exercise of stock options | $ 166 | $ 1 | 165 | |||||||||||||||||
Issuance of common stock upon exercise of stock options, shares | 90,011 | 90,011 | ||||||||||||||||||
Issuance of common stock upon vesting of restricted stock units, net, shares | 50,751 | |||||||||||||||||||
Issuance of common stock upon vesting of performance stock units, net, shares | 32,665 | |||||||||||||||||||
Issuance of restricted common stock, net, shares | 735,987 | |||||||||||||||||||
Issuance of restricted performance common stock, net, shares | 95,946 | |||||||||||||||||||
Employee stock-based compensation costs | $ 2,662 | 3,318 | (656) | |||||||||||||||||
Treasury repurchase program | (5,393) | (5,393) | ||||||||||||||||||
Adjustment from foreign currency translation | (16) | $ (16) | ||||||||||||||||||
Net income (loss) | 15,444 | 15,444 | ||||||||||||||||||
Ending balance at Dec. 31, 2018 | 60,947 | $ 779 | 384,940 | (108,392) | (216,364) | (16) | ||||||||||||||
Ending balances, shares at Dec. 31, 2018 | 0 | |||||||||||||||||||
Ending balance, shares at Dec. 31, 2018 | 81,715,330 | |||||||||||||||||||
Issuance of preferred stock in connection with private placement | $ 62,662 | $ 33,881 | ||||||||||||||||||
Issuance of preferred stock in connection with private placement, shares | 64,914 | 35,086 | ||||||||||||||||||
Beneficial conversion feature of preferred stock | $ (1,407) | $ (1,067) | $ 1,407 | $ 1,067 | $ (1,407) | $ (1,067) | ||||||||||||||
Accretion of beneficial conversion feature of Series A Preferred Shares (Participating) | (99) | (35) | 99 | 35 | (99) | (35) | ||||||||||||||
Accrued dividend on preferred stock | $ (6,159) | (1,030) | $ 6,159 | 1,030 | $ (6,159) | (1,030) | ||||||||||||||
Redemption Accretion of Series B preferred stock | $ (187) | $ 187 | $ (187) | |||||||||||||||||
Issuance of common stock upon exercise of stock options | $ 415 | $ 1 | 414 | |||||||||||||||||
Issuance of common stock upon exercise of stock options, shares | 167,438 | 167,438 | ||||||||||||||||||
Issuance of common stock upon vesting of restricted stock units, net, shares | 43,667 | |||||||||||||||||||
Issuance of Series A preferred stock for dividend on Series B preferred stock upon conversion to Series A preferred, shares | 206 | |||||||||||||||||||
Issuance of common stock upon vesting of performance stock units, net, shares | 7,000 | |||||||||||||||||||
Issuance of restricted common stock, net, shares | 1,117,579 | |||||||||||||||||||
Issuance of restricted performance common stock, net, shares | 342,500 | |||||||||||||||||||
Employee stock-based compensation costs | $ 4,345 | 6,251 | (1,906) | |||||||||||||||||
Adjustment from foreign currency translation | 215 | 215 | ||||||||||||||||||
Net income (loss) | (14,647) | (14,647) | ||||||||||||||||||
Ending balance at Dec. 31, 2019 | 41,291 | $ 780 | $ 391,605 | $ (110,298) | $ (240,995) | $ 199 | ||||||||||||||
Ending balances, shares at Dec. 31, 2019 | 100,206 | 100,206 | ||||||||||||||||||
Ending balances at Dec. 31, 2019 | $ 106,527 | $ 106,527 | $ 106,527 | |||||||||||||||||
Ending balance, shares at Dec. 31, 2019 | 83,393,514 |
Consolidated Statements of St_2
Consolidated Statements of Stockholders' Equity (Parenthetical) - USD ($) $ in Thousands | Feb. 20, 2019 | Dec. 31, 2019 |
Series A Convertible Preferred Stock [Member] | ||
Preferred stock, net of issuance costs | $ 2,300 | $ 2,253 |
Series B Convertible Preferred Stock [Member] | ||
Preferred stock, net of issuance costs | $ 1,200 | $ 1,204 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Operating activities: | |||
Net income (loss) | $ (14,647) | $ 15,444 | $ (8,057) |
Non-cash items in net income (loss): | |||
Depreciation and amortization | 24,429 | 3,706 | 2,741 |
Amortization of debt issuance costs | 967 | ||
Employee stock-based compensation expense | 6,251 | 3,318 | 2,874 |
Noncash lease costs | 2,828 | ||
Changes in deferred taxes | (4,296) | (4,754) | 18,470 |
Changes in operating assets and liabilities: | |||
Receivables | (369) | (1,376) | 64 |
Prepaid and other assets | (1,036) | 108 | (386) |
Deferred costs and other assets | (2,347) | (3,139) | |
Accounts payable | 6,121 | (325) | 645 |
Deferred revenue | (1,356) | 1,892 | 1,370 |
Payment of acquisition related contingent consideration | (582) | (195) | |
Accrued and other liabilities | (2,012) | 1,992 | 483 |
Net cash provided by operating activities | 13,951 | 16,671 | 18,204 |
Investing activities: | |||
Purchases of property, equipment and internal-use software | (11,653) | (4,179) | (3,041) |
Acquisition of business, net of cash acquired | (284,590) | (11,773) | (8,244) |
Net cash used in investing activities | (296,243) | (15,952) | (11,285) |
Financing activities: | |||
Proceeds of long-term debt | 187,000 | ||
Debt issuance cost | (6,444) | ||
Deferred debt financing costs | (60) | ||
Repayment of long-term debt | (1,363) | ||
Proceeds from issuance of preferred stock, net of offering costs | 96,588 | ||
Payment of acquisition related contingent consideration | (3,843) | (605) | |
Proceeds from exercise of stock options | 415 | 166 | 4,206 |
Stock issuance costs | (45) | ||
Purchase of treasury stock | (1,906) | (6,049) | (4,573) |
Repayment of finance lease liabilities | (1,707) | ||
Net cash provided by (used in) financing activities | 268,740 | (6,593) | (367) |
Effect of exchange rate changes on cash | (208) | (26) | |
Increase (decrease) in cash and cash equivalents | (13,760) | (5,900) | 6,552 |
Cash and cash equivalents, beginning of year | 27,109 | 33,009 | 26,457 |
Cash and cash equivalents, end of year | $ 13,349 | $ 27,109 | $ 33,009 |
Company Overview
Company Overview | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Company Overview | 1. Company Overview Zix Corporation (“Zix,” the “Company,” “we,” “our,” “us”) is a leading provider of cloud email security and productivity and compliance solutions with easy-to-use solutions for email encryption and data loss prevention (“DLP”), advanced threat protection archiving to meet the data protection and compliance needs of our customers in a variety of industries. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation — The accompanying consolidated financial statements include the accounts of all our wholly-owned subsidiaries and are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). All inter-company accounts and transactions have been eliminated in consolidation. Use of Estimates — The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reported period. Our significant estimates include primarily those required in the valuation or impairment analysis of goodwill and intangibles, property and equipment, revenue recognition, amortization period of our commission amortization, allowances for doubtful accounts, stock-based compensation, litigation accruals, valuation allowances for deferred tax assets and tax accruals. Although we believe that adequate accruals have been made for unsettled issues, additional gains or losses could occur in future years from resolutions of outstanding matters. Actual results could differ materially from original estimates. Cash Equivalents — Cash investments with maturities of three months or less when purchased are considered cash equivalents Fair Value of Financial Instruments —The Company does not measure the fair value of any financial instrument other than cash equivalents, options, and other equity awards. The carrying values of other financial instruments (receivables and accounts payable) are not recorded at fair value but approximate fair values primarily due to their short-term nature. The carrying values of other current assets and accrued expenses are also not recorded at fair value, but approximate fair values primarily due to their short-term nature. In addition, the Company measures its long-term debt at fair value which approximates book value as the long-term debt bears market rate. Valuation of Property and Equipment — The accounting policies and estimates relating to property and equipment are considered significant because of the potential impact that impairment, obsolescence, or change in an asset’s useful life could have on the Company’s operating results. We record an impairment charge on the assets to be held and used when we determine based upon certain triggering events that the carrying value of property and equipment may not be recoverable based on expected undiscounted cash flows attributable to such assets. The amount of a potential impairment is determined by comparing the carrying amount of the asset to either the value determined from a projected discounted cash flow method, using a discount rate that is considered to be commensurate with the risk inherent in the Company’s current business model or the estimated fair market value. Assumptions are made with respect to future net cash flows expected to be generated by the related asset. An impairment charge would be recorded for an amount by which the carrying value of the asset exceeded the discounted projected net cash flows or estimated fair market value. Also, even where a current impairment charge is not necessary, the remaining useful lives are evaluated. No impairment was recorded for any of the periods presented. Property and equipment are recorded at cost and depreciated or amortized using the straight-line method over their estimated useful lives as follows: computer and office equipment and software — three years; leasehold improvements — the shorter of five years or the lease term; and furniture and fixtures — five years. We recorded a depreciation expense of $5.0 million for the year ended December 31, 2019. We allocated $4.0 million of the expense to cost of revenue, $522 thousand to research and development expense, and $482 thousand to selling, marketing, and general and administrative expenses. Goodwill and Other Intangible Assets — We account for the valuation of goodwill and other intangible assets after classifying intangible assets into three categories: (1) intangible assets with finite lives subject to amortization; (2) intangible assets with indefinite lives not subject to amortization; and (3) goodwill. For intangible assets with finite lives, tests for impairment must be performed if conditions exist that indicate the carrying value may not be recoverable. For intangible assets with indefinite lives and goodwill, tests for impairment must be performed at least annually or more frequently if events or circumstances indicate that assets might be impaired. Goodwill was $171.2 million, or 41%, and $13.8 million, or 13%, of total assets as of December 31, 2019 and 2018, respectively. We evaluate the goodwill for impairment annually in the fourth quarter, or when there is reason to believe that the value has been diminished or impaired. Evaluations for possible impairment are based upon a comparison of the estimated fair value of the reporting unit to which the goodwill has been assigned, versus the sum of the carrying value of the assets and liabilities of that unit including the assigned goodwill value. We include our entire Company as the reporting unit. The fair values used in this evaluation are estimated based on the Company’s market capitalization, which is based on the outstanding stock and market price of the stock. Impairment is deemed to exist if the net book value of the unit exceeds its estimated fair value. No impairment was recorded for any of the periods presented. Our intangible assets with finite lives are amortized using a straight line basis over their economic useful lives. Deferred Tax Assets — Deferred tax assets are recognized if it is “more likely than not” that the benefit of our deferred tax assets will be realized on future federal or state income tax returns. At December 31, 2019, we provided a valuation allowance against a significant portion, $22.5 million, of our accumulated deferred tax assets, reflecting our historical losses and the uncertainty of future taxable income sufficient to utilize net operating loss carryforwards prior to their expiration. Our total deferred tax assets not subject to a valuation allowance are valued at $36.6 million, and consist of $30.8 million for federal net operating loss carryforwards, $3.2 million relating to temporary timing differences between U.S. GAAP and tax-related expense, $2.2 million relating to U.S. state income tax credits, and $337 thousand related to Alternative Minimum Tax credits. If our U.S. taxable income increases from its current level in a future period or if the facts and circumstances on which our estimates and assumptions are based were to change, thereby impacting the likelihood of realizing our deferred tax assets, judgment would have to be applied in determining the amount of valuation allowance no longer required. Reversal of all or a part of this valuation allowance could have a significant positive impact on operating results in the period that it becomes more likely than not that certain of the Company’s deferred tax assets will be realized. Alternatively, should our future income decrease from current levels, a resulting increase to all or a part of this valuation allowance could have a significant negative impact on our operating results Uncertain Tax Positions — Our Company recognizes and measures uncertain tax positions using a two-step approach. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement. Right-of-use Assets and Lease Obligations — On January 1, 2019, we adopted Accounting Standards Update No. 2016-02, Leases Topic 842) (ASU 2016-02) using the modified retrospective transition approach by applying the new standard to all leases existing at the date of initial application. We elected the package of practical expedients permitted under the transition guidance, which allowed us to carryforward our historical lease classification, our assessment on whether a contract was or contains a lease, and our initial direct costs for any leases that existed prior to January 1, 2019. The first package of practical expedients only can be applied if lease assessment was correct under ASC 840 which defines a lease as an arrangement conveying the right to use property, plant, or equipment usually for a stated period of time. Historically, we didn’t perform the embedded lease assessment under ASC 840 as such we identified lease components of a service contract as required by ASC 842 upon adoption. We did not elect the hindsight practical expedient in determining the lease and in assessing impairment of our right-of-use assets. We also elected to combine our lease and non-lease components and to keep leases with an initial term of 12 months or less off the balance sheet and recognize the associated lease payments in the consolidated statements of comprehensive income (loss) on a straight-line basis over the lease term. Additionally, for certain equipment leases, we apply a portfolio approach to effectively account for the finance lease right-of-use (ROU) assets and lease liabilities. Upon adoption, we recognized total ROU assets of $4.8 million, with corresponding lease liabilities of $6.0 million on the consolidated balance sheets. The ROU assets include adjustments for deferred rent liabilities. The adoption did not impact our beginning retained earnings, or our prior year consolidated statements of comprehensive income (loss) and statements of cash flows. Under Topic 842, we determine if an arrangement is a lease at inception. ROU assets and lease liabilities are recognized at commencement date based on the present value of remaining lease payments over the lease term. For this purpose, we consider only payments that are fixed and determinable at the time of commencement. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Our incremental borrowing rate is the financing rate of our long-term debt at the commencement date. The ROU asset also includes any lease payments made prior to commencement and is recorded net of any lease incentives received. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise such options. When determining the probability of exercising such options, we consider contract-based, asset-based, entity-based, and market-based factors. Our lease agreements may contain variable costs such as common area maintenance, insurance, real estate taxes or other costs. Variable lease costs are expensed as incurred on the consolidated statements of income. Our lease agreements generally do not contain any residual value guarantees or restrictive covenants. Operating leases are included in operating lease assets, other current liabilities and noncurrent lease liabilities on our consolidated balance sheets. Finance leases are included in property and equipment, other current liabilities and noncurrent lease liabilities on our consolidated balance sheets. Revenue Recognition — In May 2014, The Financial Accounting Standards Board (“FASB”) issued ASC 606 which requires revenue recognition when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled to those goods and services. The standard became effective for us in 2018 but did not have a material impact to our revenue recognition process. We earn our revenue from subscription fees for rights related to the use of our software. Approximately 73% of our revenue in 2019 was derived from hosted solutions. While some contracts include one or more performance obligations, the revenue recognition pattern generally is not impacted by separate allocations of these obligations because the services are generally satisfied over the same period of time and revenue is recognized ratably over the contract term. Our subscription terms historically have ranged from one to five years. We are increasingly moving to a monthly subscription model. This shift has been largely driven by our recent acquisition activity, including AppRiver. As we further integrate our business, we expect to focus on a monthly subscription model. Revenue is recognized by applying the following steps: • Step 1: Identify the contract(s) with a customer, • Step 2: Identify the performance obligations in the contract, • Step 3: Determine the transaction price • Step 4: Allocate the transaction price to the performance obligations in the contract, and • Step 5: Recognize revenue when (or as) the performance obligation is satisfied. Step 1: Identify the contract(s) with a customer: We consider the terms and conditions of the contract and our customary business practice in identifying our contracts. We determine we have a contract with a customer when the contract is approved, we can identify each party’s rights regarding the services and products transferred, we can identify the payment terms for the services and products, the contract has commercial substance, and it is probable we will be paid. Step 2: Identify the performance obligations in the contract: ASC 606 requires identification and disclosure of performance obligations within a revenue contract. A good or service is considered distinct if the customer can both benefit from the good or service on its own or with other resources that are readily available to the customer, and the promise to transfer the good or service is separately identifiable from other promises in the contract. Step 3: Determine the transaction price: The transaction price is determined based on the consideration we expect to be entitled to receive in exchange for transferring goods and services to the customer. We include variable consideration in the transaction price if we view it as probable that a significant future reduction of cumulative revenue under the contract will not occur. Step 4: Allocate the transaction price to the performance obligations in the contract: We allocate transaction prices to each performance obligation based on the stand-alone selling price of our component services. Step 5: Recognize revenue when (or as) the performance obligation is satisfied: We begin recognize revenue when the customer obtains control of the product or services, at the amount allocated to the satisfied performance obligation. Our performance obligations are generally satisfied over time. While some contracts include one or more performance obligations (including the combined elements noted above along with additional ongoing customer support and other hosted services), the revenue recognition pattern generally is not impacted by the separate allocations of these obligations because the services are generally satisfied over the same period of time and revenue is recognized over the contract period. Discounts provided to customers are recorded as reductions in revenue. Commission Amortization — We amortize our commission costs to expense on a systemic basis over the period of expected benefit to the customer. Determination of the amortization period requires significant judgement. We apply the practical expedient noted in ASC 606-10-10-4 to account for our commission costs and related amortizations at the portfolio level. Additionally, the Company has evaluated commissions earned upon contract renewal as compared to initial commissions paid and determined that because commissions paid were not reasonably proportional to their respective contract values, our renewal commissions could not be considered commensurate with the initial commissions paid. We considered our average contract term length and historical customer retention rates to determine an average length of our customer relationships. We also concluded our add-on sales generally occur halfway into our customer relationships and evaluated our average customer renewal terms. Based on these factors we have determined that 8 years, 4 years and 18 months are the appropriate amortization periods to our new, add-on, and renewal sales commission expenses, respectively. We also perform subsequent assessments for impairment of the related deferred cost asset when indicators present. Following our acquisition of AppRiver in February 2019, we additionally evaluated AppRiver’s sales program to determine whether capitalization of these expenses was appropriate. While we determined certain costs to acquire met the capitalization criteria, we also determined renewal commissions earned were commensurate to the initial sales. Based on AppRiver’s primarily month-to-month commitments the Company has chosen to apply the practical expedient approach to immediately recognize commission expenses associated with the AppRiver program. Internal Use Software — The Company capitalizes costs related to its cloud email security, productivity and compliance solutions and certain projects for internal use incurred during the application development stage. Costs related to preliminary project activities and post implementation activities are expensed as incurred. Internal-use software is amortized on a straight-line basis over its estimated useful life, which is generally three years. Management evaluates the useful lives of these assets on an annual basis and tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets. In 2019, we capitalized $8.2 million of costs related to internal-use software. The Company expects our capitalization of these costs to increase in the future. Advertising Expense — Advertising costs are expensed as incurred. Our operations include advertising expense of $4.3 million, $1.3 million, and $1.5 million in 2019, 2018, and 2017, respectively Stock-Based Compensation — We currently use the straight-line amortization method for recognizing stock option and restricted stock compensation costs. The measurement and recognition of compensation expense for all share-based payment awards made to our employees and directors are based on the estimated fair value of the awards on the grant dates. The grant date fair value is estimated using either an option-pricing model which is consistent with the terms of the award or a market observed price, if such a price exists. Such cost is recognized over the period during which an employee or director is required to provide service in exchange for the award, i.e., “the requisite service period” (which is usually the vesting period). We also estimate the number of instruments that will ultimately be earned, rather than accounting for forfeitures as they occur. Earnings Per Share (“EPS”) — Basic EPS is based on the weighted average number of common shares outstanding during each period. Diluted EPS adjusts Basic EPS for the effects of dilutive common stock equivalents outstanding during each period using the treasury stock method. Recently Adopted Accounting Pronouncements Leases In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). Topic 842 requires companies to generally recognize on the balance sheet operating and financing lease liabilities and corresponding right-of-use assets. We elected the available practical expedients and adopted ASC 842 effective January 1, 2019, prospectively. The adoption of this standard resulted in the recognition of right-to-use assets and lease liabilities of $4.8 million and $6.0 million, with no material impact on the results of operations and cash flows. See below Note 8 “Leases" for additional information regarding our leases. Recent Accounting Pronouncements Not Yet Adopted Credit Losses In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standard Update No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (ASU 2016-13), which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. ASU 2016-13 replaces the existing incurred loss impairment model with a forward-looking expected credit loss model which will result in earlier recognition of credit losses. We will adopt the new standard effective January 1, 2020 and do not expect the adoption of this guidance to have a material impact on our consolidated financial statements. Intangibles – Goodwill and Other In January 2017, the FASB issued Accounting Standards Update No. 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (ASU 2017-04) to simplify the subsequent measurement of goodwill. The guidance removes Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. A goodwill impairment will now be the amount by which a reporting unit's carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. The accounting standard will be effective for reporting periods beginning after December 15, 2019 and is not expected to have a material impact on the Company's consolidated financial position, results of operations and cash flows. Income Taxes In December 2019, the FASB issued Accounting Standard Update No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (ASU 2019-12), which simplifies the accounting for income taxes. This guidance will be effective for us in the first quarter of 2021 on a prospective basis, and early adoption is permitted. We are currently evaluating the impact of the new guidance on our consolidated financial statements. |
Stock Options and Stock-Based E
Stock Options and Stock-Based Employee Compensation | 12 Months Ended |
Dec. 31, 2019 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock Options and Stock-based Employee Compensation | 3. Stock Options and Stock-Based Employee Compensation Below is a summary of common stock options outstanding at December 31, 2019: Authorized Shares Options Outstanding Options Vested Available for Grant Employee and Director Stock Option Plans: 2004 Stock Option Plan 5,000,000 105,000 105,000 — 2006 Director’s Stock Option Plan 1,100,000 25,000 25,000 — 2012 Incentive Plan 6,300,000 626,385 595,135 — 2018 Omnibus Incentive Plan 6,000,000 — — 4,180,776 Total 18,400,000 756,385 725,135 4,180,776 Under all of our stock option plans, new shares are issued when options are exercised. Employee and Director Stock-Based Plans We have non-qualified stock options outstanding to employees and directors under various stock option plans. The plans require the exercise price of options granted under these plans to equal or exceed the fair market value of the Company’s common stock on the date of grant. The options, subject to termination of employment, generally expire ten years from the date of grant. Historically, our employee options and equity awards typically vested pro-rata and annually over three or four years. Stock-based grants to employees, officers and directors frequently contain accelerated vesting provisions upon the occurrence of a change of control, as defined in the applicable option agreements. Under the terms of the 2018 Omnibus Incentive Plan approved by our shareholders during our annual meeting held on June 6, 2018, (the “2018 Plan”), 6,000,000 shares are available for issuance. Awards issued under the 2018 Plan typically vest pro-rata and annually over three or four years. Under the terms of the 2012 Incentive Plan adopted by our Board of Directors on April 13, 2012 (the “2012 Plan”), 2,700,000 shares are available for issuance, plus a number of additional shares (not to exceed 1,327,000) underlying options outstanding under certain of the Company’s prior equity plans that thereafter terminate or expire unexercised, or are cancelled, forfeited, or lapse for any reason. Our shareholders approved an Amended and Restated 2012 Incentive Plan during our annual meeting held June 24, 2015, increasing the number of shares available for grant by 3,600,000. Awards issued under the 2012 Plan typically vest pro-rata and annually over three or four years. Accounting Treatment We use the straight-line amortization method for recognizing stock option compensation costs. Our share-based awards include (i) stock options, (ii) restricted stock awards, some of which are subject to time-based vesting (“Restricted Stock”) and some of which are subject to performance-based vesting (“Performance Stock”), and (iii) restricted stock units, some of which are subject to time-based vesting (“RSUs”) and some of which are subject to performance-based vesting (“Performance RSUs”). For the twelve months ended December 31, 2019, 2018, and 2017, respectively, the total stock-based compensation expense resulting from stock options, Restricted Stock, RSUs, Performance RSUs, and Performance Stock was recorded to the following line items of our consolidated statements of comprehensive income (loss): Year Ended December 31, (In thousands) 2019 2018 2017 Cost of revenue $ 569 $ 327 $ 304 Research and development expenses 1,056 469 374 Selling, general and administrative expenses 4,626 2,522 2,196 Stock-based compensation expense $ 6,251 $ 3,318 $ 2,874 Our stock-based compensation expense has increased yearly due to program expansion associated with our Company growth. A deferred tax asset of $1.2 million, $673 thousand, and $824 thousand resulting from stock-based compensation expense associated with awards relating to the Company’s U.S. operations, was recorded for the twelve months ended December 31, 2019, 2018, and 2017, respectively. As of December 31, 2019, there was $11.4 million of total unrecognized stock-based compensation related to non-vested share-based compensation awards granted under the stock award plans. This cost is expected to be recognized over a weighted average period of 1.6 years. We use the Black-Scholes Option Pricing Model (“BSOPM”) to determine the fair value of option grants. The Company uses the “historical” method to calculate the estimated life of any options that may be granted. The expected stock price volatility is calculated by averaging the historical volatility of the Company’s common stock over a term equal to the expected life of the options. We did not grant options in 2019 or 2018. We granted 30,750 options in 2017. The following weighted average assumptions were applied in determining the fair value of options granted during the respective periods: Year Ended December 31, 2019 2018 2017 Risk-free interest rate — — 2.02 % Expected option life (years) — — 5.7 Expected stock price volatility — — 42 % Expected dividend yield — — — Fair value of options granted $ — $ — $ 2.06 The assumptions used in the BSOPM valuation are critical as a change in any given factor could have a material impact on the financial results of the Company. The weighted average grant-date fair value of awards of restricted stock and restricted stock units is based on quoted market price of the Company’s common stock on the date of grant. Stock Option Activity The following is a summary of all stock option transactions for the three years ended December 31, 2019: Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (Yrs) Outstanding at January 1, 2017 1,960,279 $ 3.78 Granted at market price 30,750 $ 4.96 Cancelled or expired (37,412 ) $ 4.71 Exercised (932,303 ) $ 4.51 Outstanding at December 31, 2017 1,021,314 $ 3.11 Granted at market price — $ 0.00 Cancelled or expired (7,480 ) $ 4.04 Exercised (90,011 ) $ 1.83 Outstanding at December 31, 2018 923,823 $ 3.23 Granted at market price — $ 0.00 Cancelled or expired — $ 0.00 Exercised (167,438 ) $ 2.48 Outstanding at December 31, 2019 756,385 $ 3.39 4.46 Options exercisable at December 31, 2019 725,135 $ 3.38 4.38 At December 31, 2019, all 756,385 options outstanding and all 725,135 options exercisable had an exercise price lower than the market value of the Company’s common stock. The aggregate intrinsic value of these options was $2.6 million and $2.5 million, respectively. At December 31, 2018, 923,823 options outstanding and 817,573 options exercisable had an exercise price lower than the market value of the Company’s common stock. The aggregate intrinsic value of these options was $2.3 million and $2.1 million, respectively. The total intrinsic value of options exercised during the years ended December 31, 2019 and 2018, was $987 thousand and $334 thousand, respectively. Summarized information about stock options outstanding at December 31, 2019, is as follows: Options Outstanding Options Exercisable Range of Exercise Prices Number Outstanding Weighted Average Remaining Contractual Life Weighted Average Exercise Price Number Exercisable Weighted Average Exercise Price $2.00 - $3.49 294,375 2.60 $ 2.76 294,375 $ 2.76 $3.50 - $4.99 462,010 5.64 $ 3.80 430,760 $ 3.80 756,385 4.46 $ 3.39 725,135 $ 3.38 There were 817,573 and 832,376 exercisable options at December 31, 2018 and 2017, respectively. Restricted Stock Activity The following is a summary of all Restricted Stock activity during the three years ended December 31, 2019: Restricted Shares Weighted Average Fair Value Non-vested restricted stock at January 1, 2017 689,242 $ 3.94 Granted at market price 665,623 $ 5.02 Vested (251,956 ) $ 4.00 Cancelled (20,000 ) $ 4.96 Non-vested restricted stock at December 31, 2017 1,082,909 $ 4.57 Granted at market price 842,546 $ 4.53 Vested (419,452 ) $ 4.44 Cancelled (151,003 ) $ 4.77 Non-vested restricted stock at December 31, 2018 1,355,000 $ 4.71 Granted at market price 1,236,579 $ 7.36 Vested (560,497 ) $ 4.66 Cancelled (119,000 ) $ 7.00 Non-vested restricted stock at December 31, 2019 1,912,082 $ 6.26 Restricted Stock Unit Activity The following is a summary of all RSU activity during the three years ended December 31, 2019: Restricted Stock Units Weighted Average Fair Value Non-vested restricted stock units at January 1, 2017 158,086 $ 3.92 Granted at market price 54,500 $ 4.96 Vested (126,167 ) $ 4.07 Cancelled — $ — Non-vested restricted stock units at December 31, 2017 86,419 $ 4.36 Granted at market price 36,500 $ 4.57 Vested (50,751 ) $ 4.18 Cancelled — $ — Non-vested restricted stock units at December 31, 2018 72,168 $ 4.59 Granted at market price 131,294 $ 8.19 Vested (63,387 ) $ 5.21 Cancelled — $ — Non-vested restricted stock units at December 31, 2019 140,075 $ 7.59 Performance RSU Activity The following is a summary of all Performance RSU activity during the three years ended December 31, 2019: Restricted Stock Units Weighted Average Fair Value Non-vested performance RSUs at January 1, 2017 90,831 $ 3.81 Granted at market price 11,500 $ 4.96 Vested (20,999 ) $ 4.08 Forfeited (41,668 ) $ 3.83 Non-vested performance RSUs at December 31, 2017 39,664 $ 3.98 Granted at market price 5,500 $ 4.04 Vested (32,665 ) $ 3.91 Forfeited — $ 0.00 Non-vested performance RSUs at December 31, 2018 12,499 $ 4.20 Granted at market price 50,000 $ 8.84 Vested (7,000 ) $ 4.08 Forfeited — $ 0.00 Non-vested performance RSUs at December 31, 2019 55,499 $ 8.39 Performance Stock Activity The following is a summary of all Performance Stock activity during the three years ended December 31, 2019: Restricted Stock Units Weighted Average Fair Value Non-vested performance stock at January 1, 2017 121,500 $ 3.61 Granted at market price 112,112 $ 4.96 Vested — — Forfeited (40,502 ) $ 3.61 Non-vested performance stock at December 31, 2017 193,110 $ 4.39 Granted at market price 153,723 $ 4.04 Vested (77,874 ) $ 4.26 Forfeited (13,333 ) $ 4.50 Non-vested performance stock at December 31, 2018 255,626 $ 4.22 Granted at market price 417,500 $ 7.15 Vested (123,558 ) $ 4.15 Forfeited (75,000 ) $ 7.15 Non-vested performance stock at December 31, 2019 474,568 $ 6.38 The weighted average grant-date fair value of awards of Restricted Stock, RSUs, Performance RSU’s, and Performance Stock is based on the quoted market price of the Company’s common stock on the date of grant. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 12 Months Ended |
Dec. 31, 2019 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information | 4. Supplemental Cash Flow Information Supplemental information relating to interest and taxes: Year Ended December 31, (In thousands) 2019 2018 2017 Interest payments $ 9,181 $ — $ — Income tax payments $ 493 $ 1,115 $ 636 |
Receivables, Net
Receivables, Net | 12 Months Ended |
Dec. 31, 2019 | |
Receivables [Abstract] | |
Receivables, Net | 5. Receivables, net (In thousands) December 31, 2019 2018 Gross accounts receivables $ 21,193 $ 14,135 Allowance for returns and doubtful accounts (265 ) (277 ) Unpaid portion of deferred revenue (10,847 ) (10,670 ) Note receivable 458 458 Allowance for note receivable (458 ) (458 ) Receivables, net $ 10,081 $ 3,188 The allowance for doubtful accounts includes all specific accounts receivable which we believe are likely not collectable based on known information. The reduction for the unpaid portion of deferred revenue represents future customer service or maintenance obligations which have been billed to customers, but remain unpaid as of the respective balance sheet dates. Deferred revenue on our consolidated balance sheets represents future customer service or maintenance obligations which have been billed and collected as of the respective balance sheet dates. The note receivable represents the remaining outstanding balance of an original note related to the sale of a product line in 2005 in the amount of $540 thousand. This was fully reserved at the time of the sale as the note’s collectability was not assured. The note receivable is fully reserved at December 31, 2019 and 2018. |
Prepaid and other current asset
Prepaid and other current assets | 12 Months Ended |
Dec. 31, 2019 | |
Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract] | |
Prepaid and other current assets | 6. Prepaid and other current assets (In thousands) December 31, 2019 2018 Prepaid insurance, maintenance, software licenses and other $ 4,881 $ 2,460 Tax-related 103 716 Prepaid and other current assets $ 4,984 $ 3,176 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2019 | |
Property Plant And Equipment [Abstract] | |
Property and Equipment | 7. Property and Equipment (In thousands) December 31, 2019 2018 Computer and office equipment and software $ 30,335 $ 26,762 Leasehold improvements 7,794 6,834 Furniture and fixtures 2,733 2,181 Finance lease right-of-use assets 3,362 $ — 44,224 35,777 Less accumulated depreciation (35,633 ) (31,853 ) Property and equipment, net $ 8,591 $ 3,924 Our operations include depreciation expense related to property and equipment of $5.0 million, $2.4 million, and $2.4 million in 2019, 2018, and 2017, respectfully. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Leases | 8. Leases Effective January 1, 2019, the Company adopted ASC 842, which requires recognition of a right-of-use asset and lease liability for all leases at the commencement date based on the present value of lease payments over the lease term. Additional qualitative and quantitative disclosures regarding the Company's leasing arrangements are also required. The Company adopted ASC 842 prospectively and elected the package of transition practical expedients that does not require reassessment of (1) whether any existing or expired contracts are or contain leases, (2) lease classification and (3) initial direct costs. In addition, the Company has elected other available practical expedients to not separate lease and non-lease components, which consist principally of common area maintenance charges, for all classes of underlying assets and to exclude leases with an initial term of 12 months or less. The Company determines if a contract is or contains a lease at inception. The Company has operating leases for office spaces and data centers and finance leases for equipment. The Company has entered into lease contracts ranging from 1 to 12 years with the majority of leases having terms one to seven years, many of which include options to extend in various increments. Variable lease costs consist primarily of variable common area maintenance, taxes, insurance, parking and utilities. The Company’s leases do not have any residual value guarantees or restrictive covenants. As the implicit rate is not readily determinable for most of the Company’s lease agreements, the Company uses an estimated incremental borrowing rate to determine the initial present value of lease payments. These discount rates for leases are calculated using the Company's weighted average interest rate of the term loan and delayed draw term loan. The components of lease costs are as follows: Year Ended December 31, (In thousands) 2019 Finance lease costs: Amortization of right-of-use asset $ 1,330 Interest on lease liabilities 151 Operating lease costs 3,490 Short-term lease costs 2,236 Variable lease costs 773 Total lease costs $ 7,980 Supplemental cash flow information related to leases is as follows: Year Ended December 31, (In thousands) 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows related to operating leases $ 2,410 Operating cash flows related to finance leases 151 Financing cash flows related to finance leases 1,707 Right-of-use assets obtained in exchange for lease obligations: Operating leases 7,999 Finance leases 3,362 Supplemental balance sheet information related to leases is as follows: December 31, (In thousands) Balance Sheet Classification 2019 Operating Leases Operating lease right-of-use asset Operating lease assets $ 10,128 Total operating lease assets $ 10,128 December 31, (In thousands) Balance Sheet Classification 2019 Finance Leases Finance lease right-of-use assets $ 3,362 Accumulated depreciation - finance leases (1,320 ) Finance lease right-of-use assets, net Property and equipment, net $ 2,042 Weighted average remaining lease term and weighted average discount rate are as follows: Weighted Average Remaining Lease Term (Years) Operating leases 4.18 Finance leases 1.92 Weighted Average Discount Rate Operating leases 5.86 % Finance leases 6.15 % Maturities of lease liabilities are as follows: Payments Due by Year Ending December 31, 2020 (In thousands) Total Year 1 Years 2 & 3 Years 4 & 5 Beyond 5 Years Operating leases $ 12,807 $ 3,519 $ 5,102 $ 4,186 $ — Less imputed interest (1,471 ) Total $ 11,336 Finance leases $ 2,165 $ 1,423 $ 736 $ 6 $ — Less imputed interest (111 ) Total $ 2,054 |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | 9. Goodwill and Other Intangible Assets The changes in the carrying amount of goodwill for the years ended December 31, 2019 and 2018, are as follows: Year Ended December 31, (In thousands) 2019 2018 Opening balance $ 13,783 $ 8,469 Additions 157,121 6,215 Acquisition adjustments — (901 ) Effect of currency translation adjustment 305 — Goodwill $ 171,209 $ 13,783 Our 2019 acquisitions of DeliverySlip (as defined herein) and AppRiver (as defined herein) resulted in the addition to our goodwill balance in 2019. Our 2018 acquisition of Erado (as defined herein) resulted in the addition to our goodwill balance in 2018. Our 2018 acquisition adjustments to goodwill reflect the appropriate reallocation of excess purchase price from goodwill to acquired assets and liabilities related to our 2017 Greenview and EMS (as defined herein) purchases. We evaluate goodwill for impairment annually in the fourth quarter, or when there is reason to believe that the value has been diminished or impaired. There were no impairment indicators to the goodwill recorded as of December 31, 2019. Our other intangible assets consist of the following: December 31, 2019 (In thousands) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Internal use software $ 1,456 $ (504 ) $ 952 Internally-developed hosting arrangement 9,487 (1,258 ) 8,229 Trademarks and other 5,091 (587 ) 4,504 Technology 52,905 (9,836 ) 43,069 Customer relationships 98,879 (10,597 ) 88,282 Vendor relationship 1,000 (278 ) 722 Effect of currency translation adjustment 118 Intangible assets, net $ 168,818 $ (23,060 ) $ 145,876 December 31, 2018 (In thousands) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Internal use software $ 1,189 $ (162 ) $ 1,027 Internally-developed hosting arrangement 1,520 (77 ) 1,443 Trademarks and other 691 (113 ) 578 Technology 7,604 (2,678 ) 4,926 Customer relationships 7,870 (593 ) 7,277 Intangible assets, net $ 18,874 $ (3,623 ) $ 15,251 For the twelve months ended December 31, 2019, amortization of intangible assets was recorded to the following line items of our consolidated statements of operations: Year Ended December 31, (In thousands) 2019 Cost of revenue $ 7,132 Research and development expenses 1,478 Selling, general and administrative expenses 10,827 Amortization of intangible assets $ 19,437 The following table summarizes our estimated future amortization expense: (In thousands) 2020 2021 2022 2023 2024 Thereafter Total Amortization expense $ 25,580 25,506 $ 23,686 $ 21,095 $ 16,906 $ 32,985 $ 145,758 |
Accrued Expenses
Accrued Expenses | 12 Months Ended |
Dec. 31, 2019 | |
Payables And Accruals [Abstract] | |
Accrued Expenses | 10. Accrued Expenses December 31, (In thousands) 2019 2018 Employee compensation and benefits $ 7,231 $ 5,122 Professional fees 1,576 1,289 Taxes 575 113 Other 4,350 3,223 Total accrued expenses $ 13,732 $ 9,747 |
Long-term Debt
Long-term Debt | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Long-term Debt | 11. Long-term Debt On February 20, 2019, the Company entered into a credit agreement (the “Credit Agreement”) with a syndicate of lenders and SunTrust Bank as administrative agent, which (1) provided for borrowing in the form of a senior secured term loan facility in an aggregate principal amount of $175 million (the “Term Loan”), (2) provided for a senior secured delayed draw term loan facility in an aggregate principal amount of $10 million (the “Delayed Draw Term Loan Facility”), and (3) provided for a senior secured revolving credit facility in an aggregate principal amount of $25 million, up to $5 million of which is available for letters of credit (the “Revolving Facility” and, together with the Term Loan and the Delayed Draw Term Loan Facility, the “Credit Facilities”). On February 20, 2019, the Term Loan was borrowed in full to pay a portion of the purchase price in connection with the AppRiver acquisition (described below in Note 22 “Acquisitions”), including certain fees, costs and expenses related thereto. On May 2, 2019, the Delayed Draw Term Loan Facility was borrowed in full to pay a portion of the purchase price in connection with the DeliverySlip acquisition (described below in Note 22 “Acquisitions”), including certain fees, costs and expenses related thereto. As of December 31, 2019, the Company had an outstanding debt balance of $2.0 million attributable to the Revolving Facility. The Credit Facilities are secured by substantially all the assets of Zix and its wholly-owned domestic subsidiaries and guaranteed by substantially all of Zix’s wholly-owned domestic subsidiaries. Borrowings under the Credit Agreement bear interest, at the Company’s option, at either (1) the adjusted LIBOR rate (as defined in the Credit Agreement) plus a margin ranging from 2.50% to 3.50% or (2) the alternate base rate (as defined in the Credit Agreement) plus a margin ranging from 1.50% to 2.50%. The applicable margin varies depending on the Company’s total net leverage ratio. The Credit Facilities are scheduled to mature on February 20, 2024, unless extended in accordance with the terms of the Credit Agreement. The Credit Agreement includes procedures for additional financial institutions to become lenders, or for any existing lender to increase its commitments thereunder, subject to the limits and conditions set forth in the Credit Agreement. Optional prepayments of borrowings under the Credit Facilities are permitted at any time and do not require any prepayment premium (other than reimbursement of the lenders’ breakage and redeployment costs in the case of a prepayment of LIBOR borrowings). The Credit Agreement contains various financial, operational, and legal covenants. The financial covenant is tested on a quarterly basis, based on the rolling four-quarter period that ends on the last day of each fiscal quarter. The financial covenant requires the Company to maintain a maximum total net leverage ratio of: • 5.00:1.00 for the fiscal quarters ending December 31, 2019 through June 30, 2020; • 4.75:1.00 for the fiscal quarters ending September 30, 2020 through March 31, 2021; • 4.50:1.00 for the fiscal quarters ending June 30, 2021 through December 31, 2021; and • 4.25:1.00 for the fiscal quarter ending March 31, 2022 and each fiscal quarter thereafter. The non-financial covenants restrict the Company’s ability and the ability of the Company’s restricted subsidiaries to, among other things, incur indebtedness, incur liens, merge with or acquire other entities, make investments, dispose of assets, enter into sale and leaseback transactions, make dividends, distributions or stock repurchases, prepay junior indebtedness, enter into transactions with affiliates, enter into restrictive agreements, and amend organizational documents or the terms of junior indebtedness. The Credit Agreement contains events of default that Zix believes are customary for a secured credit facility. If an event of default relating to bankruptcy or other insolvency events occurs, all obligations under the Credit Agreement will immediately become due and payable. If any other event of default exists under the Credit Agreement, the lenders may accelerate the maturity of the Credit Facilities and exercise other rights and remedies, including foreclosure or other actions against the collateral. If any default exists under the Credit Agreement, or if the Company is unable to make any of the representations and warranties in the Credit Agreement at the applicable time, Zix will be unable to borrow additional funds or have letters of credit issued under the Credit Agreement. Term Loan As of December 31, 2019, the Company had $173.7 million in principal outstanding under the Term Loan. The Term Loan was fully drawn on February 20, 2019 in the amount of $175 million, and requires quarterly payments of principal of $437.5 thousand beginning on June 30, 2019. In addition to other customary mandatory prepayment requirements, the Term Loan requires annual prepayments based on a percentage of Zix’s excess cash flow, which percentage will reduce if Zix’s total net leverage ratio decreases. At December 31, 2019, the Company had an outstanding debt balance of $168.2 million attributable to the Term Loan based on the 6.32% interest rate in effect during the period from February 20, 2019 through December 31, 2019. Included in the balance at December 31, 2019 is $5.5 million of unamortized debt issuance costs. Based on the calculation of excess cash flow and total net leverage ratio and for the year ended December 31, 2019, the Company is not required to make prepayment in addition to the quarterly installment. Future scheduled principal payments under the Term Loan as of December 31, 2019 are as follows: (In thousands) Year Ending December 31, Amount 2020 1,750 2021 1,750 2022 1,750 2023 1,750 2024 166,688 Total 173,688 Delayed Draw Term Loan Facility At December 31, 2019, the Company had $10 million in principal outstanding under the Delayed Draw Term Loan Facility. The Delayed Draw Term Loan Facility was fully drawn on May 2, 2019 in the amount of $10 million to fund the DeliverySlip acquisition. The Delayed Draw Term Loan Facility requires 1.00% per annum amortization of the original principal amount borrowed, payable in equal quarterly installments of $25 thousand beginning on September 30, 2019. In addition to other customary mandatory prepayment requirements, the Delayed Draw Term Loan Facility requires annual prepayments based on a percentage of Zix’s excess cash flow, which percentage reduces if Zix’s total net leverage ratio decreases. At December 31, 2019, the Company had an outstanding debt balance of $9.9 million attributable to the Delayed Draw Term Loan Facility based on the 5.67% interest rate in effect during the period from May 2, 2019 through December 31, 2019. Included in the balance at December 31, 2019 is $49 thousand of unamortized debt issuance costs. Based on the calculation of excess cash flow and total net leverage ratio and for the year ended December 31, 2019, the Company is not required to make prepayment in addition to the quarterly installment. Future scheduled principal payments under the Delayed Draw Term Loan Facility as of September 30, 2019 are as follows: (In thousands) Year Ending December 31, Amount 2020 100 2021 100 2022 100 2023 100 2024 9,550 Total 9,950 Revolving Facility The Company also has a Revolving Facility with the lenders, pursuant to which the lenders agreed to make a Revolving Facility available to the Company in an aggregate amount of up to $25 million. Proceeds from the Revolving Facility may be used for working capital and general business purposes, including the financing of permitted acquisitions, investments and restricted payments, subject to the conditions contained in the Credit Agreement. Zix is charged a commitment fee ranging from 0.25% to 0.50% per year on the daily amount of the unused portions of the commitments under the Revolving Facility. As of December 31, 2019, the Company had an outstanding debt balance of $2.0 million attributable to the Revolving Facility . The undrawn balance of $23 million is available to fund working capital and for other general corporate purposes, including the financing of permitted acquisitions, investments and restricted payments, subject to the conditions contained in the Credit Agreement. As of December 31, 2019, the Company has accrued $97 thousand of commitment fees for the period ended December 31, 2019. As of December 31, 2019, the estimated fair value of the Credit Facilities approximated their carrying value and the Company was in compliance with all covenants in the Credit Agreement. |
Preferred Stock
Preferred Stock | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Preferred Stock | 12. Preferred Stock On February 20, 2019, (the “Original Issuance Date” or “Closing Date”), Zix consummated a private placement pursuant to an investment agreement with an investment fund managed by True Wind Capital and issued an aggregate of $100 million of shares of convertible Preferred Stock (as defined below) at a price of $1,000 per share (the “Stated Value”). 64,914 shares of Series A Convertible Preferred Stock (the “Series A Preferred Stock”) were issued for proceeds of $62.7 million, net of issuance costs of $2.3 million, and 35,086 shares of Series B Convertible Preferred Stock (the “Series B Preferred Stock” and, together with the Series A Preferred Stock, the “Preferred Stock”) were issued for proceeds of $33.9 million, net of issuance costs of $1.2 million. The Preferred Stock is classified outside of stockholders’ equity in temporary equity because the shares contain certain redemption features which require redemption upon a change in control. The Series A Preferred Stock can be immediately converted to common stock. On June 5, 2019, Shareholders approved the conversion of the outstanding shares of Series B Preferred Stock into shares of Series A Preferred Stock. Each share of Series B Preferred Stock was converted into the number of shares of Series A Preferred Stock equal to the liquidation preference of such share of Series B Preferred Stock divided by the accreted value of a share of Series A Preferred Stock on the date of conversion plus cash in lieu of fractional shares. On June 6, 2019, all the outstanding shares of Series B Preferred Stock were converted into 35,292 shares of Series A Preferred Stock. As of December 31, 2019, no shares of Series B Preferred Stock are outstanding. The conversion option of the Series A Preferred Stock was determined to have a beneficial conversion feature. As of December 31, 2019, the beneficial conversion feature was valued at $2.5 million, excluding the additional beneficial conversion feature accrued for the deemed dividend during the quarter then ended, and was recorded to additional paid-in capital and as a discount to the Series A Preferred Stock. This resulting discount was immediately amortized as the Series A Preferred Stock has no set redemption date but is currently convertible. Dividends The Stated Value of the Series A Preferred Stock accretes at a fixed rate of 8% per annum, compounded quarterly (“Series A Preferred Dividend”). Apart from the Series A Preferred Dividend, the holders of Series A Preferred Stock are also entitled to receive any dividends paid on our common stock on an "as converted" basis. No dividend may be paid on our common stock until such dividend is paid on the Series A Preferred Stock. All calculations of the Accreted Value (as defined below) of Series A Preferred Stock will be computed on the basis of a 360-day year of twelve 30-day months. As of December 31, 2019, the accretion of the Stated Value of Series A Preferred Stock is valued at $6.3 million, including the accretion attributable to the converted Series A Preferred Stock from Series B Preferred Stock, and the accretion of the beneficial conversion feature is valued at $134 thousand. As of June 6, 2019, the accrued dividend on the Series B Preferred Stock, valued at $1.2 million, was converted to Series A Preferred Stock along with the Stated Value of the Series B Preferred Stock. Upon conversion of Series B Preferred Stock to Series A Preferred Stock on June 6, 2019, all remaining dividend calculations are based on the terms of the Series A Preferred Dividend for the converted Series A Preferred Stock. Voting Rights Holders of Series A Preferred Stock are entitled to vote, together with the holders of common stock on all matters submitted to a vote of the holders of our common stock. Each holder of Series A Preferred Stock shall be entitled to the number of votes equal to the largest number of whole shares of common stock into which all shares of Series A Preferred Stock held by such holder could be converted. The vote or consent of the holders of at least a majority of the shares of Series A Preferred Stock outstanding will be necessary for effecting or validating any of the following actions: (i) any amendment, alteration or repeal of Zix’s Articles of Incorporation or Series A Certification of Designations that would adversely affect the rights, preferences, privileges or power of the Series A Preferred Stock; (ii) any amendment or alteration to Zix’s Articles of Incorporation or any other action to authorize or create, or increase the number of authorized or issued shares of capital stock of the Company convertible into shares of, or ranking senior to, or on a parity basis with, the Series A Preferred Stock as to dividend rights or liquidation rights; (iii) the issuance of shares of Series A Preferred Stock after the Original Issuance Date other than in connection with the conversion of Series B Preferred Stock that was issued on the Original Issuance Date; (iv) any action that would cause the Company to cease to be treated as a domestic corporation for U.S. federal income tax purposes; and (v) the incurrence of any indebtedness of the Company that would cause Zix to exceed a specified leverage ratio. Liquidation Preference The Series A Preferred Stock has a liquidation preference equal to the greater of (i) the Stated Value per share as it has accreted as of such date (the “Accreted Value”) and (ii) the amount such holder would have received if the Series A Preferred Stock had converted into common stock immediately prior to such liquidation. Conversion At any time, each Series A Preferred Stock holder may elect to convert each share of such holders’ then-outstanding Series A Preferred Stock into (i) the number of shares of common stock equal to the product of (a) the Accreted Value with respect to such share on the conversion date multiplied by (b) the conversion rate (initially 166.11) as of the applicable conversion date divided by (c) 1,000 plus (ii) cash in lieu of fractional shares. Optional Redemption by Zix At any time after the fourth anniversary of the Closing Date, Zix may redeem the Series A Preferred Stock for an amount per share of Series A Preferred Stock equal to the Accreted Value per share of the Series A Preferred Stock to be redeemed as of the applicable redemption date multiplied by 1.50. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 12 Months Ended |
Dec. 31, 2019 | |
Revenue From Contract With Customer [Abstract] | |
Revenue from Contracts with Customers | 13. Revenue from Contracts with Customers Accounting policies Our Company provides message security solutions as subscription services in which we recognize revenue as our services are rendered. Our customer contracts historically have ranged from one to three-year contracts billed annually. We are increasingly moving to a monthly subscription model. This shift has been largely driven by our recent acquisition activity, including AppRiver. We exclude from the measurement of the transaction price all taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by our Company from a customer (e.g., sales, use, value added, and some excise taxes). Disaggregation of Revenue In 2019, we recorded revenue for our services in the following core industry verticals: 23% healthcare, 19% financial services, 4% government sector, and 54% as other. We operate as a single operating segment. Revenue generated from our email encryption and security solutions represented 100% of our revenue in 2019 and 2018. Contract balances Our contract assets include our accounts receivable, discussed in Footnote 5 above, and the deferred cost associated with commissions earned by our sales team on securing new, add-on, and renewal contract orders. Upon our adoption of ASC 606 on January 1, 2018, we recorded a cumulative effect adjustment, establishing a $6.6 million noncurrent deferred contract asset in recognition of the lengthened amortization period required by the new guidance. The Company simultaneously released the previously existing current deferred commission asset balance of $415 thousand. During the twelve months ended December 31, 2019 and 2018, we increased our noncurrent deferred contract asset by $5.5 million, and $4.9 million, respectively, resulting from commissions earned by our sales team during the twelve months ended December 31, 2018. During the twelve months ended December 31, 2019 and 2018, we also amortized $3.0 million and $2.2 million, respectively of deferred cost, as a selling and marketing expense in the related periods. Our deferred cost asset is assessed for impairment on a periodic basis. There were no impairment losses recognized on deferred contract cost assets for each of the twelve months ended December 31, 2019 and 2018. Our contract liabilities consist of deferred revenue representing future customer services which have been billed and collected. The $11.1 million increase to our net deferred revenue in the twelve months ended December 31, 2019, is primarily related to our AppRiver acquisition in February 2019. The $2.7 million increase to our net deferred revenue in the twelve months ended December 31, 2018, is related to the timing of orders and payments as well as growth of revenue. Performance obligations As of December 31, 2019, the aggregate amount of the transaction prices allocated to remaining service performance obligations, which represents the transaction price of firm orders less inception to date revenue, was $89.4 million. We expect to recognize approximately $62.4 million of revenue related to this backlog in 2020, and $27.0 million in periods thereafter. Approximately $47.3 million of our $173.4 million revenue recognized in the twelve months ended December 31, 2019, was included in our performance obligation balance at the beginning of the period. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 14. Fair Value Measurements FASB guidance regarding fair value measurement establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets for identical assets or liabilities; Level 2, defined as inputs other than quoted prices for similar assets and liabilities in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs for which little or no market data exists, therefore requiring an entity to develop its own assumptions. The Company recorded a $2.3 million liability for the estimated fair value of contingent consideration in our DeliverySlip acquisition. The Company determined the fair value of the contingent payment based on the probability of attainment of certain agreed upon requirements. Any changes to the variables and assumptions could significantly impact the estimated fair values recorded for the liability, resulting in significant changes to the Consolidated Statements of Comprehensive Income (Loss). The fair value measurements are based on significant inputs not observable in the market and thus represent Level 3 measurements, which reflect the Company’s own assumptions concerning the achievement of the sales milestones in measuring the fair value of the acquisition-related contingent earn-out lability. The following table represents a reconciliation of our acquisition-related contingent earn-out liability measured at fair value on a recurring basis, using Level 3 inputs for the year ended December 31, 2019: (In thousands) Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Balance at December 31, 2018 $ 1,164 Additions during the period 2,303 Payments during the period (3,300 ) Adjustments to fair value during the period recorded in General and Administrative expenses 211 Balance at December 31, 2019 $ 378 |
Earnings Per Share and Potentia
Earnings Per Share and Potential Dilution | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Earnings Per Share and Potential Dilution | 15. Earnings Per Share and Potential Dilution Basic earnings per share are computed using the weighted average number of common shares outstanding for the period under the Treasury Stock method. The dilutive effect of potential common shares outstanding is included in diluted earnings per share. The computations for basic and diluted earnings per share for the years ended December 31, 2019, 2018, and 2017, are as follows: Year Ended December 31, 2019 2018 2017 Basic weighted average shares 53,025,152 52,591,714 53,430,492 Effect of dilutive securities: Employee and director stock options — 347,167 — Restricted Stock — 409,871 — RSUs — 24,369 — Performance RSUs — 9,367 — Performance Stock — 98,807 — Potential dilutive common shares 53,025,152 53,481,295 53,430,492 For the year ended December 31, 2019, potential common shares of all securities were excluded from the calculation of diluted earnings per share because the awards were anti- dilutive. For the year ended December 31, 2018, weighted average shares related to 73,313 stock options; 131,774 shares of Restricted Stock, 6,084 RSUs, 917 Performance RSUs, and 18,536 shares of Performance Stock were excluded from the calculation of diluted earnings per share because these awards were anti-dilutive. For the year ended December 31, 2017, potential common shares of all securities were excluded from the calculation of diluted earnings per share because the awards were anti-dilutive. |
Significant Customers
Significant Customers | 12 Months Ended |
Dec. 31, 2019 | |
Text Block [Abstract] | |
Significant Customers | 16. Significant Customers In 2019, 2018, and 2017, no single customer accounted for 10% or more of our revenues. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 17. Commitments and Contingencies Our principal commitments consist primarily of obligations under operating and financing leases, which include among others, certain leases of our offices, colocations and servers as well as contractual commitment related network infrastructure and data center operations. Refer to Note 8 “Leases” for our commitments to settle contractual obligations in cash as of December 31, 2019. Claims and Proceedings We are subject to legal proceedings, claims, and litigation against our business. While the outcome of these matters is currently not determinable and the costs and expenses of defending these matters may be significant, we currently do not expect that the ultimate costs to resolve these matters will have a material adverse effect on our consolidated financial statements. |
Other Comprehensive Income (Los
Other Comprehensive Income (Loss) | 12 Months Ended |
Dec. 31, 2019 | |
Other Comprehensive Income Loss Tax [Abstract] | |
Other Comprehensive Income (Loss) | 18. Other Comprehensive Income (Loss) The assets and liabilities of international subsidiaries are translated from the respective local currency to the U.S. dollar using exchange rates at the balance sheet date. Related translation adjustments are recorded as a component of the accumulated other comprehensive income (loss). Our Consolidated Statement of Comprehensive Income (Loss) of international subsidiaries are translated from the local currency to the U.S. dollar using average exchange rates for the period covered by the income statements. We are exposed to fluctuations in the foreign currency exchange rates as a result of our net investments and operations in Canada. For fiscal year 2019, movements in currency exchange rates and the related impact on the translation of the balance sheets of our subsidiary in Canada was the primary cause of our foreign currency translation gain of $215 thousand, net of $16 thousand in income taxes. For fiscal year 2018 and 2017, foreign currency translation adjustments were immaterial. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 19. Income Taxes Components of the income taxes are as follows: (In thousands) 2019 2018 2017 Current: U.S. $ (341 ) $ (794 ) $ 183 State 216 725 (196 ) Foreign 9 71 156 Deferred Federal (4,365 ) (4,722 ) 18,461 Foreign 3 — 2 Income tax (benefit) expense $ (4,478 ) $ (4,720 ) $ 18,606 On December 22, 2017, the U.S. enacted the Tax Cuts and Jobs Act of 2017 (the “Tax Act”) which significantly changed U.S. tax law. The Tax Act, among other things, lowered the federal statutory corporate income tax rate from 34% to 21% effective January 1, 2018. The Company completed its assessment of the impact to 2018 noting no changes from what it disclosed in 2017. The Company’s income tax expense (benefit) for 2019, 2018 and 2017, respectively, reflect tax expense (benefit) based on statutory rates in 2019, 2018, and 2017. A reconciliation of the expected U.S. tax expense (benefit) to income taxes related to continuing operations is as follows: (In thousands) 2019 2018 2017 Expected tax expense at U.S. statutory rate $ (3,943 ) $ 2,260 $ 3,587 Change in corporate tax rate- deferreds — — 12,473 Increase (decrease) in valuations allowance (295 ) (7,841 ) — Increase (decrease) in valuations allowance- other — — 2,064 Nondeductible expense and nontaxable income (37 ) 111 890 State income taxes, net of federal benefits (507 ) 815 (129 ) Foreign income taxes 517 68 159 Other (213 ) (133 ) (438 ) Income tax (benefit) expense $ (4,478 ) $ (4,720 ) $ 18,606 Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Components of our U.S. deferred income taxes as of December 31, 2019 and 2018 are as follows: (In thousands) 2019 2018 Deferred tax assets: Nondeductible $ 116 $ 113 U.S. net operating loss carryforwards 49,657 46,826 State net operating loss carryforwards 572 71 Intangible assets 1,135 — Tax credit carryforwards 5,151 5,703 Stock-based compensation 1,574 976 Depreciable assets 1,209 822 Interest expense 1,611 30 Other assets 1,521 908 Total deferred tax assets 62,546 55,449 Deferred tax liabilities: Intangible assets — (1,128 ) Revenue recognition (2,976 ) (2,300 ) Prepaid expenses (997 ) (572 ) Total deferred tax assets 58,573 51,449 Less valuation allowance (22,022 ) (22,667 ) Net deferred tax assets $ 36,551 $ 28,782 The Company has partially reserved its U.S. net deferred tax assets in 2019, 2018, and 2017 due to the uncertainty of future taxable income. The Company has U.S. federal net operating loss carryforwards of approximately $236 million which begin to expire in 2021. The Company has state credits totaling $1.7 million which can be utilized through 2026 and state net operating losses that have various expiration dates. The Company also has tax credit carryforwards of approximately $3.5 million consisting of business tax credits that began to expire in 2020 and alternative minimum tax credits which will be refunded through 2021 in accordance with the new tax law effective 2018. We have determined that utilization of existing net operating losses against future taxable income is not limited by Section 382 of the Internal Revenue Code. Future ownership changes, however, may limit the Company's ability to fully utilize its existing net operating loss carryforwards against any future taxable income. The Company or one of our subsidiaries files income tax returns in the U.S. federal jurisdiction and various states and in the Canadian federal and provincial jurisdictions. We have not taken a tax position that, if challenged, would have a material effect on the financial statements or the effective tax rate for the twelve-months ended December 31, 2019, or during the prior three years. We have determined it is not reasonably possible for the amounts of unrecognized tax benefits to significantly increase or decrease within the next twelve months. We are currently subject to a three-year statute of limitations by major tax jurisdictions. |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2019 | |
Postemployment Benefits [Abstract] | |
Employee Benefit Plan | 20. Employee Benefit Plan 401(k) Plan — We have a retirement savings plan structured under Section 401(k) of the Internal Revenue Code covering substantially all of our U.S. employees. Under the plan, contributions are voluntarily made by employees, and we may provide contributions based on the employees’ contributions. Our operating income includes $1.2 million, $618 thousand, and $512 thousand in 2019, 2018, and 2017, respectively, for net contributions from operations to this plan. |
Zix Repurchase Program
Zix Repurchase Program | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Zix Repurchase Program | 21. Zix Repurchase Program On April 24, 2017, the Company’s Board of Directors approved a share repurchase program that enables the Company to purchase up to $10 million of its shares of common stock. The shares repurchase program expired on May 31, 2018. The Company did not repurchase shares during the year ended December 31, 2019. During the year ended December 31, 2018, the Company repurchased 1,206,994 shares at an aggregate cost of $5.4 million. During the year ended December 31, 2017, the Company repurchased 750,000 shares at an aggregate cost of $3.8 million. |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
Acquisitions | 22. Acquisitions DeliverySlip On May 7, 2019, the Company acquired certain assets of Cirius Messaging Inc. (“Seller”) and its wholly owned subsidiary DeliverySlip Inc.(“DeliverySlip”), related to the DeliverySlip product for a total purchase price of $13.8 million, including cash consideration of $11.4 million and a contingent consideration with an estimated fair value of $2.3 million at the acquisition date. The contingent consideration was paid in full upon the completion of certain agreed upon requirements and a related $0.2 million loss on the contingent consideration was recognized in the year ended December 31, 2019. Included in the cash consideration, a holdback amount of $1.5 million was transferred to an escrow agent for the satisfaction of the Seller’s indemnity and other obligations under the purchase agreement. The acquisition was partially financed with proceeds of $10 million from the Delayed Draw Term Loan Facility. The purchase of DeliverySlip expanded the Company’s product offering including email encryption, e-signatures and secure file solutions. The Company incurred $1.2 million in acquisition-related costs with respect to the DeliverySlip acquisition, which were recorded within operating expenses during the twelve months end December 31, 2019. Prior to the acquisition, approximately 90% of DeliverySlip’s revenue was generated from AppRiver Canada Inc, which became a subsidiary of the Company upon closing of the AppRiver acquisition (as described below). Revenue from additional acquired customers of DeliverySlip for the twelve months ended December 31, 2019 were immaterial. We accounted for the acquisition as the purchase of a business and recorded the excess purchase price as goodwill. The goodwill from this transaction is not yet finalized. The majority of the goodwill balance is expected to be deductible for tax purposes. The intangible asset we acquired from DeliverySlip is technology which we are amortizing over 6 years. The results of operations and the provisional fair values of the acquired assets and liabilities have been included in the accompanying condensed consolidated financial statements since the DeliverySlip acquisition closed on May 7, 2019. Certain estimated values are not yet finalized and subject to revision as additional information becomes available and more detailed analyses are completed. The following table summarizes the current estimated fair value of acquired assets and liabilities: (In thousands) Provisional Fair Value Assets: Technology $ 4,200 Goodwill 9,603 Total assets 13,803 Liabilities: Deferred revenue $ 52 Total liabilities 52 Net assets recorded $ 13,751 AppRiver Companies On February 20, 2019, Zix acquired 100% of the equity interest of AR Topco, LLC and its subsidiaries, including AppRiver LLC (“AppRiver” and collectively, the “AppRiver Companies”), for a total purchase price of $277.7 million, following a working capital adjustment. The purchase price included cash consideration of $273.1 million, net of cash acquired. This acquisition complements our strategy to accelerate our offerings into the cloud at the point of initial cloud application purchase and expand our customer base. We financed the acquisition with proceeds from (1) cash on hand, (2) the proceeds from the Term Loan, and (3) a private placement with an investment fund managed by True Wind Capital consisting of (i) 64,914 newly issued shares of Series A Convertible Preferred Stock, $1.00 par value per share, and (ii) 35,086 newly issued shares of Series B Convertible Preferred Stock, $1.00 par value per share, in exchange for cash consideration in an aggregate amount of $100 million (which was reduced by $3 million in True Wind Capital’s costs that were reimbursed by the Company). AppRiver is a channel-first provider of cloud-based cyber security and productivity services, offering web protection, email encryption, secure archiving, and email continuity solutions. AppRiver also provides Microsoft Office 365 and Secure Hosted Exchange services, which serve as an effective lead generation tool for AppRiver’s solutions. The acquisition of AppRiver can accelerate our offerings into the cloud at the point of initial cloud application purchase. Because AppRiver currently services over 60,000 worldwide customers using a network of 4,500 Managed Service Providers, this acquisition can also help us expand our customer base. The Company incurred $10.7 million in acquisition-related costs which included $1.1 million and $9.6 million recorded within operating expenses for the twelve months ended December 31, 2018, and for the twelve months ended December 31, 2019. Revenue from AppRiver was $97.8 million for the twelve months ended December 31, 2019, and due to the continued integration of the combined businesses, it was impracticable to determine earnings attributable to AppRiver. We accounted for the acquisition as the purchase of a business and recorded the excess purchase price as goodwill. The goodwill from this transaction is not yet finalized. The majority of the goodwill balance is expected to be deductible for tax purposes. The intangible assets we acquired from AppRiver consist of customer relationships, vendor relationships, trademarks/names, and internally developed software, which we are amortizing over 8 years, 3 years, 10 years, and 5-6 years, respectively. The results of operations and the provisional fair values of the acquired assets and liabilities have been included in the accompanying condensed consolidated financial statements since the AppRiver acquisition closed on February 20, 2019. The following table summarizes the current estimated fair value of acquired assets and liabilities: (In thousands) Estimated Fair Value Assets: Current assets $ 12,200 Property and equipment 3,235 ROU assets 8,778 Customer relationships 91,000 Vendor relationships 1,000 Trademark/Names 4,400 Internally developed software 41,100 Deferred tax asset 3,453 Goodwill 147,518 Total assets 312,684 Liabilities: Current liabilities $ 13,378 Deferred revenue 12,424 Operating lease liabilities 9,178 Total liabilities 34,980 Net assets recorded $ 277,704 Erado On April 2, 2018, the Company acquired all the outstanding capital stock of CM2.COM, Inc., d/b/a Erado (“Erado”) for a total purchase price of $14.4 million, including cash consideration of $11.8 million, net of cash acquired. The purchase of Erado strengthens Zix’s comprehensive archiving solutions with unified archiving, supervision, security, and messaging solutions for customers that demand bundled services. Erado’s long standing focus on helping its customers comply with FINRA and SEC regulations will help further strengthen Zix’s offering for customers with compliance requirements. This acquisition also expands Zix’s cloud-based email archiving capabilities into more than 50 content channels, including social media, instant message, mobile, web, audio, and video. The purchase price includes a holdback of $2.3 million for the satisfaction of certain indemnification claims by the Company, if any, during the two-year period following the closing of the acquisition. An amount equal to $1.1 million of the holdback amount, less any amounts paid or otherwise subject to an outstanding claim for indemnification, was released to the selling shareholders upon the one year anniversary of the closing of the acquisition, and the balance of the holdback amount, if any, will be distributed to the Selling Shareholders following the two year anniversary of the closing of the acquisition. The Company incurred $334 thousand in acquisition-related costs which were recorded within operating expenses during the twelve months ended December 30, 2018. We accounted for the acquisition as the purchase of a business and recorded the excess purchase price as goodwill. The goodwill from this transaction is deductible for tax purposes. The intangible assets we acquired from Erado consist of trademarks, internally developed software, and customer relationships, which we are amortizing over an estimated useful life of 5 years, 10 years, and 15 years, respectively. The results of operations and the estimated fair values of the acquired assets and liabilities have been included in the accompanying consolidated financial statements since our April 2, 2018, acquisition date. Revenue from Erado was $3.8 million for the twelve months ended December 31, 2019. Revenue was $2.1 million for the twelve months ended December 31, 2018, since the acquisition date. Due to the continued integration of the combined businesses, it was impracticable to determine the earnings. The following table summarizes the estimated fair value of acquired assets and liabilities: (In thousands) Estimated Fair Value Assets: Current assets $ 848 Property and equipment 169 Trademark/names 260 Technology 3,030 Customer relationships 4,760 Goodwill 6,215 Total assets 15,282 Liabilities: Deferred revenue $ 809 Other current liabilities 93 Total liabilities 902 Net assets recorded $ 14,380 Entelligence Messaging Server On September 13, 2017, the Company acquired Entelligence Messaging Server (“EMS”) technology, an email encryption solution, and the related business from Entrust Datacard Corporation for a cash purchase price of $1.7 million. Our acquisition of EMS strengthens our email encryption suite by offering enterprise-centric capabilities, such as advanced message tracking, PDF statement delivery, high availability on-premises architecture and standards-based end-to-end encryption. The Company incurred $58 thousand and $59 thousand in acquisition-related costs which were recorded within operating expenses for the year ended December 31, 2018 and 2017, respectively. We accounted for the acquisition as the purchase of a business and recorded the excess purchase price as goodwill. The goodwill from this transaction is deductible for tax purposes. The results of operations and the estimated fair values of the acquired assets and liabilities assumed have been included in the accompanying consolidated financial statements since our September 13, 2017, acquisition date. Revenue from EMS was not material for the years ended December 31, 2019, 2018 and 2017, respectively, and due to the continued integration of the combined businesses, it was impracticable to determine the earnings. The following table summarizes the estimated fair value of acquired assets and liabilities: (In thousands) Estimated Fair Value Assets: Trademark/names $ 140 Technology 550 Customer relationships 230 Goodwill 1,063 Total assets 1,983 Liabilities: Deferred revenue $ 333 Total liabilities 333 Net assets recorded $ 1,650 Greenview Data, Inc. On March 15, 2017, the Company acquired all of the outstanding capital stock of Greenview Data, Inc. (“Greenview”), a provider of antivirus, anti-spam, and archiving products, for a total purchase price of $7.7 million, including cash consideration of $6.7 million, subject to a customary post-closing adjustment for working capital. Our acquisition of Greenview addresses increasing buyer demand for email security bundles by adding these capabilities to our existing portfolio of encryption services. Of the cash consideration paid, $650 thousand was deposited into an escrow account for the satisfaction of certain indemnification claims of the Company, if any, during the two-year period following the closing of the acquisition, after which the balance, if any, will be distributed to the selling shareholders. Because sales of Greenview products met certain sales milestones by December 31, 2018 and by December 31, 2017, the Company was contractually obligated to pay earn-out consideration in cash of $800 thousand in each of the first quarters in 2019 and 2018. Contingent consideration is considered a Level 3 fair value measurement. We accounted for the acquisition as the purchase of a business and recorded the excess purchase price as goodwill. The goodwill from this transaction is not deductible for tax purposes. The intangible assets we acquired from Greenview consist of trademarks, internally developed software, and customer relationships, which we are amortizing over an estimated useful life of 5 years, 10 years, and 15 years, respectively. The results of operations and the estimated fair values of the acquired assets and liabilities assumed have been included in the accompanying consolidated financial statements since our March 15, 2017, acquisition date. The Company incurred $476 thousand and $427 thousand in acquisition-related costs in which was recorded within operating expenses for the year ended December 31, 2018 and 2017, respectively. Due to the integration of the combined businesses, it was impracticable to determine revenue for the year ended December 31, 2019. Revenue from Greenview was $3.4 million and $2.4 million for the year ended December 31, 2018 and 2017, respectively. Due to the continued integration of the combined businesses, it was impracticable to determine the earnings for the years ended December 31, 2019, 2018, or 2017. The following table summarizes the estimated fair value of acquired assets and liabilities: (In thousands) Estimated Fair Value Assets: Current assets $ 334 Property and equipment 249 Trademark/names 170 Technology 1,990 Customer relationships 2,880 Goodwill 4,343 Total assets 9,966 Liabilities: Deferred revenue $ 537 Other current liabilities 124 Deferred tax liability 1,609 Total liabilities 2,270 Net assets recorded $ 7,696 Pro Forma Financial Information (Unaudited) The following unaudited pro forma financial information presents the combined results of operations for the twelve month periods ending December 31, 2019, and 2018, respectively, as though the DeliverySlip, AppRiver, Erado, EMS and Greenview acquisitions that occurred during the reporting period had occurred as of the beginning of the earliest period presented, with adjustments to give effect to pro forma events that are directly attributable to the acquisition, such as amortization expense of intangible assets and acquisition-related transaction costs. These unaudited pro forma results are presented for information purposes only and are not necessarily indicative of what the actual results of operations of the combined company would have been if the acquisition had occurred at the beginning of the earliest period presented, nor are they indicative of future results of operations: Twelve Months Ended December 31, (In thousands, except per share data) 2019 2018 Revenues $ 194,313 $ 162,610 Net income (loss) 19,783 19,207 Basic income (loss) per common share $ 0.17 $ 0.20 Diluted income (loss) per common share $ 0.17 $ 0.20 |
Quarterly Results of Operations
Quarterly Results of Operations (Unaudited) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Results of Operations (Unaudited) | 23. Quarterly Results of Operations (Unaudited) The following is a summary of the quarterly results of operations for the years ended December 31, 2019 and 2018: Quarter Ended (In thousands except per share data) March 31 June 30 September 30 December 31 2019 Revenues $ 29,300 $ 45,916 $ 47,833 $ 50,380 Gross margin 18,161 25,612 26,411 26,337 Net income (loss) (6,265 ) (3,706 ) (1,597 ) (3,079 ) Basic net income (loss) attributable to common stockholders* (0.17 ) (0.13 ) (0.07 ) (0.10 ) Diluted net income (loss) attributable to common stockholders* (0.17 ) (0.13 ) (0.07 ) (0.10 ) Comprehensive (Loss) Income (6,297 ) (3,762 ) (1,562 ) (2,812 ) 2018 Revenues $ 16,654 $ 17,500 $ 17,876 $ 18,448 Gross margin 13,140 13,694 14,006 14,451 Net income (loss) 1,892 1,840 2,455 9,257 Basic net income (loss) per common share* 0.04 0.04 0.05 0.18 Diluted net income (loss) per common share* 0.04 0.03 0.05 0.17 Comprehensive Income — — — 9,224 * Net income (loss) per share is calculated independently for each quarter. The sum of Net income (loss) per share for each quarter may not equal the total Net income (loss) per share for the year due to rounding differences. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation — The accompanying consolidated financial statements include the accounts of all our wholly-owned subsidiaries and are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). All inter-company accounts and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates — The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reported period. Our significant estimates include primarily those required in the valuation or impairment analysis of goodwill and intangibles, property and equipment, revenue recognition, amortization period of our commission amortization, allowances for doubtful accounts, stock-based compensation, litigation accruals, valuation allowances for deferred tax assets and tax accruals. Although we believe that adequate accruals have been made for unsettled issues, additional gains or losses could occur in future years from resolutions of outstanding matters. Actual results could differ materially from original estimates. |
Cash Equivalents | Cash Equivalents — Cash investments with maturities of three months or less when purchased are considered cash equivalents |
Fair Value of Financial Instruments | Fair Value of Financial Instruments —The Company does not measure the fair value of any financial instrument other than cash equivalents, options, and other equity awards. The carrying values of other financial instruments (receivables and accounts payable) are not recorded at fair value but approximate fair values primarily due to their short-term nature. The carrying values of other current assets and accrued expenses are also not recorded at fair value, but approximate fair values primarily due to their short-term nature. In addition, the Company measures its long-term debt at fair value which approximates book value as the long-term debt bears market rate. |
Valuation of Property and Equipment | Valuation of Property and Equipment — The accounting policies and estimates relating to property and equipment are considered significant because of the potential impact that impairment, obsolescence, or change in an asset’s useful life could have on the Company’s operating results. We record an impairment charge on the assets to be held and used when we determine based upon certain triggering events that the carrying value of property and equipment may not be recoverable based on expected undiscounted cash flows attributable to such assets. The amount of a potential impairment is determined by comparing the carrying amount of the asset to either the value determined from a projected discounted cash flow method, using a discount rate that is considered to be commensurate with the risk inherent in the Company’s current business model or the estimated fair market value. Assumptions are made with respect to future net cash flows expected to be generated by the related asset. An impairment charge would be recorded for an amount by which the carrying value of the asset exceeded the discounted projected net cash flows or estimated fair market value. Also, even where a current impairment charge is not necessary, the remaining useful lives are evaluated. No impairment was recorded for any of the periods presented. Property and equipment are recorded at cost and depreciated or amortized using the straight-line method over their estimated useful lives as follows: computer and office equipment and software — three years; leasehold improvements — the shorter of five years or the lease term; and furniture and fixtures — five years. We recorded a depreciation expense of $5.0 million for the year ended December 31, 2019. We allocated $4.0 million of the expense to cost of revenue, $522 thousand to research and development expense, and $482 thousand to selling, marketing, and general and administrative expenses. |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets — We account for the valuation of goodwill and other intangible assets after classifying intangible assets into three categories: (1) intangible assets with finite lives subject to amortization; (2) intangible assets with indefinite lives not subject to amortization; and (3) goodwill. For intangible assets with finite lives, tests for impairment must be performed if conditions exist that indicate the carrying value may not be recoverable. For intangible assets with indefinite lives and goodwill, tests for impairment must be performed at least annually or more frequently if events or circumstances indicate that assets might be impaired. Goodwill was $171.2 million, or 41%, and $13.8 million, or 13%, of total assets as of December 31, 2019 and 2018, respectively. We evaluate the goodwill for impairment annually in the fourth quarter, or when there is reason to believe that the value has been diminished or impaired. Evaluations for possible impairment are based upon a comparison of the estimated fair value of the reporting unit to which the goodwill has been assigned, versus the sum of the carrying value of the assets and liabilities of that unit including the assigned goodwill value. We include our entire Company as the reporting unit. The fair values used in this evaluation are estimated based on the Company’s market capitalization, which is based on the outstanding stock and market price of the stock. Impairment is deemed to exist if the net book value of the unit exceeds its estimated fair value. No impairment was recorded for any of the periods presented. Our intangible assets with finite lives are amortized using a straight line basis over their economic useful lives. |
Deferred Tax Assets | Deferred Tax Assets — Deferred tax assets are recognized if it is “more likely than not” that the benefit of our deferred tax assets will be realized on future federal or state income tax returns. At December 31, 2019, we provided a valuation allowance against a significant portion, $22.5 million, of our accumulated deferred tax assets, reflecting our historical losses and the uncertainty of future taxable income sufficient to utilize net operating loss carryforwards prior to their expiration. Our total deferred tax assets not subject to a valuation allowance are valued at $36.6 million, and consist of $30.8 million for federal net operating loss carryforwards, $3.2 million relating to temporary timing differences between U.S. GAAP and tax-related expense, $2.2 million relating to U.S. state income tax credits, and $337 thousand related to Alternative Minimum Tax credits. If our U.S. taxable income increases from its current level in a future period or if the facts and circumstances on which our estimates and assumptions are based were to change, thereby impacting the likelihood of realizing our deferred tax assets, judgment would have to be applied in determining the amount of valuation allowance no longer required. Reversal of all or a part of this valuation allowance could have a significant positive impact on operating results in the period that it becomes more likely than not that certain of the Company’s deferred tax assets will be realized. Alternatively, should our future income decrease from current levels, a resulting increase to all or a part of this valuation allowance could have a significant negative impact on our operating results |
Uncertain Tax Positions | Uncertain Tax Positions — Our Company recognizes and measures uncertain tax positions using a two-step approach. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement. |
Right of Use Assets and Lease Obligations | Right-of-use Assets and Lease Obligations — On January 1, 2019, we adopted Accounting Standards Update No. 2016-02, Leases Topic 842) (ASU 2016-02) using the modified retrospective transition approach by applying the new standard to all leases existing at the date of initial application. We elected the package of practical expedients permitted under the transition guidance, which allowed us to carryforward our historical lease classification, our assessment on whether a contract was or contains a lease, and our initial direct costs for any leases that existed prior to January 1, 2019. The first package of practical expedients only can be applied if lease assessment was correct under ASC 840 which defines a lease as an arrangement conveying the right to use property, plant, or equipment usually for a stated period of time. Historically, we didn’t perform the embedded lease assessment under ASC 840 as such we identified lease components of a service contract as required by ASC 842 upon adoption. We did not elect the hindsight practical expedient in determining the lease and in assessing impairment of our right-of-use assets. We also elected to combine our lease and non-lease components and to keep leases with an initial term of 12 months or less off the balance sheet and recognize the associated lease payments in the consolidated statements of comprehensive income (loss) on a straight-line basis over the lease term. Additionally, for certain equipment leases, we apply a portfolio approach to effectively account for the finance lease right-of-use (ROU) assets and lease liabilities. Upon adoption, we recognized total ROU assets of $4.8 million, with corresponding lease liabilities of $6.0 million on the consolidated balance sheets. The ROU assets include adjustments for deferred rent liabilities. The adoption did not impact our beginning retained earnings, or our prior year consolidated statements of comprehensive income (loss) and statements of cash flows. Under Topic 842, we determine if an arrangement is a lease at inception. ROU assets and lease liabilities are recognized at commencement date based on the present value of remaining lease payments over the lease term. For this purpose, we consider only payments that are fixed and determinable at the time of commencement. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Our incremental borrowing rate is the financing rate of our long-term debt at the commencement date. The ROU asset also includes any lease payments made prior to commencement and is recorded net of any lease incentives received. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise such options. When determining the probability of exercising such options, we consider contract-based, asset-based, entity-based, and market-based factors. Our lease agreements may contain variable costs such as common area maintenance, insurance, real estate taxes or other costs. Variable lease costs are expensed as incurred on the consolidated statements of income. Our lease agreements generally do not contain any residual value guarantees or restrictive covenants. Operating leases are included in operating lease assets, other current liabilities and noncurrent lease liabilities on our consolidated balance sheets. Finance leases are included in property and equipment, other current liabilities and noncurrent lease liabilities on our consolidated balance sheets. |
Revenue Recognition | Revenue Recognition — In May 2014, The Financial Accounting Standards Board (“FASB”) issued ASC 606 which requires revenue recognition when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled to those goods and services. The standard became effective for us in 2018 but did not have a material impact to our revenue recognition process. We earn our revenue from subscription fees for rights related to the use of our software. Approximately 73% of our revenue in 2019 was derived from hosted solutions. While some contracts include one or more performance obligations, the revenue recognition pattern generally is not impacted by separate allocations of these obligations because the services are generally satisfied over the same period of time and revenue is recognized ratably over the contract term. Our subscription terms historically have ranged from one to five years. We are increasingly moving to a monthly subscription model. This shift has been largely driven by our recent acquisition activity, including AppRiver. As we further integrate our business, we expect to focus on a monthly subscription model. Revenue is recognized by applying the following steps: • Step 1: Identify the contract(s) with a customer, • Step 2: Identify the performance obligations in the contract, • Step 3: Determine the transaction price • Step 4: Allocate the transaction price to the performance obligations in the contract, and • Step 5: Recognize revenue when (or as) the performance obligation is satisfied. Step 1: Identify the contract(s) with a customer: We consider the terms and conditions of the contract and our customary business practice in identifying our contracts. We determine we have a contract with a customer when the contract is approved, we can identify each party’s rights regarding the services and products transferred, we can identify the payment terms for the services and products, the contract has commercial substance, and it is probable we will be paid. Step 2: Identify the performance obligations in the contract: ASC 606 requires identification and disclosure of performance obligations within a revenue contract. A good or service is considered distinct if the customer can both benefit from the good or service on its own or with other resources that are readily available to the customer, and the promise to transfer the good or service is separately identifiable from other promises in the contract. Step 3: Determine the transaction price: The transaction price is determined based on the consideration we expect to be entitled to receive in exchange for transferring goods and services to the customer. We include variable consideration in the transaction price if we view it as probable that a significant future reduction of cumulative revenue under the contract will not occur. Step 4: Allocate the transaction price to the performance obligations in the contract: We allocate transaction prices to each performance obligation based on the stand-alone selling price of our component services. Step 5: Recognize revenue when (or as) the performance obligation is satisfied: We begin recognize revenue when the customer obtains control of the product or services, at the amount allocated to the satisfied performance obligation. Our performance obligations are generally satisfied over time. While some contracts include one or more performance obligations (including the combined elements noted above along with additional ongoing customer support and other hosted services), the revenue recognition pattern generally is not impacted by the separate allocations of these obligations because the services are generally satisfied over the same period of time and revenue is recognized over the contract period. Discounts provided to customers are recorded as reductions in revenue. |
Commission Amortization | Commission Amortization — We amortize our commission costs to expense on a systemic basis over the period of expected benefit to the customer. Determination of the amortization period requires significant judgement. We apply the practical expedient noted in ASC 606-10-10-4 to account for our commission costs and related amortizations at the portfolio level. Additionally, the Company has evaluated commissions earned upon contract renewal as compared to initial commissions paid and determined that because commissions paid were not reasonably proportional to their respective contract values, our renewal commissions could not be considered commensurate with the initial commissions paid. We considered our average contract term length and historical customer retention rates to determine an average length of our customer relationships. We also concluded our add-on sales generally occur halfway into our customer relationships and evaluated our average customer renewal terms. Based on these factors we have determined that 8 years, 4 years and 18 months are the appropriate amortization periods to our new, add-on, and renewal sales commission expenses, respectively. We also perform subsequent assessments for impairment of the related deferred cost asset when indicators present. Following our acquisition of AppRiver in February 2019, we additionally evaluated AppRiver’s sales program to determine whether capitalization of these expenses was appropriate. While we determined certain costs to acquire met the capitalization criteria, we also determined renewal commissions earned were commensurate to the initial sales. Based on AppRiver’s primarily month-to-month commitments the Company has chosen to apply the practical expedient approach to immediately recognize commission expenses associated with the AppRiver program. |
Internal Use Software | Internal Use Software — The Company capitalizes costs related to its cloud email security, productivity and compliance solutions and certain projects for internal use incurred during the application development stage. Costs related to preliminary project activities and post implementation activities are expensed as incurred. Internal-use software is amortized on a straight-line basis over its estimated useful life, which is generally three years. Management evaluates the useful lives of these assets on an annual basis and tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets. In 2019, we capitalized $8.2 million of costs related to internal-use software. The Company expects our capitalization of these costs to increase in the future. |
Advertising Expense | Advertising Expense — Advertising costs are expensed as incurred. Our operations include advertising expense of $4.3 million, $1.3 million, and $1.5 million in 2019, 2018, and 2017, respectively |
Stock-Based Compensation | Stock-Based Compensation — We currently use the straight-line amortization method for recognizing stock option and restricted stock compensation costs. The measurement and recognition of compensation expense for all share-based payment awards made to our employees and directors are based on the estimated fair value of the awards on the grant dates. The grant date fair value is estimated using either an option-pricing model which is consistent with the terms of the award or a market observed price, if such a price exists. Such cost is recognized over the period during which an employee or director is required to provide service in exchange for the award, i.e., “the requisite service period” (which is usually the vesting period). We also estimate the number of instruments that will ultimately be earned, rather than accounting for forfeitures as they occur. |
Earnings Per Share ("EPS") | Earnings Per Share (“EPS”) — Basic EPS is based on the weighted average number of common shares outstanding during each period. Diluted EPS adjusts Basic EPS for the effects of dilutive common stock equivalents outstanding during each period using the treasury stock method. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements Leases In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). Topic 842 requires companies to generally recognize on the balance sheet operating and financing lease liabilities and corresponding right-of-use assets. We elected the available practical expedients and adopted ASC 842 effective January 1, 2019, prospectively. The adoption of this standard resulted in the recognition of right-to-use assets and lease liabilities of $4.8 million and $6.0 million, with no material impact on the results of operations and cash flows. See below Note 8 “Leases" for additional information regarding our leases. Recent Accounting Pronouncements Not Yet Adopted Credit Losses In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standard Update No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (ASU 2016-13), which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. ASU 2016-13 replaces the existing incurred loss impairment model with a forward-looking expected credit loss model which will result in earlier recognition of credit losses. We will adopt the new standard effective January 1, 2020 and do not expect the adoption of this guidance to have a material impact on our consolidated financial statements. Intangibles – Goodwill and Other In January 2017, the FASB issued Accounting Standards Update No. 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (ASU 2017-04) to simplify the subsequent measurement of goodwill. The guidance removes Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. A goodwill impairment will now be the amount by which a reporting unit's carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. The accounting standard will be effective for reporting periods beginning after December 15, 2019 and is not expected to have a material impact on the Company's consolidated financial position, results of operations and cash flows. Income Taxes |
Fair Value Measurements | FASB guidance regarding fair value measurement establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets for identical assets or liabilities; Level 2, defined as inputs other than quoted prices for similar assets and liabilities in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs for which little or no market data exists, therefore requiring an entity to develop its own assumptions. |
Stock Options and Stock-Based_2
Stock Options and Stock-Based Employee Compensation (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of Common Stock Options Outstanding | Below is a summary of common stock options outstanding at December 31, 2019: Authorized Shares Options Outstanding Options Vested Available for Grant Employee and Director Stock Option Plans: 2004 Stock Option Plan 5,000,000 105,000 105,000 — 2006 Director’s Stock Option Plan 1,100,000 25,000 25,000 — 2012 Incentive Plan 6,300,000 626,385 595,135 — 2018 Omnibus Incentive Plan 6,000,000 — — 4,180,776 Total 18,400,000 756,385 725,135 4,180,776 |
Summary of Total Stock-based Compensation Expense Resulting from Stock Options, Restricted Stock, RSUs, Performance RSUs, and Performance Stock | For the twelve months ended December 31, 2019, 2018, and 2017, respectively, the total stock-based compensation expense resulting from stock options, Restricted Stock, RSUs, Performance RSUs, and Performance Stock was recorded to the following line items of our consolidated statements of comprehensive income (loss): Year Ended December 31, (In thousands) 2019 2018 2017 Cost of revenue $ 569 $ 327 $ 304 Research and development expenses 1,056 469 374 Selling, general and administrative expenses 4,626 2,522 2,196 Stock-based compensation expense $ 6,251 $ 3,318 $ 2,874 |
Weighted Average Assumptions Applied in Determining Fair Value of Options Granted | The following weighted average assumptions were applied in determining the fair value of options granted during the respective periods: Year Ended December 31, 2019 2018 2017 Risk-free interest rate — — 2.02 % Expected option life (years) — — 5.7 Expected stock price volatility — — 42 % Expected dividend yield — — — Fair value of options granted $ — $ — $ 2.06 |
Summary of All Stock Option Transactions | The following is a summary of all stock option transactions for the three years ended December 31, 2019: Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (Yrs) Outstanding at January 1, 2017 1,960,279 $ 3.78 Granted at market price 30,750 $ 4.96 Cancelled or expired (37,412 ) $ 4.71 Exercised (932,303 ) $ 4.51 Outstanding at December 31, 2017 1,021,314 $ 3.11 Granted at market price — $ 0.00 Cancelled or expired (7,480 ) $ 4.04 Exercised (90,011 ) $ 1.83 Outstanding at December 31, 2018 923,823 $ 3.23 Granted at market price — $ 0.00 Cancelled or expired — $ 0.00 Exercised (167,438 ) $ 2.48 Outstanding at December 31, 2019 756,385 $ 3.39 4.46 Options exercisable at December 31, 2019 725,135 $ 3.38 4.38 |
Summarized Information about Stock Options Outstanding by Range of Exercise Prices | Summarized information about stock options outstanding at December 31, 2019, is as follows: Options Outstanding Options Exercisable Range of Exercise Prices Number Outstanding Weighted Average Remaining Contractual Life Weighted Average Exercise Price Number Exercisable Weighted Average Exercise Price $2.00 - $3.49 294,375 2.60 $ 2.76 294,375 $ 2.76 $3.50 - $4.99 462,010 5.64 $ 3.80 430,760 $ 3.80 756,385 4.46 $ 3.39 725,135 $ 3.38 |
Summary of All Restricted Stock Activity | The following is a summary of all Restricted Stock activity during the three years ended December 31, 2019: Restricted Shares Weighted Average Fair Value Non-vested restricted stock at January 1, 2017 689,242 $ 3.94 Granted at market price 665,623 $ 5.02 Vested (251,956 ) $ 4.00 Cancelled (20,000 ) $ 4.96 Non-vested restricted stock at December 31, 2017 1,082,909 $ 4.57 Granted at market price 842,546 $ 4.53 Vested (419,452 ) $ 4.44 Cancelled (151,003 ) $ 4.77 Non-vested restricted stock at December 31, 2018 1,355,000 $ 4.71 Granted at market price 1,236,579 $ 7.36 Vested (560,497 ) $ 4.66 Cancelled (119,000 ) $ 7.00 Non-vested restricted stock at December 31, 2019 1,912,082 $ 6.26 |
Summary of All Restricted Stock Unit Activity | The following is a summary of all RSU activity during the three years ended December 31, 2019: Restricted Stock Units Weighted Average Fair Value Non-vested restricted stock units at January 1, 2017 158,086 $ 3.92 Granted at market price 54,500 $ 4.96 Vested (126,167 ) $ 4.07 Cancelled — $ — Non-vested restricted stock units at December 31, 2017 86,419 $ 4.36 Granted at market price 36,500 $ 4.57 Vested (50,751 ) $ 4.18 Cancelled — $ — Non-vested restricted stock units at December 31, 2018 72,168 $ 4.59 Granted at market price 131,294 $ 8.19 Vested (63,387 ) $ 5.21 Cancelled — $ — Non-vested restricted stock units at December 31, 2019 140,075 $ 7.59 |
Summary of All Performance RSU Activity | The following is a summary of all Performance RSU activity during the three years ended December 31, 2019: Restricted Stock Units Weighted Average Fair Value Non-vested performance RSUs at January 1, 2017 90,831 $ 3.81 Granted at market price 11,500 $ 4.96 Vested (20,999 ) $ 4.08 Forfeited (41,668 ) $ 3.83 Non-vested performance RSUs at December 31, 2017 39,664 $ 3.98 Granted at market price 5,500 $ 4.04 Vested (32,665 ) $ 3.91 Forfeited — $ 0.00 Non-vested performance RSUs at December 31, 2018 12,499 $ 4.20 Granted at market price 50,000 $ 8.84 Vested (7,000 ) $ 4.08 Forfeited — $ 0.00 Non-vested performance RSUs at December 31, 2019 55,499 $ 8.39 |
Summary of All Performance Stock Activity | The following is a summary of all Performance Stock activity during the three years ended December 31, 2019: Restricted Stock Units Weighted Average Fair Value Non-vested performance stock at January 1, 2017 121,500 $ 3.61 Granted at market price 112,112 $ 4.96 Vested — — Forfeited (40,502 ) $ 3.61 Non-vested performance stock at December 31, 2017 193,110 $ 4.39 Granted at market price 153,723 $ 4.04 Vested (77,874 ) $ 4.26 Forfeited (13,333 ) $ 4.50 Non-vested performance stock at December 31, 2018 255,626 $ 4.22 Granted at market price 417,500 $ 7.15 Vested (123,558 ) $ 4.15 Forfeited (75,000 ) $ 7.15 Non-vested performance stock at December 31, 2019 474,568 $ 6.38 |
Supplemental Cash Flow Inform_2
Supplemental Cash Flow Information (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information Relating to Interest and Taxes | Supplemental information relating to interest and taxes: Year Ended December 31, (In thousands) 2019 2018 2017 Interest payments $ 9,181 $ — $ — Income tax payments $ 493 $ 1,115 $ 636 |
Receivables, Net (Tables)
Receivables, Net (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Receivables [Abstract] | |
Summary of Net Receivables | (In thousands) December 31, 2019 2018 Gross accounts receivables $ 21,193 $ 14,135 Allowance for returns and doubtful accounts (265 ) (277 ) Unpaid portion of deferred revenue (10,847 ) (10,670 ) Note receivable 458 458 Allowance for note receivable (458 ) (458 ) Receivables, net $ 10,081 $ 3,188 |
Prepaid and other current ass_2
Prepaid and other current assets (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract] | |
Schedule of Prepaid and Other Current Assets | (In thousands) December 31, 2019 2018 Prepaid insurance, maintenance, software licenses and other $ 4,881 $ 2,460 Tax-related 103 716 Prepaid and other current assets $ 4,984 $ 3,176 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Property Plant And Equipment [Abstract] | |
Summary of Property and Equipment | (In thousands) December 31, 2019 2018 Computer and office equipment and software $ 30,335 $ 26,762 Leasehold improvements 7,794 6,834 Furniture and fixtures 2,733 2,181 Finance lease right-of-use assets 3,362 $ — 44,224 35,777 Less accumulated depreciation (35,633 ) (31,853 ) Property and equipment, net $ 8,591 $ 3,924 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Schedule of Components of Lease Costs | The components of lease costs are as follows: Year Ended December 31, (In thousands) 2019 Finance lease costs: Amortization of right-of-use asset $ 1,330 Interest on lease liabilities 151 Operating lease costs 3,490 Short-term lease costs 2,236 Variable lease costs 773 Total lease costs $ 7,980 |
Schedule of Supplemental Cash Flow Information Related to Leases | Supplemental cash flow information related to leases is as follows: Year Ended December 31, (In thousands) 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows related to operating leases $ 2,410 Operating cash flows related to finance leases 151 Financing cash flows related to finance leases 1,707 Right-of-use assets obtained in exchange for lease obligations: Operating leases 7,999 Finance leases 3,362 |
Schedule of Supplemental Balance Sheet Information Related to Lease | Supplemental balance sheet information related to leases is as follows: December 31, (In thousands) Balance Sheet Classification 2019 Operating Leases Operating lease right-of-use asset Operating lease assets $ 10,128 Total operating lease assets $ 10,128 December 31, (In thousands) Balance Sheet Classification 2019 Finance Leases Finance lease right-of-use assets $ 3,362 Accumulated depreciation - finance leases (1,320 ) Finance lease right-of-use assets, net Property and equipment, net $ 2,042 |
Schedule of Weighted Average Remaining Lease Term and Weighted Average Discount Rate | Weighted average remaining lease term and weighted average discount rate are as follows: Weighted Average Remaining Lease Term (Years) Operating leases 4.18 Finance leases 1.92 Weighted Average Discount Rate Operating leases 5.86 % Finance leases 6.15 % |
Schedule of Maturities of Lease Liabilities | Maturities of lease liabilities are as follows: Payments Due by Year Ending December 31, 2020 (In thousands) Total Year 1 Years 2 & 3 Years 4 & 5 Beyond 5 Years Operating leases $ 12,807 $ 3,519 $ 5,102 $ 4,186 $ — Less imputed interest (1,471 ) Total $ 11,336 Finance leases $ 2,165 $ 1,423 $ 736 $ 6 $ — Less imputed interest (111 ) Total $ 2,054 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill for the years ended December 31, 2019 and 2018, are as follows: Year Ended December 31, (In thousands) 2019 2018 Opening balance $ 13,783 $ 8,469 Additions 157,121 6,215 Acquisition adjustments — (901 ) Effect of currency translation adjustment 305 — Goodwill $ 171,209 $ 13,783 |
Schedule of Other Intangible Assets | Our other intangible assets consist of the following: December 31, 2019 (In thousands) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Internal use software $ 1,456 $ (504 ) $ 952 Internally-developed hosting arrangement 9,487 (1,258 ) 8,229 Trademarks and other 5,091 (587 ) 4,504 Technology 52,905 (9,836 ) 43,069 Customer relationships 98,879 (10,597 ) 88,282 Vendor relationship 1,000 (278 ) 722 Effect of currency translation adjustment 118 Intangible assets, net $ 168,818 $ (23,060 ) $ 145,876 December 31, 2018 (In thousands) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Internal use software $ 1,189 $ (162 ) $ 1,027 Internally-developed hosting arrangement 1,520 (77 ) 1,443 Trademarks and other 691 (113 ) 578 Technology 7,604 (2,678 ) 4,926 Customer relationships 7,870 (593 ) 7,277 Intangible assets, net $ 18,874 $ (3,623 ) $ 15,251 |
Schedule of Amortization of Intangible Assets | For the twelve months ended December 31, 2019, amortization of intangible assets was recorded to the following line items of our consolidated statements of operations: Year Ended December 31, (In thousands) 2019 Cost of revenue $ 7,132 Research and development expenses 1,478 Selling, general and administrative expenses 10,827 Amortization of intangible assets $ 19,437 |
Summary of Estimated Future Amortization Expense | The following table summarizes our estimated future amortization expense: (In thousands) 2020 2021 2022 2023 2024 Thereafter Total Amortization expense $ 25,580 25,506 $ 23,686 $ 21,095 $ 16,906 $ 32,985 $ 145,758 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Payables And Accruals [Abstract] | |
Summary of Accrued Expenses | December 31, (In thousands) 2019 2018 Employee compensation and benefits $ 7,231 $ 5,122 Professional fees 1,576 1,289 Taxes 575 113 Other 4,350 3,223 Total accrued expenses $ 13,732 $ 9,747 |
Long-term Debt (Tables)
Long-term Debt (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Term Loan [Member] | |
Schedule of Future Scheduled Principal Payments | Future scheduled principal payments under the Term Loan as of December 31, 2019 are as follows: (In thousands) Year Ending December 31, Amount 2020 1,750 2021 1,750 2022 1,750 2023 1,750 2024 166,688 Total 173,688 |
Senior Secured Delayed Draw Term Loan Facility [Member] | |
Schedule of Future Scheduled Principal Payments | Future scheduled principal payments under the Delayed Draw Term Loan Facility as of September 30, 2019 are as follows: (In thousands) Year Ending December 31, Amount 2020 100 2021 100 2022 100 2023 100 2024 9,550 Total 9,950 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of Reconciliation of Contingent Earn-out Liability Measured at Fair Value on Recurring Basis | The following table represents a reconciliation of our acquisition-related contingent earn-out liability measured at fair value on a recurring basis, using Level 3 inputs for the year ended December 31, 2019: (In thousands) Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Balance at December 31, 2018 $ 1,164 Additions during the period 2,303 Payments during the period (3,300 ) Adjustments to fair value during the period recorded in General and Administrative expenses 211 Balance at December 31, 2019 $ 378 |
Earnings Per Share and Potent_2
Earnings Per Share and Potential Dilution (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Computations of Basic and Diluted Earnings Per Share | The computations for basic and diluted earnings per share for the years ended December 31, 2019, 2018, and 2017, are as follows: Year Ended December 31, 2019 2018 2017 Basic weighted average shares 53,025,152 52,591,714 53,430,492 Effect of dilutive securities: Employee and director stock options — 347,167 — Restricted Stock — 409,871 — RSUs — 24,369 — Performance RSUs — 9,367 — Performance Stock — 98,807 — Potential dilutive common shares 53,025,152 53,481,295 53,430,492 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Components of Income Taxes | Components of the income taxes are as follows: (In thousands) 2019 2018 2017 Current: U.S. $ (341 ) $ (794 ) $ 183 State 216 725 (196 ) Foreign 9 71 156 Deferred Federal (4,365 ) (4,722 ) 18,461 Foreign 3 — 2 Income tax (benefit) expense $ (4,478 ) $ (4,720 ) $ 18,606 |
Schedule of Reconciliation of Tax Expense Benefit to Income Taxes Related to Continuing Operations | On December 22, 2017, the U.S. enacted the Tax Cuts and Jobs Act of 2017 (the “Tax Act”) which significantly changed U.S. tax law. The Tax Act, among other things, lowered the federal statutory corporate income tax rate from 34% to 21% effective January 1, 2018. The Company completed its assessment of the impact to 2018 noting no changes from what it disclosed in 2017. The Company’s income tax expense (benefit) for 2019, 2018 and 2017, respectively, reflect tax expense (benefit) based on statutory rates in 2019, 2018, and 2017. A reconciliation of the expected U.S. tax expense (benefit) to income taxes related to continuing operations is as follows: (In thousands) 2019 2018 2017 Expected tax expense at U.S. statutory rate $ (3,943 ) $ 2,260 $ 3,587 Change in corporate tax rate- deferreds — — 12,473 Increase (decrease) in valuations allowance (295 ) (7,841 ) — Increase (decrease) in valuations allowance- other — — 2,064 Nondeductible expense and nontaxable income (37 ) 111 890 State income taxes, net of federal benefits (507 ) 815 (129 ) Foreign income taxes 517 68 159 Other (213 ) (133 ) (438 ) Income tax (benefit) expense $ (4,478 ) $ (4,720 ) $ 18,606 |
Components of Deferred Income Taxes | Components of our U.S. deferred income taxes as of December 31, 2019 and 2018 are as follows: (In thousands) 2019 2018 Deferred tax assets: Nondeductible $ 116 $ 113 U.S. net operating loss carryforwards 49,657 46,826 State net operating loss carryforwards 572 71 Intangible assets 1,135 — Tax credit carryforwards 5,151 5,703 Stock-based compensation 1,574 976 Depreciable assets 1,209 822 Interest expense 1,611 30 Other assets 1,521 908 Total deferred tax assets 62,546 55,449 Deferred tax liabilities: Intangible assets — (1,128 ) Revenue recognition (2,976 ) (2,300 ) Prepaid expenses (997 ) (572 ) Total deferred tax assets 58,573 51,449 Less valuation allowance (22,022 ) (22,667 ) Net deferred tax assets $ 36,551 $ 28,782 |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Unaudited Pro Forma Financial Information | The following unaudited pro forma financial information presents the combined results of operations for the twelve month periods ending December 31, 2019, and 2018, respectively, as though the DeliverySlip, AppRiver, Erado, EMS and Greenview acquisitions that occurred during the reporting period had occurred as of the beginning of the earliest period presented, with adjustments to give effect to pro forma events that are directly attributable to the acquisition, such as amortization expense of intangible assets and acquisition-related transaction costs. These unaudited pro forma results are presented for information purposes only and are not necessarily indicative of what the actual results of operations of the combined company would have been if the acquisition had occurred at the beginning of the earliest period presented, nor are they indicative of future results of operations: Twelve Months Ended December 31, (In thousands, except per share data) 2019 2018 Revenues $ 194,313 $ 162,610 Net income (loss) 19,783 19,207 Basic income (loss) per common share $ 0.17 $ 0.20 Diluted income (loss) per common share $ 0.17 $ 0.20 |
Delivery Slip Inc. [Member] | |
Summary of Estimated Fair Value of Acquired Assets and Liabilities | The following table summarizes the current estimated fair value of acquired assets and liabilities: (In thousands) Provisional Fair Value Assets: Technology $ 4,200 Goodwill 9,603 Total assets 13,803 Liabilities: Deferred revenue $ 52 Total liabilities 52 Net assets recorded $ 13,751 |
AppRiver Companies [Member] | |
Summary of Estimated Fair Value of Acquired Assets and Liabilities | The following table summarizes the current estimated fair value of acquired assets and liabilities: (In thousands) Estimated Fair Value Assets: Current assets $ 12,200 Property and equipment 3,235 ROU assets 8,778 Customer relationships 91,000 Vendor relationships 1,000 Trademark/Names 4,400 Internally developed software 41,100 Deferred tax asset 3,453 Goodwill 147,518 Total assets 312,684 Liabilities: Current liabilities $ 13,378 Deferred revenue 12,424 Operating lease liabilities 9,178 Total liabilities 34,980 Net assets recorded $ 277,704 |
Erado [Member] | |
Summary of Estimated Fair Value of Acquired Assets and Liabilities | The following table summarizes the estimated fair value of acquired assets and liabilities: (In thousands) Estimated Fair Value Assets: Current assets $ 848 Property and equipment 169 Trademark/names 260 Technology 3,030 Customer relationships 4,760 Goodwill 6,215 Total assets 15,282 Liabilities: Deferred revenue $ 809 Other current liabilities 93 Total liabilities 902 Net assets recorded $ 14,380 |
Entelligence Messaging Server [Member] | |
Summary of Estimated Fair Value of Acquired Assets and Liabilities | The following table summarizes the estimated fair value of acquired assets and liabilities: (In thousands) Estimated Fair Value Assets: Trademark/names $ 140 Technology 550 Customer relationships 230 Goodwill 1,063 Total assets 1,983 Liabilities: Deferred revenue $ 333 Total liabilities 333 Net assets recorded $ 1,650 |
Greenview Data, Inc [Member] | |
Summary of Estimated Fair Value of Acquired Assets and Liabilities | The following table summarizes the estimated fair value of acquired assets and liabilities: (In thousands) Estimated Fair Value Assets: Current assets $ 334 Property and equipment 249 Trademark/names 170 Technology 1,990 Customer relationships 2,880 Goodwill 4,343 Total assets 9,966 Liabilities: Deferred revenue $ 537 Other current liabilities 124 Deferred tax liability 1,609 Total liabilities 2,270 Net assets recorded $ 7,696 |
Quarterly Results of Operatio_2
Quarterly Results of Operations (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Summary of Quarterly Results of Operations | The following is a summary of the quarterly results of operations for the years ended December 31, 2019 and 2018: Quarter Ended (In thousands except per share data) March 31 June 30 September 30 December 31 2019 Revenues $ 29,300 $ 45,916 $ 47,833 $ 50,380 Gross margin 18,161 25,612 26,411 26,337 Net income (loss) (6,265 ) (3,706 ) (1,597 ) (3,079 ) Basic net income (loss) attributable to common stockholders* (0.17 ) (0.13 ) (0.07 ) (0.10 ) Diluted net income (loss) attributable to common stockholders* (0.17 ) (0.13 ) (0.07 ) (0.10 ) Comprehensive (Loss) Income (6,297 ) (3,762 ) (1,562 ) (2,812 ) 2018 Revenues $ 16,654 $ 17,500 $ 17,876 $ 18,448 Gross margin 13,140 13,694 14,006 14,451 Net income (loss) 1,892 1,840 2,455 9,257 Basic net income (loss) per common share* 0.04 0.04 0.05 0.18 Diluted net income (loss) per common share* 0.04 0.03 0.05 0.17 Comprehensive Income — — — 9,224 * Net income (loss) per share is calculated independently for each quarter. The sum of Net income (loss) per share for each quarter may not equal the total Net income (loss) per share for the year due to rounding differences. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Schedule Of Significant Accounting Policies [Line Items] | |||
Cash investments maturities | 3 months | ||
Estimated useful lives of depreciated or amortized Property and equipment | 3 years | ||
Depreciation expense | $ 5,000,000 | $ 2,400,000 | $ 2,400,000 |
Goodwill | $ 171,209,000 | $ 13,783,000 | 8,469,000 |
Goodwill to total asset | 41.00% | 13.00% | |
Impairment | $ 0 | $ 0 | 0 |
Accumulated deferred tax assets | 22,500,000 | ||
Total deferred tax asset not subject to a valuation allowance | 36,600,000 | ||
Alternative Minimum Tax credits | 337,000 | ||
Right-to-use-assets | 10,128,000 | ||
Lease liabilities | 11,336,000 | ||
Research and development expenses | 20,431,000 | 11,323,000 | 10,980,000 |
Advertising expense | $ 4,300,000 | $ 1,300,000 | $ 1,500,000 |
Minimum [Member] | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Software subscription term | 1 year | ||
Maximum [Member] | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Software subscription term | 5 years | ||
Customer Concentration Risk [Member] | Sales Revenue Net [Member] | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Revenue in percentage | 73.00% | ||
ASU 2016-02 | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Right-to-use-assets | $ 4,800,000 | ||
Lease liabilities | 6,000,000 | ||
Federal [Member] | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Federal net operating loss carryforwards | 30,800,000 | ||
State [Member] | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Income tax credits | 2,200,000 | ||
Foreign [Member] | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Income tax credits | 3,200,000 | ||
Cost of Revenue [Member] | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Depreciation expense | 4,000,000 | ||
Research and Development Expense [Member] | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Depreciation expense | 522,000 | ||
Selling, Marketing, and General and Administrative Expenses [Member] | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Depreciation expense | $ 482,000 | ||
New Sales Commission Expenses [Member] | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Amortization period | 8 years | ||
Add-on Sales Commission Expenses [Member] | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Amortization period | 4 years | ||
Renewal Sales Commission Expenses [Member] | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Amortization period | 18 months | ||
Computer [Member] | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Estimated useful lives of depreciated or amortized Property and equipment | 3 years | ||
Office Equipment [Member] | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Estimated useful lives of depreciated or amortized Property and equipment | 3 years | ||
Software [Member] | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Estimated useful lives of depreciated or amortized Property and equipment | 3 years | ||
Research and development expenses | $ 8,200,000 | ||
Leasehold Improvements [Member] | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Estimated useful lives of depreciated or amortized Property and equipment | 5 years | ||
Furniture and Fixtures [Member] | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Estimated useful lives of depreciated or amortized Property and equipment | 5 years |
Stock Options and Stock-Based_3
Stock Options and Stock-Based Employee Compensation - Summary of Common Stock Options Outstanding (Detail) - shares | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Apr. 13, 2012 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Authorized Shares | 18,400,000 | ||||
Options Outstanding | 756,385 | 923,823 | 1,021,314 | 1,960,279 | |
Options Vested | 725,135 | ||||
Available for Grant | 4,180,776 | ||||
2004 Stock Option Plan [Member] | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Authorized Shares | 5,000,000 | ||||
Options Outstanding | 105,000 | ||||
Options Vested | 105,000 | ||||
2006 Director's Stock Option Plan [Member] | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Authorized Shares | 1,100,000 | ||||
Options Outstanding | 25,000 | ||||
Options Vested | 25,000 | ||||
2018 Omnibus Incentive Plan [Member] | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Authorized Shares | 6,000,000 | 2,700,000 | |||
Available for Grant | 4,180,776 | ||||
2012 Incentive Plan [Member] | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Authorized Shares | 6,300,000 | ||||
Options Outstanding | 626,385 | ||||
Options Vested | 595,135 |
Stock Options and Stock-Based_4
Stock Options and Stock-Based Employee Compensation - Additional Information (Detail) - USD ($) $ in Thousands | Jun. 24, 2015 | Apr. 13, 2012 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Expiry of option | 10 years | |||||
Shares available for issuance | 18,400,000 | |||||
Total unrecognized stock-based compensation related to non-vested stock-based compensation awards | $ 11,400 | |||||
The number of years over which cost is expected to be recognized | 1 year 7 months 6 days | |||||
Deferred tax assets, tax deferred expense compensation and benefits employee compensation | $ 1,200 | $ 673 | $ 824 | |||
Options granted during period | 0 | 0 | 30,750 | |||
Options outstanding | 756,385 | 923,823 | 1,021,314 | 1,960,279 | ||
Options, options exercisable | 725,135 | |||||
Number Exercisable | 725,135 | 817,573 | 832,376 | |||
Stock Options [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Aggregate intrinsic value of options exercised | $ 987 | $ 334 | ||||
Employee and Director Stock Options [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Options outstanding | 756,385 | 923,823 | ||||
Options, options exercisable | 725,135 | 817,573 | ||||
Aggregate intrinsic value of options outstanding | $ 2,600 | $ 2,300 | ||||
Aggregate intrinsic value of options exercisable | $ 2,500 | $ 2,100 | ||||
2018 Omnibus Incentive Plan [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Shares available for issuance | 2,700,000 | 6,000,000 | ||||
Additional shares underlying options outstanding | 3,600,000 | 1,327,000 | ||||
Minimum [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Vesting period of options | 3 years | |||||
Minimum [Member] | 2018 Omnibus Incentive Plan [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Vesting period of options | 3 years | 3 years | ||||
Maximum [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Vesting period of options | 4 years | |||||
Maximum [Member] | 2018 Omnibus Incentive Plan [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Vesting period of options | 4 years | 4 years |
Stock Options and Stock-Based_5
Stock Options and Stock-Based Employee Compensation - Summary of Total Stock-based Compensation Expense Resulting from Stock Options, Restricted Stock, RSUs, Performance RSUs, and Performance Stock (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | $ 6,251 | $ 3,318 | $ 2,874 |
Cost of Revenue [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | 569 | 327 | 304 |
Research and Development Expenses [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | 1,056 | 469 | 374 |
Selling, General and Administrative Expenses [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | $ 4,626 | $ 2,522 | $ 2,196 |
Stock Options and Stock-Based_6
Stock Options and Stock-Based Employee Compensation - Weighted Average Assumptions Applied in Determining Fair Value of Options Granted (Detail) | 12 Months Ended |
Dec. 31, 2017$ / shares | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Risk-free interest rate | 2.02% |
Expected option life (years) | 5 years 8 months 12 days |
Expected stock price volatility | 42.00% |
Fair value of options granted | $ 2.06 |
Stock Options and Stock-Based_7
Stock Options and Stock-Based Employee Compensation - Summary of All Stock Option Transactions (Detail) - $ / shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding Roll Forward | |||
Shares, Outstanding, Beginning Balance | 923,823 | 1,021,314 | 1,960,279 |
Shares, Granted at market price | 0 | 0 | 30,750 |
Shares, Cancelled or expired | (7,480) | (37,412) | |
Shares, Exercised | (167,438) | (90,011) | (932,303) |
Shares, Outstanding Ending Balance | 756,385 | 923,823 | 1,021,314 |
Shares, Options Exercisable | 725,135 | ||
Weighted Average Exercise Price, Outstanding, Beginning Balance | $ 3.23 | $ 3.11 | $ 3.78 |
Weighted Average Exercise Price, Granted at market price | 0 | 0 | 4.96 |
Weighted Average Exercise Price, Cancelled or expired | 0 | 4.04 | 4.71 |
Weighted Average Exercise Price, Exercised | 2.48 | 1.83 | 4.51 |
Weighted Average Exercise Price, Outstanding, Ending Balance | 3.39 | $ 3.23 | $ 3.11 |
Weighted Average Exercise Price, Options Exercisable | $ 3.38 | ||
Weighted Average Remaining Contractual Term, Outstanding | 4 years 5 months 16 days | ||
Weighted Average Remaining Contractual Term, Options exercisable | 4 years 4 months 17 days |
Stock Options and Stock-Based_8
Stock Options and Stock-Based Employee Compensation - Summarized Information about Stock Options Outstanding by Range of Exercise Prices (Detail) - $ / shares | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Schedule Of Stock Options [Line Items] | ||||
Number Outstanding | 756,385 | 923,823 | 1,021,314 | 1,960,279 |
Weighted Average Remaining Contractual Life, Options Outstanding | 4 years 5 months 16 days | |||
Weighted Average Exercise Price, Options Outstanding | $ 3.39 | |||
Number Exercisable | 725,135 | 817,573 | 832,376 | |
Weighted Average Exercise Price, Options Exercisable | $ 3.38 | |||
$2.00 - $3.49 [Member] | ||||
Schedule Of Stock Options [Line Items] | ||||
Range of Exercise Prices, Lower range | 2 | |||
Range of Exercise Prices, Upper range | $ 3.49 | |||
Number Outstanding | 294,375 | |||
Weighted Average Remaining Contractual Life, Options Outstanding | 2 years 7 months 6 days | |||
Weighted Average Exercise Price, Options Outstanding | $ 2.76 | |||
Number Exercisable | 294,375 | |||
Weighted Average Exercise Price, Options Exercisable | $ 2.76 | |||
$3.50 - $4.99 [Member] | ||||
Schedule Of Stock Options [Line Items] | ||||
Range of Exercise Prices, Lower range | 3.50 | |||
Range of Exercise Prices, Upper range | $ 4.99 | |||
Number Outstanding | 462,010 | |||
Weighted Average Remaining Contractual Life, Options Outstanding | 5 years 7 months 21 days | |||
Weighted Average Exercise Price, Options Outstanding | $ 3.80 | |||
Number Exercisable | 430,760 | |||
Weighted Average Exercise Price, Options Exercisable | $ 3.80 |
Stock Options and Stock-Based_9
Stock Options and Stock-Based Employee Compensation - Summary of All Restricted Stock Activity (Detail) - Restricted Stock [Member] - $ / shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Shares, Non-vested, Beginning balance | 1,355,000 | 1,082,909 | 689,242 |
Shares, Granted at market price | 1,236,579 | 842,546 | 665,623 |
Shares, Vested | (560,497) | (419,452) | (251,956) |
Shares, Cancelled | (119,000) | (151,003) | (20,000) |
Shares, Non-vested, Ending balance | 1,912,082 | 1,355,000 | 1,082,909 |
Weighted Average Fair Value, Non-vested, Beginning balance | $ 4.71 | $ 4.57 | $ 3.94 |
Weighted Average Fair Value, Granted at market price | 7.36 | 4.53 | 5.02 |
Weighted Average Fair Value, Vested | 4.66 | 4.44 | 4 |
Weighted Average Fair Value, Cancelled | 7 | 4.77 | 4.96 |
Weighted Average Fair Value, Non-vested, Ending balance | $ 6.26 | $ 4.71 | $ 4.57 |
Stock Options and Stock-Base_10
Stock Options and Stock-Based Employee Compensation - Summary of All Restricted Stock Unit Activity (Detail) - Restricted Stock Units (RSUs) [Member] - $ / shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Shares, Non-vested, Beginning balance | 72,168 | 86,419 | 158,086 |
Shares, Granted at market price | 131,294 | 36,500 | 54,500 |
Shares, Vested | (63,387) | (50,751) | (126,167) |
Shares, Non-vested, Ending balance | 140,075 | 72,168 | 86,419 |
Weighted Average Fair Value, Non-vested, Beginning balance | $ 4.59 | $ 4.36 | $ 3.92 |
Weighted Average Fair Value, Granted at market price | 8.19 | 4.57 | 4.96 |
Weighted Average Fair Value, Vested | 5.21 | 4.18 | 4.07 |
Weighted Average Fair Value, Non-vested, Ending balance | $ 7.59 | $ 4.59 | $ 4.36 |
Stock Options and Stock-Base_11
Stock Options and Stock-Based Employee Compensation - Summary of All Performance RSU Activity (Detail) - Non-vested Performance RSUs [Member] - $ / shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Shares, Non-vested, Beginning balance | 12,499 | 39,664 | 90,831 |
Shares, Granted at market price | 50,000 | 5,500 | 11,500 |
Shares, Vested | (7,000) | (32,665) | (20,999) |
Shares, Cancelled | (41,668) | ||
Shares, Non-vested, Ending balance | 55,499 | 12,499 | 39,664 |
Weighted Average Fair Value, Non-vested, Beginning balance | $ 4.20 | $ 3.98 | $ 3.81 |
Weighted Average Fair Value, Granted at market price | 8.84 | 4.04 | 4.96 |
Weighted Average Fair Value, Vested | 4.08 | 3.91 | 4.08 |
Weighted Average Fair Value, Cancelled | 0 | 0 | 3.83 |
Weighted Average Fair Value, Non-vested, Ending balance | $ 8.39 | $ 4.20 | $ 3.98 |
Stock Options and Stock-Base_12
Stock Options and Stock-Based Employee Compensation - Summary of All Performance Stock Activity (Details) - Performance Stock [Member] - $ / shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Shares, Non-vested, Beginning balance | 255,626 | 193,110 | 121,500 |
Shares, Granted at market price | 417,500 | 153,723 | 112,112 |
Shares, Vested | (123,558) | (77,874) | |
Shares, Cancelled | (75,000) | (13,333) | (40,502) |
Shares, Non-vested, Ending balance | 474,568 | 255,626 | 193,110 |
Weighted Average Fair Value, Non-vested, Beginning balance | $ 4.22 | $ 4.39 | $ 3.61 |
Weighted Average Fair Value, Granted at market price | 7.15 | 4.04 | 4.96 |
Weighted Average Fair Value, Vested | 4.15 | 4.26 | |
Weighted Average Fair Value, Cancelled | 7.15 | 4.50 | 3.61 |
Weighted Average Fair Value, Non-vested, Ending balance | $ 6.38 | $ 4.22 | $ 4.39 |
Supplemental Cash Flow Inform_3
Supplemental Cash Flow Information - Supplemental Cash Flow Information Relating to Interest and Taxes (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Supplemental Cash Flow Elements [Abstract] | |||
Interest payments | $ 9,181 | ||
Income tax payments | $ 493 | $ 1,115 | $ 636 |
Receivables, Net - Summary of N
Receivables, Net - Summary of Net Receivables (Detail) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Accounts Notes And Loans Receivable Net Current [Abstract] | ||
Gross accounts receivables | $ 21,193 | $ 14,135 |
Allowance for returns and doubtful accounts | (265) | (277) |
Unpaid portion of deferred revenue | (10,847) | (10,670) |
Note receivable | 458 | 458 |
Allowance for note receivable | (458) | (458) |
Receivables, net | $ 10,081 | $ 3,188 |
Receivables, Net - Additional I
Receivables, Net - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Receivables [Abstract] | ||
Note receivable on a product line | $ 540 | $ 540 |
Date of note receivable, reserved | Dec. 31, 2019 | Dec. 31, 2018 |
Prepaid and Other Current Ass_3
Prepaid and Other Current Assets - Schedule of Prepaid and Other Current Assets (Detail) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Prepaid Expense And Other Assets Current [Abstract] | ||
Prepaid insurance, maintenance, software licenses and other | $ 4,881 | $ 2,460 |
Tax-related | 103 | 716 |
Prepaid and other current assets | $ 4,984 | $ 3,176 |
Property and Equipment - Summar
Property and Equipment - Summary of Property and Equipment (Detail) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment gross | $ 44,224 | $ 35,777 |
Less accumulated depreciation | (35,633) | (31,853) |
Property and equipment, net | 8,591 | 3,924 |
Computer and Office Equipment and Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment gross | 30,335 | 26,762 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment gross | 7,794 | 6,834 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment gross | 2,733 | $ 2,181 |
Finance Lease Right-of-Use Assets [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment gross | $ 3,362 |
Property and Equipment - Additi
Property and Equipment - Additional information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Property Plant And Equipment [Abstract] | |||
Depreciation expense | $ 5 | $ 2.4 | $ 2.4 |
Leases - Additional Information
Leases - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2019 | |
Lessee Lease Description [Line Items] | |
Lessee, operating lease, variable lease payment, terms and conditions | Variable lease costs consist primarily of variable common area maintenance, taxes, insurance, parking and utilities. |
Lessee, operating lease, existence of option to extend | true |
Minimum [Member] | |
Lessee Lease Description [Line Items] | |
Lessee, operating lease, term of contract | 1 year |
Lessee, majority operating lease, term of contract | 1 year |
Maximum [Member] | |
Lessee Lease Description [Line Items] | |
Lessee, operating lease, term of contract | 12 years |
Lessee, majority operating lease, term of contract | 7 years |
Leases - Schedule of Components
Leases - Schedule of Components of Lease Costs (Detail) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Finance lease costs: | |
Amortization of right-of-use asset | $ 1,330 |
Interest on lease liabilities | 151 |
Operating lease costs | 3,490 |
Short-term lease costs | 2,236 |
Variable lease costs | 773 |
Total lease costs | $ 7,980 |
Leases - Schedule of Supplement
Leases - Schedule of Supplemental Cash Flow Information Related to Leases (Detail) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Cash paid for amounts included in the measurement of lease liabilities: | |
Operating cash flows related to operating leases | $ 2,410 |
Operating cash flows related to finance leases | 151 |
Financing cash flows related to finance leases | 1,707 |
Right-of-use assets obtained in exchange for lease obligations: | |
Operating leases | 7,999 |
Finance leases | $ 3,362 |
Leases - Schedule of Suppleme_2
Leases - Schedule of Supplemental Balance Sheet Information Related to Leases (Detail) $ in Thousands | Dec. 31, 2019USD ($) |
Assets And Liabilities Lessee [Abstract] | |
Operating lease right-of-use asset | $ 10,128 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | zixi:OperatingLeaseAssetsMember |
Operating lease assets | $ 10,128 |
Finance lease right-of-use assets | 3,362 |
Accumulated depreciation - finance leases | (1,320) |
Finance lease right-of-use assets, net | $ 2,042 |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | us-gaap:PropertyPlantAndEquipmentMember |
Leases - Schedule of Weighted A
Leases - Schedule of Weighted Average Remaining Lease Term and Weighted Average Discount Rate (Detail) | Dec. 31, 2019 |
Lease Cost [Abstract] | |
Operating leases, weighted average remaining lease term (years) | 4 years 2 months 4 days |
Finance leases, weighted average remaining lease term (years) | 1 year 11 months 1 day |
Operating leases, weighted average discount rate | 5.86% |
Finance leases, weighted average discount rate | 6.15% |
Leases - Schedule of Maturities
Leases - Schedule of Maturities of Lease Liabilities (Detail) $ in Thousands | Dec. 31, 2019USD ($) |
Operating And Finance Leases Liabilities Payments Due [Abstract] | |
Operating leases | $ 12,807 |
Less imputed interest | (1,471) |
Lease liabilities | 11,336 |
Finance leases | 2,165 |
Less imputed interest | (111) |
Total | 2,054 |
Operating lease payments due, Year 1 | 3,519 |
Operating lease payments due, Years 2 & 3 | 5,102 |
Operating lease payments due, Years 4 & 5 | 4,186 |
Finance lease payments due, Year 1 | 1,423 |
Finance lease payments due, Years 2 & 3 | 736 |
Finance lease payments due, Years 4 & 5 | $ 6 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Schedule of Changes in Carrying Amount of Goodwill (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Goodwill Roll Forward | ||
Opening balance | $ 13,783 | $ 8,469 |
Additions | 157,121 | 6,215 |
Acquisition adjustments | (901) | |
Effect of currency translation adjustment | 305 | |
Goodwill | $ 171,209 | $ 13,783 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill impairment | $ 0 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Schedule of Other Intangible Assets (Detail) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 168,818 | $ 18,874 |
Accumulated Amortization | (23,060) | (3,623) |
Net Carrying Amount | 145,876 | 15,251 |
Internal Use Software [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 1,456 | 1,189 |
Accumulated Amortization | (504) | (162) |
Net Carrying Amount | 952 | 1,027 |
Internally-Developed Hosting Arrangement [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 9,487 | 1,520 |
Accumulated Amortization | (1,258) | (77) |
Net Carrying Amount | 8,229 | 1,443 |
Trademarks and Other [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 5,091 | 691 |
Accumulated Amortization | (587) | (113) |
Net Carrying Amount | 4,504 | 578 |
Technology [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 52,905 | 7,604 |
Accumulated Amortization | (9,836) | (2,678) |
Net Carrying Amount | 43,069 | 4,926 |
Customer Relationships [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 98,879 | 7,870 |
Accumulated Amortization | (10,597) | (593) |
Net Carrying Amount | 88,282 | $ 7,277 |
Vendor Relationships [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 1,000 | |
Accumulated Amortization | (278) | |
Net Carrying Amount | 722 | |
Effect Of Currency Translation Adjustment [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Net Carrying Amount | $ 118 |
Goodwill and Other Intangible_6
Goodwill and Other Intangible Assets - Schedule of Amortization of Intangible Assets (Detail) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Finite Lived Intangible Assets [Line Items] | |
Amortization of intangible assets | $ 19,437 |
Cost of Revenue [Member] | |
Finite Lived Intangible Assets [Line Items] | |
Amortization of intangible assets | 7,132 |
Research and Development Expense [Member] | |
Finite Lived Intangible Assets [Line Items] | |
Amortization of intangible assets | 1,478 |
Selling, General and Administrative Expenses [Member] | |
Finite Lived Intangible Assets [Line Items] | |
Amortization of intangible assets | $ 10,827 |
Goodwill and Other Intangible_7
Goodwill and Other Intangible Assets - Summary of Estimated Future Amortization Expense (Detail) $ in Thousands | Dec. 31, 2019USD ($) |
Goodwill And Intangible Assets Disclosure [Abstract] | |
2020 | $ 25,580 |
2021 | 25,506 |
2022 | 23,686 |
2023 | 21,095 |
2024 | 16,906 |
Thereafter | 32,985 |
Total | $ 145,758 |
Accrued Expenses - Summary of A
Accrued Expenses - Summary of Accrued Expenses (Detail) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Accounts Payable And Accrued Liabilities Current [Abstract] | ||
Employee compensation and benefits | $ 7,231 | $ 5,122 |
Professional fees | 1,576 | 1,289 |
Taxes | 575 | 113 |
Other | 4,350 | 3,223 |
Total accrued expenses | $ 13,732 | $ 9,747 |
Long-term Debt - Additional Inf
Long-term Debt - Additional Information (Detail) | May 02, 2019USD ($) | Feb. 20, 2019USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2019USD ($) | Sep. 30, 2019USD ($) |
Debt Instrument [Line Items] | ||||||
Outstanding debt balance | $ 168,200,000 | $ 168,200,000 | $ 168,200,000 | |||
Interest rate | 6.32% | |||||
Unamortized debt issuance costs | 5,500,000 | $ 5,500,000 | $ 5,500,000 | |||
Senior Secured Delayed Draw Term Loan Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Delayed draw term loan facility fully drawn date | May 2, 2019 | |||||
Principal outstanding | 10,000,000 | 10,000,000 | $ 10,000,000 | $ 9,950,000 | ||
Lines of credit, drawn amount | $ 10,000,000 | |||||
Senior Secured Delayed Draw Term Loan Facility [Member] | 5.67% Interest Rate Effect From May 2, 2019 Through December 31, 2019 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Outstanding debt balance | $ 9,900,000 | 9,900,000 | 9,900,000 | |||
Interest rate | 5.67% | |||||
Unamortized debt issuance costs | $ 49,000 | 49,000 | 49,000 | |||
Term Loan [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Principal outstanding | 173,688,000 | 173,688,000 | 173,688,000 | |||
Lines of credit, drawn amount | $ 175,000,000 | |||||
Debt instrument quarterly payment, principal amount | 437,500 | |||||
Credit Agreement [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Credit facility maturity date | Feb. 20, 2024 | |||||
Credit Agreement [Member] | Revolving Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Outstanding debt balance | 2,000,000 | 2,000,000 | 2,000,000 | |||
Undrawn balance | 23,000,000 | |||||
Commitment fees | 97,000 | 97,000 | $ 97,000 | |||
Credit Agreement [Member] | Maximum [Member] | December 31, 2019 through June 30, 2020 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Maximum total net leverage ratio | 5 | |||||
Credit Agreement [Member] | Maximum [Member] | September 30, 2020 through March 30, 2021 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Maximum total net leverage ratio | 4.75 | |||||
Credit Agreement [Member] | Maximum [Member] | June 30, 2021 through December 31, 2021 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Maximum total net leverage ratio | 4.50 | |||||
Credit Agreement [Member] | Maximum [Member] | March 31, 2022 and Each Fiscal Quarter Thereafter [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Maximum total net leverage ratio | 4.25 | |||||
Credit Agreement [Member] | Maximum [Member] | LIBO Rate [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument bear interest rate | 3.50% | |||||
Credit Agreement [Member] | Maximum [Member] | Alternate Base Rate [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument bear interest rate | 2.50% | |||||
Credit Agreement [Member] | Maximum [Member] | Revolving Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Percentage of commitment fee unused portions | 0.50% | |||||
Credit Agreement [Member] | Minimum [Member] | LIBO Rate [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument bear interest rate | 2.50% | |||||
Credit Agreement [Member] | Minimum [Member] | Alternate Base Rate [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument bear interest rate | 1.50% | |||||
Credit Agreement [Member] | Minimum [Member] | Revolving Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Percentage of commitment fee unused portions | 0.25% | |||||
Credit Agreement [Member] | Senior Secured Delayed Draw Term Loan Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument quarterly payment, principal amount | $ 25,000 | |||||
Amortization payments percentage of original aggregate principal amount | 1.00% | |||||
Credit Agreement [Member] | Syndicate of Lenders and SunTrust Bank [Member] | Senior Secured Revolving Credit Facility [Member] | Maximum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Aggregate principal amount | $ 25,000,000 | $ 25,000,000 | $ 25,000,000 | |||
AppRiver Companies [Member] | Credit Agreement [Member] | Syndicate of Lenders and SunTrust Bank [Member] | Senior Secured Term Loan Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Aggregate principal amount | $ 175,000,000 | |||||
AppRiver Companies [Member] | Credit Agreement [Member] | Syndicate of Lenders and SunTrust Bank [Member] | Senior Secured Delayed Draw Term Loan Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Aggregate principal amount | 10,000,000 | |||||
AppRiver Companies [Member] | Credit Agreement [Member] | Syndicate of Lenders and SunTrust Bank [Member] | Senior Secured Revolving Credit Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Aggregate principal amount | 25,000,000 | |||||
AppRiver Companies [Member] | Credit Agreement [Member] | Syndicate of Lenders and SunTrust Bank [Member] | Senior Secured Revolving Credit Facility [Member] | Maximum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Letters of credit | $ 5,000,000 | |||||
Delivery Slip Acquisition [Member] | Credit Agreement [Member] | Senior Secured Delayed Draw Term Loan Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Delayed draw term loan facility fully drawn date | May 2, 2019 |
Long-term Debt - Schedule of Fu
Long-term Debt - Schedule of Future Scheduled Principal Payments Under Term Loan (Detail) - USD ($) $ in Thousands | Dec. 31, 2019 | Sep. 30, 2019 |
Term Loan [Member] | ||
Debt Instrument [Line Items] | ||
2020 | $ 1,750 | |
2021 | 1,750 | |
2022 | 1,750 | |
2023 | 1,750 | |
2024 | 166,688 | |
Total | 173,688 | |
Senior Secured Delayed Draw Term Loan Facility [Member] | ||
Debt Instrument [Line Items] | ||
2020 | $ 100 | |
2021 | 100 | |
2022 | 100 | |
2023 | 100 | |
2024 | 9,550 | |
Total | $ 10,000 | $ 9,950 |
Preferred Stock - Additional In
Preferred Stock - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | Jun. 06, 2019 | Feb. 20, 2019 | Dec. 31, 2019 | Dec. 31, 2018 |
Temporary Equity [Line Items] | ||||
Preferred stock, shares outstanding | 0 | 0 | ||
Beneficial conversion feature, valued | $ 2,500 | |||
Series A Convertible Preferred Stock [Member] | ||||
Temporary Equity [Line Items] | ||||
Convertible Preferred stock, par value | $ 1 | $ 1 | ||
Convertible Preferred stock, shares issued | 64,914 | 100,206 | 0 | |
Issuance of preferred stock in connection with private placement | $ 62,700 | |||
Preferred stock, net of issuance costs | $ 2,300 | $ 2,253 | ||
Preferred stock, number of shares converted | 35,292 | |||
Accretion of beneficial conversion feature valued | 99 | |||
Accrued dividend on preferred stock | 6,159 | |||
Series B Convertible Preferred Stock [Member] | ||||
Temporary Equity [Line Items] | ||||
Convertible Preferred stock, shares issued | 35,086 | |||
Issuance of preferred stock in connection with private placement | $ 33,900 | |||
Preferred stock, net of issuance costs | 1,200 | $ 1,204 | ||
Preferred stock, shares outstanding | 0 | |||
Accretion of beneficial conversion feature valued | $ 35 | |||
Accrued dividend on preferred stock | $ 1,030 | |||
Series A Preferred Stock [Member] | ||||
Temporary Equity [Line Items] | ||||
Preferred stock accretion percentage | 8.00% | |||
Accretion of stated value of preferred stock | $ 6,300 | |||
Preferred stock conversion description | At any time, each Series A Preferred Stock holder may elect to convert each share of such holders’ then-outstanding Series A Preferred Stock into (i) the number of shares of common stock equal to the product of (a) the Accreted Value with respect to such share on the conversion date multiplied by (b) the conversion rate (initially 166.11) as of the applicable conversion date divided by (c) 1,000 plus (ii) cash in lieu of fractional shares. | |||
Series B Preferred Stock [Member] | ||||
Temporary Equity [Line Items] | ||||
Accretion of beneficial conversion feature valued | $ 134 | |||
Accrued dividend on preferred stock | $ 1,200 | |||
True Wind Capital [Member] | ||||
Temporary Equity [Line Items] | ||||
Aggregate purchase price of preferred stock issued in private placement | $ 100,000 | |||
Convertible Preferred stock, par value | $ 1,000 |
Revenue from Contracts with C_2
Revenue from Contracts with Customers - Additional Information (Detail) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 30, 2019USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2019USD ($)Segment | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Disaggregation Of Revenue [Line Items] | |||||||||||
Number of operating segment | Segment | 1 | ||||||||||
Percentage of revenue generated from email protection services | 100.00% | 100.00% | |||||||||
Cumulative effect adjustment establishing on noncurrent deferred contract asset | $ 6,600,000 | ||||||||||
Current deferred commission asset | 415,000 | ||||||||||
Increased noncurrent deferred contract asset | 5,500,000 | $ 4,900,000 | |||||||||
Amortization of deferred cost | 3,000,000 | 2,200,000 | |||||||||
Impairment losses recognized on deferred contract cost assets | 0 | 0 | |||||||||
Increase to net deferred revenue | 2,700,000 | ||||||||||
Revenue recognized performance obligation | 47,300,000 | ||||||||||
Revenue recognized | $ 50,380,000 | $ 47,833,000 | $ 45,916,000 | $ 29,300,000 | $ 18,448,000 | $ 17,876,000 | $ 17,500,000 | $ 16,654,000 | 173,428,000 | $ 70,478,000 | $ 65,663,000 |
AppRiver Companies [Member] | |||||||||||
Disaggregation Of Revenue [Line Items] | |||||||||||
Increase to net deferred revenue | $ 11,100,000 | ||||||||||
Healthcare [Member] | |||||||||||
Disaggregation Of Revenue [Line Items] | |||||||||||
Revenue in precentage | 23.00% | ||||||||||
Financial Services [Member] | |||||||||||
Disaggregation Of Revenue [Line Items] | |||||||||||
Revenue in precentage | 19.00% | ||||||||||
Government Sector [Member] | |||||||||||
Disaggregation Of Revenue [Line Items] | |||||||||||
Revenue in precentage | 4.00% | ||||||||||
Other [Member] | |||||||||||
Disaggregation Of Revenue [Line Items] | |||||||||||
Revenue in precentage | 54.00% | ||||||||||
Minimum [Member] | |||||||||||
Disaggregation Of Revenue [Line Items] | |||||||||||
Subscription services contracts period | 1 year | ||||||||||
Maximum [Member] | |||||||||||
Disaggregation Of Revenue [Line Items] | |||||||||||
Subscription services contracts period | 3 years |
Revenue from Contracts with C_3
Revenue from Contracts with Customers - Additional Information (Detail 1) $ in Millions | Dec. 31, 2019USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2019-01-01 | |
Disaggregation Of Revenue [Line Items] | |
Revenue, remaining performance obligation expected timing of satisfaction period | 1 year |
Revenue remaining service performance obligations | $ 89.4 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2020-01-01 | |
Disaggregation Of Revenue [Line Items] | |
Revenue, remaining performance obligation expected timing of satisfaction period | 1 year |
Revenue remaining service performance obligations | $ 62.4 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2021-01-01 | |
Disaggregation Of Revenue [Line Items] | |
Revenue, remaining performance obligation expected timing of satisfaction period | 1 year |
Revenue remaining service performance obligations | $ 27 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | May 07, 2019 |
Delivery Slip Inc. [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Contingent consideration liability | $ 2.3 | $ 2.3 |
Fair Value Measures - Schedule
Fair Value Measures - Schedule of Reconciliation of Contingent Earn-out Liability Measured at Fair Value on Recurring Basis (Detail) - Level 3 [Member] $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |
Balance at December 31, 2018 | $ 1,164 |
Additions during the period | 2,303 |
Payments during the period | (3,300) |
Adjustments to fair value during the period recorded in General and Administrative expenses | 211 |
Balance at December 31, 2019 | $ 378 |
Earnings Per Share and Potent_3
Earnings Per Share and Potential Dilution - Computations of Basic and Diluted Earnings Per Share (Detail) - shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Weighted Average Number of Shares [Line Items] | |||
Basic weighted average shares | 53,025,152 | 52,591,714 | 53,430,492 |
Potential dilutive common shares | 53,025,152 | 53,481,295 | 53,430,492 |
Employee and Director Stock Options [Member] | |||
Weighted Average Number of Shares [Line Items] | |||
Effect of dilutive securities | 347,167 | ||
Restricted Stock [Member] | |||
Weighted Average Number of Shares [Line Items] | |||
Effect of dilutive securities | 409,871 | ||
RSUs [Member] | |||
Weighted Average Number of Shares [Line Items] | |||
Effect of dilutive securities | 24,369 | ||
Performance RSUs [Member] | |||
Weighted Average Number of Shares [Line Items] | |||
Effect of dilutive securities | 9,367 | ||
Performance Stock [Member] | |||
Weighted Average Number of Shares [Line Items] | |||
Effect of dilutive securities | 98,807 |
Earnings Per Share and Potent_4
Earnings Per Share and Potential Dilution - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2018shares | |
Employee and Director Stock Options [Member] | |
Weighted Average Number of Shares [Line Items] | |
Antidilutive securities excluded from computation of earnings per share amount | 73,313 |
Restricted Stock [Member] | |
Weighted Average Number of Shares [Line Items] | |
Antidilutive securities excluded from computation of earnings per share amount | 131,774 |
RSUs [Member] | |
Weighted Average Number of Shares [Line Items] | |
Antidilutive securities excluded from computation of earnings per share amount | 6,084 |
Performance RSUs [Member] | |
Weighted Average Number of Shares [Line Items] | |
Antidilutive securities excluded from computation of earnings per share amount | 917 |
Performance Stock [Member] | |
Weighted Average Number of Shares [Line Items] | |
Antidilutive securities excluded from computation of earnings per share amount | 18,536 |
Significant Customers - Additio
Significant Customers - Additional Information (Detail) - Customer | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |||
Customer accounted for revenue | 0 | 0 | 0 |
Other Comprehensive Income (L_2
Other Comprehensive Income (Loss) - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Accumulated Other Comprehensive Income Loss [Line Items] | ||
Foreign currency translation loss, net of tax | $ (215) | $ 16 |
Canada [Member] | ||
Accumulated Other Comprehensive Income Loss [Line Items] | ||
Foreign currency translation loss, net of tax | 215 | |
Foreign currency translation loss, tax amount | $ 16 |
Income Taxes - Components of In
Income Taxes - Components of Income Taxes (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Current: | |||
U.S. | $ (341) | $ (794) | $ 183 |
State | 216 | 725 | (196) |
Foreign | 9 | 71 | 156 |
Deferred | |||
Federal | (4,365) | (4,722) | 18,461 |
Foreign | 3 | 2 | |
Income tax (benefit) expense | $ (4,478) | $ (4,720) | $ 18,606 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Income Taxes [Line Items] | ||
Federal statutory corporate income tax rate | 21.00% | 34.00% |
Unrecognized tax benefits to significantly increase or decrease | 12 months | |
Statute of limitations by major tax jurisdictions | 3 years | |
Internal Revenue Service (IRS) [Member] | ||
Income Taxes [Line Items] | ||
Operating loss carryforwards | $ 236 | |
U.S. net operating loss carryforwards expire | 2021 | |
State [Member] | ||
Income Taxes [Line Items] | ||
State tax credit carryforwards | $ 1.7 | |
Operating loss carryforwards, expiration dates | 2026 | |
General Business Tax Credit Carry Forward [Member] | ||
Income Taxes [Line Items] | ||
State tax credit carryforwards | $ 3.5 | |
Tax credit carry forward began to expiration | 2020 | |
Tax credit carry forward refunded through | 2021 |
Income Taxes - Schedule of Reco
Income Taxes - Schedule of Reconciliation of Tax Expense Benefit to Income Taxes Related to Continuing Operations (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Expected tax expense at U.S. statutory rate | $ (3,943) | $ 2,260 | $ 3,587 |
Change in corporate tax rate- deferreds | 12,473 | ||
Increase (decrease) in valuations allowance | (295) | (7,841) | |
Increase (decrease) in valuations allowance- other | 2,064 | ||
Nondeductible expense and nontaxable income | (37) | 111 | 890 |
State income taxes, net of federal benefits | (507) | 815 | (129) |
Foreign income taxes | 517 | 68 | 159 |
Other | (213) | (133) | (438) |
Income tax (benefit) expense | $ (4,478) | $ (4,720) | $ 18,606 |
Income Taxes - Components of De
Income Taxes - Components of Deferred Income Taxes (Detail) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred tax liabilities: | ||
Less valuation allowance | $ (22,500) | |
Net deferred tax assets | 36,600 | |
US [Member] | ||
Deferred tax assets: | ||
Nondeductible | 116 | $ 113 |
U.S. net operating loss carryforwards | 49,657 | 46,826 |
State net operating loss carryforwards | 572 | 71 |
Intangible assets | 1,135 | |
Tax credit carryforwards | 5,151 | 5,703 |
Stock-based compensation | 1,574 | 976 |
Depreciable assets | 1,209 | 822 |
Interest expense | 1,611 | 30 |
Other assets | 1,521 | 908 |
Total deferred tax assets | 62,546 | 55,449 |
Deferred tax liabilities: | ||
Intangible assets | (1,128) | |
Revenue recognition | (2,976) | (2,300) |
Prepaid expenses | (997) | (572) |
Total deferred tax assets | 58,573 | 51,449 |
Less valuation allowance | (22,022) | (22,667) |
Net deferred tax assets | $ 36,551 | $ 28,782 |
Employee Benefit Plan - Additio
Employee Benefit Plan - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Compensation And Retirement Disclosure [Abstract] | |||
Net contribution from operations to employee benefit plan | $ 1,200 | $ 618 | $ 512 |
Zix Repurchase Program - Additi
Zix Repurchase Program - Additional Information (Detail) - USD ($) | Apr. 24, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Equity, Class of Treasury Stock [Line Items] | ||||
Share repurchase program authorized amount | $ 10,000,000 | |||
Share repurchase program expiration date | May 31, 2018 | |||
Treasury repurchase program | $ 5,393,000 | $ 3,811,000 | ||
January 2016 Stock Repurchase Program [Member] | ||||
Equity, Class of Treasury Stock [Line Items] | ||||
Shares repurchased | 0 | 1,206,994 | 750,000 | |
Treasury repurchase program | $ 5,400,000 | $ 3,800,000 |
Acquisitions - Additional Infor
Acquisitions - Additional Information (Detail) $ / shares in Units, $ in Thousands | May 07, 2019USD ($) | May 06, 2019 | Feb. 20, 2019USD ($)CustomerServiceProvider$ / sharesshares | Apr. 02, 2018USD ($)Channel | Sep. 13, 2017USD ($) | Mar. 15, 2017USD ($) | Dec. 31, 2019USD ($)$ / shares | Dec. 31, 2018USD ($)$ / shares | Dec. 30, 2018USD ($) | Dec. 31, 2017USD ($) | Mar. 31, 2019USD ($) | Mar. 31, 2018USD ($) |
Business Acquisition [Line Items] | ||||||||||||
Cash consideration | $ 284,590 | $ 11,773 | $ 8,244 | |||||||||
Series A Convertible Preferred Stock [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Preferred stock, par value | $ / shares | $ 1 | $ 1 | ||||||||||
True Wind Capital [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Preferred stock, par value | $ / shares | $ 1,000 | |||||||||||
Investment agreement aggregate cash consideration | $ 100,000 | |||||||||||
Delivery Slip Inc. [Member] | AppRiver Companies [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Revenue generated from AppRiver Canada Inc | 90.00% | |||||||||||
Delivery Slip Inc. [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Total purchase price | $ 13,800 | |||||||||||
Cash consideration | 11,400 | |||||||||||
Contingent consideration liability | 2,300 | $ 2,300 | ||||||||||
Loss on business combination contingent consideration | (200) | |||||||||||
Cash consideration paid through escrow deposit | 1,500 | |||||||||||
Business combination, acquisition related costs | $ 1,200 | |||||||||||
Intangible assets, estimated useful live | 6 years | |||||||||||
Delivery Slip Inc. [Member] | Senior Secured Delayed Draw Term Loan Facility [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Aggregate principal amount | $ 10,000 | |||||||||||
AppRiver Companies [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Total purchase price | 277,700 | |||||||||||
Business combination, acquisition related costs | $ 10,700 | |||||||||||
Percentage of equity interest acquired | 100.00% | |||||||||||
Cash consideration | $ 273,100 | |||||||||||
Number of customers | Customer | 60,000 | |||||||||||
Number of managed service providers | ServiceProvider | 4,500 | |||||||||||
Business combination, revenue | $ 97,800 | |||||||||||
AppRiver Companies [Member] | Customer Relationships [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Intangible assets, estimated useful live | 8 years | |||||||||||
AppRiver Companies [Member] | Vendor Relationships [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Intangible assets, estimated useful live | 3 years | |||||||||||
AppRiver Companies [Member] | Trademark/names [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Intangible assets, estimated useful live | 10 years | |||||||||||
AppRiver Companies [Member] | Software [Member] | Minimum [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Intangible assets, estimated useful live | 5 years | |||||||||||
AppRiver Companies [Member] | Software [Member] | Maximum [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Intangible assets, estimated useful live | 6 years | |||||||||||
AppRiver Companies [Member] | Operating Expenses [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Business combination, acquisition related costs | 9,600 | $ 1,100 | ||||||||||
AppRiver Companies [Member] | True Wind Capital [Member] | Series A Convertible Preferred Stock [Member] | Private Placement [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Preferred stock, shares, new issue | shares | 64,914 | |||||||||||
Preferred stock, par value | $ / shares | $ 1 | |||||||||||
AppRiver Companies [Member] | True Wind Capital [Member] | Series B Convertible Preferred Stock [Member] | Private Placement [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Preferred stock, shares, new issue | shares | 35,086 | |||||||||||
Preferred stock, par value | $ / shares | $ 1 | |||||||||||
AppRiver Companies [Member] | True Wind Capital [Member] | Series A and B Convertible Preferred Stock [Member] | Private Placement [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Investment agreement aggregate cash consideration | $ 100,000 | |||||||||||
Reduction in costs, that were reimbursed | $ 3,000 | |||||||||||
Erado [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Total purchase price | $ 14,400 | |||||||||||
Cash consideration paid through escrow deposit | 2,300 | |||||||||||
Business combination, acquisition related costs | $ 334 | |||||||||||
Cash consideration | $ 11,800 | |||||||||||
Business combination, revenue | $ 3,800 | 2,100 | ||||||||||
Number of channels | Channel | 50 | |||||||||||
Escrow account certain indemnification claims, period | 2 years | |||||||||||
Holdback amount released to selling shareholders upon one year anniversary of closing acquisition | $ 1,100 | |||||||||||
Holdback released to selling shareholders, description | An amount equal to $1.1 million of the holdback amount, less any amounts paid or otherwise subject to an outstanding claim for indemnification, was released to the selling shareholders upon the one year anniversary of the closing of the acquisition | |||||||||||
Erado [Member] | Customer Relationships [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Intangible assets, estimated useful live | 15 years | |||||||||||
Erado [Member] | Trademarks [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Intangible assets, estimated useful live | 5 years | |||||||||||
Erado [Member] | Internally Developed Software [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Intangible assets, estimated useful live | 10 years | |||||||||||
Entelligence Messaging Server [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Cash consideration | $ 1,700 | |||||||||||
Business combination, acquisition related costs | $ 58 | 59 | ||||||||||
Greenview Data, Inc [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Total purchase price | $ 7,700 | |||||||||||
Cash consideration paid through escrow deposit | 650 | |||||||||||
Business combination, acquisition related costs | 476,000 | 427,000 | ||||||||||
Cash consideration | $ 6,700 | |||||||||||
Business combination, revenue | $ 3,400 | $ 2,400 | ||||||||||
Escrow account certain indemnification claims, period | 2 years | |||||||||||
Business combination, pay earnout consideration in cash on achievement of certain sale milestones | $ 800 | $ 800 | ||||||||||
Greenview Data, Inc [Member] | Customer Relationships [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Intangible assets, estimated useful live | 15 years | |||||||||||
Greenview Data, Inc [Member] | Trademarks [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Intangible assets, estimated useful live | 5 years | |||||||||||
Greenview Data, Inc [Member] | Internally Developed Software [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Intangible assets, estimated useful live | 10 years |
Acquisitions - Summary of Estim
Acquisitions - Summary of Estimated Fair Value of Acquired Assets and Liabilities (Detail) - USD ($) $ in Thousands | Dec. 31, 2019 | May 07, 2019 | Feb. 20, 2019 | Dec. 31, 2018 | Apr. 02, 2018 | Dec. 31, 2017 | Sep. 13, 2017 | Mar. 15, 2017 |
Assets: | ||||||||
Goodwill | $ 171,209 | $ 13,783 | $ 8,469 | |||||
Delivery Slip Acquisition [Member] | ||||||||
Assets: | ||||||||
Goodwill | $ 9,603 | |||||||
Total assets | 13,803 | |||||||
Liabilities: | ||||||||
Deferred revenue | 52 | |||||||
Total liabilities | 52 | |||||||
Net assets recorded | 13,751 | |||||||
AppRiver Companies [Member] | ||||||||
Assets: | ||||||||
Current assets | $ 12,200 | |||||||
Property and equipment | 3,235 | |||||||
ROU assets | 8,778 | |||||||
Deferred tax asset | 3,453 | |||||||
Goodwill | 147,518 | |||||||
Total assets | 312,684 | |||||||
Liabilities: | ||||||||
Current liabilities | 13,378 | |||||||
Deferred revenue | 12,424 | |||||||
Operating lease liabilities | 9,178 | |||||||
Total liabilities | 34,980 | |||||||
Net assets recorded | 277,704 | |||||||
Erado [Member] | ||||||||
Assets: | ||||||||
Current assets | $ 848 | |||||||
Property and equipment | 169 | |||||||
Goodwill | 6,215 | |||||||
Total assets | 15,282 | |||||||
Liabilities: | ||||||||
Deferred revenue | 809 | |||||||
Other current liabilities | 93 | |||||||
Total liabilities | 902 | |||||||
Net assets recorded | 14,380 | |||||||
Entelligence Messaging Server [Member] | ||||||||
Assets: | ||||||||
Goodwill | $ 1,063 | |||||||
Total assets | 1,983 | |||||||
Liabilities: | ||||||||
Deferred revenue | 333 | |||||||
Total liabilities | 333 | |||||||
Net assets recorded | 1,650 | |||||||
Greenview Data, Inc [Member] | ||||||||
Assets: | ||||||||
Current assets | $ 334 | |||||||
Property and equipment | 249 | |||||||
Goodwill | 4,343 | |||||||
Total assets | 9,966 | |||||||
Liabilities: | ||||||||
Deferred revenue | 537 | |||||||
Other current liabilities | 124 | |||||||
Deferred tax liability | 1,609 | |||||||
Total liabilities | 2,270 | |||||||
Net assets recorded | 7,696 | |||||||
Technology [Member] | Delivery Slip Acquisition [Member] | ||||||||
Assets: | ||||||||
Intangible assets | $ 4,200 | |||||||
Technology [Member] | Erado [Member] | ||||||||
Assets: | ||||||||
Intangible assets | 3,030 | |||||||
Technology [Member] | Entelligence Messaging Server [Member] | ||||||||
Assets: | ||||||||
Intangible assets | 550 | |||||||
Technology [Member] | Greenview Data, Inc [Member] | ||||||||
Assets: | ||||||||
Intangible assets | 1,990 | |||||||
Customer Relationships [Member] | AppRiver Companies [Member] | ||||||||
Assets: | ||||||||
Intangible assets | 91,000 | |||||||
Customer Relationships [Member] | Erado [Member] | ||||||||
Assets: | ||||||||
Intangible assets | 4,760 | |||||||
Customer Relationships [Member] | Entelligence Messaging Server [Member] | ||||||||
Assets: | ||||||||
Intangible assets | 230 | |||||||
Customer Relationships [Member] | Greenview Data, Inc [Member] | ||||||||
Assets: | ||||||||
Intangible assets | 2,880 | |||||||
Vendor Relationships [Member] | AppRiver Companies [Member] | ||||||||
Assets: | ||||||||
Intangible assets | 1,000 | |||||||
Trademark/names [Member] | AppRiver Companies [Member] | ||||||||
Assets: | ||||||||
Intangible assets | 4,400 | |||||||
Trademark/names [Member] | Erado [Member] | ||||||||
Assets: | ||||||||
Intangible assets | $ 260 | |||||||
Trademark/names [Member] | Entelligence Messaging Server [Member] | ||||||||
Assets: | ||||||||
Intangible assets | $ 140 | |||||||
Trademark/names [Member] | Greenview Data, Inc [Member] | ||||||||
Assets: | ||||||||
Intangible assets | $ 170 | |||||||
Internally-Developed Hosting Arrangement [Member] | AppRiver Companies [Member] | ||||||||
Assets: | ||||||||
Intangible assets | $ 41,100 |
Acquisitions - Unaudited Pro Fo
Acquisitions - Unaudited Pro Forma Financial Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Business Acquisition Pro Forma Information [Abstract] | ||
Revenues | $ 194,313 | $ 162,610 |
Net income (loss) | $ 19,783 | $ 19,207 |
Basic income (loss) per common share | $ 0.17 | $ 0.20 |
Diluted income (loss) per common share | $ 0.17 | $ 0.20 |
Quarterly Results of Operatio_3
Quarterly Results of Operations (Unaudited) - Summary of Quarterly Results of Operations (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 30, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenues | $ 50,380 | $ 47,833 | $ 45,916 | $ 29,300 | $ 18,448 | $ 17,876 | $ 17,500 | $ 16,654 | $ 173,428 | $ 70,478 | $ 65,663 |
Gross margin | 26,337 | 26,411 | 25,612 | 18,161 | 14,451 | 14,006 | 13,694 | 13,140 | 96,520 | 55,292 | 53,061 |
Net income (loss) | $ (3,079) | $ (1,597) | $ (3,706) | $ (6,265) | $ 9,257 | $ 2,455 | $ 1,840 | $ 1,892 | $ (14,647) | $ 15,444 | $ (8,057) |
Basic net income (loss) attributable to common stockholders | $ (0.10) | $ (0.07) | $ (0.13) | $ (0.17) | $ 0.18 | $ 0.05 | $ 0.04 | $ 0.04 | $ (0.46) | $ 0.29 | $ (0.15) |
Diluted net income (loss) attributable to common stockholders | $ (0.10) | $ (0.07) | $ (0.13) | $ (0.17) | $ 0.17 | $ 0.05 | $ 0.03 | $ 0.04 | $ (0.46) | $ 0.29 | $ (0.15) |
Comprehensive (Loss) Income | $ (2,812) | $ (1,562) | $ (3,762) | $ (6,297) | $ 9,224 | $ (14,432) | $ 15,428 | $ (8,057) |