Cover
Cover - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2023 | Feb. 21, 2024 | Jun. 30, 2023 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2023 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 000-33043 | ||
Entity Registrant Name | OMNICELL, INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 94-3166458 | ||
Entity Address, Address Line One | 4220 North Freeway | ||
Entity Address, City or Town | Fort Worth | ||
Entity Address, State or Province | TX | ||
Entity Address, Postal Zip Code | 76137 | ||
City Area Code | 877 | ||
Local Phone Number | 415-9990 | ||
Title of 12(b) Security | Common Stock, $0.001 par value | ||
Trading Symbol | OMCL | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Document Financial Statement Error Correction [Flag] | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 3.3 | ||
Entity Common Stock, Shares Outstanding | 45,915,296 | ||
Documents Incorporated by Reference | Portions of the registrant’s definitive Proxy Statement for the 2024 Annual Meeting of Stockholders to be filed with the United States Securities and Exchange Commission pursuant to Regulation 14A not later than 120 days after the end of the fiscal year covered by this Form 10-K are incorporated by reference in Part III, Items 10-14 of this Form 10-K. | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2023 | ||
Entity Central Index Key | 0000926326 |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2023 | |
Auditor Information [Abstract] | |
Auditor Firm ID | 34 |
Auditor Name | Deloitte & Touche LLP |
Auditor Location | San Jose, California |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) shares in Thousands, $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 467,972 | $ 330,362 |
Accounts receivable and unbilled receivables, net of allowances of $5,564 and $5,153, respectively | 252,025 | 299,469 |
Inventories | 110,099 | 147,549 |
Prepaid expenses | 25,966 | 27,070 |
Other current assets | 71,509 | 77,362 |
Total current assets | 927,571 | 881,812 |
Property and equipment, net | 108,601 | 93,961 |
Long-term investment in sales-type leases, net | 42,954 | 32,924 |
Operating lease right-of-use assets | 24,988 | 38,052 |
Goodwill | 735,810 | 734,274 |
Intangible assets, net | 211,173 | 242,906 |
Long-term deferred tax assets | 32,901 | 22,329 |
Prepaid commissions | 52,414 | 59,483 |
Other long-term assets | 90,466 | 105,017 |
Total assets | 2,226,878 | 2,210,758 |
Current liabilities: | ||
Accounts payable | 45,028 | 63,389 |
Accrued compensation | 51,754 | 73,455 |
Accrued liabilities | 149,276 | 172,655 |
Deferred revenues, net | 121,734 | 118,947 |
Total current liabilities | 367,792 | 428,446 |
Long-term deferred revenues | 58,622 | 37,385 |
Long-term deferred tax liabilities | 1,620 | 2,095 |
Long-term operating lease liabilities | 33,910 | 39,405 |
Other long-term liabilities | 6,318 | 6,719 |
Convertible senior notes, net | 569,662 | 566,571 |
Total liabilities | 1,037,924 | 1,080,621 |
Commitments and contingencies (Note 14) | ||
Stockholders’ equity: | ||
Preferred stock, $0.001 par value, 5,000 shares authorized; no shares issued | 0 | 0 |
Common stock, $0.001 par value, 100,000 shares authorized; 55,822 and 55,030 shares issued; 45,539 and 44,747 shares outstanding, respectively | 56 | 55 |
Treasury stock at cost, 10,283 shares outstanding, respectively | (290,319) | (290,319) |
Additional paid-in capital | 1,122,292 | 1,046,760 |
Retained earnings | 370,357 | 390,728 |
Accumulated other comprehensive loss | (13,432) | (17,087) |
Total stockholders’ equity | 1,188,954 | 1,130,137 |
Total liabilities and stockholders’ equity | $ 2,226,878 | $ 2,210,758 |
Treasury stock, shares outstanding (in shares) | 10,283 | 10,283 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Accounts receivable and unbilled receivables, net of allowance | $ 5,564 | $ 5,153 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 55,822,000 | 55,030,000 |
Common stock, shares outstanding (in shares) | 45,539,000 | 44,747,000 |
Treasury stock, shares outstanding (in shares) | 10,283,000 | 10,283,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Revenues | $ 1,147,112 | $ 1,295,947 | $ 1,132,018 |
Cost of revenues | 650,272 | 706,960 | 577,365 |
Gross profit | 496,840 | 588,987 | 554,653 |
Operating expenses: | |||
Research and development | 97,115 | 104,969 | 75,716 |
Selling, general, and administrative | 434,593 | 486,341 | 389,430 |
Total operating expenses | 531,708 | 591,310 | 465,146 |
Income (loss) from operations | (34,868) | (2,323) | 89,507 |
Interest and other income (expense), net | 14,760 | (130) | (23,500) |
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest, Total | (20,108) | (2,453) | 66,007 |
Provision for (benefit from) income taxes | 263 | (8,101) | (11,842) |
Net income (loss) | $ (20,371) | $ 5,648 | $ 77,849 |
Net income (loss) per share: | |||
Basic (in dollars per share) | $ (0.45) | $ 0.13 | $ 1.79 |
Diluted (in dollars per share) | $ (0.45) | $ 0.12 | $ 1.62 |
Weighted-average shares outstanding: | |||
Basic (in shares) | 45,212 | 44,398 | 43,475 |
Diluted (in shares) | 45,212 | 45,891 | 47,943 |
Product revenues | |||
Revenues | $ 708,561 | $ 903,222 | $ 812,512 |
Cost of revenues | 414,106 | 493,626 | 422,855 |
Services and other revenues | |||
Revenues | 438,551 | 392,725 | 319,506 |
Cost of revenues | $ 236,166 | $ 213,334 | $ 154,510 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Statement of Comprehensive Income [Abstract] | |||
Net income (loss) | $ (20,371) | $ 5,648 | $ 77,849 |
Other comprehensive income (loss): | |||
Foreign currency translation adjustments | 3,655 | (8,680) | (2,885) |
Other comprehensive income (loss) | 3,655 | (8,680) | (2,885) |
Comprehensive income (loss) | $ (16,716) | $ (3,032) | $ 74,964 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Cumulative Effect of a Change in Accounting Principle | Common Stock | Treasury Stock | Additional Paid-In Capital | Additional Paid-In Capital Cumulative Effect of a Change in Accounting Principle | Retained Earnings | Retained Earnings Cumulative Effect of a Change in Accounting Principle | Accumulated Other Comprehensive Income (Loss) |
Balance at beginning of period (in shares) at Dec. 31, 2020 | 52,677 | ||||||||
Balance at beginning of period (in shares) at Dec. 31, 2020 | (9,894) | ||||||||
Balance at beginning of period at Dec. 31, 2020 | $ 967,503 | $ 53 | $ (238,109) | $ 920,359 | $ 290,722 | $ (5,522) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income (loss) | 77,849 | 77,849 | |||||||
Other comprehensive income (loss) | (2,885) | (2,885) | |||||||
Share-based compensation | 53,160 | 53,160 | |||||||
Issuance of common stock under employee stock plans (in shares) | 1,396 | ||||||||
Issuance of common stock under employee stock plans | 67,348 | $ 1 | 67,347 | ||||||
Tax payments related to restricted stock units | (16,286) | (16,286) | |||||||
Balance at end of period (in shares) at Dec. 31, 2021 | 54,073 | ||||||||
Balance at end of period (in shares) at Dec. 31, 2021 | (9,894) | ||||||||
Balance at end of period at Dec. 31, 2021 | $ 1,146,689 | $ (56,233) | $ 54 | $ (238,109) | 1,024,580 | $ (72,742) | 368,571 | $ 16,509 | (8,407) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Accounting Standards Update [Extensible List] | Accounting Standards Update 2020-06 [Member] | ||||||||
Net income (loss) | $ 5,648 | 5,648 | |||||||
Other comprehensive income (loss) | (8,680) | (8,680) | |||||||
Stock repurchases (in shares) | (389) | ||||||||
Stock repurchases | (52,210) | $ (52,210) | |||||||
Share-based compensation | 68,247 | 68,247 | |||||||
Issuance of common stock under employee stock plans (in shares) | 957 | ||||||||
Issuance of common stock under employee stock plans | 40,182 | $ 1 | 40,181 | ||||||
Tax payments related to restricted stock units | $ (13,506) | (13,506) | |||||||
Balance at end of period (in shares) at Dec. 31, 2022 | 44,747 | 55,030 | |||||||
Balance at end of period (in shares) at Dec. 31, 2022 | (10,283) | (10,283) | |||||||
Balance at end of period at Dec. 31, 2022 | $ 1,130,137 | $ 55 | $ (290,319) | 1,046,760 | 390,728 | (17,087) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income (loss) | (20,371) | (20,371) | |||||||
Other comprehensive income (loss) | 3,655 | 3,655 | |||||||
Share-based compensation | 59,683 | 59,683 | |||||||
Issuance of common stock under employee stock plans (in shares) | 792 | ||||||||
Issuance of common stock under employee stock plans | 23,216 | $ 1 | 23,215 | ||||||
Tax payments related to restricted stock units | $ (7,366) | (7,366) | |||||||
Balance at end of period (in shares) at Dec. 31, 2023 | 45,539 | 55,822 | |||||||
Balance at end of period (in shares) at Dec. 31, 2023 | (10,283) | (10,283) | |||||||
Balance at end of period at Dec. 31, 2023 | $ 1,188,954 | $ 56 | $ (290,319) | $ 1,122,292 | $ 370,357 | $ (13,432) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Operating Activities | |||
Net income (loss) | $ (20,371) | $ 5,648 | $ 77,849 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||
Depreciation and amortization | 87,319 | 86,931 | 72,990 |
Loss on disposal of property and equipment | 2,572 | 678 | 433 |
Share-based compensation expense | 55,300 | 68,247 | 53,160 |
Deferred income taxes | (11,047) | (37,316) | (3,272) |
Amortization of operating lease right-of-use assets | 8,239 | 12,238 | 11,941 |
Impairment and abandonment of operating lease right-of-use assets related to facilities | 9,998 | 9,382 | 0 |
Impairment of internal-use and external-use software development costs, net | 0 | 1,275 | 0 |
Impairment of certain long-lived assets | 1,014 | 0 | 0 |
Amortization of debt issuance costs | 4,397 | 4,164 | 3,440 |
Amortization of discount on convertible senior notes | 0 | 0 | 18,608 |
Changes in operating assets and liabilities: | |||
Accounts receivable and unbilled receivables | 49,150 | (60,357) | (40,973) |
Inventories | 38,016 | (30,115) | (25,695) |
Prepaid expenses | 1,149 | (4,671) | (5,678) |
Other current assets | (6,821) | 6,360 | 2,801 |
Investment in sales-type leases | (10,411) | (15,354) | 3,346 |
Prepaid commissions | 7,069 | 4,312 | (6,876) |
Other long-term assets | 2,111 | 5,027 | (3,258) |
Accounts payable | (17,525) | (7,754) | 29,084 |
Accrued compensation | (21,461) | 2,446 | 12,312 |
Accrued liabilities | (10,343) | 16,651 | 34,859 |
Deferred revenues | 24,058 | 24,469 | 24,179 |
Operating lease liabilities | (10,918) | (13,781) | (12,503) |
Other long-term liabilities | (401) | (699) | (14,938) |
Net cash provided by operating activities | 181,094 | 77,781 | 231,809 |
Investing Activities | |||
External-use software development costs | (13,542) | (13,204) | (29,368) |
Purchases of property and equipment | (41,474) | (47,536) | (28,967) |
Business acquisitions, net of cash acquired | 0 | (3,392) | (354,163) |
Purchase price adjustments from business acquisitions | 0 | 5,463 | 0 |
Net cash used in investing activities | (55,016) | (58,669) | (412,498) |
Financing Activities | |||
Payments for debt issuance costs for revolving credit facility | (2,967) | 0 | 0 |
Proceeds from issuances under stock-based compensation plans | 23,216 | 40,182 | 67,348 |
Employees’ taxes paid related to restricted stock units | (7,366) | (13,506) | (16,286) |
Stock repurchases | 0 | (52,210) | 0 |
Change in customer funds, net | 10,537 | 4,581 | (3,699) |
Net cash provided by (used in) financing activities | 23,420 | (20,953) | 47,363 |
Effect of exchange rate changes on cash and cash equivalents | (1,354) | (944) | (974) |
Net increase (decrease) in cash, cash equivalents, and restricted cash | 148,144 | (2,785) | (134,300) |
Cash, cash equivalents, and restricted cash at beginning of period | 352,835 | 355,620 | 489,920 |
Cash, cash equivalents, and restricted cash at end of period | 500,979 | 352,835 | 355,620 |
Reconciliation of cash, cash equivalents, and restricted cash to the Consolidated Balance Sheets: | |||
Cash and cash equivalents | 467,972 | 330,362 | 349,051 |
Restricted cash included in other current assets | 33,007 | 22,473 | 6,569 |
Cash, cash equivalents, and restricted cash at end of period | 500,979 | 352,835 | 355,620 |
Supplemental cash flow information | |||
Cash paid for interest | 1,438 | 1,438 | 1,917 |
Income taxes paid (refunds received), net | 20,209 | 19,005 | (1,733) |
Supplemental disclosure of non-cash investing activities | |||
Unpaid purchases of property and equipment | 877 | 892 | 883 |
Transfers between inventory and property and equipment, net | $ 0 | $ 314 | $ 1,876 |
Organization and Summary of Sig
Organization and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Organization and Summary of Significant Accounting Policies | Organization and Summary of Significant Accounting Policies Business Omnicell, Inc. was incorporated in California in 1992 under the name Omnicell Technologies, Inc. and reincorporated in Delaware in 2001 as Omnicell, Inc. The Company’s major products and related services are medication management solutions and adherence tools for healthcare systems and pharmacies, which are sold in its principal market, the healthcare industry. The Company’s market is primarily located in the United States and Europe. “Omnicell” or the “Company” refer to Omnicell, Inc. and its subsidiaries, collectively. Basis of Presentation The accompanying Consolidated Financial Statements have been prepared in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”) and include all adjustments necessary for the fair presentation of the Company’s consolidated financial position, results of operations, and cash flows for the periods presented. Principles of Consolidation The Consolidated Financial Statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts reported in the Company’s Consolidated Financial Statements and accompanying Notes to Consolidated Financial Statements. These estimates are based on historical experience and various other assumptions that management believes to be reasonable. Although these estimates are based on management’s best knowledge of current events and actions that may impact the Company in the future, actual results may be different from the estimates. The Company’s critical accounting policies are those that affect its financial statements materially and involve difficult, subjective, or complex judgments by management. Those policies are revenue recognition; allowance for credit losses for accounts receivable and unbilled receivables; notes receivable from investment in sales-type leases; operating lease right-of-use assets and liabilities; inventory valuation; internal-use and external-use software development costs; impairment of goodwill; purchased intangibles and long-lived assets; fair value of assets acquired and liabilities assumed in business combinations; share-based compensation; and accounting for income taxes. As of December 31, 2023, the Company is not aware of any events or circumstances that would require an update to its estimates, judgments, or revisions to the carrying value of its assets or liabilities. Segment Reporting The Company manages its operations as a single segment for the purposes of assessing performance and making operating decisions. The Company’s Chief Operating Decision Maker (“CODM”) is its Chief Executive Officer. The CODM allocates resources and evaluates the performance of the Company at the consolidated level using information about its revenues, gross profit, income from operations, and other key financial data. All significant operating decisions are based upon an analysis of the Company as one operating segment, which is the same as its reporting segment. Foreign Currency Translation and Remeasurement Most of the Company’s foreign subsidiaries use the local currency of their respective countries as their functional currency. The Company translates the assets and liabilities of such non-U.S. dollar functional currency subsidiaries into U.S. dollars using exchange rates in effect at the end of each period. Revenue and expenses for these subsidiaries are translated using rates that approximate those in effect during the period. Gains and losses from these translations are recorded as foreign currency translation adjustments and included in accumulated other comprehensive income (loss) in stockholders’ equity. Assets and liabilities denominated in a currency other than the functional currency are remeasured into the respective entity’s functional currency. Monetary assets and liabilities are remeasured at exchange rates in effect at the end of each period, and non-monetary assets and liabilities are remeasured at historical rates. Gains and losses from foreign currency remeasurement of monetary assets and liabilities are recorded in interest and other income (expense), net. Revenue Recognition The Company earns revenues from sales of its products and related services, which are sold in the healthcare industry, its principal market. The Company’s customer arrangements typically include one or more of the following revenue categories: Connected devices, software licenses, and other. Software-enabled connected devices and software licenses that manage and regulate the storage and dispensing of pharmaceuticals, consumables blister cards, and packaging equipment and other supplies. This revenue category is often sold through long-term, sole-source agreements. Solutions in this category include, but are not limited to, XT Series automated dispensing systems and products related to the Central Pharmacy Dispensing Service and IV Compounding Service. Consumables. Medication adherence packaging, labeling, and other one-time use packaging including multimed adherence packaging and single dose blister cards, which are used by retail, community, and outpatient pharmacies, as well as by institutional pharmacies serving long-term care and other sites outside the acute care hospital, are designed to improve patient engagement and adherence to prescriptions. Technical services. Post-installation technical support and other related services, including phone support, on-site service, parts, and access to unspecified software updates and enhancements, if and when available. This revenue category is often supported by multi-year or annual contractual agreements. Advanced Services. Emerging software and service solutions which are offered on a subscription basis with fees typically based either on transaction volume or a fee over a specified period of time. Solutions in this category include, but are not limited to, EnlivenHealth ® , Specialty Pharmacy Services, 340B solutions, Inventory Optimization Service, other software solutions, and services related to the Central Pharmacy Dispensing Service and IV Compounding Service. The following table summarizes revenue recognition for each revenue category: Revenue Category Timing of Revenue Recognition Income Statement Classification Connected devices, software licenses, and other Point in time, as transfer of control occurs, generally upon installation and acceptance by the customer Product Consumables Point in time, as transfer of control occurs, generally upon shipment to or receipt by customer Product Technical services Over time, as services are provided, typically ratably over the service term Service Advanced Services Over time, as services are provided Service Prior to recognizing revenue, the Company identifies the contract, performance obligations, and transaction price, and allocates the transaction price to the performance obligations. All identified contracts meet the following required criteria: Parties to the contract have approved the contract (in writing, orally, or in accordance with other customary business practices) and are committed to perform their respective obligations. A majority of the Company’s contracts are evidenced by a non-cancelable written agreement. Contracts for consumable products are generally evidenced by an order placed via our online portal, phone, or a purchase order. Entity can identify each party’s rights regarding the goods or services to be transferred . Contract terms are documented within the written agreements. Where a written contract does not exist, such as for consumable products, the rights of each party are understood as following the Company’s standard business process and terms. The entity can identify the payment terms for the goods or services to be transferred . Payment terms are documented within the agreement and are generally net 30 to 60 days from shipment of tangible product or services performed for customers in the United States. Where a written contract does not exist, the Company’s standard payment terms are net 30 day terms. The contract has commercial substance (that is the risk, timing, or amount of the entity’s future cash flows is expected to change as a result of the contract). The Company’s agreements are an exchange of cash for a combination of products and services which result in changes in the amount of the Company’s future cash flows. It is probable the entity will collect the consideration to which it will be entitled in exchange for the goods or services that will be transferred to the customer . The Company performs a credit check for all significant customers or transactions and where collectability is not probable, payment in full or a substantial down payment prior to shipment is typically required to help ensure the full agreed upon contract price will be collected. Distinct goods or services are identified as performance obligations. A series of distinct goods or services that are substantially the same and that have the same pattern of transfer to the customer are considered a single performance obligation. Where a good or service is determined not to be distinct, the Company combines the good or service with other promised goods or services until a bundle of goods or services that is distinct is identified. To identify its performance obligations, the Company considers all products or services promised in the contract regardless of whether they are explicitly stated or are implied by customary business practices. When performance obligations are included in separate contracts, the Company considers an entire customer arrangement to determine if separate contracts should be considered combined for the purposes of revenue recognition. Most of the Company’s sales, other than renewals of support and maintenance, contain multiple performance obligations, with a combination of hardware systems, software products, support and maintenance, and professional services. The transaction price of a contract is determined based on the fixed consideration, net of an estimate for variable consideration such as various discounts or rebates provided to customers. As a result of the Company’s commercial selling practices, contract prices are generally fixed with minimal, if any, variable consideration. The transaction price is allocated to separate performance obligations proportionally based on the standalone selling price of each performance obligation. Standalone selling price is best evidenced by the price the Company charges for the good or service when selling it separately in similar circumstances to similar customers. Other than for the renewal of annual technical services contracts, the Company’s products and services are not generally sold separately. The Company uses an amount discounted from the list price as a best estimated selling price. The Company recognizes revenue when the performance obligation has been satisfied by transferring a promised good or service to a customer. The good or service is transferred when or as the customer obtains control of the good or service. Determining when control transfers requires management to make judgments that affect the timing of revenues recognized. Generally, for products requiring a complex implementation, control passes when the product is installed and ready for use. For all other products, control generally passes when product has been shipped and title has passed. For maintenance contracts and certain other services, including Advanced Services provided on a subscription basis, control passes to the customer over time, generally ratably over the service term as the Company provides a stand-ready service for the customer’s equipment. Time and material services transfer control to the customer at the time the services are provided. The portion of the transaction price allocated to the Company’s unsatisfied performance obligations for which invoicing has occurred is recorded as deferred revenues, net of deferred cost of goods sold. Deferred revenues from product sales primarily relate to delivered and invoiced products, pending installation and acceptance. Deferred revenues from service contracts primarily relate to services that have been invoiced, where services have not yet been provided. Short-term deferred revenues are expected to be recognized within the next twelve months. Long-term deferred revenues substantially consist of deferred revenues on long-term technical and Advanced Services contracts which have been invoiced and are expected to be recognized as revenue beyond twelve months, generally not more than ten years. In addition, the Company has remaining performance obligations associated with contracts for which the associated products have been accepted or associated services have started, but where invoicing has not yet occurred and therefore are not reflected in deferred revenue. These remaining performance obligations are comprised of the non-variable portions of technical services and Advanced Services provided under non-cancellable contracts with minimum commitments. Remaining performance obligations which are not included in deferred revenues are $353.9 million as of December 31, 2023. Remaining performance obligations are expected to be recognized ratably over the remaining terms of the associated contracts, which terms vary but are generally not more than ten years. Remaining performance obligations do not include product obligations, services where the associated product has not been accepted, services which have not yet started, variable portions of services, and certain other obligations. Revenues, contract assets, and contract liabilities are recorded net of associated taxes. The Company generally invoices customers for products upon shipment. Invoicing associated with the service portion of agreements is generally periodic and is billed on a monthly, quarterly, or annual basis, and in certain circumstances, multiple years are billed at one time. Advanced Services agreements are generally invoiced periodically on a monthly, quarterly or annual basis over the life of the agreement. In certain circumstances portions of these agreements may be invoiced lump sum. The amount invoiced for equipment and software is typically reflected in both accounts receivable and deferred revenues, net. The Company typically recognizes product revenue, and correspondingly reduces deferred revenues, net, for equipment and on-premise software upon written customer acceptance of installation. Consumables are recorded as revenue upon shipment to or receipt by the customer, depending upon contract terms. From time to time, the Company enters into change orders which modify the product to be received by the customer pursuant to certain contracts. Changes to any contract are accounted for as a modification of the existing contract to the extent the goods and services to be delivered as part of the contract are generally consistent with the nature and type of those to be provided under the terms of the original contract. Examples of such change orders include the addition or removal of units of equipment or changes to the configuration of the equipment where the overall nature of the contract remains intact. The Company’s change orders generally result in the change being accounted for as modifications of existing contracts given the nature of the impacted orders. In the normal course of business, the Company typically does not accept product returns unless the item is defective as manufactured or the configuration of the product is incorrect. The Company establishes provisions for estimated returns based on historical product returns. The allowance for sales returns is not material to the Consolidated Financial Statements for any periods presented. A portion of the Company’s sales are made to customers who are members of Group Purchasing Organizations (“GPOs”), each of which functions as a purchasing agent on behalf of member hospitals and other healthcare providers. The Company also has a Federal Supply Schedule Contract with the Department of Veterans Affairs (the “GSA Contract”), allowing the Department of Veterans Affairs, the Department of Defense, and other federal government customers to purchase the Company’s products. Pursuant to the terms of GPO agreements and the GSA Contract, each member or agency contracts directly with Omnicell and can purchase the Company’s products at pre-negotiated contract terms and pricing. GPOs are often fully or partially owned by the Company’s customers, and the Company pays fees to the GPO on completed contracts. The Company also pays the Industrial Funding Fee (“IFF”) to the Department of Veterans Affairs under the GSA Contract. The Company considers these fees consideration paid to customers and records them as reductions to revenue. Fees to GPOs and the IFF were $11.2 million, $17.6 million, and $17.5 million for the years ended December 31, 2023, 2022, and 2021, respectively. The accounts receivable balances are with individual members of the GPOs and federal agencies that purchase under the GSA Contract, and therefore no significant concentration of credit risk exists. During the year ended December 31, 2023, sales to members of the ten largest GPOs and federal agencies that purchase under the GSA Contract accounted for approximately 64% of the Company’s total consolidated revenues. Contract Assets and Contract Liabilities A contract asset is a right to consideration in exchange for goods or services that the Company has transferred to a customer when that right is conditioned on something other than the passage of time. A receivable will be recorded on the balance sheet when the Company has unconditional rights to consideration. A contract liability is an obligation to transfer goods or services for which the Company has received consideration, or for which an amount of consideration is due from the customer. Contract liabilities include customer deposits under non-cancelable contracts, and current and non-current deferred revenue balances. The Company’s contract balances are reported in a net contract asset or liability position on a contract-by-contract basis at the end of each reporting period. Significant changes in the contract assets and the contract liabilities balances during the period are the result of the issuance of invoices and recognition of deferred revenues in the normal course of business. The contract modifications entered into during the year ended December 31, 2023 did not have a significant impact on the Company’s contract assets or deferred revenues. Contract Costs The Company has determined that certain incentive portions of its sales commission plans require capitalization since these payments are directly related to sales achieved during a time period. These commissions are earned on the basis of: (i) the value of new bookings for connected devices, software products, and Advanced Services, provided that for Advanced Services a commission will only be paid on the amount that represents the minimum commitment and (ii) the value of new orders for consumables. Since there are no commensurate commissions earned on renewal of the service bookings, the Company concluded that the capitalized asset is related to services provided under both the initial contract and renewal periods. The Company applies a practical expedient to account for the incremental costs of obtaining a contract as part of a portfolio of contracts with similar characteristics as the Company expects the effect on the financial statements of applying the practical expedient would not differ materially from applying the accounting guidance to the individual contracts within the portfolio. A pool of contracts is defined as all contracts booked in a particular quarter. The amortization for the capitalized asset is an estimate of the pool’s original contract term, generally one year estimated initial and renewal service periods. The Company recognized contract cost expense of $23.3 million, $30.6 million, and $25.8 million during the years ended December 31, 2023, 2022, and 2021, respectively. The commission expenses paid or due to be paid as of the consolidated balance sheet date to be recognized in future periods are recorded in long-term prepaid commissions on the Consolidated Balance Sheets. Capitalized costs are periodically reviewed for impairment. There was no impairment loss recorded related to capitalized prepaid commissions as of and for the year ended December 31, 2023. Lessor Leases The Company determines if an arrangement is or contains a lease at inception. The transaction price is allocated to separate performance obligations, generally consisting of a combination of hardware systems, software products, support and maintenance, and professional services, proportionally based on the standalone selling price of each performance obligation. Standalone selling price is best evidenced by the price the Company charges for the good or service when selling it separately in similar circumstances to similar customers. Other than for the renewal of annual technical services contracts, the Company’s products and services are not generally sold separately. The Company uses an amount discounted from the list price as a best estimated selling price. Sales-Type Leases The Company enters into non-cancelable sales-type lease arrangements with the leases varying in length from one For sales-type leases, the Company recognizes revenues for its hardware and software products, net of lease execution costs, post-installation product maintenance, professional services associated with Advanced Services offerings, and technical support, at the net present value of the lease payment stream upon customer acceptance. The Company recognizes service revenues associated with sales-type leases ratably over the term of the agreement in service revenues in the Consolidated Statements of Operations. The Company recognizes interest income from sales-type leases using the effective interest method. Both hardware and software revenues, and interest income from sales-types leases are recorded in product revenues in the Consolidated Statements of Operations. The Company optimizes cash flows by selling a majority of its sales-type leases, other than those relating to U.S. government hospitals and Advanced Services products, including Central Pharmacy Dispensing Service and IV Compounding Service, to third-party leasing finance companies on a non-recourse basis. The Company has no obligation to the leasing company once the lease has been sold. Allowance for Credit Losses The Company is exposed to credit losses primarily through sales of its products and services, as well as its sales-type leasing arrangements. The Company performs credit evaluations of its customers’ financial condition in order to assess each customer’s ability to pay. These evaluations require significant judgment and are based on a variety of factors including, but not limited to, current economic trends, payment history, and a financial review of the customer. The Company continues to monitor customers’ creditworthiness on an ongoing basis. The Company maintains an allowance for credit losses for accounts receivable, unbilled receivables, and net investment in sales-type leases based on expected credit losses resulting from the inability of its customers to make required payments. The allowance for credit losses is measured using a loss rate method, considering factors such as customers’ credit risk, historical loss experience, current conditions, and forecasts. The allowance for credit losses is measured on a collective (pool) basis by aggregating customer balances with similar risk characteristics. The Company also records a specific allowance based on an analysis of individual past due balances or customer-specific information, such as a decline in creditworthiness or bankruptcy. Actual collection losses may differ from management’s estimates, and such differences could be material to the Company’s financial position and results of operations. The allowance for credit losses is presented in the Consolidated Balance Sheets as a deduction from the respective asset balance. As of December 31, 2023 and 2022, the allowance for credit losses for long-term unbilled receivables and net investment in sales-type leases were not material. Funds Held for Customers and Customer Fund Liabilities The Company offers certain products and services in which it is customary for pharmacies or insurance payors to owe funds to the Company which are collected on behalf of, and, after a short holding period, disbursed to, the Company’s customers. The Company presents amounts due from pharmacies and amounts due to be disbursed to customers on a gross basis within other current assets and accrued liabilities, respectively, in the Consolidated Balance Sheets, as such amounts are expected to be settled within one year. Generally, any funds received from the pharmacies or insurance payors that are held by the Company are segregated from its other corporate cash accounts. These funds are classified as restricted cash as the Company is contractually obligated to disburse these amounts to customers. Sales of Accounts Receivable The Company records the sale of its accounts receivables in accordance with accounting guidance for transfers and servicing of financial assets. The Company transferred non-recourse accounts receivable totaling $5.7 million, $45.3 million, and $46.7 million during the years ended December 31, 2023, 2022, and 2021, respectively, which approximated fair value, to leasing companies on a non-recourse basis. Accounts receivable balance included approximately $1.1 million and $6.7 million due from third-party leasing companies for transferred non-recourse accounts receivable as of December 31, 2023 and 2022, respectively. Cash and Cash Equivalents The Company classifies all highly-liquid investments with original maturities of three months or less as cash equivalents. The Company’s cash and cash equivalent balances include bank accounts and highly-liquid U.S. Government money market funds held in sweep and asset management accounts with financial institutions of high credit quality. The Company continuously monitors the credit worthiness of the financial institutions in which it invests. The Company has not experienced any credit losses from its cash equivalents. Cash and cash equivalents were $468.0 million and $330.4 million as of December 31, 2023 and 2022, respectively. As of December 31, 2023 and 2022, cash equivalents were $451.0 million and $301.0 million, respectively, which consisted of money market funds held in sweep and asset management accounts. Financial Instruments For assets and liabilities measured at fair value, the amounts are based on an expected exit price representing the amount that would be received from the sale of an asset or paid to transfer a liability in a transaction between market participants. The fair value may be based on assumptions that market participants would use in pricing an asset or liability. ASC 820, Fair Value Measurement , establishes a consistent framework for measuring fair value on either a recurring or nonrecurring basis whereby inputs used in valuation techniques are assigned a hierarchical level, as follows: Level 1 – Observable inputs, such as quoted prices in active markets for identical instruments; Level 2 – Quoted prices for similar instruments in active markets, or quoted prices for identical instruments in inactive markets; and Level 3 – Unobservable inputs for financial instruments reflecting Company’s assumptions. Inventory Inventories are stated at the lower of cost, computed using the first-in, first-out method, and net realizable value. Inbound shipping costs are included in cost of inventory. The Company regularly monitors inventory quantities on hand and records write-downs for excess and obsolete inventories based on the Company’s estimate of demand for its products, potential obsolescence of technology, product life cycles, and whether pricing trends or forecasts indicate that the carrying value of inventory exceeds its estimated selling price. These factors are impacted by market and economic conditions, technology changes, and new product introductions and require estimates that may include elements that are uncertain. Actual demand may differ from forecasted demand and may have a material effect on gross margins. If inventory is written down, a new cost basis is established that cannot be increased in future periods. Shipments from suppliers or contract manufacturers before the Company receives them are recorded as in-transit inventory when title and the significant risks and rewards of ownership have passed to the Company. The Company has a supply agreement with one primary supplier for construction and supply of several sub-assemblies and inventory management of sub-assemblies used in its hardware products. There are no minimum purchase requirements. The contract with the Company’s supplier may be terminated by either the supplier or by the Company without cause and at any time upon delivery of six months’ notice. Purchases from this supplier were $65.8 million, $105.7 million, and $103.2 million for the years ended December 31, 2023, 2022, and 2021, respectively. Shipping Costs Outbound freight billed to customers is recorded as product revenue. The related shipping and handling costs are expensed as part of selling, general, and administrative expense. Shipping and handling expenses were $18.6 million, $24.5 million, and $18.2 million for the years ended December 31, 2023, 2022, and 2021, respectively. Property and Equipment Property and equipment less accumulated depreciation are stated at historical cost. The Company’s expenditures for property and equipment are primarily for computer equipment and software used in the administration of its business, and for leasehold improvements to its leased facilities. The Company also develops molds and dies used in long-term manufacturing arrangements with suppliers and for production automation equipment used in the manufacturing of consumable blister card components. The Company capitalizes costs related to computer software developed or obtained for internal-use in accordance with ASC 350-40, Internal-Use Software . Software developed or obtained for internal-use includes certain costs for the development of the Company’s subscription and cloud-based offerings sold to its customers, as well as enterprise-level business and finance software that the Company customizes to meet its specific operational needs. Costs incurred in the application development phase are capitalized and amortized over their useful lives, which is generally five years. Costs recognized in the preliminary project phase and the post-implementation phase are expensed as incurred. The Company capitalized $32.2 million and $33.0 million of costs related to the application development of enterprise-level software and its subscription and cloud-based offerings, which are included in property and equipment during the years ended December 31, 2023 and 2022, respectively. Capitalized costs related to computer software developed or obtained for internal-use are included in purchases of property and equipment in the Consolidated Statements of Cash Flows. Depreciation and amortization is computed by use of the straight-line method over the estimated useful lives of the assets as stated below: Purchased software and internal-use software development costs 3 - 5 years Leasehold and building improvements Shorter of the lease term or the estimated useful life Furniture and fixtures 5 - 7 years Equipment 2 - 12 years External-Use Software Development Costs The Company capitalizes certain software development costs in accordance with ASC 985-20, Costs of Software to Be Sold, Leased, or Marketed , under which those costs incurred subsequent to the establishment of technological feasibility may be capitalized and amortized over the estimated lives of the related products. The Company establishes technological feasibility when it completes a detail program design or a working model. The Company amortizes development costs over the estimated lives of the related products, which is generally five years. All development costs prior to the completion of a detail program design or a working model are recognized as research and development expense. |
Business Combinations
Business Combinations | 12 Months Ended |
Dec. 31, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Business Combinations | Business Combinations The Company’s Consolidated Financial Statements include the results of operations of each acquired company, commencing as of their respective acquisition dates. Acquisition-related costs were expensed as incurred, and are included in selling, general, and administrative expenses in the Company’s Consolidated Statements of Operations. 2022 Acquisition Hub and Spoke Innovations On January 10, 2022, the Company completed the acquisition of all of the outstanding equity interests in Hub and Spoke Innovations pursuant to the terms and conditions of the Share Purchase Agreement, dated January 10, 2022, by and among Omnicell Limited (a wholly-owned subsidiary of the Company), Hub and Spoke Innovations Limited, and certain beneficial stockholders specified therein for a base purchase price of £2.5 million (approximately $3.4 million based on the exchange rate in effect at the acquisition date), prior to customary adjustments for closing cash, net working capital, and assumed indebtedness. The purchase price transferred for the transaction, net of cash acquired, was £2.5 million (approximately $3.4 million based on the exchange rate in effect at the acquisition date). Of the purchase price transferred, £1.9 million (approximately $2.5 million based on the exchange rate in effect at the acquisition date) was allocated to goodwill; £0.8 million (approximately $1.1 million based on the exchange rate in effect at the acquisition date) was allocated to intangible assets, which included customer relationships; and the remainder was allocated to net assets acquired. The Hub and Spoke Innovations acquisition is expected to complement Omnicell’s total solution technology portfolio for retail pharmacy in the United Kingdom to help pharmacies improve workflows, offer patients 24/7 access to their medications and provide enhanced patient care. 2021 Acquisitions MarkeTouch Media On December 31, 2021, the Company completed the acquisition of all of the outstanding equity interests in MarkeTouch Media, LLC (“MarkeTouch Media”) pursuant to the terms and conditions of the Unit Purchase Agreement, dated December 31, 2021, by and among ateb, Inc. (a wholly-owned subsidiary of the Company), MarkeTouch Media, LLC, MarkeTouch Holdings, Inc., Toucan Enterprises, Inc., and certain beneficial stockholders specified therein for a base purchase price of $82.0 million, prior to customary adjustments for closing cash, net working capital, and assumed indebtedness. The MarkeTouch Media acquisition adds mobile and web-based technology and patient engagement solutions, which is expected to expand the footprint of EnlivenHealth ® across the retail pharmacy sector, while enhancing potential growth opportunities in new market segments like specialty pharmacy and pharmacy benefits management. ReCept On December 29, 2021, the Company completed the acquisition of all outstanding equity securities of ReCept pursuant to the terms and conditions of the Agreement and Plan of Merger, dated December 1, 2021, by and among Omnicell, Inc., ReCept Holdings, Inc., Redfish Acquisition Corp, and the representative of the securityholders for a base purchase price of $100.0 million, prior to customary adjustments for closing cash, net working capital, and assumed indebtedness. The addition of ReCept’s specialty pharmacy management services, now a part of the Company’s Specialty Pharmacy Services, for health systems, provider groups, and federally qualified health centers expands Omnicell’s Advanced Services portfolio in an effort to address the growing and complex specialty pharmacy market. FDS Amplicare On September 9, 2021, the Company completed the acquisition of all of the outstanding equity interests in RxInnovation, Inc., operating as FDS Amplicare ® (“FDS Amplicare”), pursuant to the terms and conditions of the Agreement and Plan of Merger, dated July 25, 2021, by and among RxInnovation Inc., Omnicell, Inc., Fleming Acquisition Corp., and the representative of the securityholders for a base purchase price of $177.0 million, prior to customary adjustments for closing cash, net working capital, and assumed indebtedness. The FDS Amplicare acquisition adds a comprehensive and complementary suite of software-as-a-service (“SaaS”) financial management, analytics, and population health solutions to the Company’s EnlivenHealth offering. The Company incurred approximately $7.0 million in acquisition-related costs related to the FDS Amplicare acquisition during the year ended December 31, 2021. Revenues and net losses from the FDS Amplicare operations since the acquisition date through December 31, 2021 were $11.3 million and $0.9 million, respectively. The following tables represent the allocation of the respective purchase price to the assets acquired and the liabilities assumed by the Company as part of each acquisition included in the Company’s Consolidated Balance Sheets, and is reconciled to the respective purchase price transferred: FDS Amplicare (1) ReCept (2) (3) MarkeTouch Media (4) (In thousands) Purchase price transferred: Base purchase price $ 177,000 $ 100,000 $ 82,000 Add: Closing cash 465 6,569 237 Add: Net working capital adjustment 1,654 (7,357) 147 Less: Assumed indebtedness (653) (1,973) (15) Total purchase price transferred $ 178,466 $ 97,239 $ 82,369 FDS Amplicare (1) ReCept (2) (3) MarkeTouch Media (4) Fair value of assets acquired and liabilities assumed: Cash and cash equivalents $ 465 $ — $ 237 Accounts receivable and unbilled receivables 5,330 2,383 2,302 Prepaid expenses 506 192 96 Other current assets 45 12,223 — Total current assets 6,346 14,798 2,635 Property and equipment 444 172 177 Operating lease right-of-use assets 2,252 773 602 Goodwill 117,784 77,644 42,273 Intangible assets 70,000 28,100 38,000 Other long-term assets 51 195 2,850 Total assets 196,877 121,682 86,537 Accounts payable 950 219 473 Accrued compensation 1,312 1,756 — Accrued liabilities 1,497 18,249 292 Deferred revenues 1,916 222 347 Long-term deferred tax liabilities 11,686 3,383 — Long-term operating lease liabilities 920 614 206 Other long-term liabilities 130 — 2,850 Total liabilities 18,411 24,443 4,168 Total purchase price $ 178,466 $ 97,239 $ 82,369 Total purchase price, net of cash acquired $ 178,001 $ 90,670 $ 82,132 _________________________________________________ (1) During the year ended December 31, 2021, the Company recorded measurement period adjustments of $1.5 million to goodwill, consisting of an increase in intangible assets, accounts receivable and unbilled receivables, and long-term deferred tax liabilities of $0.4 million, $1.1 million, and $0.1 million, respectively, and a net working capital adjustment of $0.1 million. During the year ended December 31, 2022, the Company recorded a measurement period adjustments of $0.4 million to goodwill, consisting of an increase in long-term deferred tax liabilities and accrued liabilities of $0.3 million and $0.1 million, respectively. (2) Closing cash is included in other current assets due to its restrictive nature as cash held for customers. (3) During the year ended December 31, 2022, the Company recorded measurement period adjustments of $3.9 million to goodwill, consisting of a purchase price adjustment of $5.2 million, a decrease in long-term deferred tax liabilities of $0.2 million and a decrease in accrued liabilities of $0.3 million, partially offset by a decrease to other current assets of $1.7 million. (4) During the year ended December 31, 2022, the Company recorded a measurement period adjustment of $0.3 million to goodwill related to a purchase price adjustment. The $117.8 million of goodwill arising from the FDS Amplicare acquisition is primarily attributed to future sales of SaaS solutions and FDS Amplicare’s assembled workforce. The $77.6 million of goodwill arising from the ReCept acquisition is primarily attributed to future sales of its offerings and services and ReCept’s assembled workforce. None of the FDS Amplicare and ReCept goodwill is expected to be deductible for tax purposes as these acquisitions were treated as stock acquisitions for U.S. tax purposes. The $42.3 million of goodwill arising from the MarkeTouch Media acquisition is primarily attributed to future sales of SaaS solutions and MarkeTouch Media’s assembled workforce. The full amount of the MarkeTouch Media goodwill is expected to be deductible for tax purposes as this acquisition was treated as an asset acquisition for U.S. tax purposes. The identifiable intangible assets acquired and their estimated useful lives for amortization are as follows: FDS Amplicare (1) ReCept MarkeTouch Media Fair value Useful life Fair value Useful life Fair value Useful life (In thousands, except for years) Customer relationships $ 59,900 23 $ 28,100 23 $ 34,100 26 Acquired technology 7,700 5 - 7 — — 2,100 4 Backlog — — — — 1,800 2 Trade names 2,400 5 — — — — Total purchased intangible assets $ 70,000 $ 28,100 $ 38,000 _________________________________________________ (1) During the year ended December 31, 2021, the Company recorded a measurement period adjustment of $0.4 million in customer relationships. The customer relationships intangible assets represent the fair values of the underlying relationships and agreements with each acquired company’s customers. The acquired technology intangible assets represent the fair values of the portfolio of SaaS solutions that have reached technological feasibility and were part of the respective acquired company’s offerings at their respective acquisition dates. The backlog intangible asset represents contractually committed future billings associated with MarkeTouch Media customer contracts. The trade names intangible asset represents the fair value of brand and name recognition associated with the marketing of certain FDS Amplicare SaaS solutions. The fair values of the customer relationships and backlog intangible assets were determined based on the excess earnings method, and the fair values of the acquired technology and trade names intangible assets were determined based on the relief-from-royalty method. The key assumptions used in estimating the fair values of intangible assets included forecasted financial information; customer attrition rates; royalty rate of 10.0% for the acquired technology intangible assets for both FDS Amplicare and MarkeTouch Media; royalty rate of 2.0% for the FDS Amplicare trade names intangible asset; discount rate of 13.0% for the FDS Amplicare acquisition; discount rate of 15.0% for the ReCept acquisition; discount rate of 11.5% for the MarkeTouch Media acquisition; and certain other assumptions. The customer relationships and acquired technology intangible assets are being amortized using a double-declining method of amortization as such method better represents the economic benefits to be obtained. The backlog and trade names intangible assets are being amortized over their respective estimated useful lives using the straight-line method of amortization. Pro Forma Financial Information The following table presents certain unaudited pro forma consolidated financial information for the year ended December 31, 2021 as if the FDS Amplicare, ReCept, and MarkeTouch Media acquisitions had been completed on January 1, 2020. The pro forma effects of the Hub and Spoke Innovations acquisition were not material to the Company’s consolidated results of operations. The unaudited pro forma financial information is presented for informational purposes only, and is not indicative of what would have occurred had the acquisitions taken place on those respective dates. The unaudited pro forma financial information combines the historical results of the acquisitions with the Company’s consolidated historical results and includes certain adjustments including, but not limited to, amortization and depreciation of intangible assets and property and equipment acquired; imputed interest, interest expense, and amortization of debt issuance costs related to acquisitions, as applicable; and certain acquisition-related costs incurred. Year Ended December 31, 2021 (In thousands) Pro forma revenues $ 1,195,473 Pro forma net income $ 79,981 |
Revenues
Revenues | 12 Months Ended |
Dec. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | Revenues Disaggregation of Revenues The following table summarizes the Company’s revenues disaggregated by revenue type for the years ended December 31, 2023, 2022, and 2021: Year Ended December 31, 2023 2022 2021 (In thousands) Connected devices, software licenses, and other $ 623,584 $ 827,917 $ 739,074 Consumables 84,977 75,305 73,438 Technical services 225,831 206,687 206,989 Advanced Services 212,720 186,038 112,517 Total revenues $ 1,147,112 $ 1,295,947 $ 1,132,018 The following table summarizes the Company’s revenues disaggregated by geographic region, which is determined based on customer location, for the years ended December 31, 2023, 2022, and 2021: Year Ended December 31, 2023 2022 2021 (In thousands) United States $ 1,011,380 $ 1,168,202 $ 1,020,788 Rest of world (1) 135,732 127,745 111,230 Total revenues $ 1,147,112 $ 1,295,947 $ 1,132,018 _________________________________________________ (1) No individual country represented more than 10% of total revenues. Contract Assets and Contract Liabilities The following table reflects the Company’s contract assets and contract liabilities: December 31, 2023 2022 (In thousands) Short-term unbilled receivables, net (1) $ 22,524 $ 25,763 Long-term unbilled receivables, net (2) 11,850 14,744 Total contract assets $ 34,374 $ 40,507 Short-term deferred revenues, net $ 121,734 $ 118,947 Long-term deferred revenues 58,622 37,385 Total contract liabilities $ 180,356 $ 156,332 _________________________________________________ (1) Included in accounts receivable and unbilled receivables in the Consolidated Balance Sheets. (2) Included in other long-term assets in the Consolidated Balance Sheets. Short-term deferred revenues, net of $121.7 million and $118.9 million include deferred revenues from product sales and service contracts, net of deferred cost of sales of $12.4 million and $15.8 million, as of December 31, 2023 and 2022, respectively. During the year ended December 31, 2023, the Company recognized revenues of $115.7 million that were included in the corresponding gross short-term deferred revenues balance of $134.7 million as of December 31, 2022. Significant Customers There were no customers that accounted for more than 10% of the Company’s total revenues for the years ended December 31, 2023, 2022, and 2021. Also, there were no customers that accounted for more than 10% of the Company’s accounts receivable balance as of December 31, 2023 and 2022. |
Net Income (Loss) Per Share
Net Income (Loss) Per Share | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
Net Income Per Share | Net Income (Loss) Per Share Basic net income (loss) per share is computed by dividing net income (loss) for the period by the weighted-average number of shares outstanding during the period. In periods of net loss, all potential common shares are anti-dilutive, so diluted net loss per share equals the basic net loss per share. In periods of net income, diluted net income per share is computed by dividing net income for the period by the basic weighted-average number of shares plus any dilutive potential common stock outstanding during the period, using the treasury stock method for share-based awards and warrants, and the if-converted method for convertible senior notes. Potential common stock includes the effect of outstanding dilutive stock options, restricted stock awards, and restricted stock units, as well as shares the Company could be obligated to issue from its convertible senior notes and warrants, as described in Note 11, Convertible Senior Notes . For periods prior to the adoption of ASU 2020-06 on January 1, 2022, the Company applied the treasury stock method to calculate the dilutive impact of the convertible senior notes. Upon adoption of ASU 2020-06, effective January 1, 2022, the Company applies the if-converted method for calculating the dilutive impact of the convertible senior notes. Following the Company’s irrevocable election in December 2021 to settle the principal portion of the convertible senior notes in cash with any conversion consideration in excess of the principal portion in cash and/or shares of the Company’s common stock at the Company’s option upon conversion, only the amounts expected to be settled in excess of the principal portion are considered dilutive in calculating earnings per share under the if-converted method. Any anti-dilutive weighted-average dilutive shares related to stock award plans, convertible senior notes, and warrants are excluded from the computation of the diluted net income per share. The basic and diluted net income (loss) per share calculations for the years ended December 31, 2023, 2022, and 2021 were as follows: Year Ended December 31, 2023 2022 2021 (In thousands, except per share data) Net income (loss) $ (20,371) $ 5,648 $ 77,849 Weighted-average shares outstanding – basic 45,212 44,398 43,475 Effect of dilutive securities from stock award plans — 1,019 2,136 Effect of convertible senior notes — 474 2,044 Effect of warrants — — 288 Weighted-average shares outstanding – diluted 45,212 45,891 47,943 Net income (loss) per share – basic $ (0.45) $ 0.13 $ 1.79 Net income (loss) per share – diluted $ (0.45) $ 0.12 $ 1.62 Anti-dilutive weighted-average shares related to stock award plans 3,368 725 156 Anti-dilutive weighted-average shares related to convertible senior notes and warrants 11,816 5,908 — |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company measures its financial instruments at fair value. The Company’s cash, cash equivalents, and restricted cash are classified within Level 1 of the fair value hierarchy as they are valued primarily using quoted market prices utilizing market observable inputs. The Company’s credit facility is classified within Level 2 as the valuation inputs are based on quoted prices or market observable data of similar instruments. The Company’s convertible senior notes are classified within Level 2 as the valuation inputs are based on quoted prices in an inactive market on the last day in the reporting period. As of December 31, 2023 and 2022, the fair value of the convertible senior notes was $527.2 million and $501.4 million, respectively, compared to their carrying values of $569.7 million and $566.6 million, respectively, which are net of unamortized debt issuance costs. Refer to Note 10, Debt and Credit Agreement , for further information regarding the Company’s credit facility and Note 11, Convertible Senior Notes |
Balance Sheet Components
Balance Sheet Components | 12 Months Ended |
Dec. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Balance Sheet Components | Balance Sheet Components Balance sheet details as of December 31, 2023 and 2022 are presented in the tables below: December 31, 2023 2022 (In thousands) Inventories: Raw materials $ 51,439 $ 75,854 Work in process 1,327 9,280 Finished goods 57,333 62,415 Total inventories $ 110,099 $ 147,549 Other current assets: Funds held for customers, including restricted cash (1) $ 43,649 $ 56,703 Net investment in sales-type leases, current portion 11,867 11,486 Prepaid income taxes 8,279 1,702 Other current assets 7,714 7,471 Total other current assets $ 71,509 $ 77,362 Other long-term assets: External-use software development costs, net $ 66,659 $ 80,760 Unbilled receivables, net 11,850 14,744 Deferred debt issuance costs 3,718 2,058 Other long-term assets 8,239 7,455 Total other long-term assets $ 90,466 $ 105,017 Accrued liabilities: Operating lease liabilities, current portion $ 10,518 $ 10,761 Customer fund liabilities 43,649 56,703 Advance payments from customers 10,551 11,556 Rebate liabilities 51,277 42,802 Group purchasing organization fees 4,445 7,723 Taxes payable 2,191 9,642 Other accrued liabilities 26,645 33,468 Total accrued liabilities $ 149,276 $ 172,655 _________________________________________________ (1) Includes restricted cash of $33.0 million and $22.5 million as of December 31, 2023 and 2022, respectively. The following table summarizes the changes in accumulated balances of other comprehensive income (loss), which consisted of foreign currency translation adjustments, for the years ended December 31, 2023 and 2022: (In thousands) Balance as of December 31, 2021 $ (8,407) Other comprehensive loss (8,680) Balance as of December 31, 2022 (17,087) Other comprehensive income 3,655 Balance as of December 31, 2023 $ (13,432) |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment The following table represents the property and equipment balances as of December 31, 2023 and 2022: December 31, 2023 2022 (In thousands) Equipment $ 95,996 $ 91,391 Furniture and fixtures 4,500 5,154 Leasehold improvements 17,919 19,510 Purchased software and internal-use software development costs 118,004 76,327 Construction in progress 11,614 28,223 Property and equipment, gross 248,033 220,605 Accumulated depreciation and amortization (139,432) (126,644) Total property and equipment, net $ 108,601 $ 93,961 Depreciation and amortization expense of property and equipment was $27.0 million, $22.8 million, and $20.1 million for the years ended December 31, 2023, 2022, and 2021, respectively. The geographic location of the Company’s property and equipment, net, is based on the physical location in which it is located. The following table summarizes the geographic information for property and equipment, net, as of December 31, 2023 and 2022: December 31, 2023 2022 (In thousands) United States $ 104,312 $ 89,989 Rest of world (1) 4,289 3,972 Total property and equipment, net $ 108,601 $ 93,961 _________________________________________________ (1) No individual country represented more than 10% of total property and equipment, net. |
External-Use Software Developme
External-Use Software Development Costs | 12 Months Ended |
Dec. 31, 2023 | |
Research and Development [Abstract] | |
External-Use Software Development Costs | External-Use Software Development Costs The carrying amounts of external-use software development costs as of December 31, 2023 and 2022 were as follows: December 31, 2023 2022 (In thousands) Gross carrying amount $ 239,038 $ 225,004 Accumulated amortization (172,379) (144,244) External-use software development costs, net (1) $ 66,659 $ 80,760 _________________________________________________ (1) Included in other long-term assets in the Consolidated Balance Sheets. The Company recorded $28.7 million, $29.0 million, and $26.4 million to cost of revenues for amortization of external-use software development costs for the years ended December 31, 2023, 2022, and 2021, respectively. The estimated future amortization expenses for external-use software development costs were as follows: December 31, 2023 (In thousands) 2024 $ 25,354 2025 18,331 2026 12,792 2027 6,837 2028 2,980 Thereafter 365 Total $ 66,659 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill The following table represents changes in the carrying amount of goodwill: (In thousands) Balance as of December 31, 2021 $ 738,900 Additions (1) 2,549 Measurement period adjustments (1) (3,770) Foreign currency exchange rate fluctuations (3,405) Balance as of December 31, 2022 734,274 Foreign currency exchange rate fluctuations 1,536 Balance as of December 31, 2023 $ 735,810 _________________________________________________ (1) Refer to Note 2, Business Combinations , for further information. Intangible Assets, Net The carrying amounts and useful lives of intangible assets as of December 31, 2023 and 2022 were as follows: December 31, 2023 Gross carrying Accumulated Foreign currency exchange Net carrying Useful life (In thousands, except for years) Customer relationships $ 307,418 $ (115,232) $ (1,326) $ 190,860 4 - 30 Acquired technology 84,876 (67,033) — 17,843 4 - 20 Backlog 1,800 (1,800) — — 2 Trade names 9,200 (7,680) — 1,520 5 - 12 Patents 2,404 (1,454) — 950 2 - 20 Total intangibles assets, net $ 405,698 $ (193,199) $ (1,326) $ 211,173 December 31, 2022 Gross carrying Accumulated Foreign currency exchange Net carrying Useful life (In thousands, except for years) Customer relationships $ 311,089 $ (99,177) $ (1,514) $ 210,398 4 - 30 Acquired technology 92,066 (64,299) — 27,767 4 - 20 Backlog 1,800 (900) — 900 2 Trade names 9,200 (6,633) — 2,567 5 - 12 Patents 2,430 (1,306) — 1,124 2 - 20 Non-compete agreements 600 (450) — 150 3 Total intangibles assets, net $ 417,185 $ (172,765) $ (1,514) $ 242,906 Amortization expense of intangible assets was $31.6 million, $35.2 million, and $26.5 million for the years ended December 31, 2023, 2022, and 2021, respectively. The estimated future amortization expenses for amortizable intangible assets were as follows: December 31, (In thousands) 2024 $ 22,736 2025 21,060 2026 18,080 2027 16,245 2028 15,180 Thereafter 117,872 Total $ 211,173 |
Debt and Credit Agreement
Debt and Credit Agreement | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Debt and Credit Agreement | Debt and Credit Agreement On November 15, 2019, the Company entered into an Amended and Restated Credit Agreement (as amended, the “Prior A&R Credit Agreement”) with the lenders from time to time party thereto, Wells Fargo Securities, LLC, Citizens Bank, N.A., and JPMorgan Chase Bank, N.A., as joint lead arrangers, and Wells Fargo Bank, National Association, as administrative agent. The Prior A&R Credit Agreement provided for (a) a five-year revolving credit facility of $500.0 million (the “Prior Revolving Credit Facility”) and (b) an uncommitted incremental loan facility of up to $250.0 million (the “Prior Incremental Facility”). In addition, the Prior A&R Credit Agreement included a letter of credit sub-limit of up to $15.0 million and a swing line loan sub-limit of up to $25.0 million. The Prior A&R Credit Agreement had an expiration date of November 15, 2024, upon which date all remaining outstanding borrowings would be due and payable. On September 22, 2020 and March 29, 2023, the Company entered into amendments to the Prior A&R Credit Agreement to, among other changes, permit the issuance of the convertible senior notes and the purchase of the convertible note hedge transactions, as described in Note 11, Convertible Senior Notes , expand the Company’s flexibility to repurchase its common stock and make other restricted payments, and replace the total net leverage covenant with a new secured net leverage covenant that requires the Company to maintain a consolidated secured net leverage ratio not to exceed 3.50:1 for the calendar quarters ending September 30, 2020, December 31, 2020, and March 31, 2021 and 3.00:1 for the calendar quarters ending thereafter, as well as to remove and replace the interest rate benchmark based on the London interbank offered rate (“LIBOR”) and related LIBOR-based mechanics applicable to borrowings under the A&R Credit Agreement with an interest rate benchmark based on the secured overnight financing rate (“SOFR”) as administered by the Federal Reserve Bank of New York and related SOFR-based mechanics. Subsequent to the March 29, 2023 amendment, loans under the Prior Revolving Credit Facility bore interest, at the Company’s option, at a rate equal to either (a) the Adjusted Term SOFR (as defined in the Prior A&R Credit Agreement), plus an applicable margin ranging from 1.25% to 2.00% per annum based on the Company’s Consolidated Total Net Leverage Ratio (as defined in the Prior A&R Credit Agreement), or (b) an alternate base rate equal to the highest of (i) the prime rate, (ii) the federal funds rate plus 0.50%, and (iii) the Adjusted Term SOFR for a one month tenor plus 1.00%, plus an applicable margin ranging from 0.25% to 1.00% per annum based on the Company’s Consolidated Total Net Leverage Ratio. Undrawn commitments under the Prior Revolving Credit Facility were subject to a commitment fee ranging from 0.15% to 0.30% per annum based on the Company’s Consolidated Total Net Leverage Ratio on the average daily unused portion of the Prior Revolving Credit Facility. The applicable margin for, and certain other terms of, any term loans under the Prior Incremental Facility would be determined prior to the incurrence of such loans. The Company was permitted to make voluntary prepayments at any time without payment of a premium or penalty. The Prior A&R Credit Agreement contained customary representations and warranties and customary affirmative and negative covenants applicable to the Company and its subsidiaries, including, among other things, restrictions on indebtedness, liens, investments, mergers, dispositions, dividends, and other distributions. The Prior A&R Credit Agreement also contained financial covenants that required the Company and its subsidiaries to not exceed a maximum total secured net leverage ratio (as described above) and maintain a minimum interest coverage ratio. In addition, the Prior A&R Credit Agreement contained certain customary events of default including, but not limited to, failure to pay interest, principal, and fees, or other amounts when due, material misrepresentations or misstatements in any representation or warranty, covenant defaults, certain cross defaults to other material indebtedness, certain judgment defaults, and events of bankruptcy. The Company entered into a Second Amended and Restated Credit Agreement (the “Second A&R Credit Agreement”) on October 10, 2023, with the lenders from time to time party thereto, Wells Fargo Securities, LLC, JPMorgan Chase Bank, N.A., PNC Capital Markets LLC and TD Securities (USA) LLC as joint lead arrangers and Wells Fargo Bank, National Association, as administrative agent. The Second A&R Credit Agreement supersedes the Prior A&R Credit Agreement and provides for (a) a five-year revolving credit facility of $350.0 million (the “Current Revolving Credit Facility”) and (b) an uncommitted incremental loan facility of up to an amount equal to the sum of (i) the greater of $250.0 million or 100% of the adjusted consolidated EBITDA for the last four quarters and (ii) additional amounts subject to pro forma compliance with certain consolidated secured net leverage ratio (the “Current Incremental Facility”). In addition, the Second A&R Credit Agreement includes a letter of credit sub-limit of up to $15.0 million and a swing line loan sub-limit of up to $25.0 million. The Second A&R Credit Agreement has an expiration date of October 10, 2028, subject to acceleration under certain conditions, upon which date all remaining outstanding borrowings will be due and payable. Loans under the Current Revolving Credit Facility bear interest, at the Company’s option, at a rate equal to either (a) the Adjusted Term SOFR (as defined in the Second A&R Credit Agreement), plus an applicable margin ranging from 1.50% to 2.25% per annum based on the Company’s Consolidated Total Net Leverage Ratio (as defined in the Second A&R Credit Agreement), or (b) an alternate base rate equal to the highest of (i) the prime rate, (ii) the federal funds rate plus 0.50%, and (iii) the Adjusted Term SOFR for an interest period of one month plus 1.00%, plus an applicable margin ranging from 0.50% to 1.25% per annum based on the Company’s Consolidated Total Net Leverage Ratio. Undrawn commitments under the Current Revolving Credit Facility are subject to a commitment fee ranging from 0.20% to 0.35% per annum based on the Company’s Consolidated Total Net Leverage Ratio on the average daily unused portion of the Current Revolving Credit Facility. Subject to the terms and conditions of the Current Revolving Credit Facility or Current Incremental Facility the Company is permitted to make voluntary prepayments at any time without payment of a premium or penalty. The availability of funds under the Current Revolving Credit Facility may be subject to reduction in order to maintain compliance with the financial covenants under the Second A&R Credit Agreement. The Second A&R Credit Agreement contains customary representations and warranties and customary affirmative and negative covenants applicable to the Company and its subsidiaries, including, among other things, restrictions on indebtedness, liens, investments, mergers, dispositions, dividends, and other distributions. The Second A&R Credit Agreement contains financial covenants that require the Company and its subsidiaries to not exceed a maximum consolidated secured net leverage ratio (not to exceed 3.00:1) and maintain a minimum consolidated interest coverage ratio (not to be less than 3.00:1). In addition, the Second A&R Credit Agreement contains certain customary events of default including, but not limited to, failure to pay interest, principal, and fees, or other amounts when due, material misrepresentations or misstatements in any representation or warranty, covenant defaults, certain cross defaults to other material indebtedness, certain judgment defaults, and events of bankruptcy. The Company’s obligations under the Second A&R Credit Agreement and, at the election of the Company and the contracting counterparty, any secured swap obligations and banking services obligations owing to a lender (or an affiliate of a lender) are guaranteed by certain of its domestic subsidiaries and secured by substantially all of its and such subsidiary guarantors’ assets. In connection with entering into the Second A&R Credit Agreement, and as a condition precedent to borrowing loans thereunder, the Company and certain of the Company’s other direct and indirect subsidiaries have entered into certain ancillary agreements, including, but not limited to, a reaffirmation agreement, which amends certain terms of the existing collateral agreement and reaffirms their obligations under the existing guaranty agreement. The refinancing of the Prior Credit Agreement was evaluated in accordance with ASC 470-50, Debt - Modifications and Extinguishments. In determining whether the refinancing was to be accounted for as a debt extinguishment or a debt modification, the Company considered whether lenders within the syndicate remained the same or changed and whether the changes in debt terms were substantial. This assessment was performed on an individual lender basis within the syndicate. As a result, the refinancing was accounted for as a modification with the exception of certain lenders that exited the syndicate. The exit of certain lenders resulted in an immaterial write-off of existing unamortized debt issuance costs. The remaining unamortized debt issuance costs related to debt modification, along with the new deferred costs, will be amortized over the remaining term of the Second A&R Credit Agreement. In connection with the Second A&R Credit Agreement, the Company incurred and capitalized an additional $3.0 million of debt issuance costs. The debt issuance costs are being amortized to interest expense using the straight-line method through 2028. As of December 31, 2023, the Company had $350.0 million of funds available under the Current Revolving Credit Facility and as of December 31, 2022, the Company had $500.0 million of funds available under the Prior Revolving Credit Facility. As of December 31, 2023 and 2022, the Company had no outstanding balance under the Prior or Current Revolving Credit Facility. The Company was in compliance with all covenants as of December 31, 2023. 0.25% Convertible Senior Notes due 2025 On September 25, 2020, the Company completed a private offering of $575.0 million aggregate principal amount of 0.25% convertible senior notes (the “Notes”), including the exercise in full of the initial purchasers’ option to purchase up to an additional $75.0 million principal amount of the Notes. The Company received proceeds from the issuance of the Notes of $559.7 million, net of $15.3 million of transaction fees and other debt issuance costs. The Notes bear interest at a rate of 0.25% per year, payable semiannually in arrears on March 15 and September 15 of each year, beginning on March 15, 2021. The Notes were issued pursuant to an indenture, dated September 25, 2020 (the “Indenture”), between the Company and U.S. Bank National Association, as trustee. The Notes are general senior, unsecured obligations of the Company and will mature on September 15, 2025, unless earlier redeemed, repurchased, or converted. The Notes are convertible at the option of the holders at any time prior to the close of business on the business day immediately preceding May 15, 2025, only under the following circumstances: (i) during any fiscal quarter commencing after the fiscal quarter ended on December 31, 2020 (and only during such fiscal quarter), if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding fiscal quarter is greater than or equal to 130% of the conversion price for the Notes on each applicable trading day; (ii) during the five business day period after any ten consecutive trading day period (the “measurement period”) in which the trading price (as defined in the Indenture) per $1,000 principal amount of the Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the Company’s common stock and the conversion rate for the Notes on each such trading day; (iii) if the Company calls such Notes for redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the redemption date, but only with respect to the Notes called (or deemed called) for redemption; and (iv) upon the occurrence of specified corporate events, as specified in the Indenture. On or after May 15, 2025 until the close of business on the second scheduled trading day immediately preceding the maturity date, holders of the Notes may convert all or any portion of their Notes at any time, regardless of the foregoing conditions. During the three months ended December 31, 2023 and 2022, none of the conditional conversion features of the Notes were triggered, and therefore, the Notes are not convertible during the first quarter of 2024, commencing on January 1, 2024, and were not convertible during the first quarter of 2023, commencing on January 1, 2023. Accordingly, the Company classified the Notes as a long-term liability in its Consolidated Financial Statements as of December 31, 2023 and 2022. Whether the Notes will be convertible following the first fiscal quarter of 2024 will depend on the satisfaction of the conversion conditions in the future. Under the original terms of the Indenture, upon conversion, the Company could satisfy its conversion obligation by paying or delivering cash, shares of its common stock, or a combination thereof, at the Company’s election, in the manner and subject to the terms and conditions provided in the Indenture. On December 13, 2021, the Company irrevocably elected to fix its settlement method to a combination of cash and shares of the Company’s common stock with the specified cash amount per $1,000 principal amount of Notes of at least $1,000. As a result, for Notes converted on or after December 13, 2021, a converting noteholder will receive (i) up to $1,000 in cash per $1,000 principal amount of Notes and (ii) cash and/or shares of the Company’s common stock, at the Company’s option for any conversion consideration in excess of $1,000. In addition, the Company continues to have the ability to set the specified cash amount per $1,000 principal amount of Notes above $1,000. The initial conversion rate for the Notes is 10.2751 shares of the Company’s common stock per $1,000 principal amount of Notes, which is equivalent to an initial conversion price of approximately $97.32 per share of the Company’s common stock, subject to adjustment under certain circumstances in accordance with the terms of the Indenture. In addition, following certain corporate events that could occur prior to the maturity date of the Notes or if the Company delivers a notice of redemption in respect of the Notes, the Company will, under certain circumstances, increase the conversion rate of the Notes for a holder who elects to convert its Notes (or any portion thereof) in connection with such a corporate event or convert its Notes called (or deemed called) for redemption during the related redemption period (as defined in the Indenture), as the case may be. If the Company undergoes a fundamental change, holders may require, subject to certain exceptions, the Company to repurchase for cash all or any portion of their Notes at a fundamental change repurchase price equal to 100% of the principal amount of the Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. As of December 31, 2023, none of the criteria for a fundamental change or a conversion rate adjustment had been met. As of September 20, 2023, the Company may redeem for cash all or any portion of the Notes, at its option, if the last reported sale price of the Company’s common stock has been at least 130% of the conversion price for the Notes then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. If the Company redeems less than all of the outstanding Notes, at least $150.0 million aggregate principal amount of Notes must be outstanding and not subject to redemption as of the date of the relevant notice of redemption. No sinking fund is provided for in the Notes. The debt issuance costs associated with the Notes are being amortized to interest expense over the term of the Notes using an effective interest rate of 0.80%. As of December 31, 2023, the remaining life of the Notes and the related issuance cost accretion is approximately 1.7 years. The maximum number of shares issuable upon conversion, including the effect of a fundamental change and subject to other conversion rate adjustments, would be 5.9 million shares. As of December 31, 2023, the if-converted value of the Notes did not exceed the principal amount. The Notes consisted of the following balances reported in the Consolidated Balance Sheets as of December 31, 2023 and 2022: December 31, 2023 2022 Principal amount $ 575,000 $ 575,000 Unamortized debt issuance costs (5,338) (8,429) Convertible senior notes, net $ 569,662 $ 566,571 The following table summarizes the components of interest expense resulting from the Notes recognized in interest and other income (expense), net in the Consolidated Statements of Operations for the years ended December 31, 2023, 2022 and 2021: Year Ended December 31, 2023 2022 (1) 2021 (In thousands) Contractual coupon interest $ 1,438 $ 1,438 $ 1,438 Amortization of discount $ — $ — $ 18,608 Amortization of debt issuance costs $ 3,091 $ 3,066 $ 2,343 _________________________________________________ (1) Refer to Note 1, Organization and Summary of Significant Accounting Policies , for further information regarding the adoption of ASU 2020-06, effective January 1, 2022. Convertible Note Hedge and Warrant Transactions In connection with the issuance of the Notes in September 2020, the Company entered into convertible note hedge and warrant transactions with an affiliate of one of the initial purchasers of the Notes and certain other financial institutions (the “option counterparties”) with respect to the Company’s common stock. The convertible note hedge consists of an option for the Company to purchase up to approximately 5.9 million shares of the Company’s common stock, which is equal to the number of shares of the Company’s common stock underlying the Notes, at an initial strike price of approximately $97.32 per share. The convertible note hedge will expire upon the maturity of the Notes, if not earlier exercised or terminated. The cost of the convertible note hedge was approximately $100.6 million and was accounted for as an equity instrument, which was recorded in additional paid-in capital in the Consolidated Balance Sheets. The Company recorded a deferred tax asset of $25.8 million at issuance related to the convertible note hedge transaction. The convertible note hedge is expected generally to reduce the potential dilution to the Company’s common stock upon any conversion of Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of converted Notes. |
Convertible Senior Notes
Convertible Senior Notes | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Convertible Senior Notes | Debt and Credit Agreement On November 15, 2019, the Company entered into an Amended and Restated Credit Agreement (as amended, the “Prior A&R Credit Agreement”) with the lenders from time to time party thereto, Wells Fargo Securities, LLC, Citizens Bank, N.A., and JPMorgan Chase Bank, N.A., as joint lead arrangers, and Wells Fargo Bank, National Association, as administrative agent. The Prior A&R Credit Agreement provided for (a) a five-year revolving credit facility of $500.0 million (the “Prior Revolving Credit Facility”) and (b) an uncommitted incremental loan facility of up to $250.0 million (the “Prior Incremental Facility”). In addition, the Prior A&R Credit Agreement included a letter of credit sub-limit of up to $15.0 million and a swing line loan sub-limit of up to $25.0 million. The Prior A&R Credit Agreement had an expiration date of November 15, 2024, upon which date all remaining outstanding borrowings would be due and payable. On September 22, 2020 and March 29, 2023, the Company entered into amendments to the Prior A&R Credit Agreement to, among other changes, permit the issuance of the convertible senior notes and the purchase of the convertible note hedge transactions, as described in Note 11, Convertible Senior Notes , expand the Company’s flexibility to repurchase its common stock and make other restricted payments, and replace the total net leverage covenant with a new secured net leverage covenant that requires the Company to maintain a consolidated secured net leverage ratio not to exceed 3.50:1 for the calendar quarters ending September 30, 2020, December 31, 2020, and March 31, 2021 and 3.00:1 for the calendar quarters ending thereafter, as well as to remove and replace the interest rate benchmark based on the London interbank offered rate (“LIBOR”) and related LIBOR-based mechanics applicable to borrowings under the A&R Credit Agreement with an interest rate benchmark based on the secured overnight financing rate (“SOFR”) as administered by the Federal Reserve Bank of New York and related SOFR-based mechanics. Subsequent to the March 29, 2023 amendment, loans under the Prior Revolving Credit Facility bore interest, at the Company’s option, at a rate equal to either (a) the Adjusted Term SOFR (as defined in the Prior A&R Credit Agreement), plus an applicable margin ranging from 1.25% to 2.00% per annum based on the Company’s Consolidated Total Net Leverage Ratio (as defined in the Prior A&R Credit Agreement), or (b) an alternate base rate equal to the highest of (i) the prime rate, (ii) the federal funds rate plus 0.50%, and (iii) the Adjusted Term SOFR for a one month tenor plus 1.00%, plus an applicable margin ranging from 0.25% to 1.00% per annum based on the Company’s Consolidated Total Net Leverage Ratio. Undrawn commitments under the Prior Revolving Credit Facility were subject to a commitment fee ranging from 0.15% to 0.30% per annum based on the Company’s Consolidated Total Net Leverage Ratio on the average daily unused portion of the Prior Revolving Credit Facility. The applicable margin for, and certain other terms of, any term loans under the Prior Incremental Facility would be determined prior to the incurrence of such loans. The Company was permitted to make voluntary prepayments at any time without payment of a premium or penalty. The Prior A&R Credit Agreement contained customary representations and warranties and customary affirmative and negative covenants applicable to the Company and its subsidiaries, including, among other things, restrictions on indebtedness, liens, investments, mergers, dispositions, dividends, and other distributions. The Prior A&R Credit Agreement also contained financial covenants that required the Company and its subsidiaries to not exceed a maximum total secured net leverage ratio (as described above) and maintain a minimum interest coverage ratio. In addition, the Prior A&R Credit Agreement contained certain customary events of default including, but not limited to, failure to pay interest, principal, and fees, or other amounts when due, material misrepresentations or misstatements in any representation or warranty, covenant defaults, certain cross defaults to other material indebtedness, certain judgment defaults, and events of bankruptcy. The Company entered into a Second Amended and Restated Credit Agreement (the “Second A&R Credit Agreement”) on October 10, 2023, with the lenders from time to time party thereto, Wells Fargo Securities, LLC, JPMorgan Chase Bank, N.A., PNC Capital Markets LLC and TD Securities (USA) LLC as joint lead arrangers and Wells Fargo Bank, National Association, as administrative agent. The Second A&R Credit Agreement supersedes the Prior A&R Credit Agreement and provides for (a) a five-year revolving credit facility of $350.0 million (the “Current Revolving Credit Facility”) and (b) an uncommitted incremental loan facility of up to an amount equal to the sum of (i) the greater of $250.0 million or 100% of the adjusted consolidated EBITDA for the last four quarters and (ii) additional amounts subject to pro forma compliance with certain consolidated secured net leverage ratio (the “Current Incremental Facility”). In addition, the Second A&R Credit Agreement includes a letter of credit sub-limit of up to $15.0 million and a swing line loan sub-limit of up to $25.0 million. The Second A&R Credit Agreement has an expiration date of October 10, 2028, subject to acceleration under certain conditions, upon which date all remaining outstanding borrowings will be due and payable. Loans under the Current Revolving Credit Facility bear interest, at the Company’s option, at a rate equal to either (a) the Adjusted Term SOFR (as defined in the Second A&R Credit Agreement), plus an applicable margin ranging from 1.50% to 2.25% per annum based on the Company’s Consolidated Total Net Leverage Ratio (as defined in the Second A&R Credit Agreement), or (b) an alternate base rate equal to the highest of (i) the prime rate, (ii) the federal funds rate plus 0.50%, and (iii) the Adjusted Term SOFR for an interest period of one month plus 1.00%, plus an applicable margin ranging from 0.50% to 1.25% per annum based on the Company’s Consolidated Total Net Leverage Ratio. Undrawn commitments under the Current Revolving Credit Facility are subject to a commitment fee ranging from 0.20% to 0.35% per annum based on the Company’s Consolidated Total Net Leverage Ratio on the average daily unused portion of the Current Revolving Credit Facility. Subject to the terms and conditions of the Current Revolving Credit Facility or Current Incremental Facility the Company is permitted to make voluntary prepayments at any time without payment of a premium or penalty. The availability of funds under the Current Revolving Credit Facility may be subject to reduction in order to maintain compliance with the financial covenants under the Second A&R Credit Agreement. The Second A&R Credit Agreement contains customary representations and warranties and customary affirmative and negative covenants applicable to the Company and its subsidiaries, including, among other things, restrictions on indebtedness, liens, investments, mergers, dispositions, dividends, and other distributions. The Second A&R Credit Agreement contains financial covenants that require the Company and its subsidiaries to not exceed a maximum consolidated secured net leverage ratio (not to exceed 3.00:1) and maintain a minimum consolidated interest coverage ratio (not to be less than 3.00:1). In addition, the Second A&R Credit Agreement contains certain customary events of default including, but not limited to, failure to pay interest, principal, and fees, or other amounts when due, material misrepresentations or misstatements in any representation or warranty, covenant defaults, certain cross defaults to other material indebtedness, certain judgment defaults, and events of bankruptcy. The Company’s obligations under the Second A&R Credit Agreement and, at the election of the Company and the contracting counterparty, any secured swap obligations and banking services obligations owing to a lender (or an affiliate of a lender) are guaranteed by certain of its domestic subsidiaries and secured by substantially all of its and such subsidiary guarantors’ assets. In connection with entering into the Second A&R Credit Agreement, and as a condition precedent to borrowing loans thereunder, the Company and certain of the Company’s other direct and indirect subsidiaries have entered into certain ancillary agreements, including, but not limited to, a reaffirmation agreement, which amends certain terms of the existing collateral agreement and reaffirms their obligations under the existing guaranty agreement. The refinancing of the Prior Credit Agreement was evaluated in accordance with ASC 470-50, Debt - Modifications and Extinguishments. In determining whether the refinancing was to be accounted for as a debt extinguishment or a debt modification, the Company considered whether lenders within the syndicate remained the same or changed and whether the changes in debt terms were substantial. This assessment was performed on an individual lender basis within the syndicate. As a result, the refinancing was accounted for as a modification with the exception of certain lenders that exited the syndicate. The exit of certain lenders resulted in an immaterial write-off of existing unamortized debt issuance costs. The remaining unamortized debt issuance costs related to debt modification, along with the new deferred costs, will be amortized over the remaining term of the Second A&R Credit Agreement. In connection with the Second A&R Credit Agreement, the Company incurred and capitalized an additional $3.0 million of debt issuance costs. The debt issuance costs are being amortized to interest expense using the straight-line method through 2028. As of December 31, 2023, the Company had $350.0 million of funds available under the Current Revolving Credit Facility and as of December 31, 2022, the Company had $500.0 million of funds available under the Prior Revolving Credit Facility. As of December 31, 2023 and 2022, the Company had no outstanding balance under the Prior or Current Revolving Credit Facility. The Company was in compliance with all covenants as of December 31, 2023. 0.25% Convertible Senior Notes due 2025 On September 25, 2020, the Company completed a private offering of $575.0 million aggregate principal amount of 0.25% convertible senior notes (the “Notes”), including the exercise in full of the initial purchasers’ option to purchase up to an additional $75.0 million principal amount of the Notes. The Company received proceeds from the issuance of the Notes of $559.7 million, net of $15.3 million of transaction fees and other debt issuance costs. The Notes bear interest at a rate of 0.25% per year, payable semiannually in arrears on March 15 and September 15 of each year, beginning on March 15, 2021. The Notes were issued pursuant to an indenture, dated September 25, 2020 (the “Indenture”), between the Company and U.S. Bank National Association, as trustee. The Notes are general senior, unsecured obligations of the Company and will mature on September 15, 2025, unless earlier redeemed, repurchased, or converted. The Notes are convertible at the option of the holders at any time prior to the close of business on the business day immediately preceding May 15, 2025, only under the following circumstances: (i) during any fiscal quarter commencing after the fiscal quarter ended on December 31, 2020 (and only during such fiscal quarter), if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding fiscal quarter is greater than or equal to 130% of the conversion price for the Notes on each applicable trading day; (ii) during the five business day period after any ten consecutive trading day period (the “measurement period”) in which the trading price (as defined in the Indenture) per $1,000 principal amount of the Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the Company’s common stock and the conversion rate for the Notes on each such trading day; (iii) if the Company calls such Notes for redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the redemption date, but only with respect to the Notes called (or deemed called) for redemption; and (iv) upon the occurrence of specified corporate events, as specified in the Indenture. On or after May 15, 2025 until the close of business on the second scheduled trading day immediately preceding the maturity date, holders of the Notes may convert all or any portion of their Notes at any time, regardless of the foregoing conditions. During the three months ended December 31, 2023 and 2022, none of the conditional conversion features of the Notes were triggered, and therefore, the Notes are not convertible during the first quarter of 2024, commencing on January 1, 2024, and were not convertible during the first quarter of 2023, commencing on January 1, 2023. Accordingly, the Company classified the Notes as a long-term liability in its Consolidated Financial Statements as of December 31, 2023 and 2022. Whether the Notes will be convertible following the first fiscal quarter of 2024 will depend on the satisfaction of the conversion conditions in the future. Under the original terms of the Indenture, upon conversion, the Company could satisfy its conversion obligation by paying or delivering cash, shares of its common stock, or a combination thereof, at the Company’s election, in the manner and subject to the terms and conditions provided in the Indenture. On December 13, 2021, the Company irrevocably elected to fix its settlement method to a combination of cash and shares of the Company’s common stock with the specified cash amount per $1,000 principal amount of Notes of at least $1,000. As a result, for Notes converted on or after December 13, 2021, a converting noteholder will receive (i) up to $1,000 in cash per $1,000 principal amount of Notes and (ii) cash and/or shares of the Company’s common stock, at the Company’s option for any conversion consideration in excess of $1,000. In addition, the Company continues to have the ability to set the specified cash amount per $1,000 principal amount of Notes above $1,000. The initial conversion rate for the Notes is 10.2751 shares of the Company’s common stock per $1,000 principal amount of Notes, which is equivalent to an initial conversion price of approximately $97.32 per share of the Company’s common stock, subject to adjustment under certain circumstances in accordance with the terms of the Indenture. In addition, following certain corporate events that could occur prior to the maturity date of the Notes or if the Company delivers a notice of redemption in respect of the Notes, the Company will, under certain circumstances, increase the conversion rate of the Notes for a holder who elects to convert its Notes (or any portion thereof) in connection with such a corporate event or convert its Notes called (or deemed called) for redemption during the related redemption period (as defined in the Indenture), as the case may be. If the Company undergoes a fundamental change, holders may require, subject to certain exceptions, the Company to repurchase for cash all or any portion of their Notes at a fundamental change repurchase price equal to 100% of the principal amount of the Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. As of December 31, 2023, none of the criteria for a fundamental change or a conversion rate adjustment had been met. As of September 20, 2023, the Company may redeem for cash all or any portion of the Notes, at its option, if the last reported sale price of the Company’s common stock has been at least 130% of the conversion price for the Notes then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. If the Company redeems less than all of the outstanding Notes, at least $150.0 million aggregate principal amount of Notes must be outstanding and not subject to redemption as of the date of the relevant notice of redemption. No sinking fund is provided for in the Notes. The debt issuance costs associated with the Notes are being amortized to interest expense over the term of the Notes using an effective interest rate of 0.80%. As of December 31, 2023, the remaining life of the Notes and the related issuance cost accretion is approximately 1.7 years. The maximum number of shares issuable upon conversion, including the effect of a fundamental change and subject to other conversion rate adjustments, would be 5.9 million shares. As of December 31, 2023, the if-converted value of the Notes did not exceed the principal amount. The Notes consisted of the following balances reported in the Consolidated Balance Sheets as of December 31, 2023 and 2022: December 31, 2023 2022 Principal amount $ 575,000 $ 575,000 Unamortized debt issuance costs (5,338) (8,429) Convertible senior notes, net $ 569,662 $ 566,571 The following table summarizes the components of interest expense resulting from the Notes recognized in interest and other income (expense), net in the Consolidated Statements of Operations for the years ended December 31, 2023, 2022 and 2021: Year Ended December 31, 2023 2022 (1) 2021 (In thousands) Contractual coupon interest $ 1,438 $ 1,438 $ 1,438 Amortization of discount $ — $ — $ 18,608 Amortization of debt issuance costs $ 3,091 $ 3,066 $ 2,343 _________________________________________________ (1) Refer to Note 1, Organization and Summary of Significant Accounting Policies , for further information regarding the adoption of ASU 2020-06, effective January 1, 2022. Convertible Note Hedge and Warrant Transactions In connection with the issuance of the Notes in September 2020, the Company entered into convertible note hedge and warrant transactions with an affiliate of one of the initial purchasers of the Notes and certain other financial institutions (the “option counterparties”) with respect to the Company’s common stock. The convertible note hedge consists of an option for the Company to purchase up to approximately 5.9 million shares of the Company’s common stock, which is equal to the number of shares of the Company’s common stock underlying the Notes, at an initial strike price of approximately $97.32 per share. The convertible note hedge will expire upon the maturity of the Notes, if not earlier exercised or terminated. The cost of the convertible note hedge was approximately $100.6 million and was accounted for as an equity instrument, which was recorded in additional paid-in capital in the Consolidated Balance Sheets. The Company recorded a deferred tax asset of $25.8 million at issuance related to the convertible note hedge transaction. The convertible note hedge is expected generally to reduce the potential dilution to the Company’s common stock upon any conversion of Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of converted Notes. |
Lessor Leases
Lessor Leases | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
Lessor Leases | Lessor Leases Sales-Type Leases The following table presents the Company’s income recognized from sales-type leases for the years ended December 31, 2023, 2022, and 2021: Year Ended December 31, 2023 2022 2021 (In thousands) Sales-type lease revenues $ 36,208 $ 38,959 $ 21,887 Cost of sales-type lease revenues (18,093) (19,359) (8,918) Selling profit on sales-type lease revenues $ 18,115 $ 19,600 $ 12,969 Interest income on sales-type lease receivables $ 2,475 $ 2,106 $ 1,869 The receivables as a result of these types of transactions are collateralized by the underlying equipment leased and consist of the following components at December 31, 2023 and 2022: December 31, 2023 2022 (In thousands) Net minimum lease payments to be received $ 65,017 $ 50,755 Less: Unearned interest income portion (10,196) (6,345) Net investment in sales-type leases 54,821 44,410 Less: Current portion (1) (11,867) (11,486) Long-term investment in sales-type leases, net $ 42,954 $ 32,924 _________________________________________________ (1) The current portion of the net investment in sales-type leases is included in other current assets in the Consolidated Balance Sheets. The carrying amount of the Company’s sales-type lease receivables is a reasonable estimate of fair value. The maturity schedule of future minimum lease payments under sales-type leases retained in-house and the reconciliation to the net investment in sales-type leases reported on the Consolidated Balance Sheets was as follows: December 31, (In thousands) 2024 $ 14,504 2025 12,385 2026 10,113 2027 8,369 2028 7,281 Thereafter 12,365 Total future minimum sales-type lease payments 65,017 Present value adjustment (10,196) Total net investment in sales-type leases $ 54,821 Operating Leases The following table represents the Company’s income recognized from operating leases for the years ended December 31, 2023, 2022, and 2021: Year Ended December 31, 2023 2022 2021 (In thousands) Rental income $ 6,591 $ 9,460 $ 10,467 The maturity schedule of future minimum lease payments under operating leases was as follows: December 31, 2023 (In thousands) 2024 $ 3,547 2025 842 2026 763 2027 763 2028 571 Total future minimum operating lease payments $ 6,486 |
Lessor Leases | Lessor Leases Sales-Type Leases The following table presents the Company’s income recognized from sales-type leases for the years ended December 31, 2023, 2022, and 2021: Year Ended December 31, 2023 2022 2021 (In thousands) Sales-type lease revenues $ 36,208 $ 38,959 $ 21,887 Cost of sales-type lease revenues (18,093) (19,359) (8,918) Selling profit on sales-type lease revenues $ 18,115 $ 19,600 $ 12,969 Interest income on sales-type lease receivables $ 2,475 $ 2,106 $ 1,869 The receivables as a result of these types of transactions are collateralized by the underlying equipment leased and consist of the following components at December 31, 2023 and 2022: December 31, 2023 2022 (In thousands) Net minimum lease payments to be received $ 65,017 $ 50,755 Less: Unearned interest income portion (10,196) (6,345) Net investment in sales-type leases 54,821 44,410 Less: Current portion (1) (11,867) (11,486) Long-term investment in sales-type leases, net $ 42,954 $ 32,924 _________________________________________________ (1) The current portion of the net investment in sales-type leases is included in other current assets in the Consolidated Balance Sheets. The carrying amount of the Company’s sales-type lease receivables is a reasonable estimate of fair value. The maturity schedule of future minimum lease payments under sales-type leases retained in-house and the reconciliation to the net investment in sales-type leases reported on the Consolidated Balance Sheets was as follows: December 31, (In thousands) 2024 $ 14,504 2025 12,385 2026 10,113 2027 8,369 2028 7,281 Thereafter 12,365 Total future minimum sales-type lease payments 65,017 Present value adjustment (10,196) Total net investment in sales-type leases $ 54,821 Operating Leases The following table represents the Company’s income recognized from operating leases for the years ended December 31, 2023, 2022, and 2021: Year Ended December 31, 2023 2022 2021 (In thousands) Rental income $ 6,591 $ 9,460 $ 10,467 The maturity schedule of future minimum lease payments under operating leases was as follows: December 31, 2023 (In thousands) 2024 $ 3,547 2025 842 2026 763 2027 763 2028 571 Total future minimum operating lease payments $ 6,486 |
Lessee Leases
Lessee Leases | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
Lessee Leases | Lessee Leases The Company has operating leases for office buildings, data centers, office equipment, and vehicles. The Company’s leases have initial terms of one The maturity schedule of future minimum lease payments under operating leases and the reconciliation to the operating lease liabilities reported on the Consolidated Balance Sheets was as follows: December 31, 2023 (In thousands) 2024 $ 12,722 2025 10,609 2026 9,715 2027 8,070 2028 7,650 Thereafter 1,834 Total operating lease payments 50,600 Present value adjustment (6,172) Total operating lease liabilities (1) $ 44,428 _________________________________________________ (1) Amount consists of a current and long-term portion of operating lease liabilities of $10.5 million and $33.9 million, respectively. The current portion of the operating lease liabilities is included in accrued liabilities in the Consolidated Balance Sheets. Operating lease costs were $10.8 million, $18.9 million, and $15.0 million for the years ended December 31, 2023, 2022, and 2021, respectively. Short-term lease costs and variable lease costs were not material for the years ended December 31, 2023, 2022, and 2021. During the year ended December 31, 2023, the Company recorded impairment and abandonment charges to operating lease right-of-use assets of $10.0 million, in connection with restructuring activities to reduce its real estate footprint and for optimization of certain leased facilities. The impairment and abandonment charges were recorded to selling, general, and administrative expenses on the Company’s Consolidated Statements of Operations. Refer to Note 18, Restructuring Expenses, for additional information regarding the Company’s restructuring activities. The following table summarizes supplemental cash flow information related to the Company’s operating leases for the years ended December 31, 2023, 2022, and 2021: Year Ended December 31, 2023 2022 2021 (In thousands) Cash paid for amounts included in the measurement of lease liabilities $ 13,469 $ 16,452 $ 15,625 Right-of-use assets obtained in exchange for new lease liabilities $ 6,431 $ 12,372 $ 5,503 The following table summarizes the weighted-average remaining lease term and weighted-average discount rate related to the Company’s operating leases as of December 31, 2023 and 2022: December 31, 2023 2022 Weighted-average remaining lease term, years 4.6 5.0 Weighted-average discount rate, % 5.8 % 5.7 % |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Purchase Obligations In the ordinary course of business, the Company issues purchase orders based on its current manufacturing needs. As of December 31, 2023, the Company had non-cancelable purchase commitments of $93.9 million, of which $84.2 million are expected to be paid within the next twelve months. Ransomware Incident During the year ended December 31, 2023, the Company did not incur any material expenses or recoveries related to the previously disclosed ransomware incident in May 2022. During the year ended December 31, 2022, the Company incurred $13.6 million of expenses related to the ransomware incident, partially offset by $11.1 million of expected insurance recoveries. Expenses included costs to investigate and remediate the ransomware incident, as well as legal and other professional services, all of which were expensed as incurred. For the year ended December 31, 2022, the Company included net expenses related to the ransomware incident in cost of revenues of $0.3 million, in research and development of $0.2 million, and in selling general and administrative expenses of $2.0 million, in the Company’s Consolidated Statements of Operations. As of December 31, 2023, the Company has incurred $13.6 million of cumulative expenses related to the ransomware incident since it was detected, partially offset by $12.2 million of insurance recoveries, all of which have been received as of December 31, 2023. Legal Proceedings The Company is currently involved in various legal proceedings. As required under ASC 450, Contingencies , the Company accrues for contingencies when it believes that a loss is probable and that it can reasonably estimate the amount of any such loss. The Company has not recorded any material accrual for contingent liabilities associated with any current legal proceedings based on its belief that any potential material loss, while reasonably possible, is not probable. Furthermore, any possible range of loss in such matters cannot be reasonably estimated at this time. The Company believes that it has valid defenses with respect to legal proceedings pending against it. However, litigation is inherently unpredictable, and it is possible that cash flows or results of operations could be materially affected in any particular period by the unfavorable resolution of legal proceedings or because of the diversion of management’s attention and the creation of significant expenses, regardless of outcome. The Company is not a party to any legal proceedings that management believes may have a material impact on the Company’s financial position or results of operations. Guarantees Under the Company’s certificate of incorporation and bylaws, the Company has agreed to indemnify its directors and executive officers to the fullest extent not prohibited by Delaware and other applicable law, subject to certain exceptions. The Company has entered into individual indemnification agreements with its directors and officers. The term of the indemnification period is for the entirety of the director’s or officer’s service to the Company and continues so long as the director or officer may be subject to any claim, action, or proceeding, and there is no limit on the potential amount of future payments that the Company could be required to make under these indemnification agreements. The Company has purchased a directors’ and officers’ liability insurance policy that may enable it to recover a portion of any future payments that it may be required to make under these indemnification agreements. Assuming the applicability of coverage and the willingness of the insurer to assume coverage and subject to certain retention, loss limits, and other policy provisions, the Company believes it is unlikely that the Company will be required to pay any material amounts pursuant to these indemnification obligations. However, no assurances can be given that the insurers will not attempt to dispute the validity, applicability, or amount of coverage without expensive and time-consuming litigation against the insurers. Additionally, the Company undertakes indemnification obligations in its ordinary course of business in connection with, among other things, the sale or licensing of its products and the provision of its support services. In the ordinary course of the Company’s business, the Company has in the past and may in the future agree to indemnify another party, generally its business affiliates or customers, against certain losses suffered or incurred by the indemnified party in connection with various types of claims, which may include, without limitation, claims of intellectual property infringement, certain tax liabilities, its gross negligence or intentional acts in the performance of services, and violations of laws. The term of these indemnification obligations is generally perpetual, but typically will not extend beyond the applicable statute of limitation pursuant to applicable law. In general, the Company attempts to limit the maximum potential amount of future payments that it may be required to make under these indemnification obligations to the amounts paid to it by a customer, but in some cases the obligation may not be so limited. In addition, the Company has in the past and may in the future warrant to its customers that its products will conform to certain representations, which may include functional specifications for a limited period of time following the date of installation (generally not exceeding 30 days) or that its software media is free from material defects. Sales contracts for certain of the Company’s medication packaging systems may have in the past and may in the future include limited warranties for up to six months, but the periodic activity and ending warranty balances the Company records have historically not been material. From time to time, the Company may also warrant that its professional services will conform to certain representations, which may include that such services will be performed in a good and workmanlike manner or in a professional manner consistent with industry standards. The Company generally seeks to disclaim most warranties, including any implied or statutory warranties such as warranties of merchantability, fitness for a particular purpose, title, quality, and non-infringement, as well as any liability with respect to incidental, consequential, special, exemplary, punitive, or similar damages. In some states, such disclaimers may not be enforceable. If necessary, the Company would provide for the estimated cost of product and service warranties based on specific warranty claims and claim history. The Company has not been subject to any significant claims for such losses and has not incurred any material costs in defending or settling claims related to these indemnification obligations. Accordingly, the Company believes it is unlikely that the Company will be required to pay any material amounts pursuant to these indemnification obligations or potential warranty claims and, therefore, no material liabilities have been recorded for such indemnification obligations as of December 31, 2023 and 2022. |
Employee Benefits and Share-Bas
Employee Benefits and Share-Based Compensation | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Employee Benefits and Share-Based Compensation | Employee Benefits and Share-Based Compensation Stock Purchase Plan 1997 Employee Stock Purchase Plan The Company has an Employee Stock Purchase Plan (“ESPP”), under which employees can purchase shares of its common stock based on a percentage of their compensation, but not greater than 15% of their earnings; provided, however, an eligible employee’s right to purchase shares of the Company’s common stock may not accrue at a rate which exceeds $25,000 of the fair market value of such shares for each calendar year in which such rights are outstanding. The purchase price per share must be equal to the lower of 85% of the fair value of the common stock at the beginning of a 24-month offering period or the end of each six-month purchasing period. There was a total of 3.3 million shares reserved for future issuance under the ESPP as of December 31, 2023. Stock Award Plans 2009 Equity Incentive Plan The 2009 Equity Incentive Plan (“2009 Plan”), as amended, provides for the issuance of incentive stock options, RSAs, RSUs, PSUs, and other stock awards to the Company’s employees, directors, and consultants. There were 5.9 million shares of common stock reserved for future issuance under the 2009 Plan as of December 31, 2023. Options granted under the 2009 Plan generally become exercisable over periods of up to four years, with one-fourth of the shares vesting one year from the vesting commencement date with respect to initial grants, and the remaining shares vesting in 36 equal monthly installments thereafter. The exercise prices of the options is the fair market value of common stock on the date of grant. RSUs generally vest over periods of up to four years, with one-fourth of the shares vesting one year from the vesting commencement date with respect to initial grants, and the remaining shares vesting in 12 equal quarterly installments thereafter. Awards of restricted stock to non-employee directors are granted on the date of the annual meeting of stockholders and vest in full on the date of the next annual meeting of stockholders, provided such non-employee director remains a director on such date. PSUs granted to the Company’s executives may include performance and market conditions. PSUs become eligible for vesting when certain market or performance conditions are met. Share-Based Compensation Expense The following table sets forth the total share-based compensation expense recognized in the Company’s Consolidated Statements of Operations: Year Ended December 31, 2023 2022 2021 (In thousands) Cost of product and service revenues $ 8,288 $ 9,067 $ 7,994 Research and development 6,941 11,368 7,663 Selling, general, and administrative 40,071 47,812 37,503 Total share-based compensation expense $ 55,300 $ 68,247 $ 53,160 During the year ended December 31, 2023, the Company capitalized approximately $4.4 million of non-cash share-based compensation expense to internal-use and external-use software development costs related to internal labor. The Company did not capitalize any material non-cash share-based compensation expense to inventory during the years ended December 31, 2023, 2022, and 2021, or any material non-cash share-based compensation expense to internal-use and external-use software development costs during the years ended December 31, 2022 and 2021. Income tax benefit (expense) realized from share-based compensation was an expense of $6.5 million for the year ended December 31, 2023, and a benefit of $5.2 million and $26.6 million for the years ended December 31, 2022 and 2021, respectively. Employee Stock Purchase Plan (“ESPP”) The following assumptions were used to value shares under the ESPP for the years ended December 31, 2023, 2022, and 2021: Year Ended December 31, 2023 2022 2021 Expected life, years 0.5 - 2.0 0.5 - 2.0 0.5 - 2.0 Expected volatility, % 31.7% - 63.9% 28.8% - 45.6% 27.4% - 53.5% Risk-free interest rate, % 0.1% - 5.5% 0.1% - 3.2% 0.1% - 2.6% Dividend yield, % — % — % — % For the years ended December 31, 2023 and 2022, employees purchased approximately 353,000 and 316,000 shares of common stock, respectively, under the ESPP at a weighted-average price of $46.68 and $67.63, respectively. As of December 31, 2023, the unrecognized compensation cost related to the shares to be purchased under the ESPP was approximately $1.1 million and is expected to be recognized over a weighted-average period of 1.4 years. Stock Options The following assumptions were used to value stock options granted pursuant to the 2009 Plan for the years ended December 31, 2023 and 2021. There were no stock options granted during the year ended December 31, 2022: Year Ended December 31, 2023 2021 Expected life, years 3.2 4.9 Expected volatility, % 44.8 % 31.5 % Risk-free interest rate, % 3.7 % 0.9 % Estimated forfeiture rate, % 10.0 % 7.9 % Dividend yield, % — % — % The following table summarizes the stock option activity under the 2009 Plan during the year ended December 31, 2023: Number of Shares Weighted-Average Exercise Price Weighted-Average Remaining Years Aggregate Intrinsic Value (In thousands, except per share data) Outstanding at December 31, 2022 2,434 $ 68.65 6.1 $ 7,887 Granted 200 55.60 Exercised (165) 41.01 Expired (242) 79.49 Forfeited (204) 74.92 Outstanding at December 31, 2023 2,023 $ 67.68 4.6 $ 1,013 Exercisable at December 31, 2023 1,784 $ 67.18 4.5 $ 1,013 Vested and expected to vest at December 31, 2023 and thereafter 2,013 $ 67.64 4.6 $ 1,013 The weighted-average fair value per share of options granted during the years ended December 31, 2023 and 2021 was 19.48 and 35.17, respectively. The intrinsic value of options exercised during the years ended December 31, 2023, 2022, and 2021 was $3.2 million, $23.9 million, and $88.0 million, respectively. The tax benefit (expense) realized from stock options exercised was expense of $1.3 million for the year ended December 31, 2023, and benefit of $4.4 million and $18.3 million for the years ended December 31, 2022 and 2021, respectively. As of December 31, 2023, total unrecognized compensation cost related to unvested stock options was $3.3 million, which is expected to be recognized over a weighted-average vesting period of 0.7 years. Restricted Stock Units (“RSUs”) The following table summarizes the RSU activity under the 2009 Plan during the year ended December 31, 2023: Number of Shares Weighted-Average Grant Date Fair Value Weighted-Average Remaining Years Aggregate Intrinsic Value (In thousands, except per share data) Outstanding at December 31, 2022 1,117 $ 115.75 1.6 $ 56,297 Granted (Awarded) 695 63.74 Vested (Released) (335) 113.64 Forfeited (399) 107.89 Outstanding and unvested at December 31, 2023 1,078 $ 84.66 1.5 $ 40,551 The weighted-average grant date fair value per share of RSUs granted during the years ended December 31, 2023, 2022, and 2021 was $63.74, $111.12, and $149.65, respectively. The total fair value of RSUs that vested in the years ended December 31, 2023, 2022, and 2021 was $38.0 million, $30.7 million, and $16.7 million, respectively. As of December 31, 2023, total unrecognized compensation cost related to RSUs was $64.3 million, which is expected to be recognized over the remaining weighted-average vesting period of 3.0 years. Restricted Stock Awards (“RSAs”) The following table summarizes the RSA activity under the 2009 Plan during the year ended December 31, 2023: Number of Shares Weighted-Average Grant Date Fair Value (In thousands, except per share data) Outstanding at December 31, 2022 13 $ 109.39 Granted (Awarded) 24 70.96 Vested (Released) (13) 109.39 Outstanding and unvested at December 31, 2023 24 $ 70.96 The weighted-average grant date fair value per share of RSAs granted during the years ended December 31, 2023, 2022, and 2021 was $70.96, $109.39, and $137.36, respectively. The total fair value of RSAs that vested in the years ended December 31, 2023, 2022, and 2021 was $1.4 million, $1.6 million, and $1.4 million, respectively. As of December 31, 2023, total unrecognized compensation cost related to RSAs was $0.6 million, which is expected to be recognized over the remaining weighted-average vesting period of 0.4 years. Performance-Based Stock Unit Awards (“PSUs”) During the year ended December 31, 2022, the Company granted 56,237 PSUs to its executive officers, none of which became eligible for vesting as the achievement of a certain level of shareholder return was not achieved. During the year ended December 31, 2023, the Company granted 65,000 PSUs to its executive officers, of which 0% to 200% may become eligible for vesting depending on the level of shareholder return for the period from March 1, 2023 through March 1, 2024. The number of shares that vest at the end of the performance period depends on the percentile ranking of the total shareholder return for Omnicell stock over the performance period relative to the total shareholder return of each of the other companies in the NASDAQ Health Care Index. Stock price appreciation is calculated based on the trailing 20-day average stock price just prior to the first trading day of March in the grant year, compared to the trailing 20-day average stock price just prior to the first trading day of March in the year subsequent to the grant year. PSUs generally vest over periods of up to four years, with one-fourth of the shares vesting approximately one year from the vesting commencement date with respect to initial grants and upon confirmation by the Compensation Committee that the performance target has been met, and the remaining shares generally vesting in equal semi-annual or quarterly installments over the remaining three years. Vesting is contingent upon continued service. In addition to executive officers’ PSU awards, from time to time, the Company may grant PSUs with specific performance and service conditions to certain employees on an ad hoc basis. The following table summarizes the PSU activity under the 2009 Plan during the year ended December 31, 2023: Number of Shares Weighted-Average (In thousands, except per share data) Outstanding at December 31, 2022 135 $ 147.42 Granted 65 122.29 Vested (55) 111.05 Forfeited (70) 153.77 Outstanding and unvested at December 31, 2023 75 $ 127.14 The weighted-average grant date fair value per share of PSUs granted during the years ended December 31, 2023, 2022, and 2021 was $122.29, $155.27, and $162.16, respectively. The total fair value of PSUs that vested in the years ended December 31, 2023, 2022, and 2021 was $6.1 million, $15.0 million, and $4.4 million, respectively. As of December 31, 2023, total unrecognized compensation cost related to PSUs was approximately $5.0 million, which is expected to be recognized over the remaining weighted-average vesting period of 1.4 years. Summary of Shares Reserved for Future Issuance under Equity Incentive Plans The Company had the following ordinary shares reserved for future issuance under its equity incentive plans as of December 31, 2023: Number of Shares (In thousands) Stock options outstanding 2,023 Non-vested restricted stock awards 1,177 Shares authorized for future issuance 2,669 ESPP shares available for future issuance 3,250 Total shares reserved for future issuance 9,119 401(k) Plan |
Stock Repurchase Programs
Stock Repurchase Programs | 12 Months Ended |
Dec. 31, 2023 | |
Equity [Abstract] | |
Stock Repurchase Programs | Stock Repurchase Programs On August 2, 2016, the Company’s Board of Directors (the “Board”) authorized a stock repurchase program providing for the repurchase of up to $50.0 million of the Company’s common stock (the “2016 Repurchase Program”). The 2016 Repurchase Program is in addition to the stock repurchase program approved by the Board on November 4, 2014 providing for the repurchase of up to $50.0 million of the Company’s common stock (the “2014 Repurchase Program”). During the year ended December 31, 2022, the 2014 Repurchase Program was completed, and as of December 31, 2023, the maximum dollar value of shares that may yet be purchased under the 2016 Repurchase Program was $2.7 million. The timing, price, and volume of repurchases are to be based on market conditions, relevant securities laws, and other factors. The stock repurchases may be made from time to time on the open market, in privately negotiated transactions, or pursuant to a Rule 10b-18 plan, subject to the terms and conditions of that certain A&R Credit Agreement, as amended. The 2016 Repurchase Program does not obligate the Company to repurchase any specific number of shares, and the Company may terminate or suspend the 2016 Repurchase Program at any time. During the year ended December 31, 2022, the Company repurchased approximately 389,300 shares of its common stock under the repurchase programs at an average price of $134.11 per share for an aggregate purchase price of approximately $52.2 million. During the years ended December 31, 2023 and 2021, the Company did not repurchase any of its outstanding common stock under the stock repurchase programs. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The following is a geographical breakdown of income (loss) before income taxes: Year Ended December 31, 2023 2022 2021 (In thousands) Domestic $ (28,105) $ 369 $ 67,103 Foreign 7,997 (2,822) (1,096) Income (loss) before income taxes $ (20,108) $ (2,453) $ 66,007 The provision for (benefit from) income taxes consisted of the following: Year Ended December 31, 2023 2022 2021 (In thousands) Current: Federal $ 8,556 $ 17,973 $ (7,841) State 1,471 8,024 187 Foreign 840 192 (234) Total current income taxes 10,867 26,189 (7,888) Deferred: Federal (8,002) (25,753) (2,708) State (2,261) (7,976) (1,217) Foreign (341) (561) (29) Total deferred income taxes (10,604) (34,290) (3,954) Total provision for (benefit from) income taxes $ 263 $ (8,101) $ (11,842) The provision for (benefit from) income taxes differs from the amount computed by applying the statutory federal tax rate as follows: Year Ended December 31, 2023 2022 2021 (In thousands) U.S. federal tax provision at statutory rate $ (4,223) $ (515) $ 13,861 State taxes (624) 38 (814) Section 162(m) limitation 1,286 3,071 6,382 Non-deductible expenses 531 134 363 Uncertain tax positions (620) (776) (835) Share-based compensation tax expense (benefit) 7,384 (3,264) (20,717) Research tax credits (4,587) (6,948) (5,170) Restructuring impact — — (6,116) Foreign-derived intangible income deduction (325) (753) (68) Global intangible low-taxed income inclusion — 960 195 Foreign rate differential 219 186 (170) Foreign branch taxes 6 (51) (9) Transaction cost — 68 1,097 Provision to return true up 697 (84) 205 State rate true up 528 (135) (80) Other (9) (32) 34 Total provision for (benefit from) income taxes $ 263 $ (8,101) $ (11,842) On August 16, 2022, the Inflation Reduction Act of 2022, (the “IRA”), was signed into law. Among other things, the IRA imposes a 15% corporate alternative minimum tax for tax years beginning after December 31, 2022, levies a 1% excise tax on net stock repurchases after December 31, 2022, and provides tax incentives to promote clean energy. The provisions of the IRA did not have a material impact on the Company’s results of operations or financial position. The Organization for Economic Co-Operation and Development (“OECD”) introduced Base Erosion and Profit Shifting (“BEPS”) Pillar Two rules that impose a global minimum tax rate of 15% on multi-national corporations. The rules are effective for the Company’s financial year beginning January 1, 2024. Numerous countries have enacted or substantively enacted legislation to implement these rules. While the Company does not expect Pillar Two to have a material impact on its tax provision or effective tax rate, the Company continues to monitor evolving tax legislation in the jurisdictions in which it operates. Significant components of the Company’s deferred tax assets (liabilities) were as follows: December 31, 2023 2022 (In thousands) Deferred tax assets (liabilities): Deferred revenues $ 11,343 $ 13,514 Share-based compensation 11,763 12,064 Inventory-related items 5,136 4,567 Tax credit carryforwards 12,505 12,173 Reserves and accruals 5,660 6,244 Loss carryforwards 7,802 10,255 Lease liability 11,457 12,884 Convertible debt 9,649 15,037 Capitalized research and development 41,635 30,881 Other, net 591 1,557 Gross deferred tax assets 117,541 119,176 Valuation allowance — — Total net deferred tax assets 117,541 119,176 Intangibles (30,366) (36,357) Depreciation and amortization (35,402) (37,286) Prepaid expenses (13,858) (15,574) Right-of-use assets (6,626) (9,725) Other, net (8) — Total deferred tax liabilities (86,260) (98,942) Net deferred tax assets $ 31,281 $ 20,234 Deferred income tax assets (liabilities) are provided for temporary differences that will result in future tax deductions or future taxable income, as well as the future benefit of tax credit carryforwards. The Company recognizes deferred tax assets to the extent that it believes these assets are more likely than not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing temporary differences, projected future taxable income, tax planning strategies, and results of recent operations. As of December 31, 2023 and 2022, the Company does not have a valuation allowance against any of its deferred tax assets. As of December 31, 2023, the Company had no federal net operating loss carryforward, $19.0 million of state net operating loss carryforwards expiring at various dates beginning in 2029, and $22.3 million of foreign net operating losses carried forward indefinitely. For income tax purposes, the Company had no federal research tax credit carryforward and a California research tax credit carryforward of $20.9 million. California research tax credits are carried forward indefinitely to reduce cash taxes payable. It is the Company’s practice and intention to reinvest the earnings of its non-U.S. subsidiaries in those operations. As of December 31, 2023, the Company has not made a provision for U.S. federal income, withholding, and state income taxes on the outside basis difference related to certain foreign subsidiaries because earnings are intended to be indefinitely reinvested in operations outside the U.S. The Company files income tax returns in the United States and various state and foreign jurisdictions. In the normal course of business, the Company is subject to examinations by taxing authorities, including major jurisdictions such as the United States, Germany, Italy, France, the United Kingdom and India. With few exceptions, as of December 31, 2023, the Company was no longer subject to U.S., state, and foreign tax examinations for years before 2020, 2019, and 2019, respectively. The aggregate change in the balance of gross unrecognized tax benefit, which excludes interest and penalties, for the years ended December 31, 2023, 2022, and 2021: (In thousands) Balance as of December 31, 2020 $ 18,246 Increases related to tax positions taken during a prior period 40 Decreases related to tax positions taken during the prior period (8,908) Increases related to tax positions taken during the current period 1,219 Decreases related to expiration of statute of limitations (1,636) Balance as of December 31, 2021 8,961 Increases related to tax positions taken during a prior period 3 Decreases related to tax positions taken during the prior period (59) Increases related to tax positions taken during the current period 1,629 Decreases related to expiration of statute of limitations (1,238) Balance as of December 31, 2022 9,296 Increases related to tax positions taken during a prior period 750 Decreases related to tax positions taken during the prior period (161) Increases related to tax positions taken during the current period 1,566 Decreases related to expiration of statute of limitations (703) Balance as of December 31, 2023 $ 10,748 The total amount of gross unrecognized tax benefit that, if realized, would favorably affect the Company’s effective income tax rate in future periods, was $10.7 million and $9.3 million as of December 31, 2023 and 2022, respectively. The Company recognizes interest and penalties related to uncertain tax positions in interest and other income (expense), net in the Consolidated Statements of Operations, accruing $0.2 million, $0.2 million, and $0.3 million for the years ended December 31, 2023, 2022, and 2021, respectively. Accrued interest and penalties are included within other long-term liabilities on the Consolidated Balance Sheets. The combined amount of cumulative accrued interest and penalties was approximately $0.4 million, $0.2 million, and $0.6 million for the years ended December 31, 2023, 2022, and 2021, respectively. The Company does not believe there will be any significant changes in its unrecognized tax positions over the next twelve months. |
Restructuring Expenses
Restructuring Expenses | 12 Months Ended |
Dec. 31, 2023 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Expenses | Restructuring Expenses During the first quarter of 2021, the Company continued its organizational realignment initiative that was announced in 2020, incurring $2.0 million of employee severance costs and related expenses. During the first quarter of 2022, the Company initiated certain domestic and international restructuring initiatives in order to enhance and streamline certain engineering functions for its domestic operations and to realign its international sales organization to better serve its customers in various international markets. During the third quarter of 2022, the Company initiated restructuring initiatives associated with the integration and functionalization of certain acquisitions, primarily the 340B Link business acquisition, to further accelerate the expansion of the Company’s pharmacy inventory management capabilities. On November 23, 2022, the Company committed to a plan to reduce the Company’s headcount (“the 2022 Plan”) as part of the Company’s expense containment efforts being implemented due to ongoing macroeconomic headwinds, primarily consisting of employee severance and benefits costs. During the year ended December 31, 2022, the restructuring plans incurred $22.8 million of employee severance costs and related expenses. As of December 31, 2023, there was no material unpaid balance related to these restructuring plans. During the first quarter of 2023, as a result of continued exploration of expense containment measures, the Company committed to further reduce its headcount across many of its functions as a continuation of the 2022 Plan, and also committed to reduce its real estate footprint to align with its broader hybrid work strategy and in an effort to further reduce costs. During the year ended December 31, 2023, the Company recorded an immaterial reversal of previously recognized restructuring expenses associated with the 2022 Plan. On November 2, 2023, the Company committed to a plan to reduce the Company’s headcount and real estate footprint (the “2023 Plan”) as part of the Company’s expense containment initiatives and other actions to reduce discretionary spending being implemented due to challenging industry dynamics and macroeconomic conditions. During the year ended December 31, 2023, the restructuring plans incurred $15.5 million of employee severance costs and related expenses, net of reversals. As of December 31, 2023, the unpaid balance related to these restructuring plans was $8.9 million. Refer to Note 13, Lessee Leases for information regarding the Company’s restructuring activities for the reduction of its real estate footprint and optimization of certain leased facilities. The following table summarizes the total employee-related restructuring expenses recognized in the Company’s Consolidated Statements of Operations for the years ended December 31, 2023, 2022, and 2021: Year Ended December 31, 2023 2022 2021 (In thousands) Cost of product and service revenues $ 3,089 $ 8,018 $ 389 Research and development 3,829 3,615 105 Selling, general, and administrative 8,621 11,170 1,526 Total restructuring expenses, net of reversals $ 15,539 $ 22,803 $ 2,020 |
Schedule II Valuation and Quali
Schedule II Valuation and Qualifying Accounts | 12 Months Ended |
Dec. 31, 2023 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
Schedule II Valuation and Qualifying Accounts | SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS Balance at Beginning of Period (1) Charged (Credited) to Costs and Expenses (2) Amounts Written Off (3) Other Adjustments (4) Balance at End of Period (1) (In thousands) Year ended December 31, 2021 Accounts receivable and unbilled receivables $ 4,286 $ 2,130 $ (2,079) $ 935 $ 5,272 Long-term unbilled receivables 30 (4) — — 26 Net investment in sales-type leases 265 (37) — — 228 Total allowances deducted from assets $ 4,581 $ 2,089 $ (2,079) $ 935 $ 5,526 Year ended December 31, 2022 Accounts receivable and unbilled receivables $ 5,272 $ 2,658 $ (2,551) $ (226) $ 5,153 Long-term unbilled receivables 26 9 — — 35 Net investment in sales-type leases 228 80 — — 308 Total allowances deducted from assets $ 5,526 $ 2,747 $ (2,551) $ (226) $ 5,496 Year ended December 31, 2023 Accounts receivable and unbilled receivables $ 5,153 $ 2,726 $ (2,441) $ 126 $ 5,564 Long-term unbilled receivables 35 (4) — 31 Net investment in sales-type leases 308 (51) — — 257 Total allowances deducted from assets $ 5,496 $ 2,671 $ (2,441) $ 126 $ 5,852 __________________________________________________ (1) Allowance for credit losses. (2) Represents amounts charged and credited for provisions for credit losses. (3) Represents amounts written off from the allowance and receivable. (4) Represents other adjustments, such as foreign currency translation and purchase price accounting adjustments in connection with acquisitions. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Pay vs Performance Disclosure | |||
Net income (loss) | $ (20,371) | $ 5,648 | $ 77,849 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Dec. 31, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Organization and Summary of S_2
Organization and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The accompanying Consolidated Financial Statements have been prepared in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”) and include all adjustments necessary for the fair presentation of the Company’s consolidated financial position, results of operations, and cash flows for the periods presented. |
Principles of Consolidation | The Consolidated Financial Statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. |
Use of Estimates | The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts reported in the Company’s Consolidated Financial Statements and accompanying Notes to Consolidated Financial Statements. These estimates are based on historical experience and various other assumptions that management believes to be reasonable. Although these estimates are based on management’s best knowledge of current events and actions that may impact the Company in the future, actual results may be different from the estimates. The Company’s critical accounting policies are those that affect its financial statements materially and involve difficult, subjective, or complex judgments by management. Those policies are revenue recognition; allowance for credit losses for accounts receivable and unbilled receivables; notes receivable from investment in sales-type leases; operating lease right-of-use assets and liabilities; inventory valuation; internal-use and external-use software development costs; impairment of goodwill; purchased intangibles and long-lived assets; fair value of assets acquired and liabilities assumed in business combinations; share-based compensation; and accounting for income taxes. |
Segment Reporting | The Company manages its operations as a single segment for the purposes of assessing performance and making operating decisions. The Company’s Chief Operating Decision Maker (“CODM”) is its Chief Executive Officer. The CODM allocates resources and evaluates the performance of the Company at the consolidated level using information about its revenues, gross profit, income from operations, and other key financial data. All significant operating decisions are based upon an analysis of the Company as one operating segment, which is the same as its reporting segment. |
Foreign Currency Translation and Remeasurement | Most of the Company’s foreign subsidiaries use the local currency of their respective countries as their functional currency. The Company translates the assets and liabilities of such non-U.S. dollar functional currency subsidiaries into U.S. dollars using exchange rates in effect at the end of each period. Revenue and expenses for these subsidiaries are translated using rates that approximate those in effect during the period. Gains and losses from these translations are recorded as foreign currency translation adjustments and included in accumulated other comprehensive income (loss) in stockholders’ equity. Assets and liabilities denominated in a currency other than the functional currency are remeasured into the respective entity’s functional currency. Monetary assets and liabilities are remeasured at exchange rates in effect at the end of each period, and non-monetary assets and liabilities are remeasured at historical rates. Gains and losses from foreign currency remeasurement of monetary assets and liabilities are recorded in interest and other income (expense), net. |
Revenue Recognition and Shipping Costs | The Company earns revenues from sales of its products and related services, which are sold in the healthcare industry, its principal market. The Company’s customer arrangements typically include one or more of the following revenue categories: Connected devices, software licenses, and other. Software-enabled connected devices and software licenses that manage and regulate the storage and dispensing of pharmaceuticals, consumables blister cards, and packaging equipment and other supplies. This revenue category is often sold through long-term, sole-source agreements. Solutions in this category include, but are not limited to, XT Series automated dispensing systems and products related to the Central Pharmacy Dispensing Service and IV Compounding Service. Consumables. Medication adherence packaging, labeling, and other one-time use packaging including multimed adherence packaging and single dose blister cards, which are used by retail, community, and outpatient pharmacies, as well as by institutional pharmacies serving long-term care and other sites outside the acute care hospital, are designed to improve patient engagement and adherence to prescriptions. Technical services. Post-installation technical support and other related services, including phone support, on-site service, parts, and access to unspecified software updates and enhancements, if and when available. This revenue category is often supported by multi-year or annual contractual agreements. Advanced Services. Emerging software and service solutions which are offered on a subscription basis with fees typically based either on transaction volume or a fee over a specified period of time. Solutions in this category include, but are not limited to, EnlivenHealth ® , Specialty Pharmacy Services, 340B solutions, Inventory Optimization Service, other software solutions, and services related to the Central Pharmacy Dispensing Service and IV Compounding Service. The following table summarizes revenue recognition for each revenue category: Revenue Category Timing of Revenue Recognition Income Statement Classification Connected devices, software licenses, and other Point in time, as transfer of control occurs, generally upon installation and acceptance by the customer Product Consumables Point in time, as transfer of control occurs, generally upon shipment to or receipt by customer Product Technical services Over time, as services are provided, typically ratably over the service term Service Advanced Services Over time, as services are provided Service Prior to recognizing revenue, the Company identifies the contract, performance obligations, and transaction price, and allocates the transaction price to the performance obligations. All identified contracts meet the following required criteria: Parties to the contract have approved the contract (in writing, orally, or in accordance with other customary business practices) and are committed to perform their respective obligations. A majority of the Company’s contracts are evidenced by a non-cancelable written agreement. Contracts for consumable products are generally evidenced by an order placed via our online portal, phone, or a purchase order. Entity can identify each party’s rights regarding the goods or services to be transferred . Contract terms are documented within the written agreements. Where a written contract does not exist, such as for consumable products, the rights of each party are understood as following the Company’s standard business process and terms. The entity can identify the payment terms for the goods or services to be transferred . Payment terms are documented within the agreement and are generally net 30 to 60 days from shipment of tangible product or services performed for customers in the United States. Where a written contract does not exist, the Company’s standard payment terms are net 30 day terms. The contract has commercial substance (that is the risk, timing, or amount of the entity’s future cash flows is expected to change as a result of the contract). The Company’s agreements are an exchange of cash for a combination of products and services which result in changes in the amount of the Company’s future cash flows. It is probable the entity will collect the consideration to which it will be entitled in exchange for the goods or services that will be transferred to the customer . The Company performs a credit check for all significant customers or transactions and where collectability is not probable, payment in full or a substantial down payment prior to shipment is typically required to help ensure the full agreed upon contract price will be collected. Distinct goods or services are identified as performance obligations. A series of distinct goods or services that are substantially the same and that have the same pattern of transfer to the customer are considered a single performance obligation. Where a good or service is determined not to be distinct, the Company combines the good or service with other promised goods or services until a bundle of goods or services that is distinct is identified. To identify its performance obligations, the Company considers all products or services promised in the contract regardless of whether they are explicitly stated or are implied by customary business practices. When performance obligations are included in separate contracts, the Company considers an entire customer arrangement to determine if separate contracts should be considered combined for the purposes of revenue recognition. Most of the Company’s sales, other than renewals of support and maintenance, contain multiple performance obligations, with a combination of hardware systems, software products, support and maintenance, and professional services. The transaction price of a contract is determined based on the fixed consideration, net of an estimate for variable consideration such as various discounts or rebates provided to customers. As a result of the Company’s commercial selling practices, contract prices are generally fixed with minimal, if any, variable consideration. The transaction price is allocated to separate performance obligations proportionally based on the standalone selling price of each performance obligation. Standalone selling price is best evidenced by the price the Company charges for the good or service when selling it separately in similar circumstances to similar customers. Other than for the renewal of annual technical services contracts, the Company’s products and services are not generally sold separately. The Company uses an amount discounted from the list price as a best estimated selling price. The Company recognizes revenue when the performance obligation has been satisfied by transferring a promised good or service to a customer. The good or service is transferred when or as the customer obtains control of the good or service. Determining when control transfers requires management to make judgments that affect the timing of revenues recognized. Generally, for products requiring a complex implementation, control passes when the product is installed and ready for use. For all other products, control generally passes when product has been shipped and title has passed. For maintenance contracts and certain other services, including Advanced Services provided on a subscription basis, control passes to the customer over time, generally ratably over the service term as the Company provides a stand-ready service for the customer’s equipment. Time and material services transfer control to the customer at the time the services are provided. The portion of the transaction price allocated to the Company’s unsatisfied performance obligations for which invoicing has occurred is recorded as deferred revenues, net of deferred cost of goods sold. Deferred revenues from product sales primarily relate to delivered and invoiced products, pending installation and acceptance. Deferred revenues from service contracts primarily relate to services that have been invoiced, where services have not yet been provided. Short-term deferred revenues are expected to be recognized within the next twelve months. Long-term deferred revenues substantially consist of deferred revenues on long-term technical and Advanced Services contracts which have been invoiced and are expected to be recognized as revenue beyond twelve months, generally not more than ten years. In addition, the Company has remaining performance obligations associated with contracts for which the associated products have been accepted or associated services have started, but where invoicing has not yet occurred and therefore are not reflected in deferred revenue. These remaining performance obligations are comprised of the non-variable portions of technical services and Advanced Services provided under non-cancellable contracts with minimum commitments. Remaining performance obligations which are not included in deferred revenues are $353.9 million as of December 31, 2023. Remaining performance obligations are expected to be recognized ratably over the remaining terms of the associated contracts, which terms vary but are generally not more than ten years. Remaining performance obligations do not include product obligations, services where the associated product has not been accepted, services which have not yet started, variable portions of services, and certain other obligations. Revenues, contract assets, and contract liabilities are recorded net of associated taxes. The Company generally invoices customers for products upon shipment. Invoicing associated with the service portion of agreements is generally periodic and is billed on a monthly, quarterly, or annual basis, and in certain circumstances, multiple years are billed at one time. Advanced Services agreements are generally invoiced periodically on a monthly, quarterly or annual basis over the life of the agreement. In certain circumstances portions of these agreements may be invoiced lump sum. The amount invoiced for equipment and software is typically reflected in both accounts receivable and deferred revenues, net. The Company typically recognizes product revenue, and correspondingly reduces deferred revenues, net, for equipment and on-premise software upon written customer acceptance of installation. Consumables are recorded as revenue upon shipment to or receipt by the customer, depending upon contract terms. From time to time, the Company enters into change orders which modify the product to be received by the customer pursuant to certain contracts. Changes to any contract are accounted for as a modification of the existing contract to the extent the goods and services to be delivered as part of the contract are generally consistent with the nature and type of those to be provided under the terms of the original contract. Examples of such change orders include the addition or removal of units of equipment or changes to the configuration of the equipment where the overall nature of the contract remains intact. The Company’s change orders generally result in the change being accounted for as modifications of existing contracts given the nature of the impacted orders. In the normal course of business, the Company typically does not accept product returns unless the item is defective as manufactured or the configuration of the product is incorrect. The Company establishes provisions for estimated returns based on historical product returns. The allowance for sales returns is not material to the Consolidated Financial Statements for any periods presented. A portion of the Company’s sales are made to customers who are members of Group Purchasing Organizations (“GPOs”), each of which functions as a purchasing agent on behalf of member hospitals and other healthcare providers. The Company also has a Federal Supply Schedule Contract with the Department of Veterans Affairs (the “GSA Contract”), allowing the Department of Veterans Affairs, the Department of Defense, and other federal government customers to purchase the Company’s products. Pursuant to the terms of GPO agreements and the GSA Contract, each member or agency contracts directly with Omnicell and can purchase the Company’s products at pre-negotiated contract terms and pricing. GPOs are often fully or partially owned by the Company’s customers, and the Company pays fees to the GPO on completed contracts. The Company also pays the Industrial Funding Fee (“IFF”) to the Department of Veterans Affairs under the GSA Contract. The Company considers these fees consideration paid to customers and records them as reductions to revenue. Fees to GPOs and the IFF were $11.2 million, $17.6 million, and $17.5 million for the years ended December 31, 2023, 2022, and 2021, respectively. The accounts receivable balances are with individual members of the GPOs and federal agencies that purchase under the GSA Contract, and therefore no significant concentration of credit risk exists. During the year ended December 31, 2023, sales to members of the ten largest GPOs and federal agencies that purchase under the GSA Contract accounted for approximately 64% of the Company’s total consolidated revenues. Contract Assets and Contract Liabilities A contract asset is a right to consideration in exchange for goods or services that the Company has transferred to a customer when that right is conditioned on something other than the passage of time. A receivable will be recorded on the balance sheet when the Company has unconditional rights to consideration. A contract liability is an obligation to transfer goods or services for which the Company has received consideration, or for which an amount of consideration is due from the customer. Contract liabilities include customer deposits under non-cancelable contracts, and current and non-current deferred revenue balances. The Company’s contract balances are reported in a net contract asset or liability position on a contract-by-contract basis at the end of each reporting period. Significant changes in the contract assets and the contract liabilities balances during the period are the result of the issuance of invoices and recognition of deferred revenues in the normal course of business. The contract modifications entered into during the year ended December 31, 2023 did not have a significant impact on the Company’s contract assets or deferred revenues. Contract Costs The Company has determined that certain incentive portions of its sales commission plans require capitalization since these payments are directly related to sales achieved during a time period. These commissions are earned on the basis of: (i) the value of new bookings for connected devices, software products, and Advanced Services, provided that for Advanced Services a commission will only be paid on the amount that represents the minimum commitment and (ii) the value of new orders for consumables. Since there are no commensurate commissions earned on renewal of the service bookings, the Company concluded that the capitalized asset is related to services provided under both the initial contract and renewal periods. The Company applies a practical expedient to account for the incremental costs of obtaining a contract as part of a portfolio of contracts with similar characteristics as the Company expects the effect on the financial statements of applying the practical expedient would not differ materially from applying the accounting guidance to the individual contracts within the portfolio. A pool of contracts is defined as all contracts booked in a particular quarter. The amortization for the capitalized asset is an estimate of the pool’s original contract term, generally one |
Lessor Leases | The Company determines if an arrangement is or contains a lease at inception. The transaction price is allocated to separate performance obligations, generally consisting of a combination of hardware systems, software products, support and maintenance, and professional services, proportionally based on the standalone selling price of each performance obligation. Standalone selling price is best evidenced by the price the Company charges for the good or service when selling it separately in similar circumstances to similar customers. Other than for the renewal of annual technical services contracts, the Company’s products and services are not generally sold separately. The Company uses an amount discounted from the list price as a best estimated selling price. Sales-Type Leases The Company enters into non-cancelable sales-type lease arrangements with the leases varying in length from one For sales-type leases, the Company recognizes revenues for its hardware and software products, net of lease execution costs, post-installation product maintenance, professional services associated with Advanced Services offerings, and technical support, at the net present value of the lease payment stream upon customer acceptance. The Company recognizes service revenues associated with sales-type leases ratably over the term of the agreement in service revenues in the Consolidated Statements of Operations. The Company recognizes interest income from sales-type leases using the effective interest method. Both hardware and software revenues, and interest income from sales-types leases are recorded in product revenues in the Consolidated Statements of Operations. The Company optimizes cash flows by selling a majority of its sales-type leases, other than those relating to U.S. government hospitals and Advanced Services products, including Central Pharmacy Dispensing Service and IV Compounding Service, to third-party leasing finance companies on a non-recourse basis. The Company has no obligation to the leasing company once the lease has been sold. |
Allowance for Credit Losses | The Company is exposed to credit losses primarily through sales of its products and services, as well as its sales-type leasing arrangements. The Company performs credit evaluations of its customers’ financial condition in order to assess each customer’s ability to pay. These evaluations require significant judgment and are based on a variety of factors including, but not limited to, current economic trends, payment history, and a financial review of the customer. The Company continues to monitor customers’ creditworthiness on an ongoing basis. The Company maintains an allowance for credit losses for accounts receivable, unbilled receivables, and net investment in sales-type leases based on expected credit losses resulting from the inability of its customers to make required payments. The allowance for credit losses is measured using a loss rate method, considering factors such as customers’ credit risk, historical loss experience, current conditions, and forecasts. The allowance for credit losses is measured on a collective (pool) basis by aggregating customer balances with similar risk characteristics. The Company also records a specific allowance based on an analysis of individual past due balances or customer-specific information, such as a decline in creditworthiness or bankruptcy. Actual collection losses may differ from management’s estimates, and such differences could be material to the Company’s financial position and results of operations. The allowance for credit losses is presented in the Consolidated Balance Sheets as a deduction from the respective asset balance. As of December 31, 2023 and 2022, the allowance for credit losses for long-term unbilled receivables and net investment in sales-type leases were not material. |
Funds Held for Customers and Customer Fund Liabilities | The Company offers certain products and services in which it is customary for pharmacies or insurance payors to owe funds to the Company which are collected on behalf of, and, after a short holding period, disbursed to, the Company’s customers. The Company presents amounts due from pharmacies and amounts due to be disbursed to customers on a gross basis within other current assets and accrued liabilities, respectively, in the Consolidated Balance Sheets, as such amounts are expected to be settled within one year. Generally, any funds received from the pharmacies or insurance payors that are held by the Company are segregated from its other corporate cash accounts. These funds are classified as restricted cash as the Company is contractually obligated to disburse these amounts to customers. |
Sales of Accounts Receivable | The Company records the sale of its accounts receivables in accordance with accounting guidance for transfers and servicing of financial assets. |
Cash and Cash Equivalents | The Company classifies all highly-liquid investments with original maturities of three months or less as cash equivalents. The Company’s cash and cash equivalent balances include bank accounts and highly-liquid U.S. Government money market funds held in sweep and asset management accounts with financial institutions of high credit quality. The Company continuously monitors the credit worthiness of the financial institutions in which it invests. The Company has not experienced any credit losses from its cash equivalents. |
Financial Instruments | For assets and liabilities measured at fair value, the amounts are based on an expected exit price representing the amount that would be received from the sale of an asset or paid to transfer a liability in a transaction between market participants. The fair value may be based on assumptions that market participants would use in pricing an asset or liability. ASC 820, Fair Value Measurement , establishes a consistent framework for measuring fair value on either a recurring or nonrecurring basis whereby inputs used in valuation techniques are assigned a hierarchical level, as follows: Level 1 – Observable inputs, such as quoted prices in active markets for identical instruments; Level 2 – Quoted prices for similar instruments in active markets, or quoted prices for identical instruments in inactive markets; and Level 3 – Unobservable inputs for financial instruments reflecting Company’s assumptions. |
Inventory | Inventories are stated at the lower of cost, computed using the first-in, first-out method, and net realizable value. Inbound shipping costs are included in cost of inventory. The Company regularly monitors inventory quantities on hand and records write-downs for excess and obsolete inventories based on the Company’s estimate of demand for its products, potential obsolescence of technology, product life cycles, and whether pricing trends or forecasts indicate that the carrying value of inventory exceeds its estimated selling price. These factors are impacted by market and economic conditions, technology changes, and new product introductions and require estimates that may include elements that are uncertain. Actual demand may differ from forecasted demand and may have a material effect on gross margins. If inventory is written down, a new cost basis is established that cannot be increased in future periods. Shipments from suppliers or contract manufacturers before the Company receives them are recorded as in-transit inventory when title and the significant risks and rewards of ownership have passed to the Company. The Company has a supply agreement with one primary supplier for construction and supply of several sub-assemblies and inventory management of sub-assemblies used in its hardware products. There are no minimum purchase requirements. The |
Property and Equipment | Property and equipment less accumulated depreciation are stated at historical cost. The Company’s expenditures for property and equipment are primarily for computer equipment and software used in the administration of its business, and for leasehold improvements to its leased facilities. The Company also develops molds and dies used in long-term manufacturing arrangements with suppliers and for production automation equipment used in the manufacturing of consumable blister card components. The Company capitalizes costs related to computer software developed or obtained for internal-use in accordance with ASC 350-40, Internal-Use Software |
External-Use Software Development Costs | The Company capitalizes certain software development costs in accordance with ASC 985-20, Costs of Software to Be Sold, Leased, or Marketed |
Lessee Leases | The Company determines if an arrangement is or contains a lease at inception. Operating lease right-of-use assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. As most of its lease contracts do not provide an implicit rate, the Company uses its incremental borrowing rate based on information available at the commencement date in determining the present value of the lease payments. Lease expense is recognized on a straight-line basis over the lease term. The Company does not recognize a right-of-use asset and a lease liability for leases with an initial term of twelve months or less. The Company elected the practical expedient to not separate lease components from nonlease components and applied that practical expedient to all material classes of leased assets. Many of the Company’s operating leases include an option to extend the lease. The specific terms and conditions of the extension options vary from lease to lease, but are consistent with standard industry practices in each area that the Company operates. The Company reviews each of its lease options at a time required by the terms of the lease contract, and notifies the lessor if it chooses to exercise the lease renewal option. Until the Company is reasonably certain that it will extend the lease contract, the renewal option periods will not be recognized as right-of-use assets or lease liabilities. Certain leases include provisions for early termination, which allow the contract parties to terminate their obligations under the lease contract. The terms and conditions of the termination options vary by contract. When the Company has made a decision to exercise an early termination option, the right-of-use assets and associated lease liabilities are remeasured in accordance with the present value of the remaining cash flows under the lease contract. Certain building lease agreements include rental payments subject to change annually based on fluctuations in various indexes (i.e., Consumer Price Index (“CPI”), Retail Price Index, and other international indexes). Certain data center lease agreements include rental payments subject to change based on usage and CPI fluctuations. The changes based on usage and indexes are treated as variable lease costs and recognized in the period in which the obligation for those payments was incurred. The Company’s operating lease agreements do not contain any material residual value guarantees, restrictions, or restriction covenants. |
Business Combinations | The Company uses the acquisition method of accounting under ASC 805, Business Combinations . Each acquired company’s operating results are included in the Company’s Consolidated Financial Statements starting on the acquisition date. The purchase price is equivalent to the fair value of consideration transferred. Tangible and identifiable intangible assets acquired and liabilities assumed as of the acquisition date are recorded at the acquisition date fair value. Goodwill is recognized for the excess of purchase price over the net fair value of assets acquired and liabilities assumed. The Company’s Consolidated Financial Statements include the results of operations of each acquired company, commencing as of their respective acquisition dates. Acquisition-related costs were expensed as incurred, and are included in selling, general, and administrative expenses in the Company’s Consolidated Statements of Operations. The customer relationships intangible assets represent the fair values of the underlying relationships and agreements with each acquired company’s customers. The acquired technology intangible assets represent the fair values of the portfolio of SaaS solutions that have reached technological feasibility and were part of the respective acquired company’s offerings at their respective acquisition dates. The backlog intangible asset represents contractually committed future billings associated with MarkeTouch Media customer contracts. The trade names intangible asset represents the fair value of brand and name recognition associated with the marketing of certain FDS Amplicare SaaS solutions. The fair values of the customer relationships and backlog intangible assets were determined based on the excess earnings method, and the fair values of the acquired technology and trade names intangible assets were determined based on the relief-from-royalty method. The key assumptions used in estimating the fair values of intangible assets included forecasted financial information; customer attrition rates; royalty rate of 10.0% for the acquired technology intangible assets for both FDS Amplicare and MarkeTouch Media; royalty rate of 2.0% for the FDS Amplicare trade names intangible asset; discount rate of 13.0% for the FDS Amplicare acquisition; discount rate of 15.0% for the ReCept acquisition; discount rate of 11.5% for the MarkeTouch Media acquisition; and certain other assumptions. The customer relationships and acquired technology intangible assets are being amortized using a double-declining method of amortization as such method better represents the economic benefits to be obtained. The backlog and trade names intangible assets are being amortized over their respective estimated useful lives using the straight-line method of amortization. |
Goodwill and Acquired Intangible Assets | Goodwill The Company assesses goodwill for impairment on an annual basis on the first day of the fourth quarter of each year at the reporting unit level. This assessment is also performed whenever there is a change in circumstances that indicates the carrying value of goodwill may be impaired. The Company has one reporting unit, which is the same as its operating segment. A qualitative assessment is initially made to determine whether it is necessary to perform quantitative testing. A qualitative assessment includes, among others, consideration of: (i) past, current, and projected future earnings and equity; (ii) recent trends and market conditions; and (iii) valuation metrics involving similar companies that are publicly-traded and acquisitions of similar companies, if available. If this qualitative assessment indicates that it is more likely than not that impairment exists, or if the Company decides to bypass this option, it proceeds to the quantitative assessment. The quantitative assessment involves a comparison between the estimated fair value of the Company’s reporting unit with its carrying amount including goodwill. If the carrying value exceeds estimated fair value, the Company will record an impairment charge based on that difference. The impairment charge will be limited to the amount of goodwill. To determine the reporting unit’s fair value under the quantitative approach, the Company uses a combination of income and market approaches, such as estimated discounted future cash flows of the reporting unit, multiples of earnings or revenues, and analysis of recent sales or offerings of comparable entities. The Company also considers its market capitalization on the date of the analysis to ensure the reasonableness of its reporting unit’s fair value. The Company elected to perform a quantitative impairment assessment analysis as of October 1, 2023 for its reporting unit. The Company determined that the fair value of the reporting unit exceeded the carrying value and thus no impairment was indicated. Based on the result of this analysis, an impairment does not exist as of December 31, 2023, and there were no accumulated impairment losses. Intangible Assets In connection with its acquisitions, the Company generally recognizes assets for customer relationships, acquired technology, backlog, trade names, and non-compete agreements. Intangible assets are carried at cost less accumulated amortization. Such amortization is provided on a straight-line basis or on an accelerated basis based on a pattern of economic benefit that is expected to be obtained over the estimated useful lives of the respective assets. Amortization for acquired technology and backlog is recognized in cost of revenues, and amortization for customer relationships, trade names, non-compete agreements, and patents is recognized in selling, general, and administrative expenses. |
Convertible Debt | The Company accounts for convertible debt and related transactions in accordance with ASC 470-20, Debt with Conversion and Other Options, ASC 815, Derivatives and Hedging, and ASC 480, Distinguishing Liabilities from Equity. The Company evaluates convertible debt instruments and related transactions at inception to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for. Prior to the adoption of Accounting Standards Update (“ASU”) 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40) , convertible debt instruments that could be settled in cash were required to be separated into liability and equity components. The allocation to the liability component was based on the fair value of a similar instrument that did not contain an equity conversion option. Based on this debt-to-equity ratio, debt issuance costs were then allocated to the liability and equity components in a similar manner. The difference between the principal amount of the convertible senior notes and the liability component, inclusive of issuance costs, represented the debt discount, which the Company amortized to interest expense over the term of the convertible senior notes. The determination of the discount rate required certain estimates and assumptions. Upon adoption of ASU 2020-06, effective January 1, 2022, the convertible senior notes are no longer separated into liability and equity components, and are accounted for as a single liability, measured at amortized cost in the Consolidated Balance Sheets. Issuance costs are amortized using the effective interest method over the term of the convertible senior notes. Convertible note hedge and warrant transactions associated with convertible debt instruments are accounted for as equity instruments, and are recorded in additional paid-in capital in the Consolidated Balance Sheets. |
Valuation of Share-Based Compensation | The Company accounts for share-based compensation in accordance with ASC 718, Stock Compensation . The Company recognizes compensation expense related to share-based compensation based on the grant date estimated fair value. The fair value of stock options (“options”) on the grant date is estimated using the Black-Scholes option pricing model, which requires the following inputs: expected life, expected volatility, risk-free interest rate, expected dividend yield rate, exercise price, and closing price of its common stock on the date of grant. The expected volatility is based on a combination of historical and market-based implied volatility, and the expected life of the awards is based on the Company’s historical experience of employee stock option exercises, including forfeitures. Expense is recognized on a straight-line basis over the requisite service period. The fair value of restricted stock units (“RSUs”) and restricted stock awards (“RSAs”) is based on the stock price on the grant date. The RSUs and RSAs are subject to a service vesting condition and are recognized on a straight-line basis over the requisite service period. The fair value of performance-based stock unit awards (“PSUs”) with service and market conditions is estimated using a Monte Carlo simulation model applying a multiple awards approach. Expense is recognized when it is probable that the performance condition will be met using the accelerated attribution method over the requisite service period. Forfeiture rates are estimated based on the Company’s historical experience with equity awards that were granted and forfeited prior to vesting. The valuation assumptions used in estimating the fair value of employee share-based awards may change in future periods. |
Accounting for Income Taxes | The Company records an income tax provision for (benefit from) the anticipated tax consequences of the reported results of operations. In accordance with ASC 740, Income Taxes , the provision for (benefit from) income taxes is computed using the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined on the basis of the differences between the financial statement and tax bases of assets and liabilities and for operating losses and tax credit carryforwards. Deferred tax assets and liabilities are measured using the enacted tax rates in effect for the periods in which those tax assets and liabilities are expected to be realized or settled. In the event that these tax rates change, the Company will incur a benefit or detriment on its income tax expense in the period of enactment. If the Company were to determine that all or part of the net deferred tax assets are not realizable in the future, it will record a valuation allowance that would be charged to earnings in the period such determination is made. In accordance with ASC 740, the Company recognizes the tax benefit from an uncertain tax position if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such positions are then measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The calculation of tax liabilities involves significant judgment in estimating the impact of uncertainties in the application of ASC 740 and complex tax laws. Resolution of these uncertainties in a manner inconsistent with management’s expectations could have a material impact on the Company’s financial condition and operating results. |
Recently Adopted Authoritative Guidance and Recently Issued Authoritative Guidance | Recently Adopted Authoritative Guidance In October 2021, the Financial Accounting Standards Board (“FASB”) issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers . The update addresses diversity in practice by requiring that an acquirer recognize and measure contract assets and liabilities acquired in a business combination in accordance with Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers. The Company adopted ASU 2021-08 beginning January 1, 2023 and will apply the guidance prospectively to acquisitions occurring on or after the adoption date. Recently Issued Authoritative Guidance In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures , which requires public entities to disclose significant segment expenses that are regularly provided to the CODM. Public entities with a single reportable segment are required to apply the disclosure requirements in ASU 2023-07, as well as all existing segment disclosures and reconciliation requirements in ASC 280 on an interim and annual basis. The amendments are effective for the Company’s annual periods beginning January 1, 2024, and for interim periods within fiscal years beginning January 1, 2025. Retrospective application is required, with early adoption permitted. The Company is currently evaluating the impact ASU 2023-07 will have on its consolidated financial statements. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures , which includes amendments that further enhance income tax disclosures, primarily through standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction. The amendments are effective for the Company’s annual periods beginning January 1, 2025, with early adoption permitted, and should be applied either prospectively or retrospectively. The Company is currently evaluating the impact ASU 2023-09 will have on its consolidated financial statements. |
Net Income Per Share | Basic net income (loss) per share is computed by dividing net income (loss) for the period by the weighted-average number of shares outstanding during the period. In periods of net loss, all potential common shares are anti-dilutive, so diluted net loss per share equals the basic net loss per share. In periods of net income, diluted net income per share is computed by dividing net income for the period by the basic weighted-average number of shares plus any dilutive potential common stock outstanding during the period, using the treasury stock method for share-based awards and warrants, and the if-converted method for convertible senior notes. Potential common stock includes the effect of outstanding dilutive stock options, restricted stock awards, and restricted stock units, as well as shares the Company could be obligated to issue from its convertible senior notes and warrants, as described in Note 11, Convertible Senior Notes . For periods prior to the adoption of ASU 2020-06 on January 1, 2022, the Company applied the treasury stock method to calculate the dilutive impact of the convertible senior notes. Upon adoption of ASU 2020-06, effective January 1, 2022, the Company applies the if-converted method for calculating the dilutive impact of the convertible senior notes. Following the Company’s irrevocable election in December 2021 to settle the principal portion of the convertible senior notes in cash with any conversion consideration in excess of the principal portion in cash and/or shares of the Company’s common stock at the Company’s option upon conversion, only the amounts expected to be settled in excess of the principal portion are considered dilutive in calculating earnings per share under the if-converted method. Any anti-dilutive weighted-average dilutive shares related to stock award plans, convertible senior notes, and warrants are excluded from the computation of the diluted net income per share. |
Fair Value Hierarchy | The Company measures its financial instruments at fair value. The Company’s cash, cash equivalents, and restricted cash are classified within Level 1 of the fair value hierarchy as they are valued primarily using quoted market prices utilizing market observable inputs. The Company’s credit facility is classified within Level 2 as the valuation inputs are based on quoted prices or market observable data of similar instruments. The Company’s convertible senior notes are classified within Level 2 as the valuation inputs are based on quoted prices in an inactive market on the last day in the reporting period. |
Commitments and Contingencies | The Company is not a party to any legal proceedings that management believes may have a material impact on the Company’s financial position or results of operations. |
Guarantees | Under the Company’s certificate of incorporation and bylaws, the Company has agreed to indemnify its directors and executive officers to the fullest extent not prohibited by Delaware and other applicable law, subject to certain exceptions. The Company has entered into individual indemnification agreements with its directors and officers. The term of the indemnification period is for the entirety of the director’s or officer’s service to the Company and continues so long as the director or officer may be subject to any claim, action, or proceeding, and there is no limit on the potential amount of future payments that the Company could be required to make under these indemnification agreements. The Company has purchased a directors’ and officers’ liability insurance policy that may enable it to recover a portion of any future payments that it may be required to make under these indemnification agreements. Assuming the applicability of coverage and the willingness of the insurer to assume coverage and subject to certain retention, loss limits, and other policy provisions, the Company believes it is unlikely that the Company will be required to pay any material amounts pursuant to these indemnification obligations. However, no assurances can be given that the insurers will not attempt to dispute the validity, applicability, or amount of coverage without expensive and time-consuming litigation against the insurers. Additionally, the Company undertakes indemnification obligations in its ordinary course of business in connection with, among other things, the sale or licensing of its products and the provision of its support services. In the ordinary course of the Company’s business, the Company has in the past and may in the future agree to indemnify another party, generally its business affiliates or customers, against certain losses suffered or incurred by the indemnified party in connection with various types of claims, which may include, without limitation, claims of intellectual property infringement, certain tax liabilities, its gross negligence or intentional acts in the performance of services, and violations of laws. The term of these indemnification obligations is generally perpetual, but typically will not extend beyond the applicable statute of limitation pursuant to applicable law. In general, the Company attempts to limit the maximum potential amount of future payments that it may be required to make under these indemnification obligations to the amounts paid to it by a customer, but in some cases the obligation may not be so limited. In addition, the Company has in the past and may in the future warrant to its customers that its products will conform to certain representations, which may include functional specifications for a limited period of time following the date of installation (generally not exceeding 30 days) or that its software media is free from material defects. Sales contracts for certain of the Company’s medication packaging systems may have in the past and may in the future include limited warranties for up to six months, but the periodic activity and ending warranty balances the Company records have historically not been material. |
Organization and Summary of S_3
Organization and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Revenue Recognition for Revenue Categories | The following table summarizes revenue recognition for each revenue category: Revenue Category Timing of Revenue Recognition Income Statement Classification Connected devices, software licenses, and other Point in time, as transfer of control occurs, generally upon installation and acceptance by the customer Product Consumables Point in time, as transfer of control occurs, generally upon shipment to or receipt by customer Product Technical services Over time, as services are provided, typically ratably over the service term Service Advanced Services Over time, as services are provided Service |
Estimated Useful Lives of Assets | Depreciation and amortization is computed by use of the straight-line method over the estimated useful lives of the assets as stated below: Purchased software and internal-use software development costs 3 - 5 years Leasehold and building improvements Shorter of the lease term or the estimated useful life Furniture and fixtures 5 - 7 years Equipment 2 - 12 years The following table represents the property and equipment balances as of December 31, 2023 and 2022: December 31, 2023 2022 (In thousands) Equipment $ 95,996 $ 91,391 Furniture and fixtures 4,500 5,154 Leasehold improvements 17,919 19,510 Purchased software and internal-use software development costs 118,004 76,327 Construction in progress 11,614 28,223 Property and equipment, gross 248,033 220,605 Accumulated depreciation and amortization (139,432) (126,644) Total property and equipment, net $ 108,601 $ 93,961 |
Business Combinations (Tables)
Business Combinations (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Preliminary Allocation of the Purchase Price to the Assets Acquired and the Liabilities Assumed By the Company | The following tables represent the allocation of the respective purchase price to the assets acquired and the liabilities assumed by the Company as part of each acquisition included in the Company’s Consolidated Balance Sheets, and is reconciled to the respective purchase price transferred: FDS Amplicare (1) ReCept (2) (3) MarkeTouch Media (4) (In thousands) Purchase price transferred: Base purchase price $ 177,000 $ 100,000 $ 82,000 Add: Closing cash 465 6,569 237 Add: Net working capital adjustment 1,654 (7,357) 147 Less: Assumed indebtedness (653) (1,973) (15) Total purchase price transferred $ 178,466 $ 97,239 $ 82,369 FDS Amplicare (1) ReCept (2) (3) MarkeTouch Media (4) Fair value of assets acquired and liabilities assumed: Cash and cash equivalents $ 465 $ — $ 237 Accounts receivable and unbilled receivables 5,330 2,383 2,302 Prepaid expenses 506 192 96 Other current assets 45 12,223 — Total current assets 6,346 14,798 2,635 Property and equipment 444 172 177 Operating lease right-of-use assets 2,252 773 602 Goodwill 117,784 77,644 42,273 Intangible assets 70,000 28,100 38,000 Other long-term assets 51 195 2,850 Total assets 196,877 121,682 86,537 Accounts payable 950 219 473 Accrued compensation 1,312 1,756 — Accrued liabilities 1,497 18,249 292 Deferred revenues 1,916 222 347 Long-term deferred tax liabilities 11,686 3,383 — Long-term operating lease liabilities 920 614 206 Other long-term liabilities 130 — 2,850 Total liabilities 18,411 24,443 4,168 Total purchase price $ 178,466 $ 97,239 $ 82,369 Total purchase price, net of cash acquired $ 178,001 $ 90,670 $ 82,132 _________________________________________________ (1) During the year ended December 31, 2021, the Company recorded measurement period adjustments of $1.5 million to goodwill, consisting of an increase in intangible assets, accounts receivable and unbilled receivables, and long-term deferred tax liabilities of $0.4 million, $1.1 million, and $0.1 million, respectively, and a net working capital adjustment of $0.1 million. During the year ended December 31, 2022, the Company recorded a measurement period adjustments of $0.4 million to goodwill, consisting of an increase in long-term deferred tax liabilities and accrued liabilities of $0.3 million and $0.1 million, respectively. (2) Closing cash is included in other current assets due to its restrictive nature as cash held for customers. (3) During the year ended December 31, 2022, the Company recorded measurement period adjustments of $3.9 million to goodwill, consisting of a purchase price adjustment of $5.2 million, a decrease in long-term deferred tax liabilities of $0.2 million and a decrease in accrued liabilities of $0.3 million, partially offset by a decrease to other current assets of $1.7 million. (4) |
Summary of Identifiable Intangible Assets Acquired | The identifiable intangible assets acquired and their estimated useful lives for amortization are as follows: FDS Amplicare (1) ReCept MarkeTouch Media Fair value Useful life Fair value Useful life Fair value Useful life (In thousands, except for years) Customer relationships $ 59,900 23 $ 28,100 23 $ 34,100 26 Acquired technology 7,700 5 - 7 — — 2,100 4 Backlog — — — — 1,800 2 Trade names 2,400 5 — — — — Total purchased intangible assets $ 70,000 $ 28,100 $ 38,000 _________________________________________________ (1) During the year ended December 31, 2021, the Company recorded a measurement period adjustment of $0.4 million in customer relationships. |
Pro Forma Financial Information | The following table presents certain unaudited pro forma consolidated financial information for the year ended December 31, 2021 as if the FDS Amplicare, ReCept, and MarkeTouch Media acquisitions had been completed on January 1, 2020. The pro forma effects of the Hub and Spoke Innovations acquisition were not material to the Company’s consolidated results of operations. The unaudited pro forma financial information is presented for informational purposes only, and is not indicative of what would have occurred had the acquisitions taken place on those respective dates. The unaudited pro forma financial information combines the historical results of the acquisitions with the Company’s consolidated historical results and includes certain adjustments including, but not limited to, amortization and depreciation of intangible assets and property and equipment acquired; imputed interest, interest expense, and amortization of debt issuance costs related to acquisitions, as applicable; and certain acquisition-related costs incurred. Year Ended December 31, 2021 (In thousands) Pro forma revenues $ 1,195,473 Pro forma net income $ 79,981 |
Revenues (Tables)
Revenues (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenues by Revenue Type | The following table summarizes the Company’s revenues disaggregated by revenue type for the years ended December 31, 2023, 2022, and 2021: Year Ended December 31, 2023 2022 2021 (In thousands) Connected devices, software licenses, and other $ 623,584 $ 827,917 $ 739,074 Consumables 84,977 75,305 73,438 Technical services 225,831 206,687 206,989 Advanced Services 212,720 186,038 112,517 Total revenues $ 1,147,112 $ 1,295,947 $ 1,132,018 |
Disaggregation of Revenues by Geographical Location | The following table summarizes the Company’s revenues disaggregated by geographic region, which is determined based on customer location, for the years ended December 31, 2023, 2022, and 2021: Year Ended December 31, 2023 2022 2021 (In thousands) United States $ 1,011,380 $ 1,168,202 $ 1,020,788 Rest of world (1) 135,732 127,745 111,230 Total revenues $ 1,147,112 $ 1,295,947 $ 1,132,018 _________________________________________________ (1) No individual country represented more than 10% of total revenues. |
Contract Assets and Liabilities | The following table reflects the Company’s contract assets and contract liabilities: December 31, 2023 2022 (In thousands) Short-term unbilled receivables, net (1) $ 22,524 $ 25,763 Long-term unbilled receivables, net (2) 11,850 14,744 Total contract assets $ 34,374 $ 40,507 Short-term deferred revenues, net $ 121,734 $ 118,947 Long-term deferred revenues 58,622 37,385 Total contract liabilities $ 180,356 $ 156,332 _________________________________________________ (1) Included in accounts receivable and unbilled receivables in the Consolidated Balance Sheets. (2) Included in other long-term assets in the Consolidated Balance Sheets. |
Net Income (Loss) Per Share (Ta
Net Income (Loss) Per Share (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
Calculation of Basic and Diluted Net Income Per Share | The basic and diluted net income (loss) per share calculations for the years ended December 31, 2023, 2022, and 2021 were as follows: Year Ended December 31, 2023 2022 2021 (In thousands, except per share data) Net income (loss) $ (20,371) $ 5,648 $ 77,849 Weighted-average shares outstanding – basic 45,212 44,398 43,475 Effect of dilutive securities from stock award plans — 1,019 2,136 Effect of convertible senior notes — 474 2,044 Effect of warrants — — 288 Weighted-average shares outstanding – diluted 45,212 45,891 47,943 Net income (loss) per share – basic $ (0.45) $ 0.13 $ 1.79 Net income (loss) per share – diluted $ (0.45) $ 0.12 $ 1.62 Anti-dilutive weighted-average shares related to stock award plans 3,368 725 156 Anti-dilutive weighted-average shares related to convertible senior notes and warrants 11,816 5,908 — |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Balance Sheet Components | Balance sheet details as of December 31, 2023 and 2022 are presented in the tables below: December 31, 2023 2022 (In thousands) Inventories: Raw materials $ 51,439 $ 75,854 Work in process 1,327 9,280 Finished goods 57,333 62,415 Total inventories $ 110,099 $ 147,549 Other current assets: Funds held for customers, including restricted cash (1) $ 43,649 $ 56,703 Net investment in sales-type leases, current portion 11,867 11,486 Prepaid income taxes 8,279 1,702 Other current assets 7,714 7,471 Total other current assets $ 71,509 $ 77,362 Other long-term assets: External-use software development costs, net $ 66,659 $ 80,760 Unbilled receivables, net 11,850 14,744 Deferred debt issuance costs 3,718 2,058 Other long-term assets 8,239 7,455 Total other long-term assets $ 90,466 $ 105,017 Accrued liabilities: Operating lease liabilities, current portion $ 10,518 $ 10,761 Customer fund liabilities 43,649 56,703 Advance payments from customers 10,551 11,556 Rebate liabilities 51,277 42,802 Group purchasing organization fees 4,445 7,723 Taxes payable 2,191 9,642 Other accrued liabilities 26,645 33,468 Total accrued liabilities $ 149,276 $ 172,655 _________________________________________________ (1) Includes restricted cash of $33.0 million and $22.5 million as of December 31, 2023 and 2022, respectively. |
Summary of Changes in Accumulated Balances of Other Comprehensive Income (Loss) | The following table summarizes the changes in accumulated balances of other comprehensive income (loss), which consisted of foreign currency translation adjustments, for the years ended December 31, 2023 and 2022: (In thousands) Balance as of December 31, 2021 $ (8,407) Other comprehensive loss (8,680) Balance as of December 31, 2022 (17,087) Other comprehensive income 3,655 Balance as of December 31, 2023 $ (13,432) |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Depreciation and amortization is computed by use of the straight-line method over the estimated useful lives of the assets as stated below: Purchased software and internal-use software development costs 3 - 5 years Leasehold and building improvements Shorter of the lease term or the estimated useful life Furniture and fixtures 5 - 7 years Equipment 2 - 12 years The following table represents the property and equipment balances as of December 31, 2023 and 2022: December 31, 2023 2022 (In thousands) Equipment $ 95,996 $ 91,391 Furniture and fixtures 4,500 5,154 Leasehold improvements 17,919 19,510 Purchased software and internal-use software development costs 118,004 76,327 Construction in progress 11,614 28,223 Property and equipment, gross 248,033 220,605 Accumulated depreciation and amortization (139,432) (126,644) Total property and equipment, net $ 108,601 $ 93,961 |
Long-lived Assets by Geographic Areas | The following table summarizes the geographic information for property and equipment, net, as of December 31, 2023 and 2022: December 31, 2023 2022 (In thousands) United States $ 104,312 $ 89,989 Rest of world (1) 4,289 3,972 Total property and equipment, net $ 108,601 $ 93,961 _________________________________________________ (1) No individual country represented more than 10% of total property and equipment, net. |
External-Use Software Develop_2
External-Use Software Development Costs (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Research and Development [Abstract] | |
Schedule of Capitalized Computer Software | The carrying amounts of external-use software development costs as of December 31, 2023 and 2022 were as follows: December 31, 2023 2022 (In thousands) Gross carrying amount $ 239,038 $ 225,004 Accumulated amortization (172,379) (144,244) External-use software development costs, net (1) $ 66,659 $ 80,760 _________________________________________________ (1) Included in other long-term assets in the Consolidated Balance Sheets. |
Schedule of Future Amortization Expenses For Capitalized Software Development Costs | The estimated future amortization expenses for external-use software development costs were as follows: December 31, 2023 (In thousands) 2024 $ 25,354 2025 18,331 2026 12,792 2027 6,837 2028 2,980 Thereafter 365 Total $ 66,659 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in the Carrying Amount of Goodwill | The following table represents changes in the carrying amount of goodwill: (In thousands) Balance as of December 31, 2021 $ 738,900 Additions (1) 2,549 Measurement period adjustments (1) (3,770) Foreign currency exchange rate fluctuations (3,405) Balance as of December 31, 2022 734,274 Foreign currency exchange rate fluctuations 1,536 Balance as of December 31, 2023 $ 735,810 _________________________________________________ (1) Refer to Note 2, Business Combinations , for further information. |
Carrying Amounts and Useful Lives of Intangible Assets | The carrying amounts and useful lives of intangible assets as of December 31, 2023 and 2022 were as follows: December 31, 2023 Gross carrying Accumulated Foreign currency exchange Net carrying Useful life (In thousands, except for years) Customer relationships $ 307,418 $ (115,232) $ (1,326) $ 190,860 4 - 30 Acquired technology 84,876 (67,033) — 17,843 4 - 20 Backlog 1,800 (1,800) — — 2 Trade names 9,200 (7,680) — 1,520 5 - 12 Patents 2,404 (1,454) — 950 2 - 20 Total intangibles assets, net $ 405,698 $ (193,199) $ (1,326) $ 211,173 December 31, 2022 Gross carrying Accumulated Foreign currency exchange Net carrying Useful life (In thousands, except for years) Customer relationships $ 311,089 $ (99,177) $ (1,514) $ 210,398 4 - 30 Acquired technology 92,066 (64,299) — 27,767 4 - 20 Backlog 1,800 (900) — 900 2 Trade names 9,200 (6,633) — 2,567 5 - 12 Patents 2,430 (1,306) — 1,124 2 - 20 Non-compete agreements 600 (450) — 150 3 Total intangibles assets, net $ 417,185 $ (172,765) $ (1,514) $ 242,906 |
Estimated Future Amortization Expense for Intangible Assets | The estimated future amortization expenses for amortizable intangible assets were as follows: December 31, (In thousands) 2024 $ 22,736 2025 21,060 2026 18,080 2027 16,245 2028 15,180 Thereafter 117,872 Total $ 211,173 |
Convertible Senior Notes (Table
Convertible Senior Notes (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Convertible Debt Balances | The Notes consisted of the following balances reported in the Consolidated Balance Sheets as of December 31, 2023 and 2022: December 31, 2023 2022 Principal amount $ 575,000 $ 575,000 Unamortized debt issuance costs (5,338) (8,429) Convertible senior notes, net $ 569,662 $ 566,571 |
Summary of the Components of Interest Expense | The following table summarizes the components of interest expense resulting from the Notes recognized in interest and other income (expense), net in the Consolidated Statements of Operations for the years ended December 31, 2023, 2022 and 2021: Year Ended December 31, 2023 2022 (1) 2021 (In thousands) Contractual coupon interest $ 1,438 $ 1,438 $ 1,438 Amortization of discount $ — $ — $ 18,608 Amortization of debt issuance costs $ 3,091 $ 3,066 $ 2,343 _________________________________________________ (1) Refer to Note 1, Organization and Summary of Significant Accounting Policies , for further information regarding the adoption of ASU 2020-06, effective January 1, 2022. |
Lessor Leases (Tables)
Lessor Leases (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
Income Recognized from Sales-Type Leases | The following table presents the Company’s income recognized from sales-type leases for the years ended December 31, 2023, 2022, and 2021: Year Ended December 31, 2023 2022 2021 (In thousands) Sales-type lease revenues $ 36,208 $ 38,959 $ 21,887 Cost of sales-type lease revenues (18,093) (19,359) (8,918) Selling profit on sales-type lease revenues $ 18,115 $ 19,600 $ 12,969 Interest income on sales-type lease receivables $ 2,475 $ 2,106 $ 1,869 |
Components of Sales-Type Lease Receivables | The receivables as a result of these types of transactions are collateralized by the underlying equipment leased and consist of the following components at December 31, 2023 and 2022: December 31, 2023 2022 (In thousands) Net minimum lease payments to be received $ 65,017 $ 50,755 Less: Unearned interest income portion (10,196) (6,345) Net investment in sales-type leases 54,821 44,410 Less: Current portion (1) (11,867) (11,486) Long-term investment in sales-type leases, net $ 42,954 $ 32,924 _________________________________________________ (1) The current portion of the net investment in sales-type leases is included in other current assets in the Consolidated Balance Sheets. |
Maturity Schedule of Future Minimum Lease Payments under Sales-Type Leases | The maturity schedule of future minimum lease payments under sales-type leases retained in-house and the reconciliation to the net investment in sales-type leases reported on the Consolidated Balance Sheets was as follows: December 31, (In thousands) 2024 $ 14,504 2025 12,385 2026 10,113 2027 8,369 2028 7,281 Thereafter 12,365 Total future minimum sales-type lease payments 65,017 Present value adjustment (10,196) Total net investment in sales-type leases $ 54,821 |
Income Recognized from Operating Leases | The following table represents the Company’s income recognized from operating leases for the years ended December 31, 2023, 2022, and 2021: Year Ended December 31, 2023 2022 2021 (In thousands) Rental income $ 6,591 $ 9,460 $ 10,467 |
Maturity Schedule of Future Minimum Lease Payments under Operating Leases | The maturity schedule of future minimum lease payments under operating leases was as follows: December 31, 2023 (In thousands) 2024 $ 3,547 2025 842 2026 763 2027 763 2028 571 Total future minimum operating lease payments $ 6,486 |
Lessee Leases (Tables)
Lessee Leases (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
Maturity Schedule of Future Minimum Lease Payments under Operating Leases and the Reconciliation to the Operating Lease Liabilities | The maturity schedule of future minimum lease payments under operating leases and the reconciliation to the operating lease liabilities reported on the Consolidated Balance Sheets was as follows: December 31, 2023 (In thousands) 2024 $ 12,722 2025 10,609 2026 9,715 2027 8,070 2028 7,650 Thereafter 1,834 Total operating lease payments 50,600 Present value adjustment (6,172) Total operating lease liabilities (1) $ 44,428 _________________________________________________ (1) Amount consists of a current and long-term portion of operating lease liabilities of $10.5 million and $33.9 million, respectively. The current portion of the operating lease liabilities is included in accrued liabilities in the Consolidated Balance Sheets. |
Summary of Supplemental Cash Flow Information and Weighted-Average Remaining Lease Term and Discount Rate | The following table summarizes supplemental cash flow information related to the Company’s operating leases for the years ended December 31, 2023, 2022, and 2021: Year Ended December 31, 2023 2022 2021 (In thousands) Cash paid for amounts included in the measurement of lease liabilities $ 13,469 $ 16,452 $ 15,625 Right-of-use assets obtained in exchange for new lease liabilities $ 6,431 $ 12,372 $ 5,503 The following table summarizes the weighted-average remaining lease term and weighted-average discount rate related to the Company’s operating leases as of December 31, 2023 and 2022: December 31, 2023 2022 Weighted-average remaining lease term, years 4.6 5.0 Weighted-average discount rate, % 5.8 % 5.7 % |
Employee Benefits and Share-B_2
Employee Benefits and Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Share-Based Compensation Expense | The following table sets forth the total share-based compensation expense recognized in the Company’s Consolidated Statements of Operations: Year Ended December 31, 2023 2022 2021 (In thousands) Cost of product and service revenues $ 8,288 $ 9,067 $ 7,994 Research and development 6,941 11,368 7,663 Selling, general, and administrative 40,071 47,812 37,503 Total share-based compensation expense $ 55,300 $ 68,247 $ 53,160 |
Assumptions Used to Value ESPP Shares | The following assumptions were used to value shares under the ESPP for the years ended December 31, 2023, 2022, and 2021: Year Ended December 31, 2023 2022 2021 Expected life, years 0.5 - 2.0 0.5 - 2.0 0.5 - 2.0 Expected volatility, % 31.7% - 63.9% 28.8% - 45.6% 27.4% - 53.5% Risk-free interest rate, % 0.1% - 5.5% 0.1% - 3.2% 0.1% - 2.6% Dividend yield, % — % — % — % |
Assumptions Used to Value Stock Options Granted | The following assumptions were used to value stock options granted pursuant to the 2009 Plan for the years ended December 31, 2023 and 2021. There were no stock options granted during the year ended December 31, 2022: Year Ended December 31, 2023 2021 Expected life, years 3.2 4.9 Expected volatility, % 44.8 % 31.5 % Risk-free interest rate, % 3.7 % 0.9 % Estimated forfeiture rate, % 10.0 % 7.9 % Dividend yield, % — % — % |
Summary of Share Option Activity | The following table summarizes the stock option activity under the 2009 Plan during the year ended December 31, 2023: Number of Shares Weighted-Average Exercise Price Weighted-Average Remaining Years Aggregate Intrinsic Value (In thousands, except per share data) Outstanding at December 31, 2022 2,434 $ 68.65 6.1 $ 7,887 Granted 200 55.60 Exercised (165) 41.01 Expired (242) 79.49 Forfeited (204) 74.92 Outstanding at December 31, 2023 2,023 $ 67.68 4.6 $ 1,013 Exercisable at December 31, 2023 1,784 $ 67.18 4.5 $ 1,013 Vested and expected to vest at December 31, 2023 and thereafter 2,013 $ 67.64 4.6 $ 1,013 |
Summary of Restricted Stock Unit Activity | The following table summarizes the RSU activity under the 2009 Plan during the year ended December 31, 2023: Number of Shares Weighted-Average Grant Date Fair Value Weighted-Average Remaining Years Aggregate Intrinsic Value (In thousands, except per share data) Outstanding at December 31, 2022 1,117 $ 115.75 1.6 $ 56,297 Granted (Awarded) 695 63.74 Vested (Released) (335) 113.64 Forfeited (399) 107.89 Outstanding and unvested at December 31, 2023 1,078 $ 84.66 1.5 $ 40,551 |
Summary of Restricted Stock Awards Activity | The following table summarizes the RSA activity under the 2009 Plan during the year ended December 31, 2023: Number of Shares Weighted-Average Grant Date Fair Value (In thousands, except per share data) Outstanding at December 31, 2022 13 $ 109.39 Granted (Awarded) 24 70.96 Vested (Released) (13) 109.39 Outstanding and unvested at December 31, 2023 24 $ 70.96 |
Summary of Performance-Based Restricted Stock Activity | The following table summarizes the PSU activity under the 2009 Plan during the year ended December 31, 2023: Number of Shares Weighted-Average (In thousands, except per share data) Outstanding at December 31, 2022 135 $ 147.42 Granted 65 122.29 Vested (55) 111.05 Forfeited (70) 153.77 Outstanding and unvested at December 31, 2023 75 $ 127.14 |
Ordinary Shares Reserved for Future Issuance Under Equity Incentive Plans | The Company had the following ordinary shares reserved for future issuance under its equity incentive plans as of December 31, 2023: Number of Shares (In thousands) Stock options outstanding 2,023 Non-vested restricted stock awards 1,177 Shares authorized for future issuance 2,669 ESPP shares available for future issuance 3,250 Total shares reserved for future issuance 9,119 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Geographical Breakdown of Income (Loss) before the Provision for Income Taxes | The following is a geographical breakdown of income (loss) before income taxes: Year Ended December 31, 2023 2022 2021 (In thousands) Domestic $ (28,105) $ 369 $ 67,103 Foreign 7,997 (2,822) (1,096) Income (loss) before income taxes $ (20,108) $ (2,453) $ 66,007 |
Provision for (Benefit from) Income Taxes | The provision for (benefit from) income taxes consisted of the following: Year Ended December 31, 2023 2022 2021 (In thousands) Current: Federal $ 8,556 $ 17,973 $ (7,841) State 1,471 8,024 187 Foreign 840 192 (234) Total current income taxes 10,867 26,189 (7,888) Deferred: Federal (8,002) (25,753) (2,708) State (2,261) (7,976) (1,217) Foreign (341) (561) (29) Total deferred income taxes (10,604) (34,290) (3,954) Total provision for (benefit from) income taxes $ 263 $ (8,101) $ (11,842) |
Difference Between the Provision for (Benefit from) Income Taxes Compared to Income Taxes Computed at the Statutory Federal Tax Rate | The provision for (benefit from) income taxes differs from the amount computed by applying the statutory federal tax rate as follows: Year Ended December 31, 2023 2022 2021 (In thousands) U.S. federal tax provision at statutory rate $ (4,223) $ (515) $ 13,861 State taxes (624) 38 (814) Section 162(m) limitation 1,286 3,071 6,382 Non-deductible expenses 531 134 363 Uncertain tax positions (620) (776) (835) Share-based compensation tax expense (benefit) 7,384 (3,264) (20,717) Research tax credits (4,587) (6,948) (5,170) Restructuring impact — — (6,116) Foreign-derived intangible income deduction (325) (753) (68) Global intangible low-taxed income inclusion — 960 195 Foreign rate differential 219 186 (170) Foreign branch taxes 6 (51) (9) Transaction cost — 68 1,097 Provision to return true up 697 (84) 205 State rate true up 528 (135) (80) Other (9) (32) 34 Total provision for (benefit from) income taxes $ 263 $ (8,101) $ (11,842) |
Significant Components of Deferred Tax Assets (Liabilities) | Significant components of the Company’s deferred tax assets (liabilities) were as follows: December 31, 2023 2022 (In thousands) Deferred tax assets (liabilities): Deferred revenues $ 11,343 $ 13,514 Share-based compensation 11,763 12,064 Inventory-related items 5,136 4,567 Tax credit carryforwards 12,505 12,173 Reserves and accruals 5,660 6,244 Loss carryforwards 7,802 10,255 Lease liability 11,457 12,884 Convertible debt 9,649 15,037 Capitalized research and development 41,635 30,881 Other, net 591 1,557 Gross deferred tax assets 117,541 119,176 Valuation allowance — — Total net deferred tax assets 117,541 119,176 Intangibles (30,366) (36,357) Depreciation and amortization (35,402) (37,286) Prepaid expenses (13,858) (15,574) Right-of-use assets (6,626) (9,725) Other, net (8) — Total deferred tax liabilities (86,260) (98,942) Net deferred tax assets $ 31,281 $ 20,234 |
Change in the Balance of Gross Unrecognized Tax Benefits | The aggregate change in the balance of gross unrecognized tax benefit, which excludes interest and penalties, for the years ended December 31, 2023, 2022, and 2021: (In thousands) Balance as of December 31, 2020 $ 18,246 Increases related to tax positions taken during a prior period 40 Decreases related to tax positions taken during the prior period (8,908) Increases related to tax positions taken during the current period 1,219 Decreases related to expiration of statute of limitations (1,636) Balance as of December 31, 2021 8,961 Increases related to tax positions taken during a prior period 3 Decreases related to tax positions taken during the prior period (59) Increases related to tax positions taken during the current period 1,629 Decreases related to expiration of statute of limitations (1,238) Balance as of December 31, 2022 9,296 Increases related to tax positions taken during a prior period 750 Decreases related to tax positions taken during the prior period (161) Increases related to tax positions taken during the current period 1,566 Decreases related to expiration of statute of limitations (703) Balance as of December 31, 2023 $ 10,748 |
Restructuring Expenses (Tables)
Restructuring Expenses (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Restructuring and Related Activities [Abstract] | |
Summary of Restructuring Expenses | The following table summarizes the total employee-related restructuring expenses recognized in the Company’s Consolidated Statements of Operations for the years ended December 31, 2023, 2022, and 2021: Year Ended December 31, 2023 2022 2021 (In thousands) Cost of product and service revenues $ 3,089 $ 8,018 $ 389 Research and development 3,829 3,615 105 Selling, general, and administrative 8,621 11,170 1,526 Total restructuring expenses, net of reversals $ 15,539 $ 22,803 $ 2,020 |
Organization and Summary of S_4
Organization and Summary of Significant Accounting Policies - Narrative (Details) | 12 Months Ended | ||
Dec. 31, 2023 USD ($) segment reporting_unit | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Accounting Policies [Line Items] | |||
Number of operating segments | segment | 1 | ||
Number of reporting segments | segment | 1 | ||
Revenue from contract with customer, maximum contract term | 10 years | ||
Revenue, remaining performance obligation, amount | $ 353,900,000 | ||
Fees to GPOs | $ 11,200,000 | $ 17,600,000 | $ 17,500,000 |
Amortization period for capitalized contract costs | 10 years | ||
Initial term and renewal service periods | 10 years | ||
Contract cost expense | $ 23,300,000 | 30,600,000 | 25,800,000 |
Impairment loss related to capitalized prepaid commissions | 0 | ||
Non-recourse accounts receivable transferred | 5,700,000 | 45,300,000 | 46,700,000 |
Accounts receivable due from third-party leasing companies for transferred non-recourse accounts receivable | 1,100,000 | 6,700,000 | |
Cash and cash equivalents | 467,972,000 | 330,362,000 | 349,051,000 |
Cash equivalents | 451,000,000 | 301,000,000 | |
Minimum required purchase obligation | 93,900,000 | ||
Selling, general, and administrative | $ 434,593,000 | 486,341,000 | $ 389,430,000 |
Estimated useful life of software-related products | 5 years | ||
Number of reporting units | reporting_unit | 1 | ||
Accumulated impairment loss on goodwill | $ 0 | ||
Accounting Standards Update [Extensible List] | Accounting Standards Update 2020-06 [Member] | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |||
Accounting Policies [Line Items] | |||
Revenue, remaining performance obligation, expected timing of satisfaction, period | 10 years | ||
Other Assets | |||
Accounting Policies [Line Items] | |||
Software development costs capitalized | $ 14,600,000 | 13,200,000 | |
Internal Use Software and Software Development Costs | Property and Equipment | |||
Accounting Policies [Line Items] | |||
Software development costs capitalized | $ 32,200,000 | 33,000,000 | |
Estimated useful life of software-related products | 5 years | ||
Shipping Costs | |||
Accounting Policies [Line Items] | |||
Selling, general, and administrative | $ 18,600,000 | 24,500,000 | $ 18,200,000 |
Primary Supplier | |||
Accounting Policies [Line Items] | |||
Minimum required purchase obligation | $ 0 | ||
Period for notice of termination | 6 months | ||
Purchases from suppliers | $ 65,800,000 | $ 105,700,000 | $ 103,200,000 |
Minimum | |||
Accounting Policies [Line Items] | |||
Original terms of contracts | 1 year | ||
Term of sales-type leases | 1 year | ||
Maximum | |||
Accounting Policies [Line Items] | |||
Original terms of contracts | 5 years | ||
Term of sales-type leases | 10 years | ||
Customer Concentration Risk | Revenues | Ten Largest GPOs | |||
Accounting Policies [Line Items] | |||
Concentration risk percentage | 64% |
Organization and Summary of S_5
Organization and Summary of Significant Accounting Policies - Estimated Useful Lives of Assets (Details) | Dec. 31, 2023 |
Purchased software and internal-use software development costs | Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful life of property and equipment | 3 years |
Purchased software and internal-use software development costs | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful life of property and equipment | 5 years |
Furniture and fixtures | Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful life of property and equipment | 5 years |
Furniture and fixtures | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful life of property and equipment | 7 years |
Equipment | Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful life of property and equipment | 2 years |
Equipment | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful life of property and equipment | 12 years |
Business Combinations - Narrati
Business Combinations - Narrative (Details) $ in Thousands, £ in Millions | 12 Months Ended | ||||||||
Jan. 10, 2022 USD ($) | Jan. 10, 2022 GBP (£) | Dec. 31, 2021 USD ($) | Dec. 29, 2021 USD ($) | Sep. 09, 2021 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Jan. 10, 2022 GBP (£) | |
Acquired Finite-Lived Intangible Assets [Line Items] | |||||||||
Goodwill | $ 738,900 | $ 738,900 | $ 735,810 | $ 734,274 | |||||
Hub and Spoke Innovations | |||||||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||||||
Base purchase price | $ 3,400 | £ 2.5 | |||||||
Total purchase price transferred | 3,400 | £ 2.5 | |||||||
Goodwill | 2,500 | £ 1.9 | |||||||
Intangible assets | $ 1,100 | £ 0.8 | |||||||
MarkeTouch Media | |||||||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||||||
Base purchase price | 82,000 | ||||||||
Total purchase price transferred | 82,369 | ||||||||
Goodwill | 42,273 | 42,273 | |||||||
Intangible assets | 38,000 | 38,000 | |||||||
Goodwill expected to be deductible for tax purposes | $ 42,300 | $ 42,300 | |||||||
MarkeTouch Media | Discount Rate | |||||||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||||||
Measurement input used in estimating the fair values of intangible assets | 0.115 | 0.115 | |||||||
MarkeTouch Media | Acquired Technology | Royalty Rate | |||||||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||||||
Measurement input used in estimating the fair values of intangible assets | 0.100 | 0.100 | |||||||
ReCept | |||||||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||||||
Base purchase price | $ 100,000 | ||||||||
Total purchase price transferred | 97,239 | ||||||||
Goodwill | 77,644 | ||||||||
Intangible assets | 28,100 | ||||||||
Goodwill expected to be deductible for tax purposes | $ 0 | ||||||||
ReCept | Discount Rate | |||||||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||||||
Measurement input used in estimating the fair values of intangible assets | 0.150 | ||||||||
FDS Amplicare | |||||||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||||||
Base purchase price | $ 177,000 | ||||||||
Total purchase price transferred | 178,466 | ||||||||
Goodwill | 117,784 | ||||||||
Intangible assets | $ 70,000 | ||||||||
Acquisition related costs | $ 7,000 | ||||||||
Revenue from operations since the acquisition date | 11,300 | ||||||||
Losses from operations since the acquisition date | $ 900 | ||||||||
FDS Amplicare | Discount Rate | |||||||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||||||
Measurement input used in estimating the fair values of intangible assets | 0.130 | ||||||||
FDS Amplicare | Acquired Technology | Royalty Rate | |||||||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||||||
Measurement input used in estimating the fair values of intangible assets | 0.100 | ||||||||
FDS Amplicare | Trade Names | Royalty Rate | |||||||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||||||
Measurement input used in estimating the fair values of intangible assets | 0.020 |
Business Combinations - Summary
Business Combinations - Summary of Preliminary Purchase Price (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 29, 2021 | Sep. 09, 2021 |
FDS Amplicare | |||
Business Acquisition [Line Items] | |||
Base purchase price | $ 177,000 | ||
Add: Closing cash | 465 | ||
Add: Net working capital adjustment | 1,654 | ||
Less: Assumed indebtedness | (653) | ||
Total purchase price transferred | $ 178,466 | ||
ReCept | |||
Business Acquisition [Line Items] | |||
Base purchase price | $ 100,000 | ||
Add: Closing cash | 6,569 | ||
Add: Net working capital adjustment | (7,357) | ||
Less: Assumed indebtedness | (1,973) | ||
Total purchase price transferred | $ 97,239 | ||
MarkeTouch Media | |||
Business Acquisition [Line Items] | |||
Base purchase price | $ 82,000 | ||
Add: Closing cash | 237 | ||
Add: Net working capital adjustment | 147 | ||
Less: Assumed indebtedness | (15) | ||
Total purchase price transferred | $ 82,369 |
Business Combinations - Prelimi
Business Combinations - Preliminary Allocation of the Purchase Price to the Assets Acquired and the Liabilities Assumed By the Company (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 29, 2021 | Sep. 09, 2021 | |
Business Acquisition [Line Items] | |||||
Goodwill | $ 735,810 | $ 734,274 | $ 738,900 | ||
Measurement period adjustments | (3,770) | ||||
Purchase price adjustments from business acquisitions | $ 0 | 5,463 | 0 | ||
FDS Amplicare | |||||
Business Acquisition [Line Items] | |||||
Cash and cash equivalents | $ 465 | ||||
Accounts receivable and unbilled receivables | 5,330 | ||||
Prepaid expenses | 506 | ||||
Other current assets | 45 | ||||
Total current assets | 6,346 | ||||
Property and equipment | 444 | ||||
Operating lease right-of-use assets | 2,252 | ||||
Goodwill | 117,784 | ||||
Intangible assets | 70,000 | ||||
Other long-term assets | 51 | ||||
Total assets | 196,877 | ||||
Accounts payable | 950 | ||||
Accrued compensation | 1,312 | ||||
Accrued liabilities | 1,497 | ||||
Deferred revenues | 1,916 | ||||
Long-term deferred tax liabilities | 11,686 | ||||
Long-term operating lease liabilities | 920 | ||||
Other long-term liabilities | 130 | ||||
Total liabilities | 18,411 | ||||
Total purchase price | 178,466 | ||||
Total purchase price, net of cash acquired | $ 178,001 | ||||
Measurement period adjustments | 400 | (1,500) | |||
Adjustment, accounts receivable and unbilled receivables | 1,100 | ||||
Adjustment, deferred tax liability, noncurrent | 100 | ||||
Purchase price adjustments from business acquisitions | 100 | ||||
Increase (decrease) in deferred tax liabilities | 300 | ||||
Increase (decrease) in accrued liabilities | 100 | ||||
FDS Amplicare | Customer relationships | |||||
Business Acquisition [Line Items] | |||||
Adjustment, intangibles | 400 | ||||
ReCept | |||||
Business Acquisition [Line Items] | |||||
Cash and cash equivalents | $ 0 | ||||
Accounts receivable and unbilled receivables | 2,383 | ||||
Prepaid expenses | 192 | ||||
Other current assets | 12,223 | ||||
Total current assets | 14,798 | ||||
Property and equipment | 172 | ||||
Operating lease right-of-use assets | 773 | ||||
Goodwill | 77,644 | ||||
Intangible assets | 28,100 | ||||
Other long-term assets | 195 | ||||
Total assets | 121,682 | ||||
Accounts payable | 219 | ||||
Accrued compensation | 1,756 | ||||
Accrued liabilities | 18,249 | ||||
Deferred revenues | 222 | ||||
Long-term deferred tax liabilities | 3,383 | ||||
Long-term operating lease liabilities | 614 | ||||
Other long-term liabilities | 0 | ||||
Total liabilities | 24,443 | ||||
Total purchase price | 97,239 | ||||
Total purchase price, net of cash acquired | $ 90,670 | ||||
Measurement period adjustments | (3,900) | ||||
Purchase price adjustments from business acquisitions | 5,200 | ||||
Increase (decrease) in deferred tax liabilities | (200) | ||||
Increase (decrease) in accrued liabilities | (300) | ||||
Decrease in other assets, current | 1,700 | ||||
MarkeTouch Media | |||||
Business Acquisition [Line Items] | |||||
Cash and cash equivalents | 237 | ||||
Accounts receivable and unbilled receivables | 2,302 | ||||
Prepaid expenses | 96 | ||||
Other current assets | 0 | ||||
Total current assets | 2,635 | ||||
Property and equipment | 177 | ||||
Operating lease right-of-use assets | 602 | ||||
Goodwill | 42,273 | ||||
Intangible assets | 38,000 | ||||
Other long-term assets | 2,850 | ||||
Total assets | 86,537 | ||||
Accounts payable | 473 | ||||
Accrued compensation | 0 | ||||
Accrued liabilities | 292 | ||||
Deferred revenues | 347 | ||||
Long-term deferred tax liabilities | 0 | ||||
Long-term operating lease liabilities | 206 | ||||
Other long-term liabilities | 2,850 | ||||
Total liabilities | 4,168 | ||||
Total purchase price | 82,369 | ||||
Total purchase price, net of cash acquired | $ 82,132 | ||||
Measurement period adjustments | $ (300) |
Business Combinations - Summa_2
Business Combinations - Summary of Identifiable Intangible Assets Acquired (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 29, 2021 | Sep. 09, 2021 |
FDS Amplicare | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Fair value | $ 70,000 | ||
FDS Amplicare | Customer relationships | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Fair value | $ 59,900 | ||
Useful life (years) | 23 years | ||
FDS Amplicare | Acquired technology | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Fair value | $ 7,700 | ||
FDS Amplicare | Acquired technology | Minimum | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Useful life (years) | 5 years | ||
FDS Amplicare | Acquired technology | Maximum | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Useful life (years) | 7 years | ||
FDS Amplicare | Backlog | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Fair value | $ 0 | ||
FDS Amplicare | Trade names | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Fair value | $ 2,400 | ||
Useful life (years) | 5 years | ||
ReCept | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Fair value | $ 28,100 | ||
ReCept | Customer relationships | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Fair value | $ 28,100 | ||
Useful life (years) | 23 years | ||
ReCept | Acquired technology | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Fair value | $ 0 | ||
ReCept | Backlog | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Fair value | 0 | ||
ReCept | Trade names | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Fair value | $ 0 | ||
MarkeTouch Media | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Fair value | $ 38,000 | ||
MarkeTouch Media | Customer relationships | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Fair value | $ 34,100 | ||
Useful life (years) | 26 years | ||
MarkeTouch Media | Acquired technology | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Fair value | $ 2,100 | ||
Useful life (years) | 4 years | ||
MarkeTouch Media | Backlog | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Fair value | $ 1,800 | ||
Useful life (years) | 2 years | ||
MarkeTouch Media | Trade names | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Fair value | $ 0 |
Business Combinations - Pro For
Business Combinations - Pro Forma Financial Information (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2021 USD ($) | |
Business Combination and Asset Acquisition [Abstract] | |
Pro forma revenues | $ 1,195,473 |
Pro forma net income | $ 79,981 |
Revenues - Disaggregation of Re
Revenues - Disaggregation of Revenues by Revenue Type (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Disaggregation of Revenue [Line Items] | |||
Revenues | $ 1,147,112 | $ 1,295,947 | $ 1,132,018 |
Connected devices, software licenses, and other | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 623,584 | 827,917 | 739,074 |
Consumables | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 84,977 | 75,305 | 73,438 |
Technical services | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 225,831 | 206,687 | 206,989 |
Advanced Services | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | $ 212,720 | $ 186,038 | $ 112,517 |
Revenues - Disaggregation of _2
Revenues - Disaggregation of Revenues by Geographic Region (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Disaggregation of Revenue [Line Items] | |||
Revenues | $ 1,147,112 | $ 1,295,947 | $ 1,132,018 |
United States | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 1,011,380 | 1,168,202 | 1,020,788 |
Rest of world | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | $ 135,732 | $ 127,745 | $ 111,230 |
Revenues - Contract Assets and
Revenues - Contract Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Revenue from Contract with Customer [Abstract] | ||
Short-term unbilled receivables, net | $ 22,524 | $ 25,763 |
Long-term unbilled receivables, net | 11,850 | 14,744 |
Total contract assets | 34,374 | 40,507 |
Short-term deferred revenues, net | 121,734 | 118,947 |
Long-term deferred revenues | 58,622 | 37,385 |
Total contract liabilities | $ 180,356 | $ 156,332 |
Revenues - Narrative (Details)
Revenues - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | ||
Short-term deferred revenues, net | $ 121,734 | $ 118,947 |
Deferred cost of sales | 12,400 | 15,800 |
Deferred revenues recognized | 115,700 | |
Gross short-term deferred revenue | 134,700 | |
Long-term deferred revenues | $ 58,622 | $ 37,385 |
Net Income (Loss) Per Share (De
Net Income (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Net income (loss) | $ (20,371) | $ 5,648 | $ 77,849 |
Weighted-average shares outstanding — basic (in shares) | 45,212 | 44,398 | 43,475 |
Weighted-average shares outstanding — diluted (in shares) | 45,212 | 45,891 | 47,943 |
Net income per share - basic (in dollars per share) | $ (0.45) | $ 0.13 | $ 1.79 |
Net income per share - diluted (in dollars per share) | $ (0.45) | $ 0.12 | $ 1.62 |
Stock Award Plans | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Effect of dilutive securities from stock award plans (in shares) | 0 | 1,019 | 2,136 |
Anti-dilutive weighted-average shares related to stock award plans (in shares) | 3,368 | 725 | 156 |
Convertible Debt Securities | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Effect of dilutive securities from stock award plans (in shares) | 0 | 474 | 2,044 |
Warrant | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Effect of dilutive securities from stock award plans (in shares) | 0 | 0 | 288 |
Convertible Debt Securities and Warrants | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive weighted-average shares related to stock award plans (in shares) | 11,816 | 5,908 | 0 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Details) - Convertible Senior Notes - Convertible Debt - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Cash and Cash Equivalents [Line Items] | ||
Long-term debt, fair value | $ 527,200 | $ 501,400 |
Carrying value of debt | $ 569,662 | $ 566,571 |
Balance Sheet Components - Bala
Balance Sheet Components - Balance Sheet Components (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Inventories: | ||
Raw materials | $ 51,439 | $ 75,854 |
Work in process | 1,327 | 9,280 |
Finished goods | 57,333 | 62,415 |
Total inventories | 110,099 | 147,549 |
Other current assets: | ||
Funds held for customers, including restricted cash | 43,649 | 56,703 |
Net investment in sales-type leases, current portion | 11,867 | 11,486 |
Prepaid income taxes | 8,279 | 1,702 |
Other current assets | 7,714 | 7,471 |
Total other current assets | 71,509 | 77,362 |
Other long-term assets: | ||
External-use software development costs, net | 66,659 | 80,760 |
Unbilled receivables, net | 11,850 | 14,744 |
Deferred debt issuance costs | 3,718 | 2,058 |
Other long-term assets | 8,239 | 7,455 |
Total other long-term assets | 90,466 | 105,017 |
Accrued liabilities: | ||
Operating lease liabilities, current portion | $ 10,518 | $ 10,761 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Total accrued liabilities | Total accrued liabilities |
Customer fund liabilities | $ 43,649 | $ 56,703 |
Advance payments from customers | 10,551 | 11,556 |
Rebate liabilities | 51,277 | 42,802 |
Group purchasing organization fees | 4,445 | 7,723 |
Taxes payable | 2,191 | 9,642 |
Other accrued liabilities | 26,645 | 33,468 |
Total accrued liabilities | 149,276 | 172,655 |
Restricted cash | $ 33,000 | $ 22,500 |
Restricted Cash, Current, Statement of Financial Position [Extensible Enumeration] | Total other current assets | Total other current assets |
Balance Sheet Components - Sche
Balance Sheet Components - Schedule of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Balance at beginning of period | $ 1,130,137 | $ 1,146,689 | $ 967,503 |
Other comprehensive income (loss) | 3,655 | (8,680) | (2,885) |
Balance at end of period | 1,188,954 | 1,130,137 | 1,146,689 |
Accumulated Other Comprehensive Income (Loss) | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Balance at beginning of period | (17,087) | (8,407) | (5,522) |
Other comprehensive income (loss) | 3,655 | (8,680) | (2,885) |
Balance at end of period | $ (13,432) | $ (17,087) | $ (8,407) |
Property and Equipment - Proper
Property and Equipment - Property and Equipment Balances (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 248,033 | $ 220,605 |
Accumulated depreciation and amortization | (139,432) | (126,644) |
Total property and equipment, net | 108,601 | 93,961 |
Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 95,996 | 91,391 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 4,500 | 5,154 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 17,919 | 19,510 |
Purchased software and internal-use software development costs | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 118,004 | 76,327 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 11,614 | $ 28,223 |
Property and Equipment - Narrat
Property and Equipment - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation and amortization expense of property and equipment | $ 27 | $ 22.8 | $ 20.1 |
Property and Equipment - Summar
Property and Equipment - Summary of Geographic Information for Property and Equipment, Net (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | $ 108,601 | $ 93,961 |
United States | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | 104,312 | 89,989 |
Rest of world | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | $ 4,289 | $ 3,972 |
External-Use Software Develop_3
External-Use Software Development Costs - Schedule of Capitalized Computer Software (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Accounting Policies [Abstract] | ||
Gross carrying amount | $ 239,038 | $ 225,004 |
Accumulated amortization | (172,379) | (144,244) |
External-use software development costs, net | $ 66,659 | $ 80,760 |
External-Use Software Develop_4
External-Use Software Development Costs - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Research and Development [Abstract] | |||
Amortization of capitalized software development costs | $ 28.7 | $ 29 | $ 26.4 |
External-Use Software Develop_5
External-Use Software Development Costs - Schedule of Future Amortization Expenses For Capitalized Software Development Costs (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Accounting Policies [Abstract] | ||
2024 | $ 25,354 | |
2025 | 18,331 | |
2026 | 12,792 | |
2027 | 6,837 | |
2028 | 2,980 | |
Thereafter | 365 | |
External-use software development costs, net | $ 66,659 | $ 80,760 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Changes in the Carrying Amount of Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Goodwill [Roll Forward] | ||
Balance at beginning of period | $ 734,274 | $ 738,900 |
Additions | 2,549 | |
Measurement period adjustments | (3,770) | |
Foreign currency exchange rate fluctuations | 1,536 | (3,405) |
Balance at end of period | $ 735,810 | $ 734,274 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Carrying Amounts and Useful Lives of Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 405,698 | $ 417,185 |
Accumulated amortization | (193,199) | (172,765) |
Foreign currency exchange rate fluctuations | (1,326) | (1,514) |
Net carrying amount | 211,173 | 242,906 |
Customer relationships | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 307,418 | 311,089 |
Accumulated amortization | (115,232) | (99,177) |
Foreign currency exchange rate fluctuations | (1,326) | (1,514) |
Net carrying amount | $ 190,860 | $ 210,398 |
Customer relationships | Minimum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life | 4 years | 4 years |
Customer relationships | Maximum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life | 30 years | 30 years |
Acquired technology | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 84,876 | $ 92,066 |
Accumulated amortization | (67,033) | (64,299) |
Foreign currency exchange rate fluctuations | 0 | 0 |
Net carrying amount | $ 17,843 | $ 27,767 |
Acquired technology | Minimum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life | 4 years | 4 years |
Acquired technology | Maximum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life | 20 years | 20 years |
Backlog | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 1,800 | $ 1,800 |
Accumulated amortization | (1,800) | (900) |
Foreign currency exchange rate fluctuations | 0 | 0 |
Net carrying amount | $ 0 | $ 900 |
Useful life | 2 years | 2 years |
Trade names | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 9,200 | $ 9,200 |
Accumulated amortization | (7,680) | (6,633) |
Foreign currency exchange rate fluctuations | 0 | 0 |
Net carrying amount | $ 1,520 | $ 2,567 |
Trade names | Minimum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life | 5 years | 5 years |
Trade names | Maximum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life | 12 years | 12 years |
Patents | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 2,404 | $ 2,430 |
Accumulated amortization | (1,454) | (1,306) |
Foreign currency exchange rate fluctuations | 0 | 0 |
Net carrying amount | $ 950 | $ 1,124 |
Patents | Minimum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life | 2 years | 2 years |
Patents | Maximum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life | 20 years | 20 years |
Non-compete agreements | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 600 | |
Accumulated amortization | (450) | |
Foreign currency exchange rate fluctuations | 0 | |
Net carrying amount | $ 150 | |
Useful life | 3 years |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Amortization expense of intangible assets | $ 31.6 | $ 35.2 | $ 26.5 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Estimated Future Amortization Expense for Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2024 | $ 22,736 | |
2025 | 21,060 | |
2026 | 18,080 | |
2027 | 16,245 | |
2028 | 15,180 | |
Thereafter | 117,872 | |
Total | $ 211,173 | $ 242,906 |
Debt and Credit Agreement (Deta
Debt and Credit Agreement (Details) - Line of Credit | Oct. 10, 2023 USD ($) | Mar. 29, 2023 | Nov. 15, 2019 USD ($) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Sep. 22, 2020 |
Debt Instrument [Line Items] | ||||||
Debt issuance costs | $ 3,000,000 | |||||
Wells Fargo Securities, Citizens Bank and JP Morgan Chase Bank | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Commitment fee rate on undrawn commitments | 0.20% | 0.15% | ||||
Wells Fargo Securities, Citizens Bank and JP Morgan Chase Bank | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Commitment fee rate on undrawn commitments | 0.35% | 0.30% | ||||
Wells Fargo Securities, Citizens Bank and JP Morgan Chase Bank | Secured Overnight Financing Rate (SOFR) | ||||||
Debt Instrument [Line Items] | ||||||
Spread on variable interest rate | 1% | |||||
Wells Fargo Securities, Citizens Bank and JP Morgan Chase Bank | Secured Overnight Financing Rate (SOFR) | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Spread on variable interest rate | 1.25% | |||||
Wells Fargo Securities, Citizens Bank and JP Morgan Chase Bank | Secured Overnight Financing Rate (SOFR) | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Spread on variable interest rate | 2% | |||||
Wells Fargo Securities, Citizens Bank and JP Morgan Chase Bank | Federal Funds | ||||||
Debt Instrument [Line Items] | ||||||
Spread on variable interest rate | 0.50% | 0.50% | ||||
Wells Fargo Securities, Citizens Bank and JP Morgan Chase Bank | SOFR Plus 1.00% | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Spread on variable interest rate | 0.25% | |||||
Wells Fargo Securities, Citizens Bank and JP Morgan Chase Bank | SOFR Plus 1.00% | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Spread on variable interest rate | 1% | |||||
Wells Fargo Securities, Citizens Bank and JP Morgan Chase Bank | Secured Overnight Financing Rate (SOFR) Applicable Margin | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Spread on variable interest rate | 1.50% | |||||
Wells Fargo Securities, Citizens Bank and JP Morgan Chase Bank | Secured Overnight Financing Rate (SOFR) Applicable Margin | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Spread on variable interest rate | 2.25% | |||||
Wells Fargo Securities, Citizens Bank and JP Morgan Chase Bank | One Month Secured Overnight Financing Rate (SOFR) | ||||||
Debt Instrument [Line Items] | ||||||
Spread on variable interest rate | 1% | |||||
Wells Fargo Securities, Citizens Bank and JP Morgan Chase Bank | One Month Secured Overnight Financing Rate (SOFR) Applicable Margin | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Spread on variable interest rate | 0.50% | |||||
Wells Fargo Securities, Citizens Bank and JP Morgan Chase Bank | One Month Secured Overnight Financing Rate (SOFR) Applicable Margin | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Spread on variable interest rate | 1.25% | |||||
Wells Fargo Securities, LLC, JPMorgan Chase Bank, N.A., PNC Capital Markets LLC and TD Securities (USA) LLC | ||||||
Debt Instrument [Line Items] | ||||||
Maximum secured net leverage ratio | 3 | |||||
Debt instrument, covenant, minimum interest coverage ratio | 3 | |||||
Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Outstanding balance | $ 0 | $ 0 | ||||
Revolving Credit Facility | Wells Fargo Securities, Citizens Bank and JP Morgan Chase Bank | ||||||
Debt Instrument [Line Items] | ||||||
Term of debt instrument | 5 years | |||||
Maximum borrowing capacity | $ 500,000,000 | |||||
Line of credit facility, remaining borrowing capacity | $ 350,000,000 | $ 500,000,000 | ||||
Revolving Credit Facility | Wells Fargo Securities, Citizens Bank and JP Morgan Chase Bank | Calendar Quarters Up To and Including March 31, 2021 | ||||||
Debt Instrument [Line Items] | ||||||
Maximum secured net leverage ratio | 3.50 | |||||
Revolving Credit Facility | Wells Fargo Securities, Citizens Bank and JP Morgan Chase Bank | Calendar Quarters After March 31, 2021 | ||||||
Debt Instrument [Line Items] | ||||||
Maximum secured net leverage ratio | 3 | |||||
Revolving Credit Facility | Wells Fargo Securities, LLC, JPMorgan Chase Bank, N.A., PNC Capital Markets LLC and TD Securities (USA) LLC | ||||||
Debt Instrument [Line Items] | ||||||
Term of debt instrument | 5 years | |||||
Maximum borrowing capacity | $ 350,000,000 | |||||
Line of credit facility, accordion feature, higher borrowing capacity option | $ 250,000,000 | |||||
Debt instrument, covenant, adjusted EBITDA threshold | 100% | |||||
Incremental Loan Facility | Wells Fargo Securities, Citizens Bank and JP Morgan Chase Bank | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing capacity | 250,000,000 | |||||
Letter of Credit | Wells Fargo Securities, Citizens Bank and JP Morgan Chase Bank | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing capacity | 15,000,000 | |||||
Letter of Credit | Wells Fargo Securities, LLC, JPMorgan Chase Bank, N.A., PNC Capital Markets LLC and TD Securities (USA) LLC | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing capacity | $ 15,000,000 | |||||
Swing Line Loan | Wells Fargo Securities, Citizens Bank and JP Morgan Chase Bank | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing capacity | $ 25,000,000 | |||||
Swing Line Loan | Wells Fargo Securities, LLC, JPMorgan Chase Bank, N.A., PNC Capital Markets LLC and TD Securities (USA) LLC | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing capacity | $ 25,000,000 |
Convertible Senior Notes - Narr
Convertible Senior Notes - Narrative (Details) $ / shares in Units, shares in Millions | 12 Months Ended | ||||
Dec. 13, 2021 USD ($) $ / shares | Sep. 25, 2020 USD ($) day $ / shares shares | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Debt Instrument [Line Items] | |||||
Proceeds from issuance of convertible senior notes, net of issuance costs | $ 559,700,000 | ||||
Payments of debt issuance costs | $ 2,967,000 | $ 0 | $ 0 | ||
Purchase of convertible note hedge | 100,600,000 | ||||
Proceeds from sale of warrants | 51,300,000 | ||||
Convertible Note Hedge | |||||
Debt Instrument [Line Items] | |||||
Deferred tax asset related to the convertible note hedge transaction | $ 25,800,000 | ||||
Convertible Note Hedge Rights | |||||
Debt Instrument [Line Items] | |||||
Options and warrants to purchase shares (in shares) | shares | 5.9 | ||||
Strike price (in dollars per share) | $ / shares | $ 97.32 | ||||
Warrant | |||||
Debt Instrument [Line Items] | |||||
Options and warrants to purchase shares (in shares) | shares | 5.9 | ||||
Strike price (in dollars per share) | $ / shares | $ 141.56 | ||||
Convertible Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Principal amount of notes, minimum | $ 1,000 | ||||
Maximum cash | 1,000 | ||||
Consideration in excess, amount | $ 1,000 | ||||
Convertible Senior Notes | Convertible Debt | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 0.25% | ||||
Principal amount | $ 575,000,000 | $ 575,000,000 | $ 575,000,000 | ||
Additional principal amount subject to purchasers' option | 75,000,000 | ||||
Payments of debt issuance costs | $ 15,300,000 | ||||
Conversion ratio | 0.0102751 | ||||
Conversion price (in dollars per share) | $ / shares | $ 97.32 | ||||
Repurchase price as a percent of principal amount | 100% | ||||
Aggregate principal amount of Notes that must be outstanding and not subject to redemption if the Company redeems less than all of the Notes | $ 150,000,000 | ||||
Effective interest rate | 0.80% | ||||
Remaining life of debt discount and issuance cost accretion | 1 year 8 months 12 days | ||||
Maximum number of shares issuable upon conversion (in shares) | shares | 5.9 | ||||
Convertible Senior Notes | Convertible Debt | Period 1 | |||||
Debt Instrument [Line Items] | |||||
Threshold trading days | day | 20 | ||||
Threshold consecutive trading days | day | 30 | ||||
Threshold percentage of stock price trigger | 130% | ||||
Convertible Senior Notes | Convertible Debt | Period 2 | |||||
Debt Instrument [Line Items] | |||||
Threshold trading days | day | 5 | ||||
Threshold consecutive trading days | day | 10 | ||||
Threshold percentage of stock price trigger | 98% |
Convertible Senior Notes - Conv
Convertible Senior Notes - Convertible Debt Balances (Details) - Convertible Debt - Convertible Senior Notes - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 | Sep. 25, 2020 |
Debt Instrument [Line Items] | |||
Principal amount | $ 575,000,000 | $ 575,000,000 | $ 575,000,000 |
Unamortized debt issuance costs | (5,338,000) | (8,429,000) | |
Convertible senior notes, net | $ 569,662,000 | $ 566,571,000 |
Convertible Senior Notes - Summ
Convertible Senior Notes - Summary of the Components of Interest Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Debt Instrument [Line Items] | |||
Amortization of discount | $ 0 | $ 0 | $ 18,608 |
Amortization of debt issuance costs | 4,397 | 4,164 | 3,440 |
Convertible Senior Notes | Convertible Debt | |||
Debt Instrument [Line Items] | |||
Contractual coupon interest | 1,438 | 1,438 | 1,438 |
Amortization of discount | 18,608 | ||
Amortization of debt issuance costs | $ 3,091 | $ 3,066 | $ 2,343 |
Lessor Leases - Narrative (Deta
Lessor Leases - Narrative (Details) | Dec. 31, 2023 |
Minimum | |
Lessor, Lease, Description [Line Items] | |
Term of sales-type leases | 1 year |
Maximum | |
Lessor, Lease, Description [Line Items] | |
Term of sales-type leases | 10 years |
Lessor Leases - Income Recogniz
Lessor Leases - Income Recognized from Sales-Type Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Leases [Abstract] | |||
Sales-type lease revenues | $ 36,208 | $ 38,959 | $ 21,887 |
Cost of sales-type lease revenues | (18,093) | (19,359) | (8,918) |
Selling profit on sales-type lease revenues | 18,115 | 19,600 | 12,969 |
Interest income on sales-type lease receivables | $ 2,475 | $ 2,106 | $ 1,869 |
Lessor Leases - Components of S
Lessor Leases - Components of Sales-Type Lease Receivables (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Leases [Abstract] | ||
Total future minimum sales-type lease payments | $ 65,017 | $ 50,755 |
Less: Unearned interest income portion | (10,196) | (6,345) |
Net investment in sales-type leases | 54,821 | 44,410 |
Less: Current portion | (11,867) | (11,486) |
Long-term investment in sales-type leases, net | $ 42,954 | $ 32,924 |
Lessor Leases - Maturity Schedu
Lessor Leases - Maturity Schedule of Future Minimum Lease Payments under Sales-Type Leases (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Leases [Abstract] | ||
2024 | $ 14,504 | |
2025 | 12,385 | |
2026 | 10,113 | |
2027 | 8,369 | |
2028 | 7,281 | |
Thereafter | 12,365 | |
Total future minimum sales-type lease payments | 65,017 | $ 50,755 |
Present value adjustment | (10,196) | $ (6,345) |
Total net investment in sales-type leases | $ 54,821 |
Lessor Leases - Income Recogn_2
Lessor Leases - Income Recognized from Operating Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Leases [Abstract] | |||
Operating Lease, Lease Income, Statement of Income or Comprehensive Income [Extensible Enumeration] | Revenues | Revenues | Revenues |
Rental income | $ 6,591 | $ 9,460 | $ 10,467 |
Lessor Leases - Maturity Sche_2
Lessor Leases - Maturity Schedule of Future Minimum Lease Payments under Operating Leases (Details) $ in Thousands | Dec. 31, 2023 USD ($) |
Leases [Abstract] | |
2024 | $ 3,547 |
2025 | 842 |
2026 | 763 |
2027 | 763 |
2028 | 571 |
Total future minimum operating lease payments | $ 6,486 |
Lessee Leases - Narrative (Deta
Lessee Leases - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Lessee, Lease, Description [Line Items] | |||
Operating lease cost | $ 10,800 | $ 18,900 | $ 15,000 |
Impairment and abandonment of operating lease right-of-use assets related to facilities | $ 9,998 | $ 9,382 | $ 0 |
Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Term of operating leases | 1 year | ||
Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Term of operating leases | 12 years |
Lessee Leases - Maturity Schedu
Lessee Leases - Maturity Schedule of Future Minimum Lease Payments under Operating Leases and the Reconciliation to the Operating Lease Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Leases [Abstract] | ||
2024 | $ 12,722 | |
2025 | 10,609 | |
2026 | 9,715 | |
2027 | 8,070 | |
2028 | 7,650 | |
Thereafter | 1,834 | |
Total operating lease payments | 50,600 | |
Present value adjustment | (6,172) | |
Total operating lease liabilities | 44,428 | |
Current portion of operating lease liabilities | 10,518 | $ 10,761 |
Long-term portion of operating lease liabilities | $ 33,910 | $ 39,405 |
Lessee Leases - Supplemental Ca
Lessee Leases - Supplemental Cash Flow Information Related to Operating Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Leases [Abstract] | |||
Cash paid for amounts included in the measurement of lease liabilities | $ 13,469 | $ 16,452 | $ 15,625 |
Right-of-use assets obtained in exchange for new lease liabilities | $ 6,431 | $ 12,372 | $ 5,503 |
Lessee Leases - Weighted-Averag
Lessee Leases - Weighted-Average Remaining Lease Term and Weighted-Average Discount Rate (Details) | Dec. 31, 2023 | Dec. 31, 2022 |
Leases [Abstract] | ||
Weighted-average remaining lease term, years | 4 years 7 months 6 days | 5 years |
Weighted-average discount rate, % | 5.80% | 5.70% |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Loss Contingencies [Line Items] | ||
Non-cancelable purchase commitments | $ 93.9 | |
Non-cancelable purchase commitments expected to be paid within the next twelve months | 84.2 | |
Ransomware incident, expense | 0 | $ 13.6 |
Loss contingency, cumulative expected insurance recoveries | 11.1 | |
Loss contingency, expense incurred to date | 13.6 | |
Loss contingency, cumulative insurance recoveries | $ 12.2 | |
Standard warranty period (up to) | 30 days | |
Limited warranty period (up to) | 6 months | |
Cost of product and service revenues | ||
Loss Contingencies [Line Items] | ||
Ransomware incident, expense, net of insurance recoveries | 0.3 | |
Research and development | ||
Loss Contingencies [Line Items] | ||
Ransomware incident, expense, net of insurance recoveries | 0.2 | |
Selling, general, and administrative | ||
Loss Contingencies [Line Items] | ||
Ransomware incident, expense, net of insurance recoveries | $ 2 |
Employee Benefits and Share-B_3
Employee Benefits and Share-Based Compensation - Narrative (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares reserved for future issuance (in shares) | 9,119,000 | ||
Share-based payment arrangement, amount capitalized | $ 4,400,000 | ||
Income tax (expense) benefit from share-based compensation | $ (6,500,000) | $ 5,200,000 | $ 26,600,000 |
Shares purchased under ESPP (in shares) | 353,000 | 316,000 | |
Granted (in shares) | 200,000 | 0 | |
2009 Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares reserved for future issuance (in shares) | 5,900,000 | ||
Omnicell Plan | Other Postretirement Benefit Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Employer matching contribution, percent of employee contribution | 50% | ||
Maximum amount of employer contribution | $ 3,000 | ||
401(k) contributions | $ 7,900,000 | $ 8,100,000 | $ 6,800,000 |
ESPP | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Maximum percentage of earnings allowed for purchase of shares | 15% | ||
Maximum fair market value of shares | $ 25,000 | ||
Purchase price of common stock, percent | 85% | ||
Offering period | 24 months | ||
Purchasing period | 6 months | ||
Shares reserved for future issuance (in shares) | 3,250,000 | ||
Weighted-average price (in dollars per share) | $ 46.68 | $ 67.63 | |
Total unrecognized compensation cost | $ 1,100,000 | ||
Weighted average period of compensation cost recognized | 1 year 4 months 24 days | ||
Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares reserved for future issuance (in shares) | 2,023,000 | ||
Vesting period | 4 years | ||
Weighted average period of compensation cost recognized | 8 months 12 days | ||
Weighted-average fair value per share (in dollars per share) | $ 19.48 | $ 35.17 | |
Intrinsic value of options exercised | $ 3,200,000 | $ 23,900,000 | $ 88,000,000 |
Tax (expense) benefit realized from stock options exercised | (1,300,000) | $ 4,400,000 | $ 18,300,000 |
Unrecognized compensation cost of unvested stock options | $ 3,300,000 | ||
Stock Options | Vesting One Year from Commencement Date | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 1 year | ||
Percentage of award vesting | 25% | ||
Stock Options | Vesting in Equal Monthly Installments | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 36 months | ||
RSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 4 years | ||
Total unrecognized compensation cost | $ 64,300,000 | ||
Weighted average period of compensation cost recognized | 3 years | ||
Weighted-average grant date fair value per award granted (in dollars per share) | $ 63.74 | $ 111.12 | $ 149.65 |
Fair value of awards vested | $ 38,000,000 | $ 30,700,000 | $ 16,700,000 |
Awards granted (in shares) | 695,000 | ||
RSUs | Vesting One Year from Commencement Date | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 1 year | ||
Percentage of award vesting | 25% | ||
RSUs | Vesting in Equal Monthly Installments | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
RSAs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total unrecognized compensation cost | $ 600,000 | ||
Weighted average period of compensation cost recognized | 4 months 24 days | ||
Weighted-average grant date fair value per award granted (in dollars per share) | $ 70.96 | $ 109.39 | $ 137.36 |
Fair value of awards vested | $ 1,400,000 | $ 1,600,000 | $ 1,400,000 |
Awards granted (in shares) | 24,000 | ||
PSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 4 years | ||
Total unrecognized compensation cost | $ 5,000,000 | ||
Weighted average period of compensation cost recognized | 1 year 4 months 24 days | ||
Weighted-average grant date fair value per award granted (in dollars per share) | $ 122.29 | $ 155.27 | $ 162.16 |
Awards granted (in shares) | 65,000 | ||
Trading days used for stock price appreciation calculation | 20 days | ||
Fair value of awards vested | $ 6,100,000 | $ 15,000,000 | $ 4,400,000 |
PSUs | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percentage of shares eligible for time-based vesting | 0% | ||
PSUs | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percentage of shares eligible for time-based vesting | 200% | ||
PSUs | Officer | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Awards granted (in shares) | 65,000 | 56,237 | |
PSUs | Vesting One Year from Commencement Date | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 1 year | ||
Percentage of award vesting | 25% | ||
PSUs | Vesting in Equal Monthly Installments | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years |
Employee Benefits and Share-B_4
Employee Benefits and Share-Based Compensation - Shared-based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Share-based compensation expense | $ 55,300 | $ 68,247 | $ 53,160 |
Cost of product and service revenues | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Share-based compensation expense | 8,288 | 9,067 | 7,994 |
Research and development | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Share-based compensation expense | 6,941 | 11,368 | 7,663 |
Selling, general, and administrative | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Share-based compensation expense | $ 40,071 | $ 47,812 | $ 37,503 |
Employee Benefits and Share-B_5
Employee Benefits and Share-Based Compensation - Assumptions Used to Value ESPP Shares Granted (Details) - ESPP | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility (minimum) | 31.70% | 28.80% | 27.40% |
Expected volatility (maximum) | 63.90% | 45.60% | 53.50% |
Risk-free interest rate (minimum) | 0.10% | 0.10% | 0.10% |
Risk-free interest rate (maximum) | 5.50% | 3.20% | 2.60% |
Dividend yield | 0% | 0% | 0% |
Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected life | 6 months | 6 months | 6 months |
Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected life | 2 years | 2 years | 2 years |
Employee Benefits and Share-B_6
Employee Benefits and Share-Based Compensation - Assumptions Used to Value Stock Options Granted (Details) - Stock Options | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected life | 3 years 2 months 12 days | 4 years 10 months 24 days |
Expected volatility | 44.80% | 31.50% |
Risk-free interest rate | 3.70% | 0.90% |
Estimated forfeiture rate | 10% | 7.90% |
Dividend yield | 0% | 0% |
Employee Benefits and Share-B_7
Employee Benefits and Share-Based Compensation - Summary of Share Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Number of Shares | ||
Outstanding at beginning of year (in shares) | 2,434,000 | |
Granted (in shares) | 200,000 | 0 |
Exercised (in shares) | (165,000) | |
Expired (in shares) | (242,000) | |
Forfeited (in shares) | (204,000) | |
Outstanding at end of year (in shares) | 2,023,000 | 2,434,000 |
Exercisable (in shares) | 1,784,000 | |
Vested and expected to vest (in shares) | 2,013,000 | |
Weighted-Average Exercise Price | ||
Outstanding at beginning of year (in dollars per share) | $ 68.65 | |
Granted (in dollars per share) | 55.60 | |
Exercised (in dollars per share) | 41.01 | |
Expired (in dollars per share) | 79.49 | |
Forfeited (in dollars per share) | 74.92 | |
Outstanding at end of year (in dollars per share) | 67.68 | $ 68.65 |
Exercisable (in dollars per share) | 67.18 | |
Vested and expected to vest (in dollars per share) | $ 67.64 | |
Weighted-Average Remaining Years | ||
Outstanding | 4 years 7 months 6 days | 6 years 1 month 6 days |
Exercisable | 4 years 6 months | |
Vested and expected to vest | 4 years 7 months 6 days | |
Aggregate Intrinsic Value | ||
Outstanding | $ 1,013 | $ 7,887 |
Exercisable | 1,013 | |
Vested and expected to vest | $ 1,013 |
Employee Benefits and Share-B_8
Employee Benefits and Share-Based Compensation - Summary of Restricted Stock Unit Activity (Details) - RSUs - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Number of Shares | |||
Outstanding (in shares) | 1,117 | ||
Granted (Awarded) (in shares) | 695 | ||
Vested (Released) (in shares) | (335) | ||
Forfeited (in shares) | (399) | ||
Outstanding (in shares) | 1,078 | 1,117 | |
Weighted-Average Grant Date Fair Value | |||
Outstanding (in dollars per share) | $ 115.75 | ||
Granted (Awarded) (in dollars per share) | 63.74 | $ 111.12 | $ 149.65 |
Vested (Released) (in dollars per share) | 113.64 | ||
Forfeited (in dollars per share) | 107.89 | ||
Outstanding (in dollars per share) | $ 84.66 | $ 115.75 | |
Weighted-Average Remaining Years | |||
Outstanding | 1 year 6 months | 1 year 7 months 6 days | |
Aggregate Intrinsic Value | |||
Outstanding | $ 40,551 | $ 56,297 |
Employee Benefits and Share-B_9
Employee Benefits and Share-Based Compensation - Summary of Restricted Stock Award Activity (Details) - RSAs - $ / shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Number of Shares | |||
Outstanding (in shares) | 13 | ||
Granted (Awarded) (in shares) | 24 | ||
Vested (Released) (in shares) | (13) | ||
Outstanding (in shares) | 24 | 13 | |
Weighted-Average Grant Date Fair Value | |||
Outstanding (in dollars per share) | $ 109.39 | ||
Granted (Awarded) (in dollars per share) | 70.96 | $ 109.39 | $ 137.36 |
Vested (Released) (in dollars per share) | 109.39 | ||
Outstanding (in dollars per share) | $ 70.96 | $ 109.39 |
Employee Benefits and Share-_10
Employee Benefits and Share-Based Compensation - Summary of Performance-Based Restricted Stock Activity (Details) - Performance-Based Restricted Stock - $ / shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Number of Shares | |||
Outstanding (in shares) | 135 | ||
Granted (Awarded) (in shares) | 65 | ||
Vested (Released) (in shares) | (55) | ||
Forfeited (in shares) | (70) | ||
Outstanding (in shares) | 75 | 135 | |
Weighted-Average Grant Date Fair Value | |||
Outstanding (in dollars per share) | $ 147.42 | ||
Granted (Awarded) (in dollars per share) | 122.29 | $ 155.27 | $ 162.16 |
Vested (Released) (in dollars per share) | 111.05 | ||
Forfeited (in dollars per share) | 153.77 | ||
Outstanding (in dollars per share) | $ 127.14 | $ 147.42 |
Employee Benefits and Share-_11
Employee Benefits and Share-Based Compensation - Summary of Shares Reserved for Future Issuance Under Equity Incentive Plans (Details) shares in Thousands | Dec. 31, 2023 shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Shares reserved for future issuance (in shares) | 9,119 |
Stock options outstanding | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Shares reserved for future issuance (in shares) | 2,023 |
Non-vested restricted stock awards | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Shares reserved for future issuance (in shares) | 1,177 |
Shares authorized for future issuance | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Shares reserved for future issuance (in shares) | 2,669 |
ESPP shares available for future issuance | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Shares reserved for future issuance (in shares) | 3,250 |
Stock Repurchase Programs (Deta
Stock Repurchase Programs (Details) - USD ($) | 12 Months Ended | ||||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Aug. 02, 2016 | Nov. 04, 2014 | |
Equity, Class of Treasury Stock [Line Items] | |||||
Number of shares repurchased (in shares) | 0 | 0 | |||
Aggregate purchase price for repurchased shares | $ 0 | $ 52,210,000 | $ 0 | ||
2016 and 2014 Share Repurchase Programs | |||||
Equity, Class of Treasury Stock [Line Items] | |||||
Remaining value of shares authorized for repurchase under stock repurchase programs | $ 2,700,000 | ||||
Number of shares repurchased (in shares) | 389,300 | ||||
Average price of repurchased shares (in dollars per share) | $ 134.11 | ||||
Aggregate purchase price of treasury stock | $ 52,200,000 | ||||
2016 Repurchase Program | |||||
Equity, Class of Treasury Stock [Line Items] | |||||
Value of shares authorized for repurchase under stock repurchase programs (up to) | $ 50,000,000 | ||||
2014 Share Repurchase Program | |||||
Equity, Class of Treasury Stock [Line Items] | |||||
Value of shares authorized for repurchase under stock repurchase programs (up to) | $ 50,000,000 |
Income Taxes - Geographical Bre
Income Taxes - Geographical Breakdown of Income (Loss) before the Provision for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||
Domestic | $ (28,105) | $ 369 | $ 67,103 |
Foreign | 7,997 | (2,822) | (1,096) |
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest, Total | $ (20,108) | $ (2,453) | $ 66,007 |
Income Taxes - Provision for (B
Income Taxes - Provision for (Benefit from) Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Current: | |||
Federal | $ 8,556 | $ 17,973 | $ (7,841) |
State | 1,471 | 8,024 | 187 |
Foreign | 840 | 192 | (234) |
Total current income taxes | 10,867 | 26,189 | (7,888) |
Deferred: | |||
Federal | (8,002) | (25,753) | (2,708) |
State | (2,261) | (7,976) | (1,217) |
Foreign | (341) | (561) | (29) |
Total deferred income taxes | (10,604) | (34,290) | (3,954) |
Total provision for (benefit from) income taxes | $ 263 | $ (8,101) | $ (11,842) |
Income Taxes - Difference betwe
Income Taxes - Difference between the Provision For (Benefit From) Income Taxes Compared to Income Taxes Computed at the Statutory Federal Tax Rate (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||
U.S. federal tax provision at statutory rate | $ (4,223) | $ (515) | $ 13,861 |
State taxes | (624) | 38 | (814) |
Section 162(m) limitation | 1,286 | 3,071 | 6,382 |
Non-deductible expenses | 531 | 134 | 363 |
Uncertain tax positions | (620) | (776) | (835) |
Share-based compensation tax expense (benefit) | 7,384 | (3,264) | (20,717) |
Research tax credits | (4,587) | (6,948) | (5,170) |
Restructuring impact | 0 | 0 | (6,116) |
Foreign-derived intangible income deduction | (325) | (753) | (68) |
Global intangible low-taxed income inclusion | 0 | 960 | 195 |
Foreign rate differential | 219 | 186 | (170) |
Foreign branch taxes | 6 | (51) | (9) |
Transaction cost | 0 | 68 | 1,097 |
Provision to return true up | 697 | (84) | 205 |
State rate true up | 528 | (135) | (80) |
Other | (9) | (32) | 34 |
Total provision for (benefit from) income taxes | $ 263 | $ (8,101) | $ (11,842) |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Tax Credit Carryforward [Line Items] | |||
Valuation allowance | $ 0 | $ 0 | |
Uncertain tax positions, interest and penalties | 200,000 | 200,000 | $ 300,000 |
Interest and penalties accrued | 400,000 | $ 200,000 | $ 600,000 |
Internal Revenue Service (IRS) | |||
Tax Credit Carryforward [Line Items] | |||
Net operating loss | 0 | ||
Internal Revenue Service (IRS) | Research Tax Credit Carryforward | |||
Tax Credit Carryforward [Line Items] | |||
Tax credit carryforward amount | 0 | ||
State and Local Jurisdiction | |||
Tax Credit Carryforward [Line Items] | |||
Net operating loss | 19,000,000 | ||
State and Local Jurisdiction | Research Tax Credit Carryforward | |||
Tax Credit Carryforward [Line Items] | |||
Tax credit carryforward amount | 20,900,000 | ||
Foreign Tax Authority | |||
Tax Credit Carryforward [Line Items] | |||
Net operating loss | $ 22,300,000 |
Income Taxes - Significant Comp
Income Taxes - Significant Components of Deferred Tax Assets (Details) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Deferred tax assets (liabilities): | ||
Deferred revenues | $ 11,343,000 | $ 13,514,000 |
Share-based compensation | 11,763,000 | 12,064,000 |
Inventory-related items | 5,136,000 | 4,567,000 |
Tax credit carryforwards | 12,505,000 | 12,173,000 |
Reserves and accruals | 5,660,000 | 6,244,000 |
Loss carryforwards | 7,802,000 | 10,255,000 |
Lease liability | 11,457,000 | 12,884,000 |
Convertible debt | 9,649,000 | 15,037,000 |
Capitalized research and development | 41,635,000 | 30,881,000 |
Other, net | 591,000 | 1,557,000 |
Gross deferred tax assets | 117,541,000 | 119,176,000 |
Valuation allowance | 0 | 0 |
Total net deferred tax assets | 117,541,000 | 119,176,000 |
Intangibles | (30,366,000) | (36,357,000) |
Depreciation and amortization | (35,402,000) | (37,286,000) |
Prepaid expenses | (13,858,000) | (15,574,000) |
Right-of-use assets | (6,626,000) | (9,725,000) |
Other, net | (8,000) | 0 |
Total deferred tax liabilities | (86,260,000) | (98,942,000) |
Net deferred tax assets | $ 31,281,000 | $ 20,234,000 |
Income Taxes - Change in the Ba
Income Taxes - Change in the Balance of Gross Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Balance at beginning of period | $ 9,296 | $ 8,961 | $ 18,246 |
Increases related to tax positions taken during a prior period | 750 | 3 | 40 |
Decreases related to tax positions taken during the prior period | (161) | (59) | (8,908) |
Increases related to tax positions taken during the current period | 1,566 | 1,629 | 1,219 |
Decreases related to expiration of statute of limitations | (703) | (1,238) | (1,636) |
Balance at end of period | $ 10,748 | $ 9,296 | $ 8,961 |
Restructuring Expenses - Narrat
Restructuring Expenses - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2021 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Restructuring and Related Activities [Abstract] | ||||
Restructuring charges | $ 2,000 | $ 15,539 | $ 22,803 | $ 2,020 |
Unpaid balance related to restructuring plan | $ 8,900 |
Restructuring Expenses - Summar
Restructuring Expenses - Summary of Restructuring Expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2021 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | $ 2,000 | $ 15,539 | $ 22,803 | $ 2,020 |
Cost of product and service revenues | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 3,089 | 8,018 | 389 | |
Research and development | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 3,829 | 3,615 | 105 | |
Selling, general, and administrative | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | $ 8,621 | $ 11,170 | $ 1,526 |
Schedule II Valuation and Qua_2
Schedule II Valuation and Qualifying Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | $ 5,496 | $ 5,526 | $ 4,581 |
Charged (Credited) to Costs and Expenses | 2,671 | 2,747 | 2,089 |
Amounts Written Off | (2,441) | (2,551) | (2,079) |
Other Adjustments | 126 | (226) | 935 |
Balance at End of Period | 5,852 | 5,496 | 5,526 |
Accounts receivable and unbilled receivables | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | 5,153 | 5,272 | 4,286 |
Charged (Credited) to Costs and Expenses | 2,726 | 2,658 | 2,130 |
Amounts Written Off | (2,441) | (2,551) | (2,079) |
Other Adjustments | 126 | (226) | 935 |
Balance at End of Period | 5,564 | 5,153 | 5,272 |
Long-term unbilled receivables | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | 35 | 26 | 30 |
Charged (Credited) to Costs and Expenses | (4) | 9 | (4) |
Amounts Written Off | 0 | 0 | 0 |
Other Adjustments | 0 | 0 | |
Balance at End of Period | 31 | 35 | 26 |
Net investment in sales-type leases | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | 308 | 228 | 265 |
Charged (Credited) to Costs and Expenses | (51) | 80 | (37) |
Amounts Written Off | 0 | 0 | 0 |
Other Adjustments | 0 | 0 | 0 |
Balance at End of Period | $ 257 | $ 308 | $ 228 |