Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2022 | Oct. 27, 2022 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2022 | |
Entity File Number | 000-26966 | |
Entity Registrant Name | ADVANCED ENERGY INDUSTRIES INC | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 84-0846841 | |
Entity Address, Address Line One | 1595 Wynkoop Street, Suite 800 | |
Entity Address, City or Town | Denver | |
Entity Address, State or Province | CO | |
Entity Address, Postal Zip Code | 80202 | |
City Area Code | 970 | |
Local Phone Number | 407-6626 | |
Title of 12(b) Security | Common Stock, $0.001 par value | |
Trading Symbol | AEIS | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 37,383,115 | |
Entity Central Index Key | 0000927003 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
Unaudited Consolidated Balance
Unaudited Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 409,053 | $ 544,372 |
Accounts and other receivable, net | 307,018 | 237,227 |
Inventories | 409,422 | 338,410 |
Other current assets | 56,289 | 42,225 |
Total current assets | 1,181,782 | 1,162,234 |
Property and equipment, net | 136,502 | 114,830 |
Operating lease right-of-use assets | 102,226 | 101,769 |
Deposits and other assets | 33,364 | 19,669 |
Goodwill | 279,226 | 212,190 |
Intangible assets, net | 195,807 | 159,406 |
Deferred income tax assets | 45,148 | 47,242 |
TOTAL ASSETS | 1,974,055 | 1,817,340 |
Current liabilities: | ||
Accounts payable | 219,770 | 193,708 |
Income taxes payable | 33,040 | 9,226 |
Accrued payroll and employee benefits | 74,035 | 55,833 |
Other accrued expenses | 44,898 | 53,445 |
Customer deposits and other | 24,913 | 22,141 |
Current portion of long-term debt | 20,000 | 20,000 |
Current portion of operating lease liabilities | 16,299 | 15,843 |
Total current liabilities | 432,955 | 370,196 |
Long-term debt, net | 358,132 | 372,733 |
Operating lease liabilities | 94,575 | 95,180 |
Pension benefits | 58,208 | 67,255 |
Deferred income tax liabilities | 9,194 | 9,921 |
Other long-term liabilities | 31,043 | 30,559 |
Total liabilities | 984,107 | 945,844 |
Commitments and contingencies (Note 17) | ||
Stockholders' equity: | ||
Preferred stock, $0.001 par value, 1,000 shares authorized, none issued and outstanding | ||
Common stock, $0.001 par value, 70,000 shares authorized; 37,393 and 37,589 issued and outstanding at September 30, 2022 and December 31, 2021, respectively | 37 | 38 |
Additional paid-in capital | 128,079 | 115,706 |
Accumulated other comprehensive loss | (14,797) | (1,216) |
Retained earnings | 875,968 | 756,323 |
Advanced Energy stockholders' equity | 989,287 | 870,851 |
Noncontrolling interest | 661 | 645 |
Total stockholders' equity | 989,948 | 871,496 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 1,974,055 | $ 1,817,340 |
Unaudited Consolidated Balanc_2
Unaudited Consolidated Balance Sheets (Parenthetical) - $ / shares shares in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Unaudited Consolidated Balance Sheets | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 1,000 | 1,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 70,000 | 70,000 |
Common stock, shares issued (in shares) | 37,393 | 37,589 |
Common stock, shares outstanding (in shares) | 37,393 | 37,589 |
Unaudited Consolidated Statemen
Unaudited Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Unaudited Consolidated Statements of Operations | ||||
Sales, net | $ 516,274 | $ 346,093 | $ 1,354,682 | $ 1,059,024 |
Cost of sales | 325,056 | 226,054 | 856,990 | 666,449 |
Gross profit | 191,218 | 120,039 | 497,692 | 392,575 |
Operating expenses: | ||||
Research and development | 49,760 | 40,578 | 141,383 | 120,865 |
Selling, general, and administrative | 56,716 | 48,373 | 161,056 | 143,214 |
Amortization of intangible assets | 7,049 | 5,607 | 19,081 | 16,504 |
Restructuring expense | 121 | 1,272 | 1,178 | 2,521 |
Total operating expenses | 113,646 | 95,830 | 322,698 | 283,104 |
Operating income | 77,572 | 24,209 | 174,994 | 109,471 |
Other income (expense), net | 8,940 | 495 | 11,347 | (3,674) |
Income from continuing operations, before income taxes | 86,512 | 24,704 | 186,341 | 105,797 |
Provision for income taxes | 11,639 | 3,657 | 29,795 | 10,817 |
Income from continuing operations | 74,873 | 21,047 | 156,546 | 94,980 |
Income (loss) from discontinued operations, net of income taxes | (697) | (37) | (615) | 171 |
Net income | 74,176 | 21,010 | 155,931 | 95,151 |
Income from continuing operations attributable to noncontrolling interest | 9 | 6 | 16 | 70 |
Net income attributable to Advanced Energy Industries, Inc. | $ 74,167 | $ 21,004 | $ 155,915 | $ 95,081 |
Basic weighted-average common shares outstanding | 37,379 | 38,183 | 37,482 | 38,296 |
Diluted weighted-average common shares outstanding | 37,630 | 38,363 | 37,725 | 38,517 |
Earnings per share: | ||||
Continuing operations: Basic earnings per share | $ 2 | $ 0.55 | $ 4.18 | $ 2.48 |
Continuing operations: Diluted earnings per share | 1.99 | 0.55 | 4.15 | 2.46 |
Discontinued operations: Basic earnings (loss) per share | (0.02) | (0.02) | ||
Discontinued operations: Diluted earnings (loss) per share | (0.02) | (0.02) | ||
Net income: | ||||
Basic earnings per share | 1.98 | 0.55 | 4.16 | 2.48 |
Diluted earnings per share | $ 1.97 | $ 0.55 | $ 4.13 | $ 2.47 |
Unaudited Consolidated Statem_2
Unaudited Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Unaudited Consolidated Statements of Comprehensive Income | ||||
Net income | $ 74,176 | $ 21,010 | $ 155,931 | $ 95,151 |
Other comprehensive income (loss), net of income taxes | ||||
Foreign currency translation | (11,671) | (3,661) | (24,442) | (9,534) |
Change in fair value of cash flow hedges | 2,508 | 172 | 10,447 | 2,179 |
Minimum pension benefit retirement liability | 313 | 414 | 246 | |
Comprehensive income | 65,013 | 17,834 | 142,350 | 88,042 |
Comprehensive income attributable to noncontrolling interest | 9 | 6 | 16 | 70 |
Comprehensive income attributable to Advanced Energy Industries, Inc. | $ 65,004 | $ 17,828 | $ 142,334 | $ 87,972 |
Unaudited Consolidated Statem_3
Unaudited Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Non-controlling Interest | Total |
Beginning Balance at Dec. 31, 2020 | $ 38 | $ 105,009 | $ (2,605) | $ 712,297 | $ 601 | $ 815,340 |
Beginning Balance (in shares) at Dec. 31, 2020 | 38,293 | |||||
Stock issued from equity plans | (4,645) | (4,645) | ||||
Stock issued from equity plans (in shares) | 93 | |||||
Stock-based compensation | 5,701 | 5,701 | ||||
Dividends declared ($0.10 per share) | (3,854) | (3,854) | ||||
Other comprehensive income (loss) | (4,968) | (4,968) | ||||
Net income (loss) | 38,668 | 33 | 38,701 | |||
Ending Balance at Mar. 31, 2021 | $ 38 | 106,065 | (7,573) | 747,111 | 634 | 846,275 |
Ending Balance (in shares) at Mar. 31, 2021 | 38,386 | |||||
Beginning Balance at Dec. 31, 2020 | $ 38 | 105,009 | (2,605) | 712,297 | 601 | 815,340 |
Beginning Balance (in shares) at Dec. 31, 2020 | 38,293 | |||||
Share repurchase | (59,058) | |||||
Net income (loss) | 95,151 | |||||
Ending Balance at Sep. 30, 2021 | $ 38 | 112,227 | (9,714) | 738,569 | 671 | 841,791 |
Ending Balance (in shares) at Sep. 30, 2021 | 37,790 | |||||
Beginning Balance at Mar. 31, 2021 | $ 38 | 106,065 | (7,573) | 747,111 | 634 | 846,275 |
Beginning Balance (in shares) at Mar. 31, 2021 | 38,386 | |||||
Stock issued from equity plans | 956 | 956 | ||||
Stock issued from equity plans (in shares) | 67 | |||||
Stock-based compensation | 3,277 | 3,277 | ||||
Share repurchase | (199) | (6,304) | (6,503) | |||
Share repurchase (in shares) | (72) | |||||
Dividends declared ($0.10 per share) | (3,874) | (3,874) | ||||
Other comprehensive income (loss) | 1,035 | 1,035 | ||||
Net income (loss) | 35,409 | 31 | 35,440 | |||
Ending Balance at Jun. 30, 2021 | $ 38 | 110,099 | (6,538) | 772,342 | 665 | 876,606 |
Ending Balance (in shares) at Jun. 30, 2021 | 38,381 | |||||
Stock issued from equity plans | 223 | 223 | ||||
Stock issued from equity plans (in shares) | 14 | |||||
Stock-based compensation | 3,540 | 3,540 | ||||
Share repurchase | (1,635) | (50,920) | (52,555) | |||
Share repurchase (in shares) | (605) | |||||
Dividends declared ($0.10 per share) | (3,857) | (3,857) | ||||
Other comprehensive income (loss) | (3,176) | (3,176) | ||||
Net income (loss) | 21,004 | 6 | 21,010 | |||
Ending Balance at Sep. 30, 2021 | $ 38 | 112,227 | (9,714) | 738,569 | 671 | 841,791 |
Ending Balance (in shares) at Sep. 30, 2021 | 37,790 | |||||
Beginning Balance at Dec. 31, 2021 | $ 38 | 115,706 | (1,216) | 756,323 | 645 | $ 871,496 |
Beginning Balance (in shares) at Dec. 31, 2021 | 37,589 | 37,589 | ||||
Stock issued from equity plans | (2,430) | $ (2,430) | ||||
Stock issued from equity plans (in shares) | 52 | |||||
Stock-based compensation | 3,906 | 3,906 | ||||
Share repurchase | (254) | (6,340) | (6,594) | |||
Share repurchase (in shares) | (82) | |||||
Dividends declared ($0.10 per share) | (3,789) | (3,789) | ||||
Other comprehensive income (loss) | 1,966 | 1,966 | ||||
Net income (loss) | 36,778 | (14) | 36,764 | |||
Ending Balance at Mar. 31, 2022 | $ 38 | 116,928 | 750 | 782,972 | 631 | 901,319 |
Ending Balance (in shares) at Mar. 31, 2022 | 37,559 | |||||
Beginning Balance at Dec. 31, 2021 | $ 38 | 115,706 | (1,216) | 756,323 | 645 | $ 871,496 |
Beginning Balance (in shares) at Dec. 31, 2021 | 37,589 | 37,589 | ||||
Share repurchase | $ (25,955) | |||||
Net income (loss) | 155,931 | |||||
Ending Balance at Sep. 30, 2022 | $ 37 | 128,079 | (14,797) | 875,968 | 661 | $ 989,948 |
Ending Balance (in shares) at Sep. 30, 2022 | 37,393 | 37,393 | ||||
Beginning Balance at Mar. 31, 2022 | $ 38 | 116,928 | 750 | 782,972 | 631 | $ 901,319 |
Beginning Balance (in shares) at Mar. 31, 2022 | 37,559 | |||||
Stock issued from equity plans | 763 | 763 | ||||
Stock issued from equity plans (in shares) | 63 | |||||
Stock-based compensation | 5,016 | 5,016 | ||||
Share repurchase | $ (1) | (725) | (16,293) | (17,019) | ||
Share repurchase (in shares) | (230) | |||||
Dividends declared ($0.10 per share) | (3,806) | (3,806) | ||||
Other comprehensive income (loss) | (6,384) | (6,384) | ||||
Net income (loss) | 44,970 | 21 | 44,991 | |||
Ending Balance at Jun. 30, 2022 | $ 37 | 121,982 | (5,634) | 807,843 | 652 | 924,880 |
Ending Balance (in shares) at Jun. 30, 2022 | 37,392 | |||||
Stock issued from equity plans | 256 | 256 | ||||
Stock issued from equity plans (in shares) | 35 | |||||
Stock-based compensation | 5,953 | 5,953 | ||||
Share repurchase | (112) | (2,230) | (2,342) | |||
Share repurchase (in shares) | (34) | |||||
Dividends declared ($0.10 per share) | (3,812) | (3,812) | ||||
Other comprehensive income (loss) | (9,163) | (9,163) | ||||
Net income (loss) | 74,167 | 9 | 74,176 | |||
Ending Balance at Sep. 30, 2022 | $ 37 | $ 128,079 | $ (14,797) | $ 875,968 | $ 661 | $ 989,948 |
Ending Balance (in shares) at Sep. 30, 2022 | 37,393 | 37,393 |
Unaudited Consolidated Statem_4
Unaudited Consolidated Statements of Stockholders' Equity (Parenthetical) - $ / shares | 3 Months Ended | |||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | |
Unaudited Consolidated Statements of Stockholders' Equity | ||||||
Dividends declared (in dollars per share) | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 |
Unaudited Consolidated Statem_5
Unaudited Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 155,931 | $ 95,151 |
Less: income (loss) from discontinued operations, net of income taxes | (615) | 171 |
Income from continuing operations, net of income taxes | 156,546 | 94,980 |
Adjustments to reconcile net income to net cash from operating activities: | ||
Depreciation and amortization | 44,433 | 39,225 |
Stock-based compensation expense | 15,008 | 12,819 |
Provision for deferred income taxes | (2,496) | (1,404) |
Gain from discount on notes receivable | (638) | |
(Gain) loss on disposal and sale of assets | (4,058) | 923 |
Changes in operating assets and liabilities, net of assets acquired | ||
Accounts and other receivable, net | (68,591) | 14,957 |
Inventories | (70,407) | (118,562) |
Other assets | (11,858) | 1,958 |
Accounts payable | 21,630 | 63,404 |
Other liabilities and accrued expenses | 7,281 | 8,963 |
Income taxes payable | 25,494 | (10,215) |
Net cash from operating activities from continuing operations | 112,982 | 106,410 |
Net cash from operating activities from discontinued operations | (81) | (523) |
Net cash from operating activities | 112,901 | 105,887 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Receipt of notes receivable | 802 | |
Purchases of property and equipment | (39,507) | (21,184) |
Acquisitions, net of cash acquired | (145,779) | (18,739) |
Net cash from investing activities | (185,286) | (39,121) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from long-term borrowings | 85,000 | |
Payment of debt-issuance costs | (1,350) | |
Payments on long-term borrowings | (15,000) | (8,750) |
Dividend payments | (11,407) | (11,585) |
Purchase and retirement of common stock | (25,955) | (56,625) |
Net payments related to stock-based awards | (1,411) | (3,136) |
Net cash from financing activities | (53,773) | 3,554 |
EFFECT OF CURRENCY TRANSLATION ON CASH AND CASH EQUIVALENTS | (9,161) | (2,765) |
NET CHANGE IN CASH AND CASH EQUIVALENTS | (135,319) | 67,555 |
CASH AND CASH EQUIVALENTS, beginning of period | 544,372 | 480,368 |
CASH AND CASH EQUIVALENTS, end of period | 409,053 | 547,923 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||
Cash paid for interest | 2,965 | 2,896 |
Cash paid for income taxes | $ 5,393 | $ 25,271 |
DESCRIPTION OF BUSINESS AND BAS
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | 9 Months Ended |
Sep. 30, 2022 | |
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | |
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | NOTE 1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION Advanced Energy Industries, Inc., a Delaware corporation, and its consolidated subsidiaries ("we," "us," "our," "Advanced Energy," or the "Company") design, manufacture, sell, and support precision power products that transform, refine, and modify the raw electrical power coming from either the utility or the building facility and convert it into various types of highly controllable, usable power that is predictable, repeatable, and customizable to meet the necessary requirements for powering a wide range of complex equipment. Our plasma power solutions enable innovation in complex semiconductor and thin film plasma processes such as dry etch, strip and deposition. Our broad portfolios of high and low voltage power products are used in a wide range of applications, such as semiconductor equipment, industrial production, medical and life science equipment, data center and telecommunication. We also supply related sensing, controls, and instrumentation products for advanced measurement and calibration of radio frequency ( RF ) power and temperature, electrostatic instrumentation products for test and measurement applications, and gas sensing and monitoring solutions for multiple industrial markets. Our network of global service support centers provides a recurring revenue opportunity as we offer repair services, conversions, upgrades, refurbishments, and used equipment to companies using our products. In management's opinion, the accompanying unaudited consolidated financial statements contain all adjustments, consisting of normal, recurring adjustments, necessary to present fairly Advanced Energy’s financial position as of September 30, 2022, and the results of our operations and cash flows for the three and nine months ended September 30, 2022 and 2021. The unaudited consolidated financial statements included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") have been omitted pursuant to such rules and regulations. These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto contained in our Annual Report on Form 10-K for the year ended December 31, 2021 and other financial information filed with the SEC. Use of Estimates in the Preparation of the Consolidated Financial Statements The preparation of our consolidated financial statements in conformity with U.S. GAAP requires us to make estimates, assumptions, and judgments that affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. The significant estimates, assumptions, and judgments include, but are not limited to: ● excess and obsolete inventory; ● pension obligations; ● acquisitions and asset valuations; and ● taxes and other provisions. Significant Accounting Policies Our accounting policies are described in Note 1 to our audited consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2021 . We reclassified certain prior period amounts within these consolidated financial statements to conform to the current year presentation. New Accounting Standards From time to time, the Financial Accounting Standards Board ("FASB") or other standards setting bodies issue new accounting pronouncements. Updates to the FASB Accounting Standards Codification ("ASC") are communicated through issuance of an Accounting Standards Update ("ASU"). Unless otherwise discussed, we believe that the impact of recently issued guidance, whether adopted or to be adopted in the future, will not have a material impact on the consolidated financial statements upon adoption. New Accounting Standards Adopted In October 2021, the FASB issued ASU 2021-08, " Business Combinations (Topic 806) Accounting for Contract Assets and Contract Liabilities from Contracts with Customers." address diversity and inconsistency related to the recognition and measurement of contract assets and contract liabilities acquired in a business combination. ASU 2021-08 requires an acquirer to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with ASC 606, Revenue from Contracts with Customers . We adopted ASU 2021-08 on a prospective basis effective January 1, 2022. The adoption will impact business combinations subsequent to that date and require recognition and measurement of acquired contract assets and liabilities in accordance with ASC 606. Specifically, we will account for the related revenue contracts of the acquiree as if we originated the contracts. did not impact acquired contract assets or liabilities from prior business combinations. New Accounting Standards Issued But Not Yet Adopted In March 2020, the FASB issued ASU 2020-04, "Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting" "Reference Rate Reform (Topic 848): Scope" Our Credit Facility (refer to Note 18. Credit Facility Note 7. Derivative Financial Instruments |
ACQUISITIONS
ACQUISITIONS | 9 Months Ended |
Sep. 30, 2022 | |
ACQUISITIONS | |
ACQUISITIONS | NOTE 2. ACQUISITIONS SL Power Electronics Corporation On April 25, 2022, we acquired 100% of the issued and outstanding shares of capital stock of SL Power Electronics Corporation ("SL Power"), which is based in Calabasas, California. We accounted for this transaction as a business combination. This acquisition added complementary products to Advanced Energy’s medical power offerings and extends our presence in several advanced industrial markets. The components of the fair value of the total consideration transferred were as follows: Cash paid for acquisition $ 146,863 Less cash acquired (3,484) Total fair value of purchase consideration $ 143,379 We allocated the purchase price to the assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date, with the excess allocated to goodwill. The following table summarizes the estimated preliminary values of the assets acquired and liabilities assumed. Preliminary Fair Value September 30, 2022 Current assets and liabilities, net $ 12,013 Property and equipment 3,927 Operating lease right-of-use assets 4,996 Deferred taxes and other liabilities (1,164) Intangible assets 57,600 Goodwill 71,003 Operating lease liability (4,996) Total fair value of net assets acquired $ 143,379 The following table summarizes the intangible assets acquired: Amortization Useful Life Fair Value Method (in years) Customer relationships $ 50,500 Straight-line 10 Technology 7,100 Straight-line 5 Total $ 57,600 To estimate the fair value of intangible assets, we used a multi-period excess earnings approach for the customer relationships and a relief from royalty approach for developed technology. Goodwill represents SL Power’s assembled workforce and expected operating synergies from combining operations and approximately 85% is expected to be deductible for tax purposes. We are still evaluating the fair value for the assets acquired and liabilities assumed. Accordingly, the purchase price allocation presented above is preliminary. We included SL Power’s results of operations in our consolidated financial statements from the date of acquisition. The following table summarizes SL Power’s contribution to sales in our Consolidated Statements of Operations. Three Months Ended September 30, Nine Months Ended September 30, 2022 2022 Sales, net $ 16,659 $ 29,604 TEGAM, Inc. On June 1, 2021, we acquired 100% of the issued and outstanding shares of capital stock of TEGAM, Inc., which is based in Geneva, Ohio. We accounted for this transaction as a business combination. This acquisition added metrology and calibration instrumentation to Advanced Energy’s RF process power solutions in our Semiconductor and Industrial and Medical markets. The components of the fair value of the total consideration transferred were as follows: Cash paid at closing $ 15,430 Cash paid for indemnity holdback released in June 2022 1,800 Less cash acquired (177) Total fair value of purchase consideration $ 17,053 We allocated the purchase price to the assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date, with the excess allocated to goodwill. The following table summarizes the values of the assets acquired and liabilities assumed. Fair Value Current assets and liabilities, net $ 3,475 Property and equipment 755 Operating lease right-of-use assets 425 Intangible assets 6,900 Goodwill (deductible for tax purposes) 5,917 Other 6 Operating lease liability (425) Total fair value of net assets acquired $ 17,053 Goodwill represents TEGAM’s assembled workforce and expected operating synergies from combining operations. We included TEGAM’s results of operations in our consolidated financial statements from the date of acquisition. |
REVENUE
REVENUE | 9 Months Ended |
Sep. 30, 2022 | |
REVENUE | |
REVENUE | NOTE 3. REVENUE Nature of goods and services Products Advanced Energy provides highly engineered, mission-critical, precision power conversion, measurement, and control solutions to our global customers. We design, manufacture, sell, and support precision power products that transform, refine, and modify the raw electrical power coming from either the utility or the building facility and convert it into various types of highly controllable, usable power that is predictable, repeatable, and customizable to meet the necessary requirements for powering a wide range of complex equipment. Our power solutions enable innovation in complex semiconductor and thin film plasma processes such as dry etch, strip and deposition, high and low voltage applications such as process control, medical equipment, life science applications, industrial technology and production, scientific instruments, clean technology production, advanced material production, temperature-critical material processing, data center computing, networking, and telecommunication. We also supply related sensing, controls, and instrumentation products for advanced measurement and calibration of RF power and temperature, electrostatic instrumentation products for test and measurement applications, and gas sensing and monitoring solutions for multiple industrial markets. Our network of global service support centers provides a recurring revenue opportunity as we offer repair services, conversions, upgrades, refurbishments, and used equipment to companies using our products . Services Our services group offers warranty and after-market repair services in the regions in which we operate, providing us with preventive maintenance opportunities. Our customers continue to pursue low cost of ownership of their capital equipment and are increasingly sensitive to the costs of system downtime. They expect that suppliers offer comprehensive local repair service and customer support. To meet these market requirements, we maintain a worldwide support organization in the U.S., the People’s Republic of China ("PRC"), Japan, Korea, Taiwan, Germany, Ireland, Singapore, Israel, and Great Britain. Support services include warranty and non-warranty repair services, upgrades, and refurbishments on the products we sell. As part of our ongoing service business, we satisfy our service obligations under preventative maintenance contracts and extended warranties which had previously been offered on our discontinued inverter products. Any up-front fees received for extended warranties or maintenance plans are deferred. Revenue under these arrangements is recognized ratably over the underlying terms as we do not have historical information which would allow us to project the estimated service usage pattern at this time. Remaining Performance obligations Our remaining performance obligations primarily relate to customer purchase orders for products we have not yet shipped. We expect to fulfill the majority of these performance obligations within one year. As a result, we elected not to disclose the amount of these remaining performance obligations. Disaggregation of revenue The following tables present additional information regarding our revenue: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Semiconductor Equipment $ 266,600 $ 173,441 $ 698,354 $ 530,828 Industrial and Medical 119,587 80,800 307,436 242,412 Data Center Computing 87,542 62,231 232,941 190,843 Telecom and Networking 42,545 29,621 115,951 94,941 Total $ 516,274 $ 346,093 $ 1,354,682 $ 1,059,024 Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Product $ 471,627 $ 312,389 $ 1,238,480 $ 956,790 Services 44,647 33,704 116,202 102,234 Total $ 516,274 $ 346,093 $ 1,354,682 $ 1,059,024 Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 United States $ 197,205 $ 139,089 $ 530,240 $ 410,212 North America (excluding U.S.) 40,910 24,708 96,713 77,067 Asia 215,401 135,838 557,629 434,232 Europe 61,456 44,838 157,972 129,751 Other 1,302 1,620 12,128 7,762 Total $ 516,274 $ 346,093 $ 1,354,682 $ 1,059,024 During the three months ended September 30, 2022, Applied Materials, Inc. and Lam Research Corporation accounted for 19% and 15%, respectively, of our total revenue compared to 22% and 11%, respectively, of our total revenue during the same period in the prior year. During the nine months ended September 30, 2022, Applied Materials, Inc. and Lam Research Corporation accounted for 20% and 14%, respectively, of our total revenue compared to 21% and 10%, respectively, of our total revenue during the same period in the prior year. |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2022 | |
INCOME TAXES | |
INCOME TAXES | NOTE 4. INCOME TAXES The following table summarizes tax expense and the effective tax rate for our income from continuing operations: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Income from continuing operations, before income taxes $ 86,512 $ 24,704 $ 186,341 $ 105,797 Provision for income taxes $ 11,639 $ 3,657 $ 29,795 $ 10,817 Effective tax rate 13.5 % 14.8 % 16.0 % 10.2 % Our effective tax rates differ from the U.S. federal statutory rate of 21% for the three and nine months ended September 30, 2022 and 2021, respectively, primarily due to the benefit of earnings in foreign jurisdictions which are subject to lower tax rates, as well as tax credits, partially offset by net U.S. tax on foreign operations. The effective tax rate for the three months ended September 30, 2022 was lower than the same period in 2021 primarily due to the cumulative year to date impact of increased earnings in 2022 and the resulting mix of earnings by geography. The effective tax rate for the nine months ended September 30, 2022 was higher than the same period in 2021 primarily due to beneficial discrete items occurring in 2021 not recurring in 2022, and by the capitalization and amortization of research and development expenses rather than immediately expensing them starting in 2022 as required by the 2017 Tax Cuts and Jobs Act. Under the 2017 Tax Cuts and Jobs Act enacted in December 2017, research and development expenses incurred for tax years beginning after December 31, 2021 must be capitalized and amortized ratably over five or fifteen years for tax purposes. Although Congress is considering legislation that would defer the capitalization and amortization requirement, there is no assurance that the provision will be repealed or otherwise modified. If the requirement is not modified, it may materially increase future cash taxes beginning in 2023. The Inflation Reduction Act (“IRA”) and CHIPS and Science Act (“CHIPS Act”) were both enacted in August 2022. The IRA introduced new provisions including a 15% corporate alternative minimum tax for certain large corporations that have at least an average of $1 billion adjusted financial statement income over a consecutive three-tax-year period and a 1% excise tax surcharge on stock repurchases. The CHIPS Act provides a variety of incentives associated with investments in domestic semiconductor manufacturing and related activities. Both Acts are applicable for tax years beginning after December 31, 2022 and had no impact to our consolidated financial statements in the nine months ended September 30, 2022 . |
EARNINGS PER SHARE
EARNINGS PER SHARE | 9 Months Ended |
Sep. 30, 2022 | |
EARNINGS PER SHARE | |
EARNINGS PER SHARE | NOTE 5. EARNINGS PER SHARE We compute basic earnings per share ("EPS") by dividing income available to common stockholders by the weighted-average number of common shares outstanding during the period. The diluted EPS computation is similar to basic EPS except we increase the denominator to include the number of additional common shares that would have been outstanding (using the if-converted and treasury stock methods), if our outstanding stock options and restricted stock units had been converted to common shares (when such conversion is dilutive). The following is a reconciliation of the weighted-average shares outstanding used in the calculation of basic and diluted earnings per share: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Income from continuing operations $ 74,873 $ 21,047 $ 156,546 $ 94,980 Less: income from continuing operations attributable to noncontrolling interest 9 6 16 70 Income from continuing operations attributable to Advanced Energy Industries, Inc. $ 74,864 $ 21,041 $ 156,530 $ 94,910 Basic weighted-average common shares outstanding 37,379 38,183 37,482 38,296 Assumed exercise of dilutive stock options and restricted stock units 251 180 243 221 Diluted weighted-average common shares outstanding 37,630 38,363 37,725 38,517 Continuing operations: Basic earnings per share $ 2.00 $ 0.55 $ 4.18 $ 2.48 Diluted earnings per share $ 1.99 $ 0.55 $ 4.15 $ 2.46 Share Repurchase To execute the repurchase of shares of our common stock, we periodically enter into stock repurchase agreements. The following table summarizes these repurchases: Three Months Ended September 30, Nine Months Ended September 30, (in thousands, except per share amounts) 2022 2021 2022 2021 Amount paid or accrued to repurchase shares $ 2,342 $ 52,555 $ 25,955 $ 59,058 Number of shares repurchased 34 605 346 677 Average repurchase price per share $ 69.39 $ 86.93 $ 75.07 $ 87.30 There were no shares repurchased from related parties. Repurchased shares were retired and assumed the status of authorized and unissued shares. In July 2022, the Board of Directors approved an increase to the share repurchase plan that increased the remaining amount authorized for future repurchases to a maximum of $200.0 million with no time limitation. At 30, 2022, the remaining amount authorized by the Board of Directors for future share repurchases was $200.0 million. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 9 Months Ended |
Sep. 30, 2022 | |
FAIR VALUE MEASUREMENTS | |
FAIR VALUE MEASUREMENTS | NOTE 6. FAIR VALUE MEASUREMENTS The following tables present information about our assets and liabilities measured at fair value on a recurring basis. September 30, 2022 Description Balance Sheet Classification Level 1 Level 2 Level 3 Total Fair Value Assets: Certificates of deposit Other current assets $ — $ 2,120 $ — $ 2,120 Foreign currency forward contracts Other current assets — 208 — 208 Interest rate swaps Deposits and other assets — 16,113 — 16,113 Total assets measured at fair value on a recurring basis $ — $ 18,441 $ — $ 18,441 Liabilities: Contingent consideration Other current liabilities $ — $ — $ 1,779 $ 1,779 Total liabilities measured at fair value on a recurring basis $ — $ — $ 1,779 $ 1,779 December 31, 2021 Description Balance Sheet Classification Level 1 Level 2 Level 3 Total Fair Value Assets: Certificates of deposit Other current assets $ — $ 2,296 $ — $ 2,296 Interest rate swaps Deposits and other assets — 2,739 — 2,739 Total assets measured at fair value on a recurring basis $ — $ 5,035 $ — $ 5,035 Liabilities: Contingent consideration Other current liabilities $ — $ — $ 1,738 $ 1,738 Total liabilities measured at fair value on a recurring basis $ — $ — $ 1,738 $ 1,738 The fair value of foreign currency forward contracts is based on the movement in the forward rates of foreign currency cash flows in which the hedging instrument is denominated. We determine the fair value of interest rate swaps by estimating the net present value of the expected cash flows based on market rates and associated yield curves, adjusted for non-performance credit risk, as applicable. See Note 7. Derivative Financial Instruments |
DERIVATIVE FINANCIAL INSTRUMENT
DERIVATIVE FINANCIAL INSTRUMENTS | 9 Months Ended |
Sep. 30, 2022 | |
DERIVATIVE FINANCIAL INSTRUMENTS | |
DERIVATIVE FINANCIAL INSTRUMENTS | NOTE 7. DERIVATIVE FINANCIAL INSTRUMENTS Changes in foreign currency exchange rates impact us. We may manage these risks through the use of derivative financial instruments, primarily forward contracts with banks. These forward contracts manage the exchange rate risk associated with assets and liabilities denominated in nonfunctional currencies. Typically, we execute these derivative instruments for one-month periods and do not designate them as hedges; however, they do partially offset the economic fluctuations of certain of our assets and liabilities due to foreign exchange rate changes. The following table summarizes the notional amount of outstanding foreign currency forward contracts: September 30, December 31, 2022 2021 Foreign currency forward contracts $ 83,760 $ — Gains and losses related to foreign currency exchange contracts were offset by corresponding gains and losses on the revaluation of the underlying assets and liabilities. Both are included as components of other income (expense), net in our Consolidated Statements of Operations. In April 2020, we executed interest rate swap contracts with independent financial institutions to partially reduce the variability of cash flows in LIBOR indexed debt interest payments on our Term Loan Facility (under our existing Credit Agreement dated September 10, 2019, as amended). These transactions are accounted for as cash flow hedging instruments. The interest rate swap contracts fixed a portion of the outstanding principal balance on our term loan to a total interest rate of 1.271%. This is comprised of 0.521% average fixed rate per annum in exchange for a variable interest rate based on one-month USD-LIBOR-BBA plus the credit spread in our existing Credit Agreement (see Note 18. Credit Facility The following table summarizes the notional amount of our qualified hedging instruments: September 30, December 31, 2022 2021 Interest rate swap contracts $ 242,594 $ 255,719 The following table summarizes the balances recorded in accumulated other comprehensive loss on the Consolidated Balance Sheets for qualifying hedges. September 30, December 31, 2022 2021 Interest rate swap contract gains $ 12,427 $ 2,107 See Note 6. Fair Value Measurements As a result of using derivative financial instruments, we are exposed to the risk that counterparties to contracts could fail to meet their contractual obligations. We manage this credit risk by reviewing counterparty creditworthiness on a regular basis and limiting exposure to any single counterparty. |
ACCOUNTS AND OTHER RECEIVABLES,
ACCOUNTS AND OTHER RECEIVABLES, NET | 9 Months Ended |
Sep. 30, 2022 | |
ACCOUNTS AND OTHER RECEIVABLES, NET | |
ACCOUNTS AND OTHER RECEIVABLES, NET | NOTE 8. ACCOUNTS AND OTHER RECEIVABLES, NET We record accounts and other receivables at net realizable value. Components of accounts and other receivables, net of reserves, were as follows: September 30, December 31, 2022 2021 Amounts billed, net $ 289,007 $ 217,549 Unbilled receivables 18,011 19,678 Total receivables, net $ 307,018 $ 237,227 "Amounts billed, net" represents amounts invoiced to customers in accordance with our terms and conditions and includes an allowance for expected credit losses. These receivables are short term in nature and do not include any financing components. "Unbilled receivables" consist of amounts where we satisfied our contractual obligations associated with customer inventory stocking agreements. Such amounts typically become billable upon the customer’s consumption of the inventory. We anticipate invoicing and collecting substantially all unbilled receivables within the next twelve months. The following table summarizes the changes in expected credit losses: December 31, 2021 $ 5,784 Additions 441 Deductions - write-offs, net of recoveries (4,170) Foreign currency translation (30) September 30, 2022 $ 2,025 |
INVENTORIES
INVENTORIES | 9 Months Ended |
Sep. 30, 2022 | |
INVENTORIES | |
INVENTORIES | NOTE 9. INVENTORIES Inventories are valued at the lower of cost or net realizable value and computed on a first-in, first-out basis. Components of inventories were as follows: September 30, December 31, 2022 2021 Parts and raw materials $ 311,748 $ 261,365 Work in process 28,860 24,222 Finished goods 68,814 52,823 Total $ 409,422 $ 338,410 |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 9 Months Ended |
Sep. 30, 2022 | |
PROPERTY AND EQUIPMENT, NET | |
PROPERTY AND EQUIPMENT, NET | NOTE 10. PROPERTY AND EQUIPMENT, NET Property and equipment, net is comprised of the following: Estimated Useful September 30, December 31, Life (in years) 2022 2021 Buildings, machinery, and equipment 5 to 25 $ 149,877 $ 134,635 Computer equipment, furniture, fixtures, and vehicles 3 to 5 34,557 33,490 Leasehold improvements 2 to 10 61,804 48,370 Construction in process 16,787 5,914 263,025 222,409 Less: Accumulated depreciation (126,523) (107,579) Property and equipment, net $ 136,502 $ 114,830 The following table summarizes depreciation expense. All depreciation expense is recorded in income from continuing operations: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Depreciation expense $ 8,507 $ 7,874 $ 25,352 $ 22,721 |
GOODWILL
GOODWILL | 9 Months Ended |
Sep. 30, 2022 | |
GOODWILL AND INTANGIBLE ASSETS | |
GOODWILL | NOTE 11. GOODWILL The following table summarizes the changes in goodwill: December 31, 2021 $ 212,190 Measurement period adjustments 40 Additions from acquisition 71,003 Foreign currency translation (4,007) September 30, 2022 $ 279,226 |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 9 Months Ended |
Sep. 30, 2022 | |
GOODWILL AND INTANGIBLE ASSETS | |
INTANGIBLE ASSETS | NOTE 12. INTANGIBLE ASSETS Intangible assets consisted of the following: September 30, 2022 Gross Carrying Accumulated Net Carrying Amount Amortization Amount Technology $ 96,027 $ (43,146) $ 52,881 Customer relationships 166,018 (40,325) 125,693 Trademarks and other 26,864 (9,631) 17,233 Total $ 288,909 $ (93,102) $ 195,807 December 31, 2021 Gross Carrying Accumulated Net Carrying Amount Amortization Amount Technology $ 91,461 $ (35,854) $ 55,607 Customer relationships 118,706 (34,187) 84,519 Trademarks and other 27,244 (7,964) 19,280 Total $ 237,411 $ (78,005) $ 159,406 At September 30, 2022, the weighted average remaining useful life of intangibles subject to amortization was approximately 9.3 years. Amortization expense related to intangible assets is as follows: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Amortization expense $ 7,049 $ 5,607 $ 19,081 $ 16,504 Estimated amortization expense related to intangibles is as follows: Year Ending December 31, 2022 (remaining) $ 7,014 2023 28,058 2024 25,072 2025 20,905 2026 19,189 Thereafter 95,569 Total $ 195,807 |
RESTRUCTURING COSTS
RESTRUCTURING COSTS | 9 Months Ended |
Sep. 30, 2022 | |
RESTRUCTURING COSTS | |
RESTRUCTURING COSTS | NOTE 13. RESTRUCTURING COSTS During 2018, we committed to a restructuring plan to optimize our manufacturing footprint and to improve our operating efficiencies and synergies related to our recent acquisitions. For the periods presented, we incurred severance costs primarily related to the transition and exit of our facility in Shenzhen, PRC and actions associated with synergies related to the Artesyn acquisition. The table below summarizes restructuring charges: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Severance and related charges $ 121 $ 676 $ 833 $ 1,270 Facility relocation and closure charges — 596 345 1,251 Total restructuring charges $ 121 $ 1,272 $ 1,178 $ 2,521 Cumulative Cost Through September 30, 2022 Severance and related charges $ 21,213 Facility relocation and closure charges 7,160 Total restructuring charges $ 28,373 Our restructuring liabilities are included in other accrued expenses in our Consolidated Balance Sheets and related primarily to severance and related charges. Changes in restructuring liabilities were as follows: December 31, 2021 $ 9,263 Costs incurred and charged to expense 1,178 Costs paid or otherwise settled (8,623) Effects of changes in exchange rate (24) September 30, 2022 $ 1,794 |
WARRANTIES
WARRANTIES | 9 Months Ended |
Sep. 30, 2022 | |
WARRANTIES | |
WARRANTIES | NOTE 14. WARRANTIES Our sales agreements include customary product warranty provisions, which range from 12 Our estimated warranty obligation is included in other accrued expenses in our Consolidated Balance Sheets. Changes in our product warranty obligation were as follows: December 31, 2021 $ 3,350 Additions from acquisitions 181 Increases to accruals 4,820 Warranty expenditures (2,431) Effect of changes in exchange rates (98) September 30, 2022 $ 5,822 |
LEASES
LEASES | 9 Months Ended |
Sep. 30, 2022 | |
LEASES | |
LEASES | NOTE 15. LEASES Components of operating lease cost were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Operating lease cost $ 5,613 $ 5,735 $ 17,061 $ 17,708 Short-term and variable lease cost 1,177 578 3,516 1,704 Total operating lease cost $ 6,790 $ 6,313 $ 20,577 $ 19,412 Maturities of our operating lease liabilities are as follows: Year Ending December 31, 2022 (remaining) $ 5,421 2023 20,029 2024 17,518 2025 14,515 2026 13,190 Thereafter 68,353 Total lease payments 139,026 Less: Interest (28,152) Present value of lease liabilities $ 110,874 September 30, December 31, 2022 2021 Weighted average remaining lease term (in years) 9.1 9.8 Weighted average discount rate 4.6 % 4.5 % Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Cash paid for operating leases $ 5,557 $ 6,058 $ 16,642 $ 18,037 Right-of-use assets obtained in exchange for operating lease liabilities $ 2,222 $ 7,169 $ 14,433 $ 14,402 |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 9 Months Ended |
Sep. 30, 2022 | |
STOCK-BASED COMPENSATION | |
STOCK-BASED COMPENSATION | NOTE 16. STOCK-BASED COMPENSATION As of September 30, 2022, we had two active stock-based incentive compensation plans: the 2017 Omnibus Incentive Plan (the "2017 Plan") and the Employee Stock Purchase Plan ("ESPP"). We issue all new equity compensation grants under these two plans; however, outstanding awards previously issued under inactive plans will continue to vest and remain exercisable in accordance with the terms of the respective plans. On May 4, 2017, the stockholders approved the 2017 Plan and all shares that were then available for issuance under the 2008 Omnibus Incentive Plan ("the 2008 Plan") are now available for issuance under the 2017 Plan. The 2017 Plan and 2008 Plan provide for the grant of stock options, stock appreciation rights, restricted stock, stock units (including deferred stock units), unrestricted stock, and dividend equivalent rights. Any of the awards issued may be issued as performance-based awards to align stock compensation awards to the attainment of annual or long-term performance goals . The following table summarizes information related to our stock-based incentive compensation plans: September 30, 2022 Shares available for future issuance under the 2017 Omnibus Incentive Plan 1,536 Shares available for future issuance under the Employee Stock Purchase Plan 642 Restricted stock units ("RSU’s") are generally granted with a grant date fair value equal to the market price of our stock on the date of grant and with generally a three-year vesting schedule. Certain RSUs contain performance-based or market-based vesting conditions in addition to the time-based requirements. Stock option awards are generally granted with an exercise price equal to the market price of our stock on the date of grant and with either a three We recognize stock-based compensation expense based on the fair value of the awards issued and the functional area of the employee receiving the award. Stock-based compensation was as follows: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Stock-based compensation expense $ 6,022 $ 3,674 $ 15,008 $ 12,819 Changes in our RSUs were as follows: Nine Months Ended September 30, 2022 Weighted- Average Number of Grant Date RSUs Fair Value RSUs outstanding at beginning of period 627 $ 76.37 RSUs granted 525 $ 73.38 RSUs vested (145) $ 84.99 RSUs forfeited (248) $ 60.74 RSUs outstanding at end of period 759 $ 77.77 Changes in our stock options were as follows: Nine Months Ended September 30, 2022 Weighted- Average Number of Exercise Price Options per Share Options outstanding at beginning of period 112 $ 24.41 Options granted 76 $ 85.97 Options exercised (25) $ 23.30 Options outstanding at end of period 163 $ 53.10 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2022 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | NOTE 17. COMMITMENTS AND CONTINGENCIES We are involved in disputes and legal actions arising in the normal course of our business. While we currently believe that the amount of any ultimate loss would not be material to our financial position, the outcome of these actions is inherently difficult to predict. In the event of an adverse outcome, the ultimate loss could have a material adverse effect on our financial position or reported results of operations. An unfavorable decision in intellectual property litigation also could require material changes in production processes and products or result in our inability to ship products or components found to have violated third-party intellectual property rights. We accrue loss contingencies in connection with our commitments and contingencies, including litigation, when it is probable that a loss has occurred, and the amount of the loss can be reasonably estimated. We are not currently a party to any legal action that we believe would reasonably have a material adverse impact on our business, financial condition, results of operations or cash flows. |
CREDIT FACILITY
CREDIT FACILITY | 9 Months Ended |
Sep. 30, 2022 | |
CREDIT FACILITY | |
CREDIT FACILITY | NOTE 18. CREDIT FACILITY In September 2019, in connection with the Artesyn Acquisition Agreement, we entered into a credit agreement ("Credit Agreement") that provided aggregate financing of $500.0 million, consisting of a $350.0 million senior unsecured term loan facility (the "Term Loan Facility") and a $150.0 million senior unsecured revolving facility (the "Revolving Facility" and together with the Term Loan Facility, the "Credit Facility"). In September 2021, we amended the Credit Agreement whereby we borrowed an additional $85.0 million, which increased the aggregate amount outstanding under the Term Loan Facility to $400.0 million. In addition, we increased the Revolving Facility capacity by $50.0 million to $200.0 million. Both the Term Loan Facility and Revolving Facility mature on September 9, 2026. The following table summarizes borrowings under our Credit Facility and the associated interest rate. September 30, 2022 Balance Interest Rate Unused Line Fee Term Loan Facility subject to a fixed interest rate $ 242,594 1.271% — Term Loan Facility subject to a variable interest rate 137,406 3.865% — Revolving Facility subject to a variable interest rate — 3.865% 0.10% Total borrowings under the Credit Agreement $ 380,000 For more information on the interest rate swap that fixes the interest rate for a portion of our Term Loan Facility, see Note 7. Derivative Financial Instruments For all periods presented, we were in compliance with the Credit Agreement covenants. The following table summarizes our availability to withdraw on the Revolving Facility. September 30, December 31, 2022 2021 Available capacity on Revolving Facility $ 200,000 $ 200,000 In addition to the available capacity on the Revolving Facility, prior to the maturity date of our Credit Agreement, we may also request an increase to the financing commitments in either the Term Loan Facility or Revolving Facility by an aggregate amount not to exceed $250.0 million at identical terms to our existing Credit Facility. The fair value of the Term Loan Facility approximates the outstanding balance of $380.0 million as of September 30, 2022. The debt obligation on our Consolidated Balance Sheets consists of the following: September 30, December 31, 2022 2021 Term Loan Facility $ 380,000 $ 395,000 Less: debt discount (1,868) (2,267) Total debt 378,132 392,733 Less current portion of long-term debt (20,000) (20,000) Total long-term debt $ 358,132 $ 372,733 Contractual maturities of our debt obligations, excluding amortization of debt issuance costs, are as follows: Year Ending December 31, 2022 (remaining) $ 5,000 2023 20,000 2024 20,000 2025 20,000 2026 315,000 Total $ 380,000 Interest expense and unused line of credit fees were recorded in other income (expense), net in our Consolidated Statements of Operations as follows: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Interest expense $ 1,842 $ 1,009 $ 4,303 $ 2,973 Amortization of debt issuance costs 136 420 413 669 Unused line of credit fees and other 51 41 152 116 Total interest expense $ 2,029 $ 1,470 $ 4,868 $ 3,758 |
OPERATIONS AND SUMMARY OF SIGNI
OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ESTIMATES (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | |
Use of Estimates in the Preparation of the Consolidated Financial Statements | Use of Estimates in the Preparation of the Consolidated Financial Statements The preparation of our consolidated financial statements in conformity with U.S. GAAP requires us to make estimates, assumptions, and judgments that affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. The significant estimates, assumptions, and judgments include, but are not limited to: ● excess and obsolete inventory; ● pension obligations; ● acquisitions and asset valuations; and ● taxes and other provisions. |
Significant Accounting Policies | Significant Accounting Policies Our accounting policies are described in Note 1 to our audited consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2021 . We reclassified certain prior period amounts within these consolidated financial statements to conform to the current year presentation. |
New Accounting Standards | New Accounting Standards From time to time, the Financial Accounting Standards Board ("FASB") or other standards setting bodies issue new accounting pronouncements. Updates to the FASB Accounting Standards Codification ("ASC") are communicated through issuance of an Accounting Standards Update ("ASU"). Unless otherwise discussed, we believe that the impact of recently issued guidance, whether adopted or to be adopted in the future, will not have a material impact on the consolidated financial statements upon adoption. New Accounting Standards Adopted In October 2021, the FASB issued ASU 2021-08, " Business Combinations (Topic 806) Accounting for Contract Assets and Contract Liabilities from Contracts with Customers." address diversity and inconsistency related to the recognition and measurement of contract assets and contract liabilities acquired in a business combination. ASU 2021-08 requires an acquirer to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with ASC 606, Revenue from Contracts with Customers . We adopted ASU 2021-08 on a prospective basis effective January 1, 2022. The adoption will impact business combinations subsequent to that date and require recognition and measurement of acquired contract assets and liabilities in accordance with ASC 606. Specifically, we will account for the related revenue contracts of the acquiree as if we originated the contracts. did not impact acquired contract assets or liabilities from prior business combinations. New Accounting Standards Issued But Not Yet Adopted In March 2020, the FASB issued ASU 2020-04, "Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting" "Reference Rate Reform (Topic 848): Scope" Our Credit Facility (refer to Note 18. Credit Facility Note 7. Derivative Financial Instruments |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
SL Power Electronics Corporation | |
Business Acquisition [Line Items] | |
Schedule of components of fair value of total consideration transferred | Cash paid for acquisition $ 146,863 Less cash acquired (3,484) Total fair value of purchase consideration $ 143,379 |
Schedule of fair value of assets acquired and liabilities assumed | Preliminary Fair Value September 30, 2022 Current assets and liabilities, net $ 12,013 Property and equipment 3,927 Operating lease right-of-use assets 4,996 Deferred taxes and other liabilities (1,164) Intangible assets 57,600 Goodwill 71,003 Operating lease liability (4,996) Total fair value of net assets acquired $ 143,379 |
Summary of intangible assets acquired | Amortization Useful Life Fair Value Method (in years) Customer relationships $ 50,500 Straight-line 10 Technology 7,100 Straight-line 5 Total $ 57,600 |
Summary of revenue from SL power | Three Months Ended September 30, Nine Months Ended September 30, 2022 2022 Sales, net $ 16,659 $ 29,604 |
TEGAM, Inc. | |
Business Acquisition [Line Items] | |
Schedule of components of fair value of total consideration transferred | Cash paid at closing $ 15,430 Cash paid for indemnity holdback released in June 2022 1,800 Less cash acquired (177) Total fair value of purchase consideration $ 17,053 |
Schedule of fair value of assets acquired and liabilities assumed | Fair Value Current assets and liabilities, net $ 3,475 Property and equipment 755 Operating lease right-of-use assets 425 Intangible assets 6,900 Goodwill (deductible for tax purposes) 5,917 Other 6 Operating lease liability (425) Total fair value of net assets acquired $ 17,053 |
REVENUE (Tables)
REVENUE (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
REVENUE | |
Schedule of disaggregation of revenue | Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Semiconductor Equipment $ 266,600 $ 173,441 $ 698,354 $ 530,828 Industrial and Medical 119,587 80,800 307,436 242,412 Data Center Computing 87,542 62,231 232,941 190,843 Telecom and Networking 42,545 29,621 115,951 94,941 Total $ 516,274 $ 346,093 $ 1,354,682 $ 1,059,024 Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Product $ 471,627 $ 312,389 $ 1,238,480 $ 956,790 Services 44,647 33,704 116,202 102,234 Total $ 516,274 $ 346,093 $ 1,354,682 $ 1,059,024 Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 United States $ 197,205 $ 139,089 $ 530,240 $ 410,212 North America (excluding U.S.) 40,910 24,708 96,713 77,067 Asia 215,401 135,838 557,629 434,232 Europe 61,456 44,838 157,972 129,751 Other 1,302 1,620 12,128 7,762 Total $ 516,274 $ 346,093 $ 1,354,682 $ 1,059,024 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
INCOME TAXES | |
Schedule of tax expense and the effective tax rate for income from continuing operations | Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Income from continuing operations, before income taxes $ 86,512 $ 24,704 $ 186,341 $ 105,797 Provision for income taxes $ 11,639 $ 3,657 $ 29,795 $ 10,817 Effective tax rate 13.5 % 14.8 % 16.0 % 10.2 % |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
EARNINGS PER SHARE | |
Reconciliation of weighted-average shares outstanding used in calculation of basic and diluted EPS | Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Income from continuing operations $ 74,873 $ 21,047 $ 156,546 $ 94,980 Less: income from continuing operations attributable to noncontrolling interest 9 6 16 70 Income from continuing operations attributable to Advanced Energy Industries, Inc. $ 74,864 $ 21,041 $ 156,530 $ 94,910 Basic weighted-average common shares outstanding 37,379 38,183 37,482 38,296 Assumed exercise of dilutive stock options and restricted stock units 251 180 243 221 Diluted weighted-average common shares outstanding 37,630 38,363 37,725 38,517 Continuing operations: Basic earnings per share $ 2.00 $ 0.55 $ 4.18 $ 2.48 Diluted earnings per share $ 1.99 $ 0.55 $ 4.15 $ 2.46 |
Schedule of repurchase of shares of common stock | Three Months Ended September 30, Nine Months Ended September 30, (in thousands, except per share amounts) 2022 2021 2022 2021 Amount paid or accrued to repurchase shares $ 2,342 $ 52,555 $ 25,955 $ 59,058 Number of shares repurchased 34 605 346 677 Average repurchase price per share $ 69.39 $ 86.93 $ 75.07 $ 87.30 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
FAIR VALUE MEASUREMENTS | |
Schedule of assets and liabilities measured at fair value on a recurring basis | The following tables present information about our assets and liabilities measured at fair value on a recurring basis. September 30, 2022 Description Balance Sheet Classification Level 1 Level 2 Level 3 Total Fair Value Assets: Certificates of deposit Other current assets $ — $ 2,120 $ — $ 2,120 Foreign currency forward contracts Other current assets — 208 — 208 Interest rate swaps Deposits and other assets — 16,113 — 16,113 Total assets measured at fair value on a recurring basis $ — $ 18,441 $ — $ 18,441 Liabilities: Contingent consideration Other current liabilities $ — $ — $ 1,779 $ 1,779 Total liabilities measured at fair value on a recurring basis $ — $ — $ 1,779 $ 1,779 December 31, 2021 Description Balance Sheet Classification Level 1 Level 2 Level 3 Total Fair Value Assets: Certificates of deposit Other current assets $ — $ 2,296 $ — $ 2,296 Interest rate swaps Deposits and other assets — 2,739 — 2,739 Total assets measured at fair value on a recurring basis $ — $ 5,035 $ — $ 5,035 Liabilities: Contingent consideration Other current liabilities $ — $ — $ 1,738 $ 1,738 Total liabilities measured at fair value on a recurring basis $ — $ — $ 1,738 $ 1,738 |
DERIVATIVE FINANCIAL INSTRUME_2
DERIVATIVE FINANCIAL INSTRUMENTS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
DERIVATIVE FINANCIAL INSTRUMENTS | |
Schedule of notional amount of outstanding foreign currency forward contracts | The following table summarizes the notional amount of outstanding foreign currency forward contracts: September 30, December 31, 2022 2021 Foreign currency forward contracts $ 83,760 $ — |
Schedule of notional amount of qualified hedging instruments | The following table summarizes the notional amount of our qualified hedging instruments: September 30, December 31, 2022 2021 Interest rate swap contracts $ 242,594 $ 255,719 |
Schedule of balances recorded in Accumulated other comprehensive loss | The following table summarizes the balances recorded in accumulated other comprehensive loss on the Consolidated Balance Sheets for qualifying hedges. September 30, December 31, 2022 2021 Interest rate swap contract gains $ 12,427 $ 2,107 |
ACCOUNTS AND OTHER RECEIVABLE_2
ACCOUNTS AND OTHER RECEIVABLES, NET (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
ACCOUNTS AND OTHER RECEIVABLES, NET | |
Schedule of accounts and other receivable | September 30, December 31, 2022 2021 Amounts billed, net $ 289,007 $ 217,549 Unbilled receivables 18,011 19,678 Total receivables, net $ 307,018 $ 237,227 |
Schedule of expected credit losses | December 31, 2021 $ 5,784 Additions 441 Deductions - write-offs, net of recoveries (4,170) Foreign currency translation (30) September 30, 2022 $ 2,025 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
INVENTORIES | |
Schedule of components of inventories | September 30, December 31, 2022 2021 Parts and raw materials $ 311,748 $ 261,365 Work in process 28,860 24,222 Finished goods 68,814 52,823 Total $ 409,422 $ 338,410 |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
PROPERTY AND EQUIPMENT, NET | |
Schedule of property and equipment, net | Estimated Useful September 30, December 31, Life (in years) 2022 2021 Buildings, machinery, and equipment 5 to 25 $ 149,877 $ 134,635 Computer equipment, furniture, fixtures, and vehicles 3 to 5 34,557 33,490 Leasehold improvements 2 to 10 61,804 48,370 Construction in process 16,787 5,914 263,025 222,409 Less: Accumulated depreciation (126,523) (107,579) Property and equipment, net $ 136,502 $ 114,830 |
Schedule of depreciation expense recorded in continuing operations | The following table summarizes depreciation expense. All depreciation expense is recorded in income from continuing operations: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Depreciation expense $ 8,507 $ 7,874 $ 25,352 $ 22,721 |
GOODWILL (Tables)
GOODWILL (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
GOODWILL AND INTANGIBLE ASSETS | |
Schedule of changes in goodwill | December 31, 2021 $ 212,190 Measurement period adjustments 40 Additions from acquisition 71,003 Foreign currency translation (4,007) September 30, 2022 $ 279,226 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
GOODWILL AND INTANGIBLE ASSETS | |
Schedule of intangible assets | September 30, 2022 Gross Carrying Accumulated Net Carrying Amount Amortization Amount Technology $ 96,027 $ (43,146) $ 52,881 Customer relationships 166,018 (40,325) 125,693 Trademarks and other 26,864 (9,631) 17,233 Total $ 288,909 $ (93,102) $ 195,807 December 31, 2021 Gross Carrying Accumulated Net Carrying Amount Amortization Amount Technology $ 91,461 $ (35,854) $ 55,607 Customer relationships 118,706 (34,187) 84,519 Trademarks and other 27,244 (7,964) 19,280 Total $ 237,411 $ (78,005) $ 159,406 |
Schedule of amortization expense related to intangible assets | Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Amortization expense $ 7,049 $ 5,607 $ 19,081 $ 16,504 |
Schedule of estimated amortization expense related to intangible assets | Year Ending December 31, 2022 (remaining) $ 7,014 2023 28,058 2024 25,072 2025 20,905 2026 19,189 Thereafter 95,569 Total $ 195,807 |
RESTRUCTURING COSTS (Tables)
RESTRUCTURING COSTS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
RESTRUCTURING COSTS | |
Schedule of restructuring charges | Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Severance and related charges $ 121 $ 676 $ 833 $ 1,270 Facility relocation and closure charges — 596 345 1,251 Total restructuring charges $ 121 $ 1,272 $ 1,178 $ 2,521 Cumulative Cost Through September 30, 2022 Severance and related charges $ 21,213 Facility relocation and closure charges 7,160 Total restructuring charges $ 28,373 |
Schedule of restructuring liabilities | December 31, 2021 $ 9,263 Costs incurred and charged to expense 1,178 Costs paid or otherwise settled (8,623) Effects of changes in exchange rate (24) September 30, 2022 $ 1,794 |
WARRANTIES (Tables)
WARRANTIES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
WARRANTIES | |
Schedule of changes in accrued product warranties | December 31, 2021 $ 3,350 Additions from acquisitions 181 Increases to accruals 4,820 Warranty expenditures (2,431) Effect of changes in exchange rates (98) September 30, 2022 $ 5,822 |
LEASES (Tables)
LEASES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
LEASES | |
Components of operating lease cost | Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Operating lease cost $ 5,613 $ 5,735 $ 17,061 $ 17,708 Short-term and variable lease cost 1,177 578 3,516 1,704 Total operating lease cost $ 6,790 $ 6,313 $ 20,577 $ 19,412 |
Schedule of maturities of operating lease liabilities | Year Ending December 31, 2022 (remaining) $ 5,421 2023 20,029 2024 17,518 2025 14,515 2026 13,190 Thereafter 68,353 Total lease payments 139,026 Less: Interest (28,152) Present value of lease liabilities $ 110,874 |
Schedule of other information related to leases | September 30, December 31, 2022 2021 Weighted average remaining lease term (in years) 9.1 9.8 Weighted average discount rate 4.6 % 4.5 % Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Cash paid for operating leases $ 5,557 $ 6,058 $ 16,642 $ 18,037 Right-of-use assets obtained in exchange for operating lease liabilities $ 2,222 $ 7,169 $ 14,433 $ 14,402 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
STOCK-BASED COMPENSATION | |
Summary of information related to stock-based incentive compensation plans | September 30, 2022 Shares available for future issuance under the 2017 Omnibus Incentive Plan 1,536 Shares available for future issuance under the Employee Stock Purchase Plan 642 |
Schedule of stock-based compensation | Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Stock-based compensation expense $ 6,022 $ 3,674 $ 15,008 $ 12,819 |
Summary of changes in RSUs | Nine Months Ended September 30, 2022 Weighted- Average Number of Grant Date RSUs Fair Value RSUs outstanding at beginning of period 627 $ 76.37 RSUs granted 525 $ 73.38 RSUs vested (145) $ 84.99 RSUs forfeited (248) $ 60.74 RSUs outstanding at end of period 759 $ 77.77 |
Summary of changes in stock options | Nine Months Ended September 30, 2022 Weighted- Average Number of Exercise Price Options per Share Options outstanding at beginning of period 112 $ 24.41 Options granted 76 $ 85.97 Options exercised (25) $ 23.30 Options outstanding at end of period 163 $ 53.10 |
CREDIT FACILITY (Tables)
CREDIT FACILITY (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
CREDIT FACILITY | |
Schedule of borrowings under credit facility | September 30, 2022 Balance Interest Rate Unused Line Fee Term Loan Facility subject to a fixed interest rate $ 242,594 1.271% — Term Loan Facility subject to a variable interest rate 137,406 3.865% — Revolving Facility subject to a variable interest rate — 3.865% 0.10% Total borrowings under the Credit Agreement $ 380,000 |
Schedule of availability to withdraw on Revolving Facility | September 30, December 31, 2022 2021 Available capacity on Revolving Facility $ 200,000 $ 200,000 |
Schedule of debt obligation | September 30, December 31, 2022 2021 Term Loan Facility $ 380,000 $ 395,000 Less: debt discount (1,868) (2,267) Total debt 378,132 392,733 Less current portion of long-term debt (20,000) (20,000) Total long-term debt $ 358,132 $ 372,733 |
Schedule of contractual maturities of debt obligations | Year Ending December 31, 2022 (remaining) $ 5,000 2023 20,000 2024 20,000 2025 20,000 2026 315,000 Total $ 380,000 |
Schedule of interest expense and unused line of credit fees | Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Interest expense $ 1,842 $ 1,009 $ 4,303 $ 2,973 Amortization of debt issuance costs 136 420 413 669 Unused line of credit fees and other 51 41 152 116 Total interest expense $ 2,029 $ 1,470 $ 4,868 $ 3,758 |
ACQUISITIONS - Consideration Tr
ACQUISITIONS - Consideration Transferred (Details) - USD ($) $ in Thousands | Apr. 25, 2022 | Jun. 01, 2021 | Sep. 30, 2022 |
SL Power Electronics Corporation | |||
Business Acquisition [Line Items] | |||
Cash paid | $ 146,863 | ||
Less cash acquired | (3,484) | ||
Total fair value of purchase consideration | $ 143,379 | $ 143,379 | |
Acquired percentage | 100% | ||
TEGAM, Inc. | |||
Business Acquisition [Line Items] | |||
Cash paid | $ 15,430 | ||
Cash paid for indemnity holdback released in June 2022 | 1,800 | ||
Less cash acquired | (177) | ||
Total fair value of purchase consideration | $ 17,053 | ||
Acquired percentage | 100% |
ACQUISITIONS - Assets Acquired
ACQUISITIONS - Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Apr. 25, 2022 | Jun. 01, 2021 |
SL Power Electronics Corporation | |||
Business Acquisition [Line Items] | |||
Current assets and liabilities, net | $ 12,013 | ||
Property and equipment | 3,927 | ||
Operating lease right-of-use assets | 4,996 | ||
Deferred taxes and other liabilities | (1,164) | ||
Intangible assets | 57,600 | ||
Goodwill | 71,003 | ||
Operating lease liability | (4,996) | ||
Total fair value of net assets acquired | $ 143,379 | $ 143,379 | |
TEGAM, Inc. | |||
Business Acquisition [Line Items] | |||
Current assets and liabilities, net | $ 3,475 | ||
Property and equipment | 755 | ||
Operating lease right-of-use assets | 425 | ||
Intangible assets | 6,900 | ||
Goodwill | 5,917 | ||
Other | 6 | ||
Operating lease liability | (425) | ||
Total fair value of net assets acquired | $ 17,053 |
ACQUISITIONS - Intangible Asset
ACQUISITIONS - Intangible Assets Acquired (Details) - SL Power Electronics Corporation $ in Thousands | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
Business Acquisition [Line Items] | |
Intangible assets | $ 57,600 |
Goodwill expected to be deductible (percent) | 85% |
Customer Relationships | |
Business Acquisition [Line Items] | |
Intangible assets | $ 50,500 |
Intangible assets useful life | 10 years |
Technology | |
Business Acquisition [Line Items] | |
Intangible assets | $ 7,100 |
Intangible assets useful life | 5 years |
ACQUISITIONS - Summary of Reven
ACQUISITIONS - Summary of Revenue from SL Power Acquisition (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Business Acquisition [Line Items] | ||||
Sales, net | $ 516,274 | $ 346,093 | $ 1,354,682 | $ 1,059,024 |
SL Power Electronics Corporation | ||||
Business Acquisition [Line Items] | ||||
Sales, net | $ 16,659 | $ 29,604 |
REVENUE - Revenue by Product Li
REVENUE - Revenue by Product Line (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 516,274 | $ 346,093 | $ 1,354,682 | $ 1,059,024 |
Sales Revenue, Net | Customer Concentration Risk | Applied Materials, Inc. | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of total revenue | 19% | 22% | 20% | 21% |
Sales Revenue, Net | Customer Concentration Risk | Lam Research Corporation | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of total revenue | 15% | 11% | 14% | 10% |
United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 197,205 | $ 139,089 | $ 530,240 | $ 410,212 |
North America (excluding U.S.) | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 40,910 | 24,708 | 96,713 | 77,067 |
Asia | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 215,401 | 135,838 | 557,629 | 434,232 |
Europe | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 61,456 | 44,838 | 157,972 | 129,751 |
Other countries | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 1,302 | 1,620 | 12,128 | 7,762 |
Semiconductor Equipment | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 266,600 | 173,441 | 698,354 | 530,828 |
Industrial and Medical | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 119,587 | 80,800 | 307,436 | 242,412 |
Data Center Computing | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 87,542 | 62,231 | 232,941 | 190,843 |
Telecom and Networking | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 42,545 | 29,621 | 115,951 | 94,941 |
Product | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 471,627 | 312,389 | 1,238,480 | 956,790 |
Service | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 44,647 | $ 33,704 | $ 116,202 | $ 102,234 |
INCOME TAXES - Schedule of Tax
INCOME TAXES - Schedule of Tax Expense and Effective Tax Rate for Income from Continuing Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
INCOME TAXES | ||||
Income from continuing operations, before income taxes | $ 86,512 | $ 24,704 | $ 186,341 | $ 105,797 |
Provision for income taxes | $ 11,639 | $ 3,657 | $ 29,795 | $ 10,817 |
Effective tax rate | 13.50% | 14.80% | 16% | 10.20% |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
INCOME TAXES | ||||
Federal statutory tax rate | 21% | 21% | 21% | 21% |
EARNINGS PER SHARE - Reconcilia
EARNINGS PER SHARE - Reconciliation of Weighted-average Shares Outstanding Used in Calculation of Basic and Diluted EPS (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
EARNINGS PER SHARE | ||||
Income from continuing operations | $ 74,873 | $ 21,047 | $ 156,546 | $ 94,980 |
Less: income from continuing operations attributable to noncontrolling interest | 9 | 6 | 16 | 70 |
Income from continuing operations attributable to Advanced Energy Industries, Inc. | $ 74,864 | $ 21,041 | $ 156,530 | $ 94,910 |
Basic weighted-average common shares outstanding | 37,379 | 38,183 | 37,482 | 38,296 |
Assumed exercise of dilutive stock options and restricted stock units | 251 | 180 | 243 | 221 |
Diluted weighted-average common shares outstanding | 37,630 | 38,363 | 37,725 | 38,517 |
Continuing operations: | ||||
Basic earnings per share | $ 2 | $ 0.55 | $ 4.18 | $ 2.48 |
Diluted earnings per share | $ 1.99 | $ 0.55 | $ 4.15 | $ 2.46 |
EARNINGS PER SHARE - Share Repu
EARNINGS PER SHARE - Share Repurchase (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Jul. 31, 2022 | |
EARNINGS PER SHARE | ||||||||
Amount paid or accrued to repurchase shares | $ 2,342 | $ 17,019 | $ 6,594 | $ 52,555 | $ 6,503 | $ 25,955 | $ 59,058 | |
Number of shares repurchased | 34,000 | 605,000 | 346,000 | 677,000 | ||||
Average repurchase price per share | $ 69.39 | $ 86.93 | $ 75.07 | $ 87.30 | ||||
Shares repurchased from related parties | 0 | |||||||
Remaining authorized by Board of Directors for future repurchases as of period end | $ 200,000 | $ 200,000 | ||||||
Stock repurchase plan authorized amount | $ 200,000 |
FAIR VALUE MEASUREMENTS - Asset
FAIR VALUE MEASUREMENTS - Assets and Liabilities Measured at Fair Value (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | $ 18,441 | $ 5,035 |
Total liabilities | 1,779 | 1,738 |
Contingent Consideration | Other Current Liabilities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities | 1,779 | 1,738 |
Certificates of Deposit | Other Current Assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | 2,120 | 2,296 |
Foreign Currency Forward Contracts | Other Current Assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | 208 | |
Interest Rate Swaps | Deposits and Other Assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | 16,113 | 2,739 |
Fair Value, Inputs, Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | 18,441 | 5,035 |
Fair Value, Inputs, Level 2 | Certificates of Deposit | Other Current Assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | 2,120 | 2,296 |
Fair Value, Inputs, Level 2 | Foreign Currency Forward Contracts | Other Current Assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | 208 | |
Fair Value, Inputs, Level 2 | Interest Rate Swaps | Deposits and Other Assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | 16,113 | 2,739 |
Fair Value, Inputs, Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities | 1,779 | 1,738 |
Fair Value, Inputs, Level 3 | Contingent Consideration | Other Current Liabilities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities | $ 1,779 | $ 1,738 |
FAIR VALUE MEASUREMENTS - Narra
FAIR VALUE MEASUREMENTS - Narrative (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 | Dec. 31, 2021 | |
FAIR VALUE MEASUREMENTS | ||
Transfer into Level 3, Liabilities | $ 0 | $ 0 |
Transfer from Level 3, Liabilities | 0 | 0 |
Transfer into Level 3, Assets | 0 | 0 |
Transfer from Level 3, Assets | $ 0 | $ 0 |
DERIVATIVE FINANCIAL INSTRUME_3
DERIVATIVE FINANCIAL INSTRUMENTS (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Annual interest (as a percent) | 1.271% |
Average fixed rate | 0.521% |
Cash Flow Hedge | Designated as Hedging Instrument | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Basis points at current leverage ratios | 75 |
Foreign Exchange Forward | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Derivative, notional amount | $ 83,760 |
DERIVATIVE FINANCIAL INSTRUME_4
DERIVATIVE FINANCIAL INSTRUMENTS - Qualified Hedging Instruments (Details) - Interest Rate Swaps - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 | Dec. 31, 2021 | |
Derivative [Line Items] | ||
Derivative, notional amount | $ 242,594 | $ 255,719 |
Balances recorded in accumulated other comprehensive loss | $ 12,427 | $ 2,107 |
ACCOUNTS AND OTHER RECEIVABLE_3
ACCOUNTS AND OTHER RECEIVABLES, NET (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total receivables, net | $ 307,018 | $ 237,227 |
Amounts billed, net | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total receivables, net | 289,007 | 217,549 |
Unbilled receivables | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total receivables, net | $ 18,011 | $ 19,678 |
ACCOUNTS AND OTHER RECEIVABLE_4
ACCOUNTS AND OTHER RECEIVABLES, NET - Expected Credit Losses - (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
ACCOUNTS AND OTHER RECEIVABLES, NET | |
Balance as of beginning of period | $ 5,784 |
Additions | 441 |
Deductions - write-offs, net of recoveries | (4,170) |
Foreign currency translation | (30) |
Balance as of end of period | $ 2,025 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
INVENTORIES | ||
Parts and raw materials | $ 311,748 | $ 261,365 |
Work in process | 28,860 | 24,222 |
Finished goods | 68,814 | 52,823 |
Total | $ 409,422 | $ 338,410 |
PROPERTY AND EQUIPMENT, NET (De
PROPERTY AND EQUIPMENT, NET (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 263,025 | $ 222,409 |
Less: Accumulated depreciation | (126,523) | (107,579) |
Property and equipment, net | 136,502 | 114,830 |
Buildings, machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 149,877 | $ 134,635 |
Buildings, machinery and equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 5 years | 5 years |
Buildings, machinery and equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 25 years | 25 years |
Computer equipment, furniture, fixtures, and vehicles | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 3 years | 3 years |
Computer equipment, furniture, fixtures, and vehicles | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 5 years | 5 years |
Computer and communication equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 34,557 | $ 33,490 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 61,804 | $ 48,370 |
Leasehold improvements | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 2 years | 2 years |
Leasehold improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 10 years | 10 years |
Construction in process | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 16,787 | $ 5,914 |
PROPERTY AND EQUIPMENT, NET - D
PROPERTY AND EQUIPMENT, NET - Depreciation Expense Recorded in Continuing Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
PROPERTY AND EQUIPMENT, NET | ||||
Depreciation expense | $ 8,507 | $ 7,874 | $ 25,352 | $ 22,721 |
GOODWILL - Changes in Goodwill
GOODWILL - Changes in Goodwill (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
GOODWILL AND INTANGIBLE ASSETS | |
Balance at beginning of period | $ 212,190 |
Measurement period adjustments | 40 |
Additions from acquisition | 71,003 |
Foreign currency translation | (4,007) |
Balance at end of period | $ 279,226 |
INTANGIBLE ASSETS (Details)
INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Dec. 31, 2021 | |
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | $ 288,909 | $ 237,411 |
Finite-Lived Intangible Assets, Accumulated Amortization | (93,102) | (78,005) |
Finite-lived intangible assets, net | $ 195,807 | 159,406 |
Amortization of weighted average remaining useful life | 9 years 3 months 18 days | |
Technology. | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | $ 96,027 | 91,461 |
Finite-Lived Intangible Assets, Accumulated Amortization | (43,146) | (35,854) |
Finite-lived intangible assets, net | 52,881 | 55,607 |
Customer Relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 166,018 | 118,706 |
Finite-Lived Intangible Assets, Accumulated Amortization | (40,325) | (34,187) |
Finite-lived intangible assets, net | 125,693 | 84,519 |
Trademarks and other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 26,864 | 27,244 |
Finite-Lived Intangible Assets, Accumulated Amortization | (9,631) | (7,964) |
Finite-lived intangible assets, net | $ 17,233 | $ 19,280 |
INTANGIBLE ASSETS - Amortizatio
INTANGIBLE ASSETS - Amortization Expense Related to Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
GOODWILL AND INTANGIBLE ASSETS | ||||
Amortization expense | $ 7,049 | $ 5,607 | $ 19,081 | $ 16,504 |
INTANGIBLE ASSETS - Estimated A
INTANGIBLE ASSETS - Estimated Amortization Expense (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
GOODWILL AND INTANGIBLE ASSETS | ||
2022 (remaining) | $ 7,014 | |
2023 | 28,058 | |
2024 | 25,072 | |
2025 | 20,905 | |
2026 | 19,189 | |
Thereafter | 95,569 | |
Finite-lived intangible assets, net | $ 195,807 | $ 159,406 |
RESTRUCTURING COSTS - Restructu
RESTRUCTURING COSTS - Restructuring Charges (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 57 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | |
Restructuring Cost and Reserve [Line Items] | |||||
Total restructuring charges | $ 121 | $ 1,272 | $ 1,178 | $ 2,521 | $ 28,373 |
Severance and related charges | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Total restructuring charges | $ 121 | 676 | 833 | 1,270 | 21,213 |
Facility relocation and closure charges | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Total restructuring charges | $ 596 | $ 345 | $ 1,251 | $ 7,160 |
RESTRUCTURING COSTS - Changes i
RESTRUCTURING COSTS - Changes in Restructuring Liabilities (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 57 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | |
Restructuring Reserve [Roll Forward] | |||||
Beginning balance | $ 9,263 | ||||
Cost incurred and charged to expense | $ 121 | $ 1,272 | 1,178 | $ 2,521 | $ 28,373 |
Cost paid or otherwise settled | (8,623) | ||||
Effects of changes in exchange rate | (24) | ||||
Ending balance | $ 1,794 | $ 1,794 | $ 1,794 |
WARRANTIES - Narrative (Details
WARRANTIES - Narrative (Details) | 9 Months Ended |
Sep. 30, 2022 | |
Minimum | |
Product Liability Contingency [Line Items] | |
Standard Product Warranty Term | 12 months |
Maximum | |
Product Liability Contingency [Line Items] | |
Standard Product Warranty Term | 24 months |
WARRANTIES - Changes in Product
WARRANTIES - Changes in Product Warranty Obligation (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
Movement in Standard Product Warranty Accrual [Roll Forward] | |
Balance at beginning of period | $ 3,350 |
Additions from acquisitions | 181 |
Increases to accruals | 4,820 |
Warranty expenditures | (2,431) |
Effect of changes in exchange rates | (98) |
Balance at end of period | $ 5,822 |
LEASES - Components of Operatin
LEASES - Components of Operating Lease Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
LEASES | ||||
Operating lease cost | $ 5,613 | $ 5,735 | $ 17,061 | $ 17,708 |
Short-term and variable lease cost | 1,177 | 578 | 3,516 | 1,704 |
Total operating lease cost | $ 6,790 | $ 6,313 | $ 20,577 | $ 19,412 |
LEASES - Maturities of Operatin
LEASES - Maturities of Operating Lease Liabilities (Details) $ in Thousands | Sep. 30, 2022 USD ($) |
LEASES | |
2022 (remaining) | $ 5,421 |
2023 | 20,029 |
2024 | 17,518 |
2025 | 14,515 |
2026 | 13,190 |
Thereafter | 68,353 |
Total lease payments | 139,026 |
Less: Interest | (28,152) |
Present value of lease liabilities | $ 110,874 |
LEASES - Other Lease Cost Infor
LEASES - Other Lease Cost Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
LEASES | |||||
Weighted average remaining lease term (in years) | 9 years 1 month 6 days | 9 years 1 month 6 days | 9 years 9 months 18 days | ||
Weighted average discount rate | 4.60% | 4.60% | 4.50% | ||
Cash paid for operating leases | $ 5,557 | $ 6,058 | $ 16,642 | $ 18,037 | |
Right-of-use assets obtained in exchange for operating lease liabilities | $ 2,222 | $ 7,169 | $ 14,433 | $ 14,402 |
STOCK-BASED COMPENSATION - Narr
STOCK-BASED COMPENSATION - Narrative (Details) | 9 Months Ended |
Sep. 30, 2022 plan shares | |
Number of active stock-based incentive compensation plans | plan | 2 |
2017 OMNIBUS Incentive Plan | |
Shares available for future issuance | 1,536 |
Restricted Stock Units (RSUs) | Minimum | |
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 3 years |
Stock Option Awards | |
Awards term | 10 years |
Stock Option Awards | Minimum | |
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 3 years |
Stock Option Awards | Maximum | |
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 4 years |
Employee Stock | |
Shares available for future issuance | 642 |
STOCK-BASED COMPENSATION - Stoc
STOCK-BASED COMPENSATION - Stock-Based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
STOCK-BASED COMPENSATION | ||||
Stock-based compensation expense | $ 6,022 | $ 3,674 | $ 15,008 | $ 12,819 |
STOCK-BASED COMPENSATION - Summ
STOCK-BASED COMPENSATION - Summary of Restricted Stock Units activity (Details) - Restricted Stock Units (RSUs) shares in Thousands | 9 Months Ended |
Sep. 30, 2022 $ / shares shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Outstanding at the beginning of period | shares | 627 |
Granted | shares | 525 |
Vested | shares | (145) |
Forfeited | shares | (248) |
Outstanding at the end of period | shares | 759 |
Weighted Average Grant Date Fair Value, Beginning Balance | $ / shares | $ 76.37 |
Weighted Average Grant Date Fair Value, Granted | $ / shares | 73.38 |
Weighted Average Grant Date Fair Value, Vested | $ / shares | 84.99 |
Weighted Average Grant Date Fair Value, Forfeited | $ / shares | 60.74 |
Weighted Average Grant Date Fair Value, Ending Balance | $ / shares | $ 77.77 |
STOCK-BASED COMPENSATION - Su_2
STOCK-BASED COMPENSATION - Summary of Stock Option Activity (Details) - Time Based shares in Thousands | 9 Months Ended |
Sep. 30, 2022 $ / shares shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options outstanding at beginning of period | shares | 112 |
Options granted | shares | 76 |
Options exercised | shares | (25) |
Options outstanding at ending of period | shares | 163 |
Weighted-Average Exercise Price per Share, Options outstanding at beginning of period | $ / shares | $ 24.41 |
Weighted-Average Exercise Price per Share, Options granted | $ / shares | 85.97 |
Weighted-Average Exercise Price per Share, Options exercised | $ / shares | 23.30 |
Weighted-Average Exercise Price per Share, Options outstanding at end of period | $ / shares | $ 53.10 |
CREDIT FACILITY (Details)
CREDIT FACILITY (Details) - USD ($) $ in Thousands | 1 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2022 | Dec. 31, 2021 | Sep. 30, 2019 | |
Line of Credit Facility [Line Items] | ||||
Additional borrowings | $ 85,000 | |||
Balance | 400,000 | $ 380,000 | ||
Fair value of long-term debt | 380,000 | |||
Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit facility, borrowing capacity | $ 500,000 | |||
Increase in borrowing capacity | 250,000 | |||
Available capacity | 200,000 | $ 200,000 | ||
Term Loan Facility | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit facility, borrowing capacity | 350,000 | |||
Balance | 380,000 | $ 395,000 | ||
Unsecured Revolving Facility | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit facility, borrowing capacity | 200,000 | $ 150,000 | ||
Increase in borrowing capacity | $ 50,000 | |||
Term Loan, Fixed Interest Rate | ||||
Line of Credit Facility [Line Items] | ||||
Balance | $ 242,594 | |||
Interest Rate | 1.271% | |||
Term Loan, Variable Interest Rate | ||||
Line of Credit Facility [Line Items] | ||||
Balance | $ 137,406 | |||
Interest Rate | 3.865% | |||
Revolving Facility, Variable Interest Rate | ||||
Line of Credit Facility [Line Items] | ||||
Interest Rate | 3.865% | |||
Unused Line Fee | 0.10% |
CREDIT FACILITY - Debt Obligati
CREDIT FACILITY - Debt Obligation (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 | Sep. 30, 2021 |
Debt: | |||
Term Loan Facility | $ 380,000 | $ 400,000 | |
Less: debt discount | (1,868) | $ (2,267) | |
Total debt | 378,132 | 392,733 | |
Less current portion of long-term debt | (20,000) | (20,000) | |
Total long-term debt | 358,132 | 372,733 | |
Term Loan Facility | |||
Debt: | |||
Term Loan Facility | $ 380,000 | $ 395,000 |
CREDIT FACILITY - Contractual M
CREDIT FACILITY - Contractual Maturities (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Sep. 30, 2021 |
CREDIT FACILITY | ||
2022 (remaining) | $ 5,000 | |
2023 | 20,000 | |
2024 | 20,000 | |
2025 | 20,000 | |
2026 | 315,000 | |
Total | $ 380,000 | $ 400,000 |
CREDIT FACILITY - Interest Expe
CREDIT FACILITY - Interest Expense and Unused Line of Credit Fees (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
CREDIT FACILITY | ||||
Interest expense | $ 1,842 | $ 1,009 | $ 4,303 | $ 2,973 |
Amortization of debt issuance costs | 136 | 420 | 413 | 669 |
Unused line of credit fees and other | 51 | 41 | 152 | 116 |
Total interest expense | $ 2,029 | $ 1,470 | $ 4,868 | $ 3,758 |