Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2022 | May 06, 2022 | |
Cover | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-35774 | |
Entity Registrant Name | INNODATA INC | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 13-3475943 | |
Entity Address, Address Line One | 55 Challenger Road | |
Entity Address, City or Town | Ridgefield Park, | |
Entity Address, State or Province | NJ | |
Entity Address, Postal Zip Code | 07660 | |
City Area Code | 201 | |
Local Phone Number | 371-8000 | |
Title of 12(b) Security | Common Stock | |
Trading Symbol | INOD | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 27,178,638 | |
Entity Central Index Key | 0000903651 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 15,427 | $ 18,902 |
Accounts receivable, net of allowance for doubtful accounts of $820 and $730, respectively | 10,904 | 11,379 |
Prepaid expenses and other current assets | 3,755 | 3,681 |
Total current assets | 30,086 | 33,962 |
Property and equipment, net | 2,881 | 2,947 |
Right-of-use-asset, net | 4,623 | 5,621 |
Other assets | 2,104 | 2,247 |
Deferred income taxes, net | 1,870 | 1,950 |
Intangibles, net | 11,228 | 10,347 |
Goodwill | 2,142 | 2,143 |
Total assets | 54,934 | 59,217 |
Current liabilities: | ||
Accounts payable | 1,725 | 1,823 |
Accrued expenses and other | 7,232 | 7,564 |
Accrued salaries, wages and related benefits | 6,041 | 6,391 |
Income and other taxes | 3,407 | 3,213 |
Long-term obligations - current portion | 1,229 | 1,279 |
Operating lease liability - current portion | 812 | 1,034 |
Total current liabilities | 20,446 | 21,304 |
Deferred income taxes, net | 17 | 15 |
Long-term obligations, net of current portion | 6,134 | 6,217 |
Operating lease liability, net of current portion | 4,291 | 5,276 |
Total liabilities | 30,888 | 32,812 |
Commitments and contingencies | ||
Non-controlling interests | (732) | (3,522) |
STOCKHOLDERS' EQUITY: | ||
Serial preferred stock; 4,998,000 shares authorized, none outstanding | ||
Common stock, $.01 par value; 75,000,000 shares authorized; 30,363,000 shares issued and 27,179,000 outstanding at March 31, 2022 and 30,347,000 shares issued and 27,163,000 outstanding at December 31, 2021 | 304 | 303 |
Additional paid-in capital | 32,767 | 35,121 |
Retained earnings | 345 | 3,160 |
Accumulated other comprehensive loss | (2,173) | (2,192) |
Stockholders' Equity before Treasury Stock, Total | 31,243 | 36,392 |
Less: treasury stock, 3,184,000 shares at March 31, 2022 and December 31, 2021 at cost | (6,465) | (6,465) |
Total stockholders' equity | 24,778 | 29,927 |
Total liabilities, non-controlling interests and stockholders' equity | $ 54,934 | $ 59,217 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Accounts receivable, net of allowance for doubtful accounts | $ 820 | $ 730 |
Series preferred stock, shares authorized | 4,998,000 | 4,998,000 |
Series preferred stock, outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 75,000,000 | 75,000,000 |
Common stock, shares issued | 30,363,000 | 30,347,000 |
Common stock, shares outstanding | 27,179,000 | 27,163,000 |
Treasury stock, shares | 3,184,000 | 3,184,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) | ||
Revenues | $ 21,192 | $ 15,967 |
Operating costs and expenses: | ||
Direct operating costs | 13,414 | 10,096 |
Selling and administrative expenses | 10,190 | 5,525 |
Interest expense, net | 3 | 10 |
Total | 23,607 | 15,631 |
Income (loss) before provision for income taxes | (2,415) | 336 |
Provision for income taxes | 475 | (73) |
Consolidated net income (loss) | (2,890) | 409 |
Income (loss) attributable to non-controlling interests | (75) | 11 |
Net income (loss) attributable to Innodata Inc. and Subsidiaries | $ (2,815) | $ 398 |
Income (loss) per share attributable to Innodata Inc. and Subsidiaries: | ||
Basic | $ (0.10) | $ 0.02 |
Diluted | $ (0.10) | $ 0.01 |
Weighted average shares outstanding: | ||
Basic | 27,158 | 25,873 |
Diluted | 27,158 | 29,452 |
Comprehensive income (loss): | ||
Consolidated net income (loss) | $ (2,890) | $ 409 |
Pension liability adjustment, net of taxes | 40 | 11 |
Change in fair value of derivatives, net of taxes | 5 | 0 |
Foreign currency translation adjustment | (26) | (21) |
Other comprehensive loss | 19 | (10) |
Total comprehensive income (loss) | (2,871) | 399 |
Less: Comprehensive income attributable to non-controlling interest | (75) | 11 |
Comprehensive income (loss) attributable to Innodata Inc. and Subsidiaries | $ (2,796) | $ 388 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Cash flows from operating activities: | ||
Consolidated net income (loss) | $ (2,890) | $ 409 |
Adjustments to reconcile consolidated net income (loss) to net cash provided by operating activities: | ||
Depreciation and amortization | 873 | 697 |
Stock-based compensation | 537 | 278 |
Deferred income taxes | 44 | (45) |
Pension cost | 11 | 142 |
Loss on lease termination | 125 | 0 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 487 | (448) |
Prepaid expenses and other current assets | (63) | 223 |
Other assets | 144 | 52 |
Accounts payable and accrued expenses | (533) | 956 |
Accrued salaries, wages and related benefits | (407) | (789) |
Income and other taxes | 176 | (718) |
Net cash provided by (used in) operating activities | (1,496) | 757 |
Cash flows from investing activities: | ||
Capital expenditures | (1,939) | (503) |
Net cash used in investing activities | (1,939) | (503) |
Cash flows from financing activities: | ||
Proceeds from exercise of stock options | 26 | 609 |
Withholding taxes on net settlement of stock-based compensation | 0 | (764) |
Redemption of non-controlling interest | 1 | 0 |
Payment of long-term obligations | (39) | (268) |
Net cash used in financing activities | (12) | (423) |
Effect of exchange rate changes on cash and cash equivalents | (28) | (108) |
Net increase (decrease) in cash and cash equivalents | (3,475) | (277) |
Cash and cash equivalents, beginning of period | 18,902 | 17,573 |
Cash and cash equivalents, end of period | 15,427 | 17,296 |
Supplemental disclosures of cash flow information: | ||
Cash paid for income taxes | 308 | 571 |
Non cash redemption of non-controlling interest | (2,864) | 0 |
Cash paid for operating leases | 493 | 437 |
Cash paid for interest | $ 4 | $ 11 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Treasury Stock | Total |
Balance at Dec. 31, 2020 | $ 289 | $ 31,921 | $ 4,833 | $ (938) | $ (6,465) | $ 29,640 |
Balance (in shares) at Dec. 31, 2020 | 28,984,000 | |||||
Balance (in shares) at Dec. 31, 2020 | 3,184,000 | |||||
Net income attributable to Innodata Inc. and subsidiaries | $ 0 | 0 | 398 | 0 | $ 0 | 398 |
Stock-based compensation | $ 0 | 278 | 0 | 0 | 0 | 278 |
Stock based compensation (in shares) | 0 | |||||
Stock option exercises | $ 4 | 605 | 0 | 0 | 0 | 609 |
Stock option exercises (in shares) | 690,000 | |||||
Shares withheld for exercise settlement and taxes | $ 1 | (764) | 0 | 0 | 0 | (763) |
Shares withheld for exercise settlement and taxes (in shares) | (193,000) | |||||
Pension liability adjustments, net of taxes | $ 0 | 0 | 0 | 11 | 0 | 11 |
Foreign currency translation adjustment | 0 | 0 | 0 | (21) | 0 | (21) |
Change in fair value of derivatives, net of taxes | 0 | 0 | 0 | 0 | 0 | 0 |
Balance at Mar. 31, 2021 | $ 294 | 32,040 | 5,231 | (948) | $ (6,465) | 30,152 |
Balance (in shares) at Mar. 31, 2021 | 29,481,000 | |||||
Balance (in shares) at Mar. 31, 2021 | 3,184,000 | |||||
Balance at Dec. 31, 2021 | $ 303 | 35,121 | 3,160 | (2,192) | $ (6,465) | $ 29,927 |
Balance (in shares) at Dec. 31, 2021 | 30,347,000 | |||||
Balance (in shares) at Dec. 31, 2021 | 3,184,000 | 3,184,000 | ||||
Net income attributable to Innodata Inc. and subsidiaries | $ 0 | 0 | (2,815) | 0 | $ 0 | $ (2,815) |
Stock-based compensation | 0 | 537 | 0 | 0 | 0 | 537 |
Stock option exercises | $ 1 | 26 | 0 | 0 | 0 | 27 |
Stock option exercises (in shares) | 23,000 | |||||
Shares withheld for exercise settlement and taxes | $ 0 | (53) | 0 | 0 | 0 | (53) |
Shares withheld for exercise settlement and taxes (in shares) | (7,000) | |||||
Redemption of non-controlling interest | $ 0 | (2,864) | 0 | 0 | 0 | (2,864) |
Pension liability adjustments, net of taxes | 0 | 0 | 0 | 40 | 0 | 40 |
Foreign currency translation adjustment | 0 | 0 | 0 | (26) | 0 | (26) |
Change in fair value of derivatives, net of taxes | 0 | 0 | 0 | 5 | 0 | 5 |
Balance at Mar. 31, 2022 | $ 304 | $ 32,767 | $ 345 | $ (2,173) | $ (6,465) | $ 24,778 |
Balance (in shares) at Mar. 31, 2022 | 30,363,000 | |||||
Balance (in shares) at Mar. 31, 2022 | 3,184,000 | 3,184,000 |
Summary of Significant Accounti
Summary of Significant Accounting Policies and Estimates | 3 Months Ended |
Mar. 31, 2022 | |
Summary of Significant Accounting Policies and Estimates | |
Summary of Significant Accounting Policies and Estimates | 1. Summary of Significant Accounting Policies and Estimates Basis of Presentation Certain information and note disclosures normally included in or with financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) have been condensed or omitted from these condensed consolidated financial statements pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) and, accordingly, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. Unless otherwise noted, the accounting policies used in preparing these condensed consolidated financial statements are the same as those described in the notes to the consolidated financial statements for the year ended December 31, 2021. Principles of Consolidation Use of Estimates Revenue Recognition For the Digital Data Solutions (DDS) segment, revenue is recognized primarily based on the quantity delivered or resources utilized in the period in which services are performed and performance conditions are satisfied as per the agreement. Revenue from agreements billed on a time-and-materials basis is recognized as services are performed. Revenue from fixed-fee agreements, which are not significant to overall revenues, is recognized based on the proportional performance method of accounting, as services are performed, or milestones are achieved. For the Synodex segment, revenue is recognized primarily based on the quantity delivered in the period in which services are performed and performance conditions are satisfied as per the agreement. A portion of the Synodex segment revenue is derived from licensing the Company’s functional software and providing access to the Company’s hosted software platform. Revenue from such services is recognized monthly when all parties to the agreement have agreed to the agreement; each party’s rights are identifiable; the payment terms are identifiable; the agreement has commercial substance; access to the service is provided to the end user; and collection is probable. The Agility segment derives its revenue primarily from subscription arrangements and provision of enriched media analysis services. It also derives revenue as a reseller of corporate communication solutions. Revenue from subscriptions is recognized monthly when access to the service is provided to the end user; all parties to the agreement have agreed to the agreement; each party’s rights are identifiable; the payment terms are identifiable; the agreement has commercial substance; and collection is probable. Revenue from enriched media analysis services is recognized when the services are performed, and performance conditions are satisfied. Revenue from the reseller agreements is recognized at the gross amount received for the goods in accordance with the Company functioning as a principal due to the Company meeting the following criteria: the Company acts as the primary obligor in the sales transaction; assumes the credit risk; sets the price; can select suppliers; and is involved in the execution of the services, including after sales service. Revenue includes reimbursement of out-of-pocket expenses, with the corresponding out-of-pocket expenses included in direct operating costs. The Company considers U.S. GAAP criteria for determining whether to report gross revenue as a principal versus net revenue as an agent. The Company evaluates whether it is in control of the services before the same are transferred to the customer to assess whether it is principal or agent in the arrangement. Revenue is recognized on a gross basis if the Company is in the capacity of principal and on a net basis if it falls in the capacity of an agent. Contract acquisition costs, which are included in prepaid expenses and other current assets, are amortized over the term of a subscription agreement or contract that normally has a duration of 12 months or less. The Company reviews these prepaid acquisition costs on a periodic basis to determine the need to adjust the carrying values for early-terminated contracts. Foreign Currency Translation The functional currency for the Company’s subsidiaries in Germany, the United Kingdom and for the Company’s Agility subsidiary in Canada are the Euro, the Pound Sterling and the Canadian dollar, respectively. The financial statements of these subsidiaries are prepared in these respective currencies. Financial information is translated from the applicable functional currency to the U.S. dollar (the reporting currency) for inclusion in the Company’s condensed consolidated financial statements. Income, expenses and cash flows are translated at weighted-average exchange rates prevailing during the fiscal period, and assets and liabilities are translated at fiscal period-end exchange rates. Resulting translation adjustments are included as a component of accumulated other comprehensive loss in stockholders’ equity. Foreign exchange transaction gains or losses are included in direct operating costs in the accompanying condensed consolidated statements of operations and comprehensive income (loss). Derivative Instruments Capitalized Developed Software three Income Taxes In assessing the realization of deferred tax assets, management considered whether it is more likely than not that all or some portion of the U.S. and Canadian deferred tax assets will not be realizable. As the expectation of future taxable income resulting from the U.S. and Canadian entities cannot be predicted with certainty, the Company maintains a valuation allowance against all the U.S. and Canadian net deferred tax assets. The Company accounts for income taxes regarding uncertain tax positions, and recognizes interest and penalties related to uncertain tax positions in income tax expense in the condensed consolidated statements of operations and comprehensive income (loss). Deferred Revenue Recent Accounting Pronouncements |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 3 Months Ended |
Mar. 31, 2022 | |
Goodwill and Intangible Assets | |
Goodwill and Intangible Assets | 2. Goodwill and Intangible Assets The change in the carrying amount of goodwill for the three months ended March 31, 2022 was as follows (in thousands): Balance as of January 1, 2022 $ 2,143 Foreign currency translation adjustment (1) Balance as of March 31, 2022 $ 2,142 The fair value measurement of goodwill for the Agility segment was classified within Level 3 of the fair value hierarchy because the Company used the income approach, which utilizes significant inputs that are unobservable in the market and the market multiple approach which utilizes comparable entities to further validate the carrying values. The Company believes it made reasonable estimates and assumptions to calculate the fair value of the reporting unit as of the impairment test measurement date. The carrying value of Goodwill was $2.1 million as of March 31, 2022, and December 31, 2021. Information regarding the Company acquired intangible assets and capitalized developed software was as follows (in thousands): Company Acquired Intangible Assets Capitalized Developed Software Capitalized Trademarks Media Capitalized Developed Developed Customer and Contact Developed Software - in technology relationships tradenames Patents Database Software Progress Total Gross carrying amounts: Balance as of January 1, 2022 $ 3,169 $ 2,228 $ 880 $ 45 $ 3,648 $ 8,576 $ 635 $ 19,181 Additions - - - - - - 1,389 1,389 Transfers - - - - - 1,265 (1,265) - Foreign currency translation 24 36 1 1 (44) 130 (1) 147 Balance as of March 31, 2022 $ 3,193 $ 2,264 $ 881 $ 46 $ 3,604 $ 9,971 $ 758 $ 20,717 Accumulated amortization: Balance as of January 1, 2022 $ 2,158 $ 1,377 $ 685 $ 34 $ 2,005 $ 2,575 $ - $ 8,834 Amortization expense 79 47 14 1 91 365 - 597 Foreign currency translation 20 22 1 - (23) 38 - 58 Balance as of March 31, 2022 $ 2,257 $ 1,446 $ 700 $ 35 $ 2,073 $ 2,978 $ - $ 9,489 Net carrying values - March 31, 2022 $ 936 $ 818 $ 181 $ 11 $ 1,531 $ 6,993 $ 758 $ 11,228 Amortization expense relating to acquired intangible assets was $0.2 million for the three months ended March 31, 2022. Amortization expense relating to capitalized developed software was $0.4 million for the three months ended March 31, 2022. As of March 31, 2022, estimated future amortization expense for intangible assets was as follows (in thousands): Year Amortization 2022 $ 2,199 2023 2,630 2024 2,228 2025 1,456 2026 812 Thereafter 1,903 $ 11,228 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2022 | |
Income Taxes | |
Income Taxes | 3. Income Taxes Taxes primarily consist of a provision for foreign taxes recorded by the Company’s foreign subsidiaries in accordance with local tax regulations. Effective income tax rates are disproportionate due to the losses incurred by the Company’s U.S. and Canadian subsidiaries and a valuation allowance recorded on deferred taxes of these entities and tax effects of foreign operations, including foreign exchange gains and losses. The reconciliations of the U.S. statutory rate with the Company’s effective tax rate for the three -month periods ended March 31, 2022 and 2021 are summarized in the table below: For the Three Months Ended March 31, 2022 2021 Federal income tax expense at statutory rate (21.0) % 21.0 % Effect of: Change in valuation allowance 35.1 26.7 Tax effects of foreign operations 5.9 85.2 Return to provision true up 4.7 0.4 Foreign operations permanent difference - foreign exchange gains and losses 4.4 15.4 Increase (decrease) in unrecognized tax benefits (ASC 740) 1.1 (114.9) State income tax net of federal benefit 0.2 2.4 Withholding tax - 0.3 Effect of stock based compensation - (61.3) Foreign rate differential (8.0) (5.8) Other (2.7) 8.9 Effective tax rate 19.7 % (21.7) % The following table presents a roll-forward of the Company’s unrecognized tax benefits and associated interest for the three months ended March 31, 2022 (in thousands): Unrecognized tax benefits Balance - January 1, 2022 $ 1,753 Interest accrual 26 Foreign currency remeasurement (28) Balance - March 31, 2022 $ 1,751 The Company expects that unrecognized tax benefits as of March 31, 2022, if recognized, would have a material impact on the Company’s effective tax rate. Tax Assessments In September 2015, the Company’s Indian subsidiary was subject to an inquiry by the Service Tax Department in India regarding the classification of services provided by this subsidiary, asserting that the services provided by this subsidiary fall under the category of online information and database access or retrieval services (OID Services), and not under the category of business support services (BS Services) that are exempt from service tax as historically indicated in the subsidiary’s service tax filings. The Company disagrees with the Service Tax Department’s position. In November 2019, the Commissioner of Central Tax, GST & Central Excise issued an order confirming the Service Tax Department's position. The Company is contesting this order in an appeal to the Customs, Excise and Service Tax Appellate Tribunal. In the event the Service Tax Department is ultimately successful in proving that the services fall under the category of OID Services, the revenues earned by the Company’s Indian subsidiary for the period July 2012 through November 2016 would be subject to a service tax of between 12.36% and 15%, and this subsidiary may also be liable for interest and penalties. The revenue of the Company’s Indian subsidiary during this period was approximately $63.0 million. In accordance with new rules promulgated by the Service Tax Department, as of December 1, 2016 service tax is no longer applicable to OID or BS Services. Based on the Company’s assessment in consultation with the Company’s tax counsel, the Company has not recorded any tax liability for this case. In a separate action relating to service tax refunds, in October 2016, the Company’s Indian subsidiary received notices from the Indian Service Tax Department in India seeking to reverse service tax refunds of approximately $160,000 previously granted to the Company’s Indian subsidiary for three quarters in 2014, asserting that the services provided by this subsidiary fall under the category of OID Services and not BS Services. The appeal was determined in favor of the Service Tax Department. The Company disagrees with the basis of this decision and is contesting it. The Company expects delays in its Indian subsidiary receiving further service tax refunds until this matter is adjudicated with finality, and currently has service tax credits of approximately $1.0 million recorded as a receivable. Based on the Company’s assessment in consultation with the Company’s tax counsel, the Company has not recorded any tax liability for this case. Substantial recovery against the Company in the above referenced 2015 Service Tax Department case could have a material adverse impact on the Company, and unfavorable rulings or recoveries in other tax proceedings could have a material adverse impact on the consolidated operating results of the period (and subsequent periods) in which the rulings or recovery occurs. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2022 | |
Commitments and Contingencies | |
Commitments and Contingencies | 4. Commitments and Contingencies Litigation – The Company is also subject to various other legal proceedings and claims that have arisen in the ordinary course of business. While management currently believes that the ultimate outcome of these proceedings will not have a material adverse effect on the Company’s consolidated financial position or overall trends in consolidated results of operations, litigation is subject to inherent uncertainties. Substantial recovery against the Company in the above-referenced Philippine action could have a material adverse impact on the Company, and unfavorable rulings or recoveries in the other proceedings could have a material adverse impact on the consolidated operating results in the period in which the ruling or recovery occurs. In addition, the Company’s estimate of the potential impact on the Company’s consolidated financial position or overall consolidated results of operations for the above referenced legal proceedings could change in the future. The Company’s legal accruals related to legal proceedings and claims are based on the Company’s determination of whether or not a loss is probable. The Company reviews outstanding proceedings and claims with external counsel to assess probability and estimates of loss. The accruals are adjusted if necessary. While the Company intends to defend these matters vigorously, adverse outcomes that it estimates could reach approximately $350,000 in the aggregate beyond recorded amounts are reasonably possible. If circumstances change, the Company may be required to record adjustments that could be material to its reported consolidated financial condition and results of operations. |
Stock Options and Restricted Sh
Stock Options and Restricted Shares | 3 Months Ended |
Mar. 31, 2022 | |
Stock Options and Restricted Shares | |
Stock Options and Restricted Shares | 5. Stock Options and Restricted Shares A summary of option activity under the Innodata Inc. 2013 Stock Plan, as amended and restated effective June 7, 2016 (the “2013 Plan”) and changes during each of the three-month periods ended March 31, 2022 and 2021 are presented below: Weighted - Weighted-Average Number of Average Exercise Remaining Contractual Aggregate Options Price Term (years) Intrinsic Value Outstanding at January 1, 2021 5,906,884 $ 1.61 Granted 360,000 6.40 Exercised (689,616) 2.17 Forfeited/Expired (13,333) 1.38 Outstanding at March 31, 2021 5,563,935 $ 1.86 7.69 $ 24,770,815 Exercisable at March 31, 2021 3,594,434 $ 1.68 7.10 $ 16,621,389 Vested and Expected to Vest at March 31, 2021 5,563,935 $ 1.86 7.69 $ 24,770,815 Weighted-Average Number of Weighted - Average Remaining Contractual Aggregate Options Exercise Price Term (years) Intrinsic Value Outstanding at January 1, 2022 5,536,896 $ 2.66 Granted 1,479,558 5.21 Exercised (22,500) 1.17 Forfeited/Expired (35,400) 5.10 Outstanding at March 31, 2022 6,958,554 $ 3.20 7.84 $ 26,515,544 Exercisable at March 31, 2022 3,418,917 $ 1.82 6.53 $ 17,679,562 Vested and Expected to Vest at March 31, 2022 6,958,554 $ 3.20 7.84 $ 26,515,544 During the three months ended March 31, 2022, a total of 22,500 options were exercised at an average price of $1.17. The fair value of stock options is estimated on the date of grant using the Black-Scholes option pricing model. The weighted-average fair value of the options granted, and weighted-average assumptions were as follows: For the Three Months Ended March 31, 2022 2021 Weighted average fair value of options granted $ 3.10 $ 3.33 Risk-free interest rate 1.94%-2.33% 0.22%-0.82% Expected term (years) 6.0 - 6.42 2.96 - 6.0 Expected volatility factor 62.00 % 59.62 % Expected dividends - - A summary of restricted shares issued under the 2013 Plan as of March 31, 2022 is presented below: Number of Restricted Weighted-Average Grant Shares Date Fair Value Unvested at January 1, 2022 25,000 - Granted - - Vested (25,000) - Forfeited/Expired - - Unvested at March 31, 2022 - $ 1.38 A summary of restricted stock units issued under the 2013 Plan and the Innodata Inc. 2021 Equity Compensation Plan (“2021 Plan”, and together with the 2013 Plan collectively, the “Equity Plans”) is presented below: In March 2022 the Company granted restricted stock units (“RSU”) pursuant to the Equity Plans. Each RSU has vesting conditions based on both the achievement of performance-based metrics and the continuation of employment over a defined period. The level of performance determines the number of RSUs that performance-vest, and performance vested RSUs must also time-vest in order to be fully vested, Each fully-vested RSU represents the right to receive one share of the Company’s common stock or the fair market value of one share of common stock, at the Company’s discretion, and is classified as an equity award. Each RSU vests pursuant to the vesting schedule found in the respective RSU agreement. RSUs are generally subject to graduated vesting schedules and stock-based compensation expense is computed by tranche and recognized on a straight-line basis over the tranches’ applicable vesting period based on the expected achievement level. The fair value of stock options is estimated on the date of grant using the Binomial option pricing model. Restricted stock unit activity during the three months ended March 31, 2022 was as follows: Number of Weighted-Average Restricted Stock Grant Date Units Fair Value Unvested at January 1, 2022 - Granted* 700,000 $ 5.59 Vested - Forfeited/Expired - Unvested at March 31, 2022 700,000 * 500,000 RSUs were issued under the 2013 plan and 200,000 RSUs were issued under the 2021 plan The compensation cost related to non-vested stock options and restricted stock awards not yet recognized as of March 31, 2022 totaled approximately $7.9 million. The weighted-average period over which these costs will be recognized is 30 months. During the three months ended March 31, 2022, 700,000 performance-based restricted stock units were granted and remain non-vested at March 31, 2022. Vesting of the performance-based restricted stock units is contingent on the achievement of certain financial performance goals and service vesting conditions. The compensation cost related to non-vested restricted stock unit awards not yet recognized as of March 31, 2022 totaled approximately $3.9 million. The weighted-average period over which these costs will be recognized is 36 months. The stock-based compensation expense related to the Equity Plans were allocated as follows (in thousands): For the Three Months Ended March 31, 2022 2021 Direct operating costs $ 52 $ 38 Selling and administrative expenses 485 240 Total stock-based compensation $ 537 $ 278 |
Operating Leases
Operating Leases | 3 Months Ended |
Mar. 31, 2022 | |
Operating Leases | |
Operating Leases | 6. Operating Leases The Company has various lease agreements for its offices and service delivery centers. The Company has determined that the risks and benefits related to the leased properties are retained by the lessors. Accordingly, these are accounted for as operating leases. These lease agreements are for terms ranging from two The table below summarizes the amounts recognized in the condensed consolidated financial statements related to operating leases for the periods presented (in thousands): For the Three Months Ended March 31, 2022 2021 Rent expense for long-term operating leases $ 376 $ 388 Rent expense for short-term leases 117 49 Total rent expense $ 493 $ 437 The following table presents the maturity profile of the Company’s operating lease liabilities based on the contractual undiscounted payments with a reconciliation of these amounts to the remaining net present value of the operating lease liability reported in the condensed consolidated balance sheet as of March 31, 2022 (in thousands): Year Amount 2022 $ 1,214 2023 954 2024 821 2025 836 2026 851 2027 and thereafter 2,172 Total lease payments 6,848 Less: Interest (1,745) Net present value of lease liabilities $ 5,103 Current portion $ 812 Long-term portion 4,291 Total $ 5,103 The weighted average remaining lease terms and discount rates for all of the Company’s operating leases as of March 31, 2022 were as follows: Weighted-average lease term remaining 51 months Weighted-average discount rate 8.68 % |
Long-term obligations
Long-term obligations | 3 Months Ended |
Mar. 31, 2022 | |
Long-term obligations | |
Long-term obligations | 7. Long-term obligations Total long-term obligations as of March 31, 2022 and December 31, 2021 consisted of the following (in thousands): March 31, December 31, 2022 2021 Pension obligations - accrued pension liability $ 6,760 $ 6,839 Settlement agreement 213 272 Microsoft licenses 390 385 7,363 7,496 Less: Current portion of long-term obligations 1,229 1,279 Totals $ 6,134 $ 6,217 |
Redemption of non-controlling i
Redemption of non-controlling interest | 3 Months Ended |
Mar. 31, 2022 | |
Redemption of non-controlling interest | |
Redemption of non-controlling interest | 8. Redemption of non-controlling interest On March 31, 2022, the Company redeemed the 7.5% non-controlling interest in Innodata Synodex, LLC; Innodata Synodex, LLC is now a wholly owned subsidiary. The Company accounted for the transaction in accordance with ASC Topic 810, “Consolidation”, which discusses the proper accounting treatment of the carrying value for the non-controlling interest. Under the standard, any change in ownership that does not result in a loss of control is to be accounted for as an equity transaction. To comply with the standard, the Company reclassified the remaining carrying value of the Non-controlling interest attributed to the Synodex subsidiary amounting to $2.9 million from Non-controlling interest to Additional paid-in capital in the Condensed Consolidated Balance Sheets as of March 31, 2022. |
Comprehensive loss
Comprehensive loss | 3 Months Ended |
Mar. 31, 2022 | |
Comprehensive loss | |
Comprehensive loss | 9. Comprehensive loss Accumulated other comprehensive loss, as reflected in the condensed consolidated balance sheets, consists of pension liability adjustments, net of taxes, foreign currency translation adjustment and changes in fair value of derivatives, net of taxes. The components of accumulated other comprehensive loss as of March 31, 2022 and 2021, and reclassifications from accumulated other comprehensive loss for the three months then ended, are presented below (in thousands): Foreign Currency Pension Liability Fair Value of Translation Accumulated Other Adjustment Derivatives Adjustment Comprehensive Loss Balance at January 1, 2022 $ (858) $ (353) $ (981) $ (2,192) Other comprehensive loss before reclassifications, net of taxes - (78) (26) (104) Total other comprehensive loss before reclassifications, net of taxes (858) (431) (1,007) (2,296) Net amount reclassified to earnings 40 83 - 123 Balance at March 31, 2022 $ (818) $ (348) $ (1,007) $ (2,173) Foreign Currency Pension Liability Fair Value of Translation Accumulated Other Adjustment Derivatives Adjustment Comprehensive Loss Balance at January 1, 2021 $ (444) $ - $ (494) $ (938) Other comprehensive loss before reclassifications, net of taxes - - (21) (21) Total other comprehensive loss before reclassifications, net of taxes (444) - (515) (959) Net amount reclassified to earnings 11 - - 11 Balance at March 31, 2021 $ (433) $ - $ (515) $ (948) All reclassifications from accumulated other comprehensive loss had an impact on direct operating costs in the condensed consolidated statements of operations and comprehensive income (loss). |
Segment reporting and concentra
Segment reporting and concentrations | 3 Months Ended |
Mar. 31, 2022 | |
Segment reporting and concentrations. | |
Segment reporting and concentrations | 10. Segment reporting and concentrations The Company’s operations are classified in three reporting segments: Digital Data Solutions (DDS), Synodex and Agility. The DDS segment provides AI-enabled software platforms and managed services to companies that require high-quality data for training AI and machine learning (ML) algorithms, and AI digital transformation solutions to help companies apply AI/ML to real-world problems relating to analyzing and deriving insights from documents. In conjunction with AI digital transformation, the Company often provides a range of data engineering support services, including data transformation, data curation, data hygiene, data consolidation, data compliance, and master data management. The Synodex segment provides an industry platform that transforms medical records into useable digital data organized in accordance with its proprietary data models or customer data models. The Agility segment provides an industry platform that provides marketing communications and public relations professionals with the ability to target and distribute content to journalists and social media influencers world-wide and to monitor and analyze global news channels (print, web, radio and TV) and social media channels. A significant portion of the Company’s revenue is generated from its locations in the Philippines, India, Sri Lanka, Canada, Germany, the United Kingdom and Israel. Revenues from external customers, segment operating profit (loss), and other reportable segment information are as follows (in thousands): For the Three Months Ended March 31, 2022 2021 Revenues: DDS $ 15,911 $ 11,764 Synodex 1,669 1,018 Agility 3,612 3,185 Total Consolidated $ 21,192 $ 15,967 Income (loss) before provision for income taxes (1) DDS $ 1,253 $ 654 Synodex (988) 108 Agility (2,680) (426) Total Consolidated $ (2,415) $ 336 Income (loss) before provision for income taxes (2) DDS $ 1,096 $ 584 Synodex (859) 152 Agility (2,652) (400) Total Consolidated $ (2,415) $ 336 March 31, 2022 December 31, 2021 Total assets: DDS $ 34,255 $ 40,100 Synodex 2,346 1,753 Agility 18,333 17,364 Total Consolidated $ 54,934 $ 59,217 March 31, 2022 December 31, 2021 Goodwill: Agility $ 2,142 $ 2,143 Total $ 2,142 $ 2,143 (1) Before elimination of any inter-segment profits (2) After elimination of any inter-segment profits Revenues for the period ended March 31, 2022 and 2021 by geographic region (determined based upon customer’s domicile), were as follows (in thousands): For the Three Months Ended March 31, 2022 2021 United States $ 13,393 $ 8,220 United Kingdom 3,082 2,802 The Netherlands 1,652 1,654 Canada 1,377 1,595 Others - principally Europe 1,688 1,696 Totals $ 21,192 $ 15,967 Long-lived assets as of March 31, 2022 and December 31, 2021 by geographic region were comprised of (in thousands): March 31, December 31, 2022 2021 United States $ 5,306 $ 4,578 Foreign countries: Canada 8,411 9,280 United Kingdom 1,443 1,538 Philippines 3,959 4,027 India 1,557 1,481 Sri Lanka 198 154 Total foreign 15,568 16,480 Totals $ 20,874 $ 21,058 Long-lived assets include the unamortized balance of right-of-use assets amounting to $4.6 million and $5.6 million as of March 31, 2022 and December 31, 2021, respectively. One customer in the DDS segment generated approximately 21% of the Company’s total revenues for the three months ended March 31, 2022. Another customer in the DDS segment generated approximately 12% of the Company’s total revenues for the three months ended March 31, 2021. No other customer accounted for 10% or more of total revenues during these periods. Further, revenues from non-U.S. customers accounted for 37% and 49% As of March 31, 2022, approximately 31% of the Company’s accounts receivable was from foreign (principally European) customers and 31% of the Company’s accounts receivable was due from one customer. As of December 31, 2021, approximately 37% of the Company’s accounts receivable was from foreign (principally European) customers and 19% of the Company’s accounts receivable was due from one customer. No other customer accounted for 10% or more of the accounts receivable as of March 31, 2022 and December 31, 2021. |
Income (Loss) per Share
Income (Loss) per Share | 3 Months Ended |
Mar. 31, 2022 | |
Income (Loss) Per Share | |
Income (Loss) per Share | 11. Income (Loss) Per Share For the Three Months Ended March 31, 2022 2021 Net income (loss) attributable to Innodata Inc. and Subsidiaries $ (2,815) $ 398 Weighted average common shares outstanding 27,158 25,873 Dilutive effect of outstanding options - 3,579 Adjusted for dilutive computation 27,158 29,452 Basic income (loss) per share is computed using the weighted-average number of common shares outstanding during the year. Diluted income (loss) per share is computed by considering the impact of the potential issuance of common shares, using the treasury stock method, on the weighted-average number of shares outstanding. For those securities that are not convertible into a class of common stock, the “two-class” method of computing income (loss) per share is used. Options to purchase 7.0 million shares of common stock for the three months ended March 31, 2022 were outstanding but not included in the computation of diluted loss per share because the effect would have been anti-dilutive. Options to purchase 0.3 million shares of common stock for the three months ended March 31, 2021 were outstanding but not included in the computation of diluted income per share because the exercise price of the options was greater than the average market price of the common shares. |
Derivatives
Derivatives | 3 Months Ended |
Mar. 31, 2022 | |
Derivatives | |
Derivatives. | 12. Derivatives The Company conducts a large portion of its operations in international markets, which subject it to foreign currency fluctuations. The most significant foreign currency exposures occur when revenue and associated accounts receivable are collected in one currency and expenses to generate that revenue are incurred in another currency. The Company is also subject to wage inflation and other government mandated increases and operating expenses in Asian countries where the Company has the majority of its operations. The Company’s primary inflation and exchange rate exposure relates to payroll, other payroll costs and operating expenses in the Philippines, India, Sri Lanka and Israel. In addition, although most of the Company’s revenue is denominated in U.S. dollars, a significant portion of total revenues is denominated in Canadian dollars, Pound Sterling and Euros. The Company’s policy is to enter derivative instrument contracts with terms that coincide with the underlying exposure being hedged for a period up to 12 months. As such, the Company’s derivative instruments are expected to be highly effective. For derivative instruments that are designated and qualify as cash flow hedges, the entire change in fair value of the hedging instrument is recorded to Other comprehensive income (loss). Upon settlement of these contracts, the change in the fair value recorded in Other comprehensive income (loss) are reclassified to earnings and included as part of Direct operating costs The Company formally documents all relationships between hedging instruments and hedged items, as well as its risk management objective and strategy for undertaking hedge transactions. The Company does not hold or issue derivatives for trading purposes. All derivatives are recognized at their fair value and classified based on the instrument’s maturity date. The total notional amount for outstanding derivatives designated as hedges was $20.4 million as of March 31, 2022. The total notional amount for outstanding derivatives designated as hedges was $19.7 million as of December 31, 2021. The following table presents the fair value of derivative instruments included within the condensed consolidated balance sheets as of March 31, 2022 and December 31, 2021 (in thousands): Balance Sheet Location Fair Value 2022 2021 Derivatives designated as hedging instruments: Foreign currency forward contracts Accrued expenses $ 348 $ 353 The effect of foreign currency forward contracts designated as cash flow hedges on the condensed consolidated statements of operations for the three months ended March 31, 2022 and 2021 were as follows (in thousands): For the Three Months Ended March 31, 2022 2021 Net gain (loss) recognized in OCI (1) $ (78) $ - Net (gain) loss reclassified from accumulated OCI into income (2) $ 83 $ - Net gain recognized in income (3) $ - $ - (1) Net change in fair value of the effective portion classified into other comprehensive income (“OCI”) (2) Effective portion classified within direct operating costs. (3) There were no ineffective portions for the period presented. |
Summary of Significant Accoun_2
Summary of Significant Accounting Estimates and Policies (Policies) | 3 Months Ended |
Mar. 31, 2022 | |
Summary of Significant Accounting Policies and Estimates | |
Basis of Presentation | Basis of Presentation Certain information and note disclosures normally included in or with financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) have been condensed or omitted from these condensed consolidated financial statements pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) and, accordingly, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. Unless otherwise noted, the accounting policies used in preparing these condensed consolidated financial statements are the same as those described in the notes to the consolidated financial statements for the year ended December 31, 2021. |
Principles of Consolidation | Principles of Consolidation |
Use of Estimates | Use of Estimates |
Revenue Recognition | Revenue Recognition For the Digital Data Solutions (DDS) segment, revenue is recognized primarily based on the quantity delivered or resources utilized in the period in which services are performed and performance conditions are satisfied as per the agreement. Revenue from agreements billed on a time-and-materials basis is recognized as services are performed. Revenue from fixed-fee agreements, which are not significant to overall revenues, is recognized based on the proportional performance method of accounting, as services are performed, or milestones are achieved. For the Synodex segment, revenue is recognized primarily based on the quantity delivered in the period in which services are performed and performance conditions are satisfied as per the agreement. A portion of the Synodex segment revenue is derived from licensing the Company’s functional software and providing access to the Company’s hosted software platform. Revenue from such services is recognized monthly when all parties to the agreement have agreed to the agreement; each party’s rights are identifiable; the payment terms are identifiable; the agreement has commercial substance; access to the service is provided to the end user; and collection is probable. The Agility segment derives its revenue primarily from subscription arrangements and provision of enriched media analysis services. It also derives revenue as a reseller of corporate communication solutions. Revenue from subscriptions is recognized monthly when access to the service is provided to the end user; all parties to the agreement have agreed to the agreement; each party’s rights are identifiable; the payment terms are identifiable; the agreement has commercial substance; and collection is probable. Revenue from enriched media analysis services is recognized when the services are performed, and performance conditions are satisfied. Revenue from the reseller agreements is recognized at the gross amount received for the goods in accordance with the Company functioning as a principal due to the Company meeting the following criteria: the Company acts as the primary obligor in the sales transaction; assumes the credit risk; sets the price; can select suppliers; and is involved in the execution of the services, including after sales service. Revenue includes reimbursement of out-of-pocket expenses, with the corresponding out-of-pocket expenses included in direct operating costs. The Company considers U.S. GAAP criteria for determining whether to report gross revenue as a principal versus net revenue as an agent. The Company evaluates whether it is in control of the services before the same are transferred to the customer to assess whether it is principal or agent in the arrangement. Revenue is recognized on a gross basis if the Company is in the capacity of principal and on a net basis if it falls in the capacity of an agent. Contract acquisition costs, which are included in prepaid expenses and other current assets, are amortized over the term of a subscription agreement or contract that normally has a duration of 12 months or less. The Company reviews these prepaid acquisition costs on a periodic basis to determine the need to adjust the carrying values for early-terminated contracts. |
Foreign Currency Translation | Foreign Currency Translation The functional currency for the Company’s subsidiaries in Germany, the United Kingdom and for the Company’s Agility subsidiary in Canada are the Euro, the Pound Sterling and the Canadian dollar, respectively. The financial statements of these subsidiaries are prepared in these respective currencies. Financial information is translated from the applicable functional currency to the U.S. dollar (the reporting currency) for inclusion in the Company’s condensed consolidated financial statements. Income, expenses and cash flows are translated at weighted-average exchange rates prevailing during the fiscal period, and assets and liabilities are translated at fiscal period-end exchange rates. Resulting translation adjustments are included as a component of accumulated other comprehensive loss in stockholders’ equity. Foreign exchange transaction gains or losses are included in direct operating costs in the accompanying condensed consolidated statements of operations and comprehensive income (loss). |
Derivative Instruments | Derivative Instruments |
Capitalized Developed Software | Capitalized Developed Software three |
Income Taxes | Income Taxes In assessing the realization of deferred tax assets, management considered whether it is more likely than not that all or some portion of the U.S. and Canadian deferred tax assets will not be realizable. As the expectation of future taxable income resulting from the U.S. and Canadian entities cannot be predicted with certainty, the Company maintains a valuation allowance against all the U.S. and Canadian net deferred tax assets. The Company accounts for income taxes regarding uncertain tax positions, and recognizes interest and penalties related to uncertain tax positions in income tax expense in the condensed consolidated statements of operations and comprehensive income (loss). |
Deferred Revenue | Deferred Revenue |
Recent Accounting Pronouncements | Recent Accounting Pronouncements |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Goodwill and Intangible Assets | |
Schedule of Carrying Amount of Goodwill | The change in the carrying amount of goodwill for the three months ended March 31, 2022 was as follows (in thousands): Balance as of January 1, 2022 $ 2,143 Foreign currency translation adjustment (1) Balance as of March 31, 2022 $ 2,142 |
Schedule of company's acquisition-related intangible assets | Information regarding the Company acquired intangible assets and capitalized developed software was as follows (in thousands): Company Acquired Intangible Assets Capitalized Developed Software Capitalized Trademarks Media Capitalized Developed Developed Customer and Contact Developed Software - in technology relationships tradenames Patents Database Software Progress Total Gross carrying amounts: Balance as of January 1, 2022 $ 3,169 $ 2,228 $ 880 $ 45 $ 3,648 $ 8,576 $ 635 $ 19,181 Additions - - - - - - 1,389 1,389 Transfers - - - - - 1,265 (1,265) - Foreign currency translation 24 36 1 1 (44) 130 (1) 147 Balance as of March 31, 2022 $ 3,193 $ 2,264 $ 881 $ 46 $ 3,604 $ 9,971 $ 758 $ 20,717 Accumulated amortization: Balance as of January 1, 2022 $ 2,158 $ 1,377 $ 685 $ 34 $ 2,005 $ 2,575 $ - $ 8,834 Amortization expense 79 47 14 1 91 365 - 597 Foreign currency translation 20 22 1 - (23) 38 - 58 Balance as of March 31, 2022 $ 2,257 $ 1,446 $ 700 $ 35 $ 2,073 $ 2,978 $ - $ 9,489 Net carrying values - March 31, 2022 $ 936 $ 818 $ 181 $ 11 $ 1,531 $ 6,993 $ 758 $ 11,228 |
Schedule of estimated amortization expense for intangible assets | As of March 31, 2022, estimated future amortization expense for intangible assets was as follows (in thousands): Year Amortization 2022 $ 2,199 2023 2,630 2024 2,228 2025 1,456 2026 812 Thereafter 1,903 $ 11,228 |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Income Taxes | |
Schedule of Effective Income Tax Rate Reconciliation | The reconciliations of the U.S. statutory rate with the Company’s effective tax rate for the three -month periods ended March 31, 2022 and 2021 are summarized in the table below: For the Three Months Ended March 31, 2022 2021 Federal income tax expense at statutory rate (21.0) % 21.0 % Effect of: Change in valuation allowance 35.1 26.7 Tax effects of foreign operations 5.9 85.2 Return to provision true up 4.7 0.4 Foreign operations permanent difference - foreign exchange gains and losses 4.4 15.4 Increase (decrease) in unrecognized tax benefits (ASC 740) 1.1 (114.9) State income tax net of federal benefit 0.2 2.4 Withholding tax - 0.3 Effect of stock based compensation - (61.3) Foreign rate differential (8.0) (5.8) Other (2.7) 8.9 Effective tax rate 19.7 % (21.7) % |
Schedule of unrecognized Tax Benefits | The following table presents a roll-forward of the Company’s unrecognized tax benefits and associated interest for the three months ended March 31, 2022 (in thousands): Unrecognized tax benefits Balance - January 1, 2022 $ 1,753 Interest accrual 26 Foreign currency remeasurement (28) Balance - March 31, 2022 $ 1,751 |
Stock Options and Restricted _2
Stock Options and Restricted Shares (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Schedule of Stock Option Activity | A summary of option activity under the Innodata Inc. 2013 Stock Plan, as amended and restated effective June 7, 2016 (the “2013 Plan”) and changes during each of the three-month periods ended March 31, 2022 and 2021 are presented below: Weighted - Weighted-Average Number of Average Exercise Remaining Contractual Aggregate Options Price Term (years) Intrinsic Value Outstanding at January 1, 2021 5,906,884 $ 1.61 Granted 360,000 6.40 Exercised (689,616) 2.17 Forfeited/Expired (13,333) 1.38 Outstanding at March 31, 2021 5,563,935 $ 1.86 7.69 $ 24,770,815 Exercisable at March 31, 2021 3,594,434 $ 1.68 7.10 $ 16,621,389 Vested and Expected to Vest at March 31, 2021 5,563,935 $ 1.86 7.69 $ 24,770,815 Weighted-Average Number of Weighted - Average Remaining Contractual Aggregate Options Exercise Price Term (years) Intrinsic Value Outstanding at January 1, 2022 5,536,896 $ 2.66 Granted 1,479,558 5.21 Exercised (22,500) 1.17 Forfeited/Expired (35,400) 5.10 Outstanding at March 31, 2022 6,958,554 $ 3.20 7.84 $ 26,515,544 Exercisable at March 31, 2022 3,418,917 $ 1.82 6.53 $ 17,679,562 Vested and Expected to Vest at March 31, 2022 6,958,554 $ 3.20 7.84 $ 26,515,544 |
Schedule of weighted average assumptions | The fair value of stock options is estimated on the date of grant using the Black-Scholes option pricing model. The weighted-average fair value of the options granted, and weighted-average assumptions were as follows: For the Three Months Ended March 31, 2022 2021 Weighted average fair value of options granted $ 3.10 $ 3.33 Risk-free interest rate 1.94%-2.33% 0.22%-0.82% Expected term (years) 6.0 - 6.42 2.96 - 6.0 Expected volatility factor 62.00 % 59.62 % Expected dividends - - |
Schedule of Compensation Cost for Share-based Payment Arrangements, Allocation of Share-based Compensation Costs by Plan [Table Text Block] | For the Three Months Ended March 31, 2022 2021 Direct operating costs $ 52 $ 38 Selling and administrative expenses 485 240 Total stock-based compensation $ 537 $ 278 |
Restricted Stock | |
Summary of restricted shares under the Company's Plan | Number of Restricted Weighted-Average Grant Shares Date Fair Value Unvested at January 1, 2022 25,000 - Granted - - Vested (25,000) - Forfeited/Expired - - Unvested at March 31, 2022 - $ 1.38 |
Restricted Stock Units | |
Summary of restricted shares under the Company's Plan | Restricted stock unit activity during the three months ended March 31, 2022 was as follows: Number of Weighted-Average Restricted Stock Grant Date Units Fair Value Unvested at January 1, 2022 - Granted* 700,000 $ 5.59 Vested - Forfeited/Expired - Unvested at March 31, 2022 700,000 * 500,000 RSUs were issued under the 2013 plan and 200,000 RSUs were issued under the 2021 plan |
Operating Leases (Tables)
Operating Leases (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Operating Leases | |
Schedule of Operating Lease Expense Recognized in Financial Statements | The table below summarizes the amounts recognized in the condensed consolidated financial statements related to operating leases for the periods presented (in thousands): For the Three Months Ended March 31, 2022 2021 Rent expense for long-term operating leases $ 376 $ 388 Rent expense for short-term leases 117 49 Total rent expense $ 493 $ 437 |
Schedule of Net Present Value of Operating Lease Liability | The following table presents the maturity profile of the Company’s operating lease liabilities based on the contractual undiscounted payments with a reconciliation of these amounts to the remaining net present value of the operating lease liability reported in the condensed consolidated balance sheet as of March 31, 2022 (in thousands): Year Amount 2022 $ 1,214 2023 954 2024 821 2025 836 2026 851 2027 and thereafter 2,172 Total lease payments 6,848 Less: Interest (1,745) Net present value of lease liabilities $ 5,103 Current portion $ 812 Long-term portion 4,291 Total $ 5,103 |
Schedule of Weighted Average Remaining Lease Terms and Discount Rates | The weighted average remaining lease terms and discount rates for all of the Company’s operating leases as of March 31, 2022 were as follows: Weighted-average lease term remaining 51 months Weighted-average discount rate 8.68 % |
Long-term obligations (Tables)
Long-term obligations (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Long-term obligations | |
Schedule of Total Long-Term Obligations | Total long-term obligations as of March 31, 2022 and December 31, 2021 consisted of the following (in thousands): March 31, December 31, 2022 2021 Pension obligations - accrued pension liability $ 6,760 $ 6,839 Settlement agreement 213 272 Microsoft licenses 390 385 7,363 7,496 Less: Current portion of long-term obligations 1,229 1,279 Totals $ 6,134 $ 6,217 |
Comprehensive loss (Tables)
Comprehensive loss (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Comprehensive loss | |
Schedule of Accumulated Other Comprehensive Loss | Foreign Currency Pension Liability Fair Value of Translation Accumulated Other Adjustment Derivatives Adjustment Comprehensive Loss Balance at January 1, 2022 $ (858) $ (353) $ (981) $ (2,192) Other comprehensive loss before reclassifications, net of taxes - (78) (26) (104) Total other comprehensive loss before reclassifications, net of taxes (858) (431) (1,007) (2,296) Net amount reclassified to earnings 40 83 - 123 Balance at March 31, 2022 $ (818) $ (348) $ (1,007) $ (2,173) Foreign Currency Pension Liability Fair Value of Translation Accumulated Other Adjustment Derivatives Adjustment Comprehensive Loss Balance at January 1, 2021 $ (444) $ - $ (494) $ (938) Other comprehensive loss before reclassifications, net of taxes - - (21) (21) Total other comprehensive loss before reclassifications, net of taxes (444) - (515) (959) Net amount reclassified to earnings 11 - - 11 Balance at March 31, 2021 $ (433) $ - $ (515) $ (948) |
Segment reporting and concent_2
Segment reporting and concentrations (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Segment reporting and concentrations. | |
Schedule of Segment Reporting Information, by Segment | Revenues from external customers, segment operating profit (loss), and other reportable segment information are as follows (in thousands): For the Three Months Ended March 31, 2022 2021 Revenues: DDS $ 15,911 $ 11,764 Synodex 1,669 1,018 Agility 3,612 3,185 Total Consolidated $ 21,192 $ 15,967 Income (loss) before provision for income taxes (1) DDS $ 1,253 $ 654 Synodex (988) 108 Agility (2,680) (426) Total Consolidated $ (2,415) $ 336 Income (loss) before provision for income taxes (2) DDS $ 1,096 $ 584 Synodex (859) 152 Agility (2,652) (400) Total Consolidated $ (2,415) $ 336 March 31, 2022 December 31, 2021 Total assets: DDS $ 34,255 $ 40,100 Synodex 2,346 1,753 Agility 18,333 17,364 Total Consolidated $ 54,934 $ 59,217 March 31, 2022 December 31, 2021 Goodwill: Agility $ 2,142 $ 2,143 Total $ 2,142 $ 2,143 (1) Before elimination of any inter-segment profits (2) After elimination of any inter-segment profits |
Schedule of Revenue from External Customers and Long-Lived Assets | Revenues for the period ended March 31, 2022 and 2021 by geographic region (determined based upon customer’s domicile), were as follows (in thousands): For the Three Months Ended March 31, 2022 2021 United States $ 13,393 $ 8,220 United Kingdom 3,082 2,802 The Netherlands 1,652 1,654 Canada 1,377 1,595 Others - principally Europe 1,688 1,696 Totals $ 21,192 $ 15,967 |
Schedule of Revenue from External Customers based on Client domicile | Long-lived assets as of March 31, 2022 and December 31, 2021 by geographic region were comprised of (in thousands): March 31, December 31, 2022 2021 United States $ 5,306 $ 4,578 Foreign countries: Canada 8,411 9,280 United Kingdom 1,443 1,538 Philippines 3,959 4,027 India 1,557 1,481 Sri Lanka 198 154 Total foreign 15,568 16,480 Totals $ 20,874 $ 21,058 |
Income (Loss) Per Share (Tables
Income (Loss) Per Share (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Income (Loss) Per Share | |
Schedule of Earnings Per Share, Basic and Diluted | For the Three Months Ended March 31, 2022 2021 Net income (loss) attributable to Innodata Inc. and Subsidiaries $ (2,815) $ 398 Weighted average common shares outstanding 27,158 25,873 Dilutive effect of outstanding options - 3,579 Adjusted for dilutive computation 27,158 29,452 |
Derivatives (Tables)
Derivatives (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Derivatives | |
Schedule of fair value of derivative instruments | The following table presents the fair value of derivative instruments included within the condensed consolidated balance sheets as of March 31, 2022 and December 31, 2021 (in thousands): Balance Sheet Location Fair Value 2022 2021 Derivatives designated as hedging instruments: Foreign currency forward contracts Accrued expenses $ 348 $ 353 |
Schedule of effects of foreign currency forward contracts designated as cash flow hedges | The effect of foreign currency forward contracts designated as cash flow hedges on the condensed consolidated statements of operations for the three months ended March 31, 2022 and 2021 were as follows (in thousands): For the Three Months Ended March 31, 2022 2021 Net gain (loss) recognized in OCI (1) $ (78) $ - Net (gain) loss reclassified from accumulated OCI into income (2) $ 83 $ - Net gain recognized in income (3) $ - $ - (1) Net change in fair value of the effective portion classified into other comprehensive income (“OCI”) (2) Effective portion classified within direct operating costs. (3) There were no ineffective portions for the period presented. |
Summary of Significant Accoun_3
Summary of Significant Accounting Estimates and Policies - Additional Information (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Description of Business and Summary of Significant Accounting Policies [Line Items] | |||
Amortization period | 12 months | ||
Foreign Currency Transaction Gain (Loss), before Tax | $ 419,000 | $ 140,000 | |
Outstanding foreign currency forward contracts | $ 3,000,000 | $ 4,500,000 | |
Minimum | Computer software | |||
Description of Business and Summary of Significant Accounting Policies [Line Items] | |||
Property and equipment useful lives | 3 years | ||
Maximum | Computer software | |||
Description of Business and Summary of Significant Accounting Policies [Line Items] | |||
Property and equipment useful lives | 10 years |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Carrying Amount of Goodwill (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Goodwill and Intangible Assets | |
Balance | $ 2,143 |
Foreign currency translation | (1) |
Balance | $ 2,142 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Acquisition-Related Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Dec. 31, 2021 | |
Gross carrying amounts: | ||
Balance | $ 19,181 | |
Additions | 1,389 | |
Foreign currency translation | 147 | |
Balance | 20,717 | |
Accumulated amortization: | ||
Balance | 8,834 | |
Amortization expense | 597 | |
Foreign currency translation | 58 | |
Net carrying values | 11,228 | $ 10,347 |
Accumulated amortization | 9,489 | 8,834 |
Balance | 9,489 | |
Goodwill | 2,142 | 2,143 |
Developed technology [Member] | ||
Gross carrying amounts: | ||
Balance | 3,169 | |
Foreign currency translation | 24 | |
Balance | 3,193 | |
Accumulated amortization: | ||
Balance | 2,158 | |
Amortization expense | 79 | |
Foreign currency translation | 20 | |
Net carrying values | 936 | |
Accumulated amortization | 2,257 | 2,158 |
Balance | 2,257 | |
Customer relationships [Member] | ||
Gross carrying amounts: | ||
Balance | 2,228 | |
Foreign currency translation | 36 | |
Balance | 2,264 | |
Accumulated amortization: | ||
Balance | 1,377 | |
Amortization expense | 47 | |
Foreign currency translation | 22 | |
Net carrying values | 818 | |
Accumulated amortization | 1,446 | 1,377 |
Balance | 1,446 | |
Trademarks and trade names [Member] | ||
Gross carrying amounts: | ||
Balance | 880 | |
Foreign currency translation | 1 | |
Balance | 881 | |
Accumulated amortization: | ||
Balance | 685 | |
Amortization expense | 14 | |
Foreign currency translation | 1 | |
Net carrying values | 181 | |
Accumulated amortization | 700 | 685 |
Balance | 700 | |
Patents [Member] | ||
Gross carrying amounts: | ||
Balance | 45 | |
Foreign currency translation | 1 | |
Balance | 46 | |
Accumulated amortization: | ||
Balance | 34 | |
Amortization expense | 1 | |
Net carrying values | 11 | |
Accumulated amortization | 35 | 34 |
Balance | 35 | |
Media Contact Database [Member] | ||
Gross carrying amounts: | ||
Balance | 3,648 | |
Foreign currency translation | (44) | |
Balance | 3,604 | |
Accumulated amortization: | ||
Balance | 2,005 | |
Amortization expense | 91 | |
Foreign currency translation | (23) | |
Net carrying values | 1,531 | |
Accumulated amortization | 2,073 | 2,005 |
Balance | 2,073 | |
Developed software | ||
Accumulated amortization: | ||
Amortization expense | 400 | |
Capitalized Software Development Cost | ||
Gross carrying amounts: | ||
Balance | 8,576 | |
Transfers | 1,265 | |
Foreign currency translation | 130 | |
Balance | 9,971 | |
Accumulated amortization: | ||
Balance | 2,575 | |
Amortization expense | 365 | |
Foreign currency translation | 38 | |
Net carrying values | 6,993 | |
Accumulated amortization | 2,978 | $ 2,575 |
Balance | 2,978 | |
Capitalized Software Development Cost - Work in Progress | ||
Gross carrying amounts: | ||
Balance | 635 | |
Additions | 1,389 | |
Transfers | (1,265) | |
Foreign currency translation | (1) | |
Balance | 758 | |
Accumulated amortization: | ||
Net carrying values | $ 758 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Estimated Amortization Expense (Details) $ in Thousands | Mar. 31, 2022USD ($) |
Goodwill and Intangible Assets | |
2022 | $ 2,199 |
2023 | 2,630 |
2024 | 2,228 |
2025 | 1,456 |
2026 | 812 |
Thereafter | 1,903 |
Finite-Lived Intangible Assets, Net | $ 11,228 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Additional Information (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Goodwill and Intangible Assets | |
Amortization expense | $ 597 |
Intangible Assets, Amortization Period [Member] | |
Goodwill and Intangible Assets | |
Amortization expense | $ 200 |
Income Taxes - Tax Rate Reconci
Income Taxes - Tax Rate Reconciliation (Details) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Income Taxes | ||
Federal income tax expense (benefit) at statutory rate | (21.00%) | 21.00% |
Effect of: | ||
Change in valuation allowance | 35.10% | 26.70% |
Foreign operations permanent difference - foreign exchange gains and losses | 4.40% | 15.40% |
State income tax net of federal benefit | 0.20% | 2.40% |
Withholding tax | 0.30% | |
Return to provision true up | 4.70% | 0.40% |
Tax effects of foreign operations | 5.90% | 85.20% |
Increase (decrease) in unrecognized tax benefits (ASC 740) | 1.10% | (114.90%) |
Foreign rate differential | (8.00%) | (5.80%) |
Effect of stock-based compensation | (61.30%) | |
Other | (2.70%) | 8.90% |
Effective tax rate | 19.70% | (21.70%) |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Income Taxes | |
Balance - January 1, 2021 | $ 1,753 |
Interest accrual | 26 |
Foreign currency remeasurement | (28) |
Balance - September 30, 2021 | $ 1,751 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 1 Months Ended | |
Oct. 31, 2016 | Sep. 30, 2015 | |
Income Taxes [Line Items] | ||
Subsidiary Revenue | $ 63,000,000 | |
Reversal of Service Tax Refund | $ 160,000 | |
Service Tax Credit Receivable | $ 1,000,000 | |
Maximum | ||
Income Taxes [Line Items] | ||
Percentage for Subsidiary Service Tax | 15.00% | |
Minimum | ||
Income Taxes [Line Items] | ||
Percentage for Subsidiary Service Tax | 12.36% |
Commitments and Contingencies (
Commitments and Contingencies (Details) | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Commitments and Contingencies | |
Estimated Litigation Liability | $ 6,800,000 |
Interest Rate Description Litigation | plus legal interest that accrued at 12% per annum from August 13, 2008 to June 30, 2013, and thereafter accrued and continues to accrue at 6% per annum |
Litigation Settlement, Expense | $ 350,000 |
Stock Options and Restricted _3
Stock Options and Restricted Shares - Summary of Stock Option Activity (Details) - Employee Stock Option [Member] - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of Options, Outstanding at January 1, 2021, (in shares) | 5,536,896 | 5,906,884 |
Number of Options, Granted (in shares) | 1,479,558 | 360,000 |
Number of Options, Exercised (in shares) | (22,500) | (689,616) |
Number of Options, Forfeited/Expired (in shares) | (35,400) | (13,333) |
Number of Options, Outstanding at March 31, 2021, (in shares) | 6,958,554 | 5,563,935 |
Number of Options Exercisable at March 31, 2021 (in shares) | 3,418,917 | 3,594,434 |
Number of Options, Vested and Expected to Vest at March 31, 2021 (in shares) | 6,958,554 | 5,563,935 |
Weighted Average Exercise Price Outstanding (in dollars per shares) | $ 2.66 | $ 1.61 |
Weighted Average Exercise Price Granted (in dollars per shares) | 5.21 | 6.40 |
Weighted Average Exercise Price Exercised (in dollars per shares) | 1.17 | 2.17 |
Weighted Average Exercise Price Forfeited/Expired (in dollars per shares) | 5.10 | 1.38 |
Weighted Average Exercise Price Outstanding (in dollars per shares) | 3.20 | 1.86 |
Weighted Average Exercise Price Exercisable at March 31, 2021 (in dollars per shares) | 1.82 | 1.68 |
Weighted Average Exercise Price Vested and Expected to Vest at March 31, 2021 (in dollars per shares) | $ 3.20 | $ 1.86 |
Weighted Average Remaining Contractual Term Outstanding (in years) | 7 years 10 months 2 days | 7 years 8 months 8 days |
Weighted Average Remaining Contractual Term Exercisable at March 31, 2021 (in years) | 6 years 6 months 10 days | 7 years 1 month 6 days |
Weighted Average Remaining Contractual Term Vested and Expected to Vest at March 31, 2021 (in years) | 7 years 10 months 2 days | 7 years 8 months 8 days |
Aggregate Intrinsic Value, Outstanding at March 31, 2021 | $ 26,515,544 | $ 24,770,815 |
Aggregate Intrinsic Value, Exercisable at March 31, 2021 | 17,679,562 | 16,621,389 |
Aggregate Intrinsic Value, Vested and Expected to Vest at March 31, 2021 | $ 26,515,544 | $ 24,770,815 |
Stock Options and Restricted _4
Stock Options and Restricted Shares - Weighted Average Fair Values and Assumptions (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted average fair value of options granted (in dollars per share) | $ 3.10 | $ 3.33 |
Expected volatility factor | 62.00% | 59.62% |
Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Risk-free interest rate | 1.94% | 0.22% |
Expected life (years) | 6 years | 2 years 11 months 15 days |
Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Risk-free interest rate | 2.33% | 0.82% |
Expected life (years) | 6 years 5 months 1 day | 6 years |
Stock Options and Restricted _5
Stock Options and Restricted Shares- Summary of Restricted Shares (Details) | 3 Months Ended |
Mar. 31, 2022$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Shares, Granted | 700,000 |
Number of RSUs issued | 700,000 |
Restricted Stock | 2013 Stock Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Shares, Unvested at Beginning of the year | 25,000 |
Number of Shares, Granted | 0 |
Number of Shares, Vested | (25,000) |
Number of Shares, Forfeited/Expired | 0 |
Number of Shares, Unvested at End of the year | 0 |
Weighted-Average Grant Date Fair Value, Outstanding | $ / shares | $ 0 |
Weighted-Average Grant Date Fair Value, Granted | $ / shares | 0 |
Weighted-Average Grant Date Fair Value, Vested | $ / shares | 0 |
Weighted-Average Grant Date Fair Value, Forfeited/Expired | $ / shares | 0 |
Weighted-Average Grant Date Fair Value, Outstanding | $ / shares | $ 1.38 |
Number of RSUs issued | 0 |
Restricted Stock Units | 2013 Stock Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Shares, Granted | 500,000 |
Number of RSUs issued | 500,000 |
Restricted Stock Units | Equity Plans | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Shares, Unvested at Beginning of the year | 0 |
Number of Shares, Granted | 700,000 |
Number of Shares, Unvested at End of the year | 700,000 |
Weighted-Average Grant Date Fair Value, Granted | $ / shares | $ 5.59 |
Number of RSUs issued | 700,000 |
Performance Shares | 2021 Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Shares, Granted | 200,000 |
Number of RSUs issued | 200,000 |
Stock Options and Restricted _6
Stock Options and Restricted Shares - Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Derivatives, Fair Value [Line Items] | ||
Total stock-based compensation | $ 537 | $ 278 |
Equity Plans | ||
Derivatives, Fair Value [Line Items] | ||
Direct operating costs | 52 | 38 |
Selling and administrative expenses | 485 | 240 |
Total stock-based compensation | $ 537 | $ 278 |
Stock Options and Restricted _7
Stock Options and Restricted Shares - Additional Information (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of Shares, Granted | 700,000 | |
Compensation cost related to non-vested stock options and restricted stock awards not yet recognized | $ 7,900,000 | |
Weighted-average period over which compensation cost recognized | 30 months | |
Restricted Stock Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Compensation cost related to non-vested stock options and restricted stock awards not yet recognized | $ 3,900,000 | |
Weighted-average period over which compensation cost recognized | 36 months | |
Number of shares eligible to receive for each fully vested RSU | 1 | |
Employee Stock Option [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Fair value of restricted stock units granted | $ 26,515,544 | $ 24,770,815 |
2013 Stock Plan | Restricted Stock Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of Shares, Granted | 500,000 | |
2021 Plan | Performance Shares | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of Shares, Granted | 200,000 | |
Equity Plans | Restricted Stock Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of Shares, Granted | 700,000 |
Operating Leases - Operating Le
Operating Leases - Operating Leases Amount Recognized (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Operating Leases, Rent Expense | $ 493 | $ 437 |
Long Term Operating Lease | ||
Operating Leases, Rent Expense | 376 | 388 |
Short Term Operating Lease | ||
Operating Leases, Rent Expense | $ 117 | $ 49 |
Operating Leases - Net Present
Operating Leases - Net Present Value of Operating Lease Liability (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Operating Leases | ||
2022 | $ 1,214 | |
2023 | 954 | |
2024 | 821 | |
2025 | 836 | |
2026 | 851 | |
2027 and thereafter | 2,172 | |
Total lease payments | 6,848 | |
Less: Interest | (1,745) | |
Net present value of lease liabilities | 5,103 | |
Current portion | 812 | $ 1,034 |
Long- term portion | 4,291 | $ 5,276 |
Total | $ 5,103 |
Operating Leases - Weighted Ave
Operating Leases - Weighted Average Remaining Lease Terms (Details) | Mar. 31, 2022 |
Operating Leases | |
Weighted-average lease term remaining | 51 months |
Weighted-average discount rate | 8.68% |
Operating Leases - Additional I
Operating Leases - Additional Information (Details) | 3 Months Ended |
Mar. 31, 2022 | |
Minimum | |
Lessee, Operating Lease, Term of Contract | 2 years |
Percentage of Rental Escalations | 1.75% |
Maximum | |
Lessee, Operating Lease, Term of Contract | 11 years |
Percentage of Rental Escalations | 10.00% |
Long-term obligations (Details)
Long-term obligations (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Pension obligations | ||
Pension obligations - accrued pension liability | $ 6,760 | $ 6,839 |
Settlement agreement | 213 | 272 |
Microsoft licenses | 390 | 385 |
Long-term Debt | 7,363 | 7,496 |
Less: Current portion of long-term obligations | 1,229 | 1,279 |
Totals | $ 6,134 | $ 6,217 |
Redemption of non-controlling_2
Redemption of non-controlling interest (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Redeemable Noncontrolling Interest [Line Items] | ||
Non-controlling interests | $ (732) | $ (3,522) |
Additional Paid-in Capital | ||
Redeemable Noncontrolling Interest [Line Items] | ||
Non-controlling interests | $ 2,900 | |
Innodata Synodex, LLC | ||
Redeemable Noncontrolling Interest [Line Items] | ||
Non controlling interest redemption percentage | 7.50% |
Comprehensive loss - Reclassifi
Comprehensive loss - Reclassifications out of Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Balance | $ 29,927 | $ 29,640 |
Balance | 24,778 | 30,152 |
Accumulated Other Comprehensive Loss | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Balance | (2,192) | (938) |
Other comprehensive income (loss) before reclassifications, net of taxes | (104) | (21) |
Total other comprehensive loss before reclassifications, net of taxes | (2,296) | (959) |
Net amount reclassified to earnings | 123 | 11 |
Balance | (2,173) | (948) |
Accumulated Defined Benefit Plans Adjustment Attributable to Parent [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Balance | (858) | (444) |
Total other comprehensive loss before reclassifications, net of taxes | (858) | (444) |
Net amount reclassified to earnings | 40 | 11 |
Balance | (818) | (433) |
Accumulated Gain (Loss), Net, Cash Flow Hedge, Parent [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Balance | (353) | |
Other comprehensive income (loss) before reclassifications, net of taxes | (78) | |
Total other comprehensive loss before reclassifications, net of taxes | (431) | |
Net amount reclassified to earnings | 83 | |
Balance | (348) | |
Accumulated Foreign Currency Adjustment Attributable to Parent [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Balance | (981) | (494) |
Other comprehensive income (loss) before reclassifications, net of taxes | (26) | (21) |
Total other comprehensive loss before reclassifications, net of taxes | (1,007) | (515) |
Balance | $ (1,007) | $ (515) |
Segment reporting and concent_3
Segment reporting and concentrations (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Segment reporting information | |||
Revenues | $ 21,192 | $ 15,967 | |
Income (loss) before provision for income taxes | (2,415) | 336 | |
Total assets | 54,934 | $ 59,217 | |
Goodwill | 2,142 | 2,143 | |
Before Intersegment Eliminations [Member] | |||
Segment reporting information | |||
Income (loss) before provision for income taxes | (2,415) | 336 | |
After Intersegment Eliminations [Member] | |||
Segment reporting information | |||
Income (loss) before provision for income taxes | (2,415) | 336 | |
DDS [Member] | |||
Segment reporting information | |||
Revenues | 15,911 | 11,764 | |
Total assets | 34,255 | 40,100 | |
DDS [Member] | Before Intersegment Eliminations [Member] | |||
Segment reporting information | |||
Income (loss) before provision for income taxes | 1,253 | 654 | |
DDS [Member] | After Intersegment Eliminations [Member] | |||
Segment reporting information | |||
Income (loss) before provision for income taxes | 1,096 | 584 | |
Synodex [Member] | |||
Segment reporting information | |||
Revenues | 1,669 | 1,018 | |
Total assets | 2,346 | 1,753 | |
Synodex [Member] | Before Intersegment Eliminations [Member] | |||
Segment reporting information | |||
Income (loss) before provision for income taxes | (988) | 108 | |
Synodex [Member] | After Intersegment Eliminations [Member] | |||
Segment reporting information | |||
Income (loss) before provision for income taxes | (859) | 152 | |
Agility [Member] | |||
Segment reporting information | |||
Revenues | 3,612 | 3,185 | |
Total assets | 18,333 | 17,364 | |
Goodwill | 2,142 | $ 2,143 | |
Agility [Member] | Before Intersegment Eliminations [Member] | |||
Segment reporting information | |||
Income (loss) before provision for income taxes | (2,680) | (426) | |
Agility [Member] | After Intersegment Eliminations [Member] | |||
Segment reporting information | |||
Income (loss) before provision for income taxes | $ (2,652) | $ (400) |
Segment reporting and concent_4
Segment reporting and concentrations - Revenues by geographic region (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Segment Reporting Information [Line Items] | ||
Revenues | $ 21,192 | $ 15,967 |
US | ||
Segment Reporting Information [Line Items] | ||
Revenues | 13,393 | 8,220 |
United Kingdom | ||
Segment Reporting Information [Line Items] | ||
Revenues | 3,082 | 2,802 |
The Netherlands | ||
Segment Reporting Information [Line Items] | ||
Revenues | 1,652 | 1,654 |
Canada | ||
Segment Reporting Information [Line Items] | ||
Revenues | 1,377 | 1,595 |
Other - principally Europe | ||
Segment Reporting Information [Line Items] | ||
Revenues | $ 1,688 | $ 1,696 |
Segment reporting and concent_5
Segment reporting and concentrations - Long-lived assets (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long - lived assets | $ 20,874 | $ 21,058 |
US | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long - lived assets | 5,306 | 4,578 |
Canada | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long - lived assets | 8,411 | 9,280 |
United Kingdom | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long - lived assets | 1,443 | 1,538 |
Philippines | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long - lived assets | 3,959 | 4,027 |
India | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long - lived assets | 1,557 | 1,481 |
Sri Lanka | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long - lived assets | 198 | 154 |
Total Foreign | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long - lived assets | $ 15,568 | $ 16,480 |
Segment reporting and concent_6
Segment reporting and concentrations - Additional information (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2022USD ($)clientsegment | Mar. 31, 2021 | Dec. 31, 2021USD ($)client | |
Segment Reporting Information [Line Items] | |||
Number of Reportable Segments | segment | 3 | ||
Classification of segment assets | $ | $ 54,934 | $ 59,217 | |
Foreign Customer [Member] | Accounts receivable | Customer Concentration Risk | |||
Segment Reporting Information [Line Items] | |||
Concentration Risk, Percentage | 31.00% | 19.00% | |
One Client [Member] | Sales Revenue, Net [Member] | Customer Concentration Risk | US | |||
Segment Reporting Information [Line Items] | |||
Number of clients | 1 | ||
Concentration Risk, Percentage | 21.00% | 12.00% | |
Another client [Member] | Sales Revenue, Net [Member] | Customer Concentration Risk | US | |||
Segment Reporting Information [Line Items] | |||
Number of clients | 0 | ||
Concentration Risk, Percentage | 10.00% | ||
Another client [Member] | Sales Revenue, Net [Member] | Customer Concentration Risk | Non-US | |||
Segment Reporting Information [Line Items] | |||
Concentration Risk, Percentage | 37.00% | 49.00% | |
Three Clients [Member] | Accounts receivable | |||
Segment Reporting Information [Line Items] | |||
Number of clients | 37 | ||
Three Clients [Member] | Accounts receivable | Customer Concentration Risk | |||
Segment Reporting Information [Line Items] | |||
Concentration Risk, Percentage | 31.00% | 10.00% |
Income (Loss) Per Share (Detail
Income (Loss) Per Share (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Income (Loss) Per Share | ||
Net income (loss) attributable to Innodata Inc. and Subsidiaries | $ (2,815) | $ 398 |
Weighted average common shares outstanding | 27,158 | 25,873 |
Dilutive effect of outstanding options | 0 | 3,579 |
Adjusted for dilutive computation | 27,158 | 29,452 |
Income (Loss) Per Share - Addit
Income (Loss) Per Share - Additional information (Details) - shares shares in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Employee Stock Option [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share, Amount | 7 | 0.3 |
Derivatives - Additional Inform
Derivatives - Additional Information (Details) - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative notional amount | $ 20.4 | $ 19.7 |
Derivatives - fair value of der
Derivatives - fair value of derivative instruments (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Accrued expenses | Foreign currency forward contracts | Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Derivatives designated as hedging instruments | $ 348 | $ 353 |
Derivatives - Contracts designa
Derivatives - Contracts designated as cash flow hedges (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Derivatives | |
Loss recognized in OCI | $ (78) |
Loss reclassified from accumulated OCI into income | $ 83 |