Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | Apr. 30, 2019 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | AXON ENTERPRISE, INC. | |
Entity Central Index Key | 0001069183 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Entity Common Stock, Shares Outstanding | 59,127,439 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 223,642 | $ 349,462 |
Short-term investments | 105,312 | 0 |
Accounts and notes receivable, net of allowance of $2,355 and $1,882 as of March 31, 2019 and December 31, 2018, respectively | 149,096 | 130,579 |
Contract assets, net | 17,945 | 13,960 |
Inventory | 37,587 | 33,763 |
Prepaid expenses and other current assets | 33,340 | 30,391 |
Total current assets | 566,922 | 558,155 |
Property and equipment, net of accumulated depreciation of $41,707 and $39,885 as of March 31, 2019 and December 31, 2018, respectively | 41,347 | 37,893 |
Deferred income tax assets, net | 18,770 | 19,347 |
Intangible assets, net | 15,067 | 15,935 |
Goodwill | 25,017 | 24,981 |
Long-term notes receivable, net of current portion | 36,316 | 40,230 |
Other assets | 35,756 | 22,999 |
Total assets | 739,195 | 719,540 |
Current liabilities: | ||
Accounts payable | 9,865 | 15,164 |
Accrued liabilities | 36,348 | 41,092 |
Contract with customer, liability, current | 110,063 | 107,016 |
Other current liabilities | 3,914 | 37 |
Total current liabilities | 163,794 | 166,011 |
Deferred revenue, net of current portion | 74,784 | 74,417 |
Liability for unrecognized tax benefits | 3,156 | 2,849 |
Long-term deferred compensation | 3,675 | 3,235 |
Other long-term liabilities | 13,247 | 5,704 |
Total liabilities | 258,656 | 252,216 |
Commitments and contingencies (Note 12) | ||
Stockholders’ equity: | ||
Preferred stock, $0.00001 par value; 25,000,000 shares authorized; no shares issued and outstanding as of March 31, 2019 and December 31, 2018 | 0 | 0 |
Common stock, $0.00001 par value; 200,000,000 shares authorized; 59,109,286 and 58,810,637 shares issued and outstanding as of March 31, 2019 and December 31, 2018, respectively | 1 | 1 |
Additional paid-in capital | 460,146 | 453,400 |
Treasury stock at cost, 20,220,227 shares as of March 31, 2019 and December 31, 2018 | (155,947) | (155,947) |
Retained earnings | 177,802 | 171,383 |
Accumulated other comprehensive loss | (1,463) | (1,513) |
Total stockholders’ equity | 480,539 | 467,324 |
Total liabilities and stockholders’ equity | 739,195 | 719,540 |
Current portion of deferred revenue | ||
Current liabilities: | ||
Contract with customer, liability, current | 110,063 | 107,016 |
Customer deposits | ||
Current liabilities: | ||
Contract with customer, liability, current | $ 3,604 | $ 2,702 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Allowance on accounts receivable | $ 2,355 | $ 1,882 |
Accumulated depreciation | $ 41,707 | $ 39,885 |
Preferred stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized (in shares) | 25,000,000 | 25,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized (in shares) | 200,000,000 | 200,000,000 |
Common stock, shares issued (in shares) | 59,109,286 | 58,810,637 |
Common stock, shares outstanding (in shares) | 59,109,286 | 58,810,637 |
Treasury stock, shares (in shares) | 20,220,227 | 20,220,227 |
Unaudited Condensed Consolidate
Unaudited Condensed Consolidated Statements of Operations and Comprehensive Income - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Net sales | $ 115,810 | $ 101,215 |
Cost of sales | 46,893 | 36,754 |
Gross margin | 68,917 | 64,461 |
Operating expenses: | ||
Sales, general and administrative | 42,892 | 35,759 |
Research and development | 23,354 | 15,119 |
Total operating expenses | 66,246 | 50,878 |
Income from operations | 2,671 | 13,583 |
Interest and other income, net | 2,313 | 1,263 |
Income before provision for income taxes | 4,984 | 14,846 |
Provision for (benefit from) income taxes | (1,435) | 1,920 |
Net income | $ 6,419 | $ 12,926 |
Net income per common and common equivalent shares: | ||
Basic (in dollars per share) | $ 0.11 | $ 0.24 |
Diluted (in dollars per share) | $ 0.11 | $ 0.24 |
Weighted average number of common and common equivalent shares outstanding: | ||
Basic (in shares) | 58,914 | 53,119 |
Diluted (in shares) | 59,751 | 54,532 |
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||
Net income | $ 6,419 | $ 12,926 |
Foreign currency translation adjustments | 50 | (707) |
Comprehensive income | 6,469 | 12,219 |
Product | ||
Net sales | 88,089 | 80,974 |
Cost of sales | 39,600 | 32,434 |
Service | ||
Net sales | 27,721 | 20,241 |
Cost of sales | $ 7,293 | $ 4,320 |
Unaudited Condensed Consolida_2
Unaudited Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Treasury Stock | Retained Earnings | Accumulated Other Comprehensive Income (Loss) |
Beginning balance (in shares) at Dec. 31, 2017 | 52,969,869 | 20,220,227 | ||||
Beginning balance at Dec. 31, 2017 | $ 167,444 | $ 1 | $ 201,672 | $ (155,947) | $ 123,185 | $ (1,467) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock under employee plans (in shares) | 337,214 | |||||
Issuance of common stock under employee plans | (3,421) | (3,421) | ||||
Stock-based compensation | 4,093 | 4,093 | ||||
Net income | 12,926 | 12,926 | ||||
Foreign currency translation adjustments | (707) | (707) | ||||
Ending balance (in shares) at Mar. 31, 2018 | 53,307,083 | 20,220,227 | ||||
Ending balance at Mar. 31, 2018 | 199,329 | $ 1 | 202,344 | $ (155,947) | 155,105 | (2,174) |
Beginning balance (in shares) at Dec. 31, 2018 | 58,810,637 | 20,220,227 | ||||
Beginning balance at Dec. 31, 2018 | 467,324 | $ 1 | 453,400 | $ (155,947) | 171,383 | (1,513) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock under employee plans (in shares) | 298,649 | |||||
Issuance of common stock under employee plans | (1,159) | (1,159) | ||||
Stock-based compensation | 7,905 | 7,905 | ||||
Net income | 6,419 | 6,419 | ||||
Foreign currency translation adjustments | 50 | 50 | ||||
Ending balance (in shares) at Mar. 31, 2019 | 59,109,286 | 20,220,227 | ||||
Ending balance at Mar. 31, 2019 | $ 480,539 | $ 1 | $ 460,146 | $ (155,947) | $ 177,802 | $ (1,463) |
Unaudited Condensed Consolida_3
Unaudited Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Cash flows from operating activities: | ||
Net income | $ 6,419 | $ 12,926 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 2,800 | 2,411 |
Loss on disposal and impairment of property and equipment, net | 242 | 34 |
Loss on disposal and abandonment of intangible assets | 18 | 0 |
Stock-based compensation | 7,905 | 4,093 |
Deferred income taxes | 577 | 1,514 |
Unrecognized tax benefits | 307 | 104 |
Other noncash, net | 896 | 22 |
Change in assets and liabilities: | ||
Accounts and notes receivable and contract assets | (21,994) | (17,060) |
Inventory | (3,936) | 2,408 |
Prepaid expenses and other assets | (3,152) | (1,702) |
Accounts payable, accrued and other liabilities | (7,284) | 6,740 |
Deferred revenue | 3,232 | 6,554 |
Net cash provided by (used in) operating activities | (13,970) | 18,044 |
Cash flows from investing activities: | ||
Purchases of investments | (105,322) | (802) |
Proceeds from maturity/call of investments | 0 | 3,167 |
Purchases of property and equipment | (5,271) | (1,063) |
Purchases of intangible assets | (162) | (34) |
Net cash provided by (used in) investing activities | (110,755) | 1,268 |
Cash flows from financing activities: | ||
Proceeds from options exercised | 100 | 356 |
Income and payroll tax payments for net-settled stock awards | (1,259) | (3,777) |
Net cash used in financing activities | (1,159) | (3,421) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 67 | 469 |
Net increase (decrease) in cash, cash equivalents and restricted cash | (125,817) | 16,360 |
Cash, cash equivalents and restricted cash, beginning of period | 351,027 | 78,438 |
Cash, cash equivalents and restricted cash, end of period | 225,210 | 94,798 |
Supplemental disclosures: | ||
Cash and cash equivalents | 223,642 | 92,330 |
Total cash, cash equivalents and restricted cash shown in the statements of cash flows | 351,027 | 78,438 |
Cash paid for income taxes, net of refunds | 758 | 63 |
Non-cash transactions | ||
Property and equipment purchases in accounts payable and accrued liabilities | $ 328 | $ 136 |
Organization and Summary of Sig
Organization and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Summary of Significant Accounting Policies | Organization and Summary of Significant Accounting Policies Axon Enterprise, Inc. (“Axon,” the “Company,” "we," or "us") is a market-leading provider of law enforcement technology solutions. Our core mission is to protect life. We fulfill that mission through developing hardware and software products that advance the long term objectives of a) obsoleting the bullet, b) reducing social conflict, and c) enabling a fair and effective justice system. Our headquarters in Scottsdale, Arizona houses our executive management, sales, marketing, certain engineering, manufacturing, and other administrative support functions. We also have a software engineering development center located in Seattle, Washington, and subsidiaries located in Australia, Canada, Finland, Hong Kong, Germany, India, the Netherlands, the United Kingdom, and Vietnam. The accompanying unaudited condensed consolidated financial statements include the accounts of Axon Enterprise, Inc. and our wholly owned subsidiaries. All material intercompany accounts, transactions, and profits have been eliminated. Basis of Presentation and Use of Estimates These unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the SEC. Certain information related to our organization, significant accounting policies and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) has been condensed or omitted. The accounting policies followed in the preparation of these unaudited condensed consolidated financial statements are consistent with those followed in our annual consolidated financial statements for the year ended December 31, 2018 , as filed on Form 10-K, with the exception of our adoption of certain accounting pronouncements which we describe below. In the opinion of management, these unaudited condensed consolidated financial statements contain all material adjustments, consisting only of normal recurring adjustments, necessary to fairly state our financial position, results of operations and cash flows for the periods presented and the presentations and disclosures herein are adequate when read in conjunction with our Form 10-K for the year ended December 31, 2018 . The results of operations for the three months ended March 31, 2019 and 2018 are not necessarily indicative of the results to be expected for the full year (or any other period). Significant estimates and assumptions in these unaudited condensed consolidated financial statements include: • product warranty reserves, • inventory valuation, • revenue recognition, • valuation of goodwill, intangible and long-lived assets, • recognition, measurement and valuation of current and deferred income taxes, • stock-based compensation, • recognition and measurement of lease liabilities, • recognition and measurement of contingencies and accrued litigation expense, and • fair values of identified tangible and intangible assets acquired and liabilities assumed in business combinations. Actual results could differ materially from those estimates. Segment Information Our operations are comprised of two reportable segments: the manufacture and sale of conducted electrical weapons ("CEWs"), batteries, accessories, extended warranties and other products and services (the “TASER” segment); and the development, manufacture, and sale of software and sensors, which includes the sale of devices, wearables, applications, cloud and mobile products (collectively, the “Software and Sensors” segment). Revenue from our “products” in the Software and Sensors segment are generally from sales of sensors, including on-officer body cameras, Axon Fleet cameras, other hardware sensors, warranties on sensors, and other products, and is sometimes referred to as "Sensors and Other revenue." Revenue from our “services” in the Software and Sensors segment comprise sales related to the Axon Cloud, which includes Axon Evidence, cloud-based evidence management software revenue, other recurring cloud-hosted software revenue and related professional services, and is sometimes referred to as "Axon Cloud revenue." Within the Software and Sensors segment, we include only revenues and costs attributable to that segment, which costs include: costs of sales for both products and services, direct labor, product management and research and development ("R&D") for products included, or to be included, within the Software and Sensors segment. All other costs are included in the TASER segment. Our Chief Executive Officer, who is the Chief Operating Decision Maker (the “CODM”), is not provided asset information or sales, general, and administrative expense by segment. Reportable segments are determined based on discrete financial information reviewed by the CODM. We organize and review operations based on products and services. We perform an analysis of our reportable segments on at least an annual basis. Additional information related to our business segments is summarized in Note 15. Geographic Information and Major Customers For the three months ended March 31, 2019 and 2018, no individual country outside the U.S. represented more than 10% of total net sales. Individual sales transactions in the international market are generally larger and occur more intermittently than in the domestic market due to the profile of our customers. For the three months ended March 31, 2019 and 2018, no customer represented more than 10% of total net sales. At March 31, 2019 and December 31, 2018 , no customer represented more than 10% of the aggregate balance of accounts and notes receivable and contract assets. Income per Common Share Basic income per common share is computed by dividing net income by the weighted average number of common shares outstanding during the periods presented. Potentially dilutive securities include outstanding stock options and unvested restricted stock units ("RSUs"). The dilutive effect of potentially dilutive securities is reflected in diluted earnings per share by application of the treasury stock method. Under the treasury stock method, an increase in the fair market value of our common stock can result in a greater dilutive effect from potentially dilutive securities. The calculation of the weighted average number of shares outstanding and earnings per share are as follows (in thousands except per share data): Three Months Ended March 31, 2019 2018 Numerator for basic and diluted earnings per share: Net income $ 6,419 $ 12,926 Denominator: Weighted average shares outstanding 58,914 53,119 Dilutive effect of stock-based awards 837 1,413 Diluted weighted average shares outstanding 59,751 54,532 Anti-dilutive stock-based awards excluded 12,125 404 Net income per common share: Basic $ 0.11 $ 0.24 Diluted $ 0.11 $ 0.24 Standard Warranties We warranty our CEWs, Axon cameras and certain related accessories from manufacturing defects on a limited basis for a period of one year after purchase and, thereafter, will repair or replace any defective unit for a fee. Estimated costs for the standard warranty are charged to cost of products sold when revenue is recorded for the related product. Future warranty costs are estimated based on historical data related to warranty claims on a quarterly basis and this rate is applied to current product sales. Historically, reserve amounts have been increased if management becomes aware of a component failure or other issue that could result in larger than anticipated warranty claims from customers. The warranty reserve is reviewed quarterly to verify that it sufficiently reflects the remaining warranty obligations based on the anticipated expenditures over the balance of the warranty obligation period, and adjustments are made when actual warranty claim experience differs from estimates. The warranty reserve is included in accrued liabilities on the accompanying condensed consolidated balance sheets. Changes in our estimated product warranty liabilities were as follows (in thousands): Three Months Ended March 31, 2019 2018 Balance, beginning of period $ 898 $ 644 Utilization of accrual (123 ) (93 ) Warranty expense 252 8 Balance, end of period $ 1,027 $ 559 Fair Value Measurements and Financial Instruments The fair value framework prioritizes the inputs to valuation techniques for measuring financial assets and liabilities measured on a recurring basis and for non-financial assets and liabilities when these items are re-measured. Fair value is considered to be the exchange price in an orderly transaction between market participants to sell an asset or transfer a liability at the measurement date. The hierarchy below lists three levels of fair value based on the extent to which inputs used in measuring fair value are observable in the market. We categorize each of our fair value measurements in one of these three levels based on the lowest level input that is significant to the fair value measurement in its entirety. These levels are: • Level 1 – Valuation techniques in which all significant inputs are unadjusted quoted prices from active markets for assets or liabilities that are identical to the assets or liabilities being measured. • Level 2 – Valuation techniques in which significant inputs include quoted prices from active markets for assets or liabilities that are similar to the assets or liabilities being measured and/or quoted prices for assets or liabilities that are identical or similar to the assets or liabilities being measured from markets that are not active. Also, model-derived valuations in which all significant inputs and significant value drivers are observable in active markets are Level 2 valuation techniques. • Level 3 – Valuation techniques in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are valuation technique inputs that reflect our own assumptions about inputs that market participants would use in pricing an asset or liability. We have cash equivalents and investments, which at March 31, 2019 and December 31, 2018 were comprised of money market funds and, at March 31, 2019, also included corporate bonds. See additional disclosure regarding the fair value of our cash equivalents and investments in Note 3. Included in the balance of other assets as of March 31, 2019 and December 31, 2018 was $3.9 million and $3.6 million , respectively, related to corporate-owned life insurance policies which are used to fund our deferred compensation plan. We determine the fair value of insurance contracts by obtaining the cash surrender value of the contracts from the issuer, a Level 2 valuation technique. Our financial instruments also include accounts and notes receivable, accounts payable and accrued liabilities. Due to the short-term nature of these instruments, their carrying values approximate their fair values on the accompanying condensed consolidated balance sheets. Restricted Cash Restricted cash balances as of March 31, 2019 and December 31, 2018 included $0.9 million of sales proceeds related to long-term contracts with customers, which were included in prepaid expenses and other current assets on our condensed consolidated balance sheets. The proceeds are held in escrow until certain billing milestones are achieved, and then specified amounts are transferred to our operating accounts. Restricted cash balances as of March 31, 2019 and December 31, 2018 also included $0.7 million related to a performance guarantee for an international customer sales contract, which were included in other assets on our accompanying condensed consolidated balance sheets. Valuation of Goodwill, Intangibles and Long-lived Assets We evaluate whether events and circumstances have occurred that indicate the remaining estimated useful life of long-lived assets and identifiable intangible assets, excluding goodwill and intangible assets with indefinite useful lives, may warrant revision or that the remaining balance of these assets may not be recoverable. Such circumstances could include, but are not limited to, a change in the product mix, a change in the way products are created, produced or delivered, or a significant change in the way products are branded and marketed. In performing the review for recoverability, we estimate the future undiscounted cash flows expected to result from the use of the assets and their eventual disposition. The amount of the impairment loss, if impairment exists, is calculated based on the excess of the carrying amounts of the assets over their estimated fair value computed using discounted cash flows. We do not amortize goodwill and intangible assets with indefinite useful lives; rather such assets are required to be tested for impairment at least annually or sooner whenever events or changes in circumstances indicate that the assets may be impaired. We perform our annual goodwill and intangible asset impairment tests in the fourth quarter of each year. Recently Issued Accounting Guidance Recently Adopted Accounting Pronouncements In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-02, Leases (Topic 842), which is intended to increase transparency and comparability among organizations by requiring the recognition of right-of-use (“ROU”) assets and lease liabilities on the balance sheet. In July 2018, the FASB issued additional guidance which provided an additional transition method for adopting the updated guidance. Most prominent among the changes in the standard is the requirement for lessees to recognize ROU assets and lease liabilities for those leases that were classified as operating leases under previous U.S. GAAP. On January 1, 2019, we adopted Topic 842 by applying the non-comparative modified retrospective method of adoption. Under this method, financial information related to periods prior to adoption will be as originally reported under the then-current standard (Topic 840, Leases). Results for reporting periods beginning on or after January 1, 2019 are presented under Topic 842, while prior period amounts are not adjusted, and continue to be reported in accordance with our historic accounting under Topic 840. We elected to apply the package of practical expedients to not reassess whether a contract is or contains a lease, lease classification, or initial lease costs for all leases that commenced before the adoption date. The adoption had a material impact to our condensed consolidated balance sheet. The most significant impact was the recognition of ROU assets and lease liabilities for operating leases, while our accounting for finance leases remained substantially unchanged. There was no other impact from the adoption. The adjustments to the opening balance sheet were as follows (in thousands): December 31, 2018 Impact of Adoption of Topic 842 on Opening Balance Sheet January 1, 2019 (As reported) (As adjusted) Consolidated Balance Sheet Data: Other assets $ 22,999 $ 12,483 $ 35,482 Total assets 719,540 12,483 732,023 — Accrued liabilities 41,092 (1,138 ) 39,954 Other current liabilities 37 3,588 3,625 Total current liabilities 166,011 2,450 168,461 Other long-term liabilities 5,704 10,033 15,737 Total liabilities 252,216 12,483 264,699 Total liabilities and stockholders' equity 719,540 12,483 732,023 See Note 11 for further disclosures related to Topic 842. In June 2018, the FASB issued ASU 2018-07, Compensation - Stock Compensation (Topic 718), expanding the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. We adopted this standard on January 1, 2019 and the adoption had no impact on our condensed consolidated financial statements. Effective the first quarter of 2020: In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 includes an impairment model (known as the current expected credit loss model) on financial instruments and other commitments that is based on expected losses rather than incurred losses. Under the new guidance, an entity recognizes as an allowance its estimate of expected credit losses, which the FASB believes will result in more timely recognition of such losses. The use of forecasted information is intended to incorporate more timely information in the estimate of expected credit loss. This ASU will also require enhanced disclosures relating to significant estimates and judgments used in estimating credit losses, as well as credit quality. We are currently in the process of evaluating the impact of adoption of ASU 2016-13 on our condensed consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement. ASU 2018-13 eliminates, adds and modifies certain disclosure requirements for fair value measurements. The amendments apply to the disclosures of changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. Early adoption is permitted, and an entity is also permitted to early adopt any removed or modified disclosures and delay adoption of the additional disclosures until their effective date. As ASU 2018-13 only revises disclosure requirements, it is not expected to have a material impact on our condensed consolidated financial statements. Reclassification of Prior Year Presentation Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations. |
Revenues
Revenues | 3 Months Ended |
Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | Revenues Nature of Products and Services The following table presents our revenues by primary product and service offering (in thousands): Three Months Ended March 31, 2019 Three Months Ended March 31, 2018 TASER Software and Sensors Total TASER Software and Sensors Total TASER 7 $ 9,954 $ — $ 9,954 $ — $ — $ — TASER X26P 15,872 — 15,872 16,474 — 16,474 TASER X2 13,085 — 13,085 23,932 — 23,932 TASER Pulse and Bolt 670 — 670 1,346 — 1,346 Single cartridges 19,160 — 19,160 16,114 — 16,114 Axon Body — 6,445 6,445 — 5,558 5,558 Axon Flex — 1,224 1,224 — 1,669 1,669 Axon Fleet — 3,516 3,516 — 2,116 2,116 Axon Dock — 3,312 3,312 — 3,035 3,035 Axon Evidence and cloud services 36 27,618 27,654 — 20,241 20,241 TASER Cam — 903 903 — 1,360 1,360 Extended warranties 4,316 4,930 9,246 3,706 2,490 6,196 Other 2,298 2,471 4,769 1,952 1,222 3,174 Total $ 65,391 $ 50,419 $ 115,810 $ 63,524 $ 37,691 $ 101,215 The following table presents our revenues disaggregated by geography (in thousands): Three Months Ended March 31, 2019 2018 United States $ 94,333 81 % $ 77,950 77 % Other countries 21,477 19 23,265 23 Total $ 115,810 100 % $ 101,215 100 % Contract Balances The following table presents our contract assets, contract liabilities and certain information related to these balances as of and for the three months ended March 31, 2019 (in thousands): March 31, 2019 Contract assets, net $ 18,257 Contract liabilities (deferred revenue) 184,847 Revenue recognized in the period from: Amounts included in contract liabilities at the beginning of the period 31,222 Contract liabilities (deferred revenue) consisted of the following (in thousands): March 31, 2019 December 31, 2018 Current Long-Term Total Current Long-Term Total Warranty: TASER $ 11,821 $ 15,770 $ 27,591 $ 12,797 $ 16,847 $ 29,644 Software and Sensors 8,779 6,060 14,839 8,273 6,516 14,789 20,600 21,830 42,430 21,070 23,363 44,433 Hardware: TASER 3,845 16,091 19,936 9,355 15,598 24,953 Software and Sensors 31,104 24,023 55,127 20,878 24,685 45,563 34,949 40,114 75,063 30,233 40,283 70,516 Services: TASER 75 438 513 — — — Software and Sensors 54,439 12,402 66,841 55,713 10,771 66,484 54,514 12,840 67,354 55,713 10,771 66,484 Total $ 110,063 $ 74,784 $ 184,847 $ 107,016 $ 74,417 $ 181,433 March 31, 2019 December 31, 2018 Current Long-Term Total Current Long-Term Total TASER $ 15,741 $ 32,299 $ 48,040 $ 22,152 $ 32,445 $ 54,597 Software and Sensors 94,322 42,485 136,807 84,864 41,972 126,836 Total $ 110,063 $ 74,784 $ 184,847 $ 107,016 $ 74,417 $ 181,433 Remaining Performance Obligations As of March 31, 2019 , we had approximately $930 million of remaining performance obligations, which included both recognized contract liabilities as well as amounts that will be invoiced and recognized in future periods. The remaining performance obligations are limited only to arrangements that meet the definition of a contract under Topic 606 as of March 31, 2019 . We expect to recognize between 15% - 20% of this balance over the next twelve months, and expect the remainder to be recognized over the following five to seven years, subject to risks related to delayed deployments, budget appropriation or other contract cancellation clauses. |
Cash, Cash Equivalents and Inve
Cash, Cash Equivalents and Investments | 3 Months Ended |
Mar. 31, 2019 | |
Cash and Cash Equivalents [Abstract] | |
Cash, Cash Equivalents and Investments | Cash, Cash Equivalents and Investments The following tables summarize our cash, cash equivalents, and held-to-maturity investments at March 31, 2019 and December 31, 2018 (in thousands): As of March 31, 2019 Amortized Cost Gross Unrealized Losses Fair Value Cash and Cash Equivalents Short-Term Investments Cash $ 123,098 $ — $ 123,098 $ 123,098 $ — Level 1: Money market funds 83,449 — 83,449 83,449 — Level 2: Corporate bonds 122,407 (56 ) 122,351 17,095 105,312 Total $ 328,954 $ (56 ) $ 328,898 $ 223,642 $ 105,312 As of December 31, 2018 Amortized Cost Gross Unrealized Losses Fair Value Cash and Cash Equivalents Short-Term Investments Cash $ 144,095 $ — $ 144,095 $ 144,095 $ — Level 1: Money market funds 205,367 — 205,367 205,367 — Total $ 349,462 $ — $ 349,462 $ 349,462 $ — We believe unrealized losses on our investments are due to interest rate fluctuations. As these investments are short-term in nature, are expected to be redeemed at par value, and/or because we have the ability and intent to hold these investments to maturity, we do not consider these investments to be other than temporarily impaired as of March 31, 2019. |
Inventory
Inventory | 3 Months Ended |
Mar. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Inventory | Inventory Inventories are stated at the lower of cost and net realizable value. Cost is determined using the weighted average cost of raw materials, which approximates the first-in, first-out (“FIFO”) method and includes allocations of manufacturing labor and overhead. Included in finished goods at March 31, 2019 and December 31, 2018 was $1.3 million and $1.4 million , respectively, of trial and evaluation hardware units. Provisions are made to reduce excess, obsolete or slow-moving inventories to their net realizable value. Inventory consisted of the following at March 31, 2019 and December 31, 2018 (in thousands): March 31, 2019 December 31, 2018 Raw materials $ 20,574 $ 19,670 Finished goods 17,013 14,093 Total inventory $ 37,587 $ 33,763 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 3 Months Ended |
Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets The changes in the carrying amount of goodwill for the three months ended March 31, 2019 were as follows (in thousands): TASER Software and Sensors Total Balance, beginning of period $ 1,338 $ 23,643 $ 24,981 Foreign currency translation adjustment 18 18 36 Balance, end of period $ 1,356 $ 23,661 $ 25,017 Intangible assets (other than goodwill) consisted of the following (in thousands): March 31, 2019 December 31, 2018 Useful Life Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Amortizable (definite-lived) intangible assets: Domain names 5-10 years $ 3,161 $ (808 ) $ 2,353 $ 3,161 $ (732 ) $ 2,429 Issued patents 4-15 years 2,982 (1,158 ) 1,824 2,940 (1,106 ) 1,834 Issued trademarks 3-11 years 922 (490 ) 432 1,053 (599 ) 454 Customer relationships 4-8 years 3,717 (1,027 ) 2,690 3,701 (880 ) 2,821 Non-compete agreements 3-4 years 452 (375 ) 77 540 (439 ) 101 Developed technology 3-7 years 10,660 (4,889 ) 5,771 13,404 (7,081 ) 6,323 Re-acquired distribution rights 2 years 2,031 (2,031 ) — 1,928 (1,813 ) 115 Total amortizable 23,925 (10,778 ) 13,147 26,727 (12,650 ) 14,077 Not amortizable (indefinite-lived) intangible assets: TASER trademark 900 900 900 900 Patents and trademarks pending 1,020 1,020 958 958 Total not amortizable 1,920 1,920 1,858 1,858 Total intangible assets $ 25,845 $ (10,778 ) $ 15,067 $ 28,585 $ (12,650 ) $ 15,935 Amortization expense of intangible assets for the three months ended March 31, 2019 and 2018 was $1.0 million and $1.4 million , respectively. Estimated amortization for intangible assets with definite lives for the remaining nine months of 2019 , the next five years ended December 31, and thereafter, is as follows (in thousands): 2019 Remaining $ 2,501 2020 3,293 2021 2,846 2022 1,244 2023 946 2024 862 Thereafter 1,455 Total $ 13,147 |
Other Assets
Other Assets | 3 Months Ended |
Mar. 31, 2019 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Other Assets | Other Assets Other assets consisted of the following at March 31, 2019 and December 31, 2018 (in thousands): March 31, 2019 December 31, 2018 Cash surrender value of corporate-owned life insurance policies $ 3,919 $ 3,596 Deferred commissions (1) 16,141 15,530 Restricted cash 659 661 Operating lease assets 11,659 — Prepaid expenses, deposits and other 3,378 3,212 Total other long-term assets $ 35,756 $ 22,999 (1) Represents assets for the incremental costs of obtaining contracts with customers, which consist primarily of sales commissions. These costs are ascribed to or allocated to the underlying performance obligations in the contracts and amortized consistent with the recognition timing of the revenue for the underlying performance obligations. |
Accrued Liabilities
Accrued Liabilities | 3 Months Ended |
Mar. 31, 2019 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities | Accrued Liabilities Accrued liabilities consisted of the following at March 31, 2019 and December 31, 2018 (in thousands): March 31, 2019 December 31, 2018 Accrued salaries, benefits and bonus $ 13,993 $ 19,063 Accrued professional, consulting and lobbying fees 4,476 4,894 Accrued warranty expense 1,027 898 Accrued income and other taxes 4,392 4,167 Other accrued liabilities 12,460 12,070 Accrued liabilities $ 36,348 $ 41,092 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes We file income tax returns for federal purposes and in many states, as well as in multiple foreign jurisdictions. Our tax filings remain subject to examination by applicable tax authorities for a certain length of time, generally three to four years, following the tax year to which these filings relate. Our U.S. federal income tax return for fiscal year 2016 is currently under audit by the Internal Revenue Service. Deferred Tax Assets Net deferred income tax assets at March 31, 2019 , primarily include R&D tax credits, stock-based compensation expense, deferred revenue, accruals and reserves, and net operating losses, partially offset by accelerated depreciation expense and valuation allowance reserve. Our total net deferred tax assets at March 31, 2019 were $18.8 million . In preparing our condensed consolidated financial statements, management assesses the likelihood that its deferred tax assets will be realized from future taxable income. In evaluating our ability to recover our deferred income tax assets, management considers all available positive and negative evidence, including our operating results, ongoing tax planning and forecasts of future taxable income on a jurisdiction by jurisdiction basis. A valuation allowance is established if it is determined that it is more likely than not that some portion or all of the net deferred tax assets will not be realized. Management exercises significant judgment in determining our provisions for income taxes, our deferred tax assets and liabilities, and our future taxable income for purposes of assessing our ability to utilize any future tax benefit from our deferred tax assets. As of March 31, 2019 , we continue to demonstrate three-year cumulative pre-tax income in the U.S. federal and state tax jurisdictions; however, we have Arizona R&D Tax Credits expiring unutilized each year. Therefore, management has concluded that it is more likely than not that our Arizona R&D deferred tax asset will not be realized. As of March 31, 2019 , we have cumulative pre-tax losses in Australia, the U.K., and Canada, which limits the ability to consider other subjective evidence, such as projections for future growth. On the basis of this evaluation, a full valuation allowance has been recorded for these jurisdictions. The amount of the deferred tax asset considered realizable; however, could be adjusted in future periods if objective negative evidence in the form of cumulative losses is no longer present and additional weight is given to subjective evidence such as projections for growth. We complete R&D tax credit studies for each year that an R&D tax credit is claimed for federal, Arizona, and California income tax purposes. Management has made the determination that it is more likely than not that the full benefit of the R&D tax credit will not be sustained on examination and recorded a liability for unrecognized tax benefits of $5.7 million as of March 31, 2019 . In addition, management accrued $0.1 million for estimated uncertain tax positions related to certain federal income tax liabilities. Should the unrecognized benefit of $5.7 million be recognized, our effective tax rate would be favorably impacted. Approximately $2.7 million of the unrecognized tax benefit associated with R&D credits has been netted against the R&D deferred tax asset. Effective Tax Rate Our overall effective tax rate for the three months ended March 31, 2019 , after discrete period adjustments, was (28.8)% . Before discrete adjustments, the tax rate was 21.1% , which is greater than the federal statutory rate, primarily due to state taxes and non-deductible expenses for items such as meals and entertainment, executive compensation limitation under Internal Revenue Code ("IRC") Section 162(m), lobbying fees, and an income inclusion from global intangible low-taxed income ("GILTI"), offset by a reduction for foreign-derived intangible income ("FDII") and R&D tax credits. The effective tax rate was favorably impacted by a $2.7 million discrete tax benefit primarily associated with windfalls related to stock-based compensation for RSUs that vested or stock options that were exercised during the three months ended March 31, 2019 . This was offset by an unfavorable discrete item of $0.3 million related to the write off of certain deferred tax assets related to future stock compensation vests for certain officers for whom deductibility of compensation is limited by IRC Section 162(m). |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Performance-based stock awards We have issued performance-based stock options and performance-based RSUs, the vesting of which is generally contingent upon the achievement of certain performance criteria related to our operating performance, as well as successful and timely development and market acceptance of future product introductions. In addition, certain of the performance RSUs have additional service requirements subsequent to the achievement of the performance criteria. Compensation expense is recognized over the requisite service period, which is defined as the longest explicit, implicit or derived service period based on management’s estimate of the probability of the performance criteria being satisfied, adjusted at each balance sheet date. For awards containing multiple service, performance or market conditions, and all conditions must be satisfied prior to vesting, compensation expense is recognized over the requisite service period, which is defined as the longest explicit, implicit or derived service period, based on management’s estimate of the probability of the performance criteria being satisfied, adjusted at each balance sheet date. For both service-based and performance-based RSUs, we account for forfeitures as they occur as a reduction to stock-based compensation expense and additional paid-in-capital. For performance-based options with a vesting schedule based entirely on the attainment of both performance and market conditions, stock-based compensation expense is recognized for each pair of performance and market conditions over the longer of the expected achievement period of the performance and market conditions, beginning at the point in time that the relevant performance condition is considered probable of achievement. The fair value of such awards is estimated on the grant date using Monte Carlo simulations. CEO Performance Award On May 24, 2018 (the “Grant Date”), our stockholders approved the Board of Directors’ grant of 6,365,856 stock option awards to Patrick W. Smith, our CEO (the “CEO Performance Award”). The CEO Performance Award consists of 12 vesting tranches with a vesting schedule based entirely on the attainment of both operational goals (performance conditions) and market capitalization goals (market conditions), assuming continued employment either as the CEO or as both Executive Chairman and Chief Product Officer and service through each vesting date. Each of the 12 vesting tranches of the CEO Performance Award have a 10-year contractual term and will vest upon certification by the Board of Directors that both (i) the market capitalization goal for such tranche, which begins at $2.5 billion for the first tranche and increases by increments of $1.0 billion thereafter, and (ii) any one of the following eight operational goals focused on revenue or eight operational goals focused on Adjusted EBITDA have been met for the previous four consecutive fiscal quarters. Adjusted EBITDA for purposes of the CEO Performance Award ("Adjusted EBITDA (CEO Performance Award)") is defined as net income (loss) attributable to common stockholders before interest expense, investment interest income, provision (benefit) for income taxes, depreciation and amortization, and stock-based compensation expense. Eight Separate Revenue Goals (1) (in thousands) Eight Separate Adjusted EBITDA (CEO Performance Award) Goals (in thousands) Goal #1, $710,058 Goal #9, $125,000 Goal #2, $860,058 Goal #10, $155,000 Goal #3, $1,010,058 Goal #11, $175,000 Goal #4, $1,210,058 Goal #12, $190,000 Goal #5, $1,410,058 Goal #13, $200,000 Goal #6, $1,610,058 Goal #14, $210,000 Goal #7, $1,810,058 Goal #15, $220,000 Goal #8, $2,010,058 Goal #16, $230,000 (1) In connection with the business acquisition that was completed during the three months ended June 30, 2018, the revenue goals have been adjusted for the acquiree's Target Revenue, as defined in the CEO Performance Award agreement. As of March 31, 2019 , the following operational goals were considered probable of achievement: • Total revenue of $710.1 million ; and • Adjusted EBITDA (CEO Performance Award) of $125.0 million The first two market capitalization goals have been achieved as of March 31, 2019 . However, none of the stock options granted under the CEO Performance Award have vested thus far as the operational goals have not yet been achieved as of March 31, 2019 . As there are two operational goals considered probable of achievement, we recorded stock-based compensation expense of $4.7 million related to the CEO Performance Award from the Grant Date through March 31, 2019 . The number of stock options that would vest related to the two tranches is approximately 1.1 million shares. As of March 31, 2019 , we had $40.5 million of total unrecognized stock-based compensation expense for the performance goals that were considered probable of achievement, which will be recognized over a weighted-average period of 7.0 years. As of March 31, 2019 , we had unrecognized stock-based compensation expense of $200.7 million for the performance goals that were considered not probable of achievement. eXponential Stock Performance Plan On February 12, 2019, our shareholders approved the 2019 Stock Incentive Plan (the “2019 Plan”), which was adopted by the Board of Directors to reserve a sufficient number of shares to facilitate our eXponential Stock Performance Plan (“XSPP”) and grants of eXponential Stock Units (“XSUs”) under the plan. Pursuant to the XSPP, all eligible full-time U.S. employees were granted an award of 60 XSUs in January 2019, and certain employees had the opportunity to elect to receive a percentage of the value of their target compensation over the next nine years (2019-2027) in the form of additional XSUs. For employees who elected to receive XSUs, the XSU grants were made as an up front, lump sum grant in January 2019, and are intended to replace that portion of the target compensation they elected to receive in the form of XSUs for the next nine years. Accordingly, their go forward target compensation will be reduced until 2027 by the amount of such compensation that the employees elected to receive in the form of the January 2019 XSU grants. A total of approximately 5.2 million XSUs were granted in the three months ended March 31, 2019 . The XSUs are grants of restricted stock units, each with a term of approximately nine years, that vest in 12 equal tranches. Each of the 12 tranches will vest upon certification by the Compensation Committee of the Board of Directors that both (i) the market capitalization goal for such tranche, which begins at $2.5 billion for the first tranche and increases by increments of $1.0 billion thereafter, and (ii) any one of eight operational goals focused on revenue or eight operational goals focused on Adjusted EBITDA (CEO Performance Award) have been met for the previous four consecutive fiscal quarters. The XSPP contains an anti-dilution provision, which is used to calculate a maximum number of shares outstanding for purposes of determining achievement of the market capitalization goals whereby the maximum number of shares used to calculate the market capitalization goal is calculated by organically growing the current number of shares outstanding by 3% per year (the "XSU Maximum"). Any shares of Stock issued to Patrick W. Smith upon the exercise of the stock options granted to Mr. Smith under the CEO Performance Award shall increase the XSU Maximum. The XSU Maximum shall also be adjusted for acquisitions, spin-offs or other changes in the number of outstanding shares of common stock, if such changes have a corresponding adjustment on the market capitalization goals. The market capitalization and operational goals are identical to the CEO Performance Award, except for the number of shares that are used to calculate the market capitalization goals if shares outstanding exceed the XSU Maximum. Additionally, because the grant date is different than that of the CEO Performance Award, the measurement period for market capitalization is not identical. Stock-based compensation expense associated with XSU awards is recognized over the longer of the expected achievement period for each pair of market capitalization and operational goals, beginning at the point in time when the relevant operational goal is considered probable of being met. The market capitalization goal period and the valuation of each tranche are determined using a Monte Carlo simulation which is also is used as the basis for determining the expected achievement period of the market capitalization goal. The probability of meeting an operational goal and the expected achievement point in time for meeting a probable operational goal are based on a subjective assessment of our forward-looking financial projections, taking into consideration statistical analysis. Even though no tranches of the XSU awards vest unless a market capitalization and a matching operational goal are both achieved, stock-based compensation expense is recognized when an operational goal is considered probable of achievement regardless of whether a market capitalization goal is actually achieved. The first market capitalization goal has been achieved as of March 31, 2019 . However, none of the XSU tranches have vested thus far as the operational goals have not yet been achieved as of March 31, 2019 . As there are two operational goals considered probable of achievement, we recorded stock-based compensation expense of $0.7 million related to the XSU awards from their respective grant dates through March 31, 2019 . The number of XSU awards that would vest related to the two tranches is approximately 0.9 million shares. As of March 31, 2019 , we had $36.8 million of total unrecognized stock-based compensation expense for the performance goals that were considered probable of achievement, which will be recognized over a weighted-average period of 7 years . As of March 31, 2019 , we had unrecognized stock-based compensation expense of $137.0 million for the performance goals that were considered not probable of achievement. Given the complexity of the awards, we utilized Monte Carlo simulations to simulate a range of possible future market capitalizations for the Company over the term of the awards. The average of all iterations of the simulation was used as the basis for the valuation and market capitalization goal derived service period for each tranche. Additionally, we applied an illiquidity discount of between 10.0% and 16.8% to the valuation of XSUs because the awards specify a post-vest holding period of 2.5 years. Certain of the XSU awards specify a post-vest holding period of the longer of 2.5 years or until the next tranche vests. The illiquidity discounts were estimated using the Finnerty model and reduced by the impact of expected payroll and income taxes due upon vesting of the awards, as the related proportion of shares are expected to be sold to satisfy such obligations. We measured the grant date fair value of the XSU awards with the following assumptions: risk-free interest rate of between 2.47% and 2.62% , expected term of approximately 9 years, expected volatility of between 44.96% and 45.47% , and dividend yield of 0.00% . Restricted Stock Units The following table summarizes RSU activity for the three months ended March 31, 2019 (number of units and aggregate intrinsic value in thousands): Number of Units Weighted Average Grant-Date Fair Value Aggregate Units outstanding, beginning of year 1,655 $ 28.34 Granted 5,667 34.32 Released (290 ) 20.91 Forfeited (46 ) 34.43 Units outstanding, end of period 6,986 33.47 $ 380,123 Aggregate intrinsic value represents our closing stock price on the last trading day of the period, which was $54.41 per share, multiplied by the number of RSUs outstanding. As of March 31, 2019 , there was $84.9 million in unrecognized compensation costs related to RSUs under our stock plans for shares that are expected to vest. We expect to recognize the cost related to the RSUs over a weighted average period of 4.59 years . RSUs are released when vesting requirements are met. During the three months ended March 31, 2019 , we granted 5.7 million RSUs, consisting of 0.3 million service-based RSUs and 5.4 million performance-based RSUs, including 5.2 million XSUs. As of March 31, 2019 , the performance criteria had been met for approximately five thousand of the 5.7 million performance-based RSUs outstanding. Certain of the performance-based RSUs outstanding as of March 31, 2019 can vest with a range of shares earned being between 0% and 200% of the targeted shares granted, depending on the final achievement of pre-determined performance criteria as of the vesting date. The amount of RSUs included in the table above related to such grants is the target level. The maximum additional number of performance-based RSUs that could be earned is 0.3 million , which are not included in the table above. Certain RSUs that vested in the three months ended March 31, 2019 were net-share settled such that we withheld shares with value equivalent to the employees’ minimum statutory obligation for the applicable income and other employment taxes, and remitted the cash to the appropriate taxing authorities. Total shares withheld related to RSUs were approximately 15 thousand and had a value of $1.3 million on their respective vesting dates as determined by the closing stock price on such dates. Payments for the employees’ tax obligations are reflected as a financing activity within the condensed consolidated statements of cash flows. We record a liability for the tax withholding to be paid by us as a reduction to additional paid-in capital. Stock Option Activity The following table summarizes stock option activity for the three months ended March 31, 2019 (number of units and aggregate intrinsic value in thousands): Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life (years) Aggregate Options outstanding, beginning of year 6,458 $ 28.24 Granted — — Exercised (24 ) 4.20 Expired / terminated — — Options outstanding, end of period 6,434 28.33 8.83 $ 167,827 Options exercisable, end of period 68 4.54 1.69 3,397 Aggregate intrinsic value represents the difference between the exercise price of the underlying stock option awards and the closing market price of our common stock of $54.41 on March 31, 2019 . The intrinsic value of options exercised for the three months ended March 31, 2019 and 2018 was $1.0 million and $2.0 million , respectively. As of March 31, 2019 , total options outstanding included 6.4 million unvested performance-based stock options. Of this total, 1.1 million options relate to tranches of the CEO Performance Award considered probable of achievement. Stock-based Compensation Expense The following table summarizes the composition of stock-based compensation for the three months ended March 31, 2019 and 2018 (in thousands): Three Months Ended March 31, 2019 2018 Cost of products sold and services delivered $ 226 $ 141 Sales, general and administrative expenses 4,681 2,304 Research and development expenses 2,998 1,648 Total stock-based compensation $ 7,905 $ 4,093 Stock Incentive Plan In February 2019, our shareholders approved the 2019 Plan authorizing an additional 6.0 million shares, plus remaining available shares under prior plans, for issuance under the new plan. Combined with the legacy stock incentive plans, there are 2.2 million shares available for grant as of March 31, 2019 . Stock Repurchase Plan In February 2016, our Board of Directors authorized a stock repurchase program to acquire up to $50.0 million of our outstanding common stock subject to stock market conditions and corporate considerations. During the three months ended March 31, 2019 and 2018, no common shares were purchased under the program. As of March 31, 2019 , $16.3 million remains available under the plan for future purchases. Any future purchases will be discretionary. |
Line of Credit
Line of Credit | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Line of Credit | Line of Credit We have a $50.0 million unsecured revolving line of credit with a domestic bank, of which $10.0 million is available for letters of credit. The credit agreement matures on December 31, 2021 and has an accordion feature which allows for an increase in the total line of credit up to $100.0 million , subject to certain conditions, including the availability of additional bank commitments. At March 31, 2019 and December 31, 2018, there were no borrowings under the line. Under the terms of the line of credit, available borrowings are reduced by outstanding letters of credit. As of March 31, 2019 , we had letters of credit outstanding of approximately $3.1 million under the facility and available borrowing of $46.9 million , excluding amounts available under the accordion feature. Advances under the line of credit bear interest at LIBOR plus 1.0 to 1.5% per year determined in accordance with a pricing grid based on our funded debt to earnings before interest, taxes, depreciation and amortization ("EBITDA") ratio. We are required to comply with a maximum funded debt to EBITDA ratio of no greater than 2.50 to 1.00 based upon a trailing four fiscal quarter period. At March 31, 2019 , our funded debt to EBITDA ratio was 0.001 to 1.00. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Leases | Leases Lease Obligations We determine if an arrangement is a lease at inception. Operating lease ROU assets and liabilities are recognized based on the present value of future minimum lease payments over the lease term at commencement date. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the commencement date in determining the present value of future payments. Additionally, we use the portfolio approach in determining the discount rate used to present value lease payments. We give consideration to our line of credit as well as publicly available data for instruments with similar characteristics when calculating our incremental borrowing rates. The ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. We have operating and finance leases for office space and certain equipment. Leases with an initial term of 12 months or less are not recorded on the balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term. For leases beginning on or after January 1, 2019, we account for lease components separately from non-lease components for all asset classes. Our leases have remaining terms of less than 1 to 4 years, some of which include one or more options to renew for up to 2 years, and some of which include options to terminate the leases within 1 year. The exercise of lease renewal options is at our sole discretion and such options are included in ROU assets and liabilities for renewal periods that are reasonably certain of exercise. Certain of our lease agreements include stated rental payment escalations. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. We sublease certain real estate to third parties. Finance leases as of March 31, 2019 were immaterial. Leases (in thousands) Classification March 31, 2019 Assets Operating lease assets Other assets $ 11,659 Liabilities Current Operating Other current liabilities $ 3,877 Noncurrent Operating Other long-term liabilities 8,897 Total lease liabilities $ 12,774 The components of lease expense were as follows (in thousands): Classification Three Months Ended March 31, 2019 Operating lease expense (1) Sales, general and administrative expenses (2) $ 1,017 Sublease income Other income (42 ) Net lease expense $ 975 (1) Includes short-term leases, which are immaterial. (2) An immaterial portion of operating lease expense is included within research and development expenses and cost of sales. Other information related to leases was as follows (in thousands, except lease term and discount rate): Three Months Ended March 31, 2019 Supplemental Cash Flows Information Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 961 Right-of-use assets obtained in exchange for lease liabilities Operating leases 84 Weighted average remaining lease term Operating leases 3.2 years Weighted average discount rate Operating leases 3.6 % Future minimum lease payments under non-cancellable leases as of March 31, 2019 were as follows (in thousands): Operating Sublease income Net 2019 Remaining $ 3,419 $ (246 ) $ 3,173 2020 4,203 (82 ) 4,121 2021 3,325 — 3,325 2022 2,449 — 2,449 2023 1,173 — 1,173 2024 — — — Thereafter — — — Total minimum lease payments 14,569 (328 ) 14,241 Less: Amount representing interest (1,467 ) Present value of lease payments $ 12,774 As of March 31, 2019 , we do not have any leases that have not yet commenced other than the land lease purchase agreement described in Note 12. Disclosures related to periods prior to adoption of Topic 842 Rent expense under all operating leases, including both cancelable and non-cancelable leases, was $4.2 million and $2.9 million for the years ended December 31, 2018 and 2017, respectively. Future minimum lease payments under non-cancelable leases at December 31, 2018, were as follows (in thousands): Operating Capital 2019 $ 3,670 $ 40 2020 3,572 36 2021 2,961 — 2022 2,001 — 2023 573 — Thereafter — — Total minimum lease payments $ 12,777 76 Less: Amount representing interest (6 ) Capital lease obligation $ 70 |
Leases | Leases Lease Obligations We determine if an arrangement is a lease at inception. Operating lease ROU assets and liabilities are recognized based on the present value of future minimum lease payments over the lease term at commencement date. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the commencement date in determining the present value of future payments. Additionally, we use the portfolio approach in determining the discount rate used to present value lease payments. We give consideration to our line of credit as well as publicly available data for instruments with similar characteristics when calculating our incremental borrowing rates. The ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. We have operating and finance leases for office space and certain equipment. Leases with an initial term of 12 months or less are not recorded on the balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term. For leases beginning on or after January 1, 2019, we account for lease components separately from non-lease components for all asset classes. Our leases have remaining terms of less than 1 to 4 years, some of which include one or more options to renew for up to 2 years, and some of which include options to terminate the leases within 1 year. The exercise of lease renewal options is at our sole discretion and such options are included in ROU assets and liabilities for renewal periods that are reasonably certain of exercise. Certain of our lease agreements include stated rental payment escalations. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. We sublease certain real estate to third parties. Finance leases as of March 31, 2019 were immaterial. Leases (in thousands) Classification March 31, 2019 Assets Operating lease assets Other assets $ 11,659 Liabilities Current Operating Other current liabilities $ 3,877 Noncurrent Operating Other long-term liabilities 8,897 Total lease liabilities $ 12,774 The components of lease expense were as follows (in thousands): Classification Three Months Ended March 31, 2019 Operating lease expense (1) Sales, general and administrative expenses (2) $ 1,017 Sublease income Other income (42 ) Net lease expense $ 975 (1) Includes short-term leases, which are immaterial. (2) An immaterial portion of operating lease expense is included within research and development expenses and cost of sales. Other information related to leases was as follows (in thousands, except lease term and discount rate): Three Months Ended March 31, 2019 Supplemental Cash Flows Information Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 961 Right-of-use assets obtained in exchange for lease liabilities Operating leases 84 Weighted average remaining lease term Operating leases 3.2 years Weighted average discount rate Operating leases 3.6 % Future minimum lease payments under non-cancellable leases as of March 31, 2019 were as follows (in thousands): Operating Sublease income Net 2019 Remaining $ 3,419 $ (246 ) $ 3,173 2020 4,203 (82 ) 4,121 2021 3,325 — 3,325 2022 2,449 — 2,449 2023 1,173 — 1,173 2024 — — — Thereafter — — — Total minimum lease payments 14,569 (328 ) 14,241 Less: Amount representing interest (1,467 ) Present value of lease payments $ 12,774 As of March 31, 2019 , we do not have any leases that have not yet commenced other than the land lease purchase agreement described in Note 12. Disclosures related to periods prior to adoption of Topic 842 Rent expense under all operating leases, including both cancelable and non-cancelable leases, was $4.2 million and $2.9 million for the years ended December 31, 2018 and 2017, respectively. Future minimum lease payments under non-cancelable leases at December 31, 2018, were as follows (in thousands): Operating Capital 2019 $ 3,670 $ 40 2020 3,572 36 2021 2,961 — 2022 2,001 — 2023 573 — Thereafter — — Total minimum lease payments $ 12,777 76 Less: Amount representing interest (6 ) Capital lease obligation $ 70 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Land Lease Purchase Agreement On December 13, 2018, we entered into a Purchase and Sale Agreement ("PSA") to purchase a leasehold interest to a parcel of land located in Maricopa County, Arizona for a period of 84 years, on which we intend to construct our new headquarters. The purchase price of the land lease was $13.1 million . It is also contemplated that we will prepay the rent under the lease in the amount of $10.9 million . The PSA includes a due diligence period, during which we may terminate and forfeit our initial deposit of $0.2 million . On March 4, 2019, we entered into an amendment to the PSA which extended the due diligence period to May 3, 2019. On May 3, 2019, we entered into a second amendment to the PSA which extended the due diligence period to June 28, 2019. The second amendment also revised certain stated approval dates and removed the requirement for an additional deposit originally due at the end of the due diligence period. Product Litigation We are currently named as a defendant in seven lawsuits in which the plaintiffs allege either wrongful death or personal injury in situations in which a TASER CEW was used by law enforcement officers in connection with arrests. While the facts vary from case to case, these product liability claims typically allege defective product design, manufacturing, and/or failure to warn. They seek compensatory and sometimes punitive damages, often in unspecified amounts. We continue to aggressively defend all product litigation. As a general rule, it is our policy not to settle suspect injury or death cases. Exceptions are sometimes made where the settlement is strategically beneficial to us. Due to the confidential nature of our litigation strategy and the confidentiality agreements that are executed in the event of a settlement, we do not identify or comment on specific settlements by case or amount. Based on current information, we do not believe that the outcome of any such legal proceeding will have a material effect on our financial position, results of operations, or cash flows. We are self-insured for the first $5.0 million of any product claim made after 2014. No judgment or settlement has ever exceeded this amount in any products case. We continue to maintain product liability insurance coverage, including an insurance policy fronting arrangement, above our self-insured retention with various limits depending on the policy period. Other Litigation We are a defendant in a litigation matter filed by Digital Ally Inc. (“Digital”) in the District of Kansas alleging patent infringement regarding our Axon Signal technology. Digital seeks a judgment of infringement, monetary damages, a permanent injunction, punitive damages and attorneys’ fees and costs. Both fact and expert discovery are complete. The parties filed motions for summary judgment on January 31, 2019 and briefing is now complete. Rulings are not expected before the fourth quarter of 2019. No trial date has been set but, if necessary, is not expected to occur before the first quarter of 2020. We are vigorously defending this litigation. The case has been substantially narrowed based on (1) the district court’s dismissal of all of Digital’s antitrust claims in January 2017, which ruling was affirmed by the Federal Circuit in May 2018 and the U.S. Supreme Court denied review; (2) the district court’s dismissal of Digital’s ‘292 patent from the litigation with prejudice in March 2018, and Digital’s execution of a covenant not to sue Axon on that patent on existing Axon products; and (3) Digital’s dismissal of certain inconsistent claims in the ‘452 patent, leaving only one independent claim for resolution by the court. We believe the ‘452 patent is both invalid and not infringed, and we do not believe it is probable that we will incur a material loss. Although we have not yet been served, we are aware that a consumer class action lawsuit previously filed and dismissed in California in 2018 has been refiled in Nevada. The case alleges the TASER Pulse, X2 and X26P CEWs have a faulty safety switch based on Douglas Richey’s Pulse allegedly discharging inside its neoprene case in a jacket pocket without injury. Any such discharge was likely due to static electricity, as disclosed in our consumer warnings. We will vigorously defend this claim and the propriety of any class certification. U.S. Federal Trade Commission Investigation In June 2018 we received a letter from the U.S. Federal Trade Commission (“FTC”) with respect to its non-public investigation into our acquisition of VIEVU, LLC in May 2018. The FTC issued a subpoena for certain information and documentation relating to the acquisition on March 21, 2019. We are cooperating with the investigation. General From time to time, we are notified that we may be a party to a lawsuit or that a claim is being made against us. It is our policy to not disclose the specifics of any claim or threatened lawsuit until the summons and complaint are actually served on us. After carefully assessing the claim, and assuming we determine that we are not at fault or we disagree with the damages or relief demanded, we vigorously defend any lawsuit filed against us. We record a liability when losses are deemed probable and reasonably estimable. When losses are deemed reasonably possible but not probable, we determine whether it is possible to provide an estimate of the amount of the loss or range of possible losses for the claim, if material for disclosure. In evaluating matters for accrual and disclosure purposes, we take into consideration factors such as our historical experience with matters of a similar nature, the specific facts and circumstances asserted, the likelihood of our prevailing, the availability of insurance, and the severity of any potential loss. We reevaluate and update accruals as matters progress over time. Based on our assessment of outstanding litigation and claims as of March 31, 2019 , we have determined that it is not reasonably possible that these lawsuits will individually, or in the aggregate, materially affect our results of operations, financial condition or cash flows. However, the outcome of any litigation is inherently uncertain and there can be no assurance that any expense, liability or damages that may ultimately result from the resolution of these matters will be covered by our insurance or will not be in excess of amounts recognized or provided by insurance coverage and will not have a material adverse effect on our operating results, financial condition or cash flows. Off-Balance Sheet Arrangements Under certain circumstances, we use letters of credit and surety bonds to guarantee our performance under various contracts, principally in connection with the installation and integration of Axon cameras and related technologies. Certain of our letters of credit and surety bonds have stated expiration dates with others being released as the contractual performance terms are completed. At March 31, 2019 , we had outstanding letters of credit of $3.1 million that are expected to expire in May 2019 and September 2021. Additionally, we had $24.6 million of outstanding surety bonds at March 31, 2019 , with $0.4 million expiring in 2019, $0.7 million expiring in 2020, $2.3 million expiring in 2021, $3.2 million expiring in 2022, $7.5 million expiring in 2023 and the remaining $10.5 million expiring in 2024. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions We subscribe to various cloud-based applications from Salesforce. Bret Taylor, a member of our Board of Directors, serves as President and Chief Product Officer of Salesforce. We incur costs at different times throughout the year, typically in advance of services being provided, and subsequently amortize these costs ratably to expense as services are provided over the contractual term. The cost to subscribe to various cloud-based hosting arrangements from Salesforce and Quip was $0.5 million and $0.4 million for the three months ended March 31, 2019 and 2018, respectively. As of March 31, 2019 , $0.1 million was due to Salesforce for such arrangements. Amounts due to Salesforce as of December 31, 2018 were negligible. |
Employee Benefit Plans
Employee Benefit Plans | 3 Months Ended |
Mar. 31, 2019 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans We have a defined contribution 401 (k) plan for eligible employees, which is qualified under Sections 401 (a) and 401 (k) of the Internal Revenue Code of 1986, as amended. Employees are entitled to make tax-deferred contributions of up to the maximum amount allowed by law of their eligible compensation. We also have a non-qualified deferred compensation plan for certain executives, key employees and non-employee directors through which participants may elect to postpone the receipt and taxation of a portion of their compensation, including stock-based compensation, received from us. The non-qualified deferred compensation plan allows eligible participants to defer up to 80% of their base salary and up to 100% of other types of compensation. The plan also allows for matching and discretionary employer contributions. Employee deferrals are deemed 100% vested upon contribution. Distributions from the plan are made upon retirement, death, separation of service, specified date or upon the occurrence of an unforeseeable emergency. Distributions can be paid in a variety of forms from lump sum to installments over a period of years. Participants in the plan are entitled to select from a wide variety of investments available under the plan and are allocated gains or losses based upon the performance of the investments selected by the participant. All gains or losses are allocated fully to plan participants and we do not guarantee a rate of return on deferred balances. Assets related to this plan consist of corporate-owned life insurance contracts and are included in other assets in the condensed consolidated balance sheets. Participants have no rights or claims with respect to any plan assets and any such assets are subject to the claims of our general creditors. Contributions to the plans are made by both the employee and us. Our contributions to the 401(k) plan are based on the level of employee contributions and are immediately vested. Our matching contributions to the 401(k) and non-qualified deferred compensation plan for the three months ended March 31, 2019 and 2018 , were $1.4 million and $0.8 million , respectively. Future matching contributions to the plans are at our sole discretion. |
Segment Data
Segment Data | 3 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
Segment Data | Segment Data Our operations are comprised of two reportable segments: the manufacture and sale of CEWs, batteries, accessories, extended warranties and other products and services (the “TASER” segment); and the software and sensors business, which includes the sale of devices, wearables, applications, cloud and mobile products (collectively, the “Software and Sensors” segment). Our Chief Executive Officer, who is the CODM, is not provided asset information or sales, general, and administrative expense by segment. Information relative to our reportable segments was as follows (in thousands): Three Months Ended March 31, 2019 Three Months Ended March 31, 2018 TASER Software and Sensors Total TASER Software and Sensors Total Net sales from products $ 65,301 $ 22,788 $ 88,089 $ 63,524 $ 17,450 $ 80,974 Net sales from services 90 27,631 27,721 — 20,241 20,241 Net sales 65,391 50,419 115,810 63,524 37,691 101,215 Cost of product sales 23,278 16,322 39,600 20,543 11,891 32,434 Cost of service sales — 7,293 7,293 — 4,320 4,320 Cost of sales 23,278 23,615 46,893 20,543 16,211 36,754 Gross margin 42,113 26,804 68,917 42,981 21,480 64,461 Research and development 3,712 19,642 23,354 2,960 12,159 15,119 |
Organization and Summary of S_2
Organization and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation and Use of Estimates These unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the SEC. Certain information related to our organization, significant accounting policies and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) has been condensed or omitted. The accounting policies followed in the preparation of these unaudited condensed consolidated financial statements are consistent with those followed in our annual consolidated financial statements for the year ended December 31, 2018 , as filed on Form 10-K, with the exception of our adoption of certain accounting pronouncements which we describe below. In the opinion of management, these unaudited condensed consolidated financial statements contain all material adjustments, consisting only of normal recurring adjustments, necessary to fairly state our financial position, results of operations and cash flows for the periods presented and the presentations and disclosures herein are adequate when read in conjunction with our Form 10-K for the year ended December 31, 2018 . The results of operations for the three months ended March 31, 2019 and 2018 are not necessarily indicative of the results to be expected for the full year (or any other period). Significant estimates and assumptions in these unaudited condensed consolidated financial statements include: • product warranty reserves, • inventory valuation, • revenue recognition, • valuation of goodwill, intangible and long-lived assets, • recognition, measurement and valuation of current and deferred income taxes, • stock-based compensation, • recognition and measurement of lease liabilities, • recognition and measurement of contingencies and accrued litigation expense, and • fair values of identified tangible and intangible assets acquired and liabilities assumed in business combinations. Actual results could differ materially from those estimates. |
Use of Estimates | Basis of Presentation and Use of Estimates These unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the SEC. Certain information related to our organization, significant accounting policies and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) has been condensed or omitted. The accounting policies followed in the preparation of these unaudited condensed consolidated financial statements are consistent with those followed in our annual consolidated financial statements for the year ended December 31, 2018 , as filed on Form 10-K, with the exception of our adoption of certain accounting pronouncements which we describe below. In the opinion of management, these unaudited condensed consolidated financial statements contain all material adjustments, consisting only of normal recurring adjustments, necessary to fairly state our financial position, results of operations and cash flows for the periods presented and the presentations and disclosures herein are adequate when read in conjunction with our Form 10-K for the year ended December 31, 2018 . The results of operations for the three months ended March 31, 2019 and 2018 are not necessarily indicative of the results to be expected for the full year (or any other period). Significant estimates and assumptions in these unaudited condensed consolidated financial statements include: • product warranty reserves, • inventory valuation, • revenue recognition, • valuation of goodwill, intangible and long-lived assets, • recognition, measurement and valuation of current and deferred income taxes, • stock-based compensation, • recognition and measurement of lease liabilities, • recognition and measurement of contingencies and accrued litigation expense, and • fair values of identified tangible and intangible assets acquired and liabilities assumed in business combinations. Actual results could differ materially from those estimates. |
Segment Information | Segment Information Our operations are comprised of two reportable segments: the manufacture and sale of conducted electrical weapons ("CEWs"), batteries, accessories, extended warranties and other products and services (the “TASER” segment); and the development, manufacture, and sale of software and sensors, which includes the sale of devices, wearables, applications, cloud and mobile products (collectively, the “Software and Sensors” segment). Revenue from our “products” in the Software and Sensors segment are generally from sales of sensors, including on-officer body cameras, Axon Fleet cameras, other hardware sensors, warranties on sensors, and other products, and is sometimes referred to as "Sensors and Other revenue." Revenue from our “services” in the Software and Sensors segment comprise sales related to the Axon Cloud, which includes Axon Evidence, cloud-based evidence management software revenue, other recurring cloud-hosted software revenue and related professional services, and is sometimes referred to as "Axon Cloud revenue." Within the Software and Sensors segment, we include only revenues and costs attributable to that segment, which costs include: costs of sales for both products and services, direct labor, product management and research and development ("R&D") for products included, or to be included, within the Software and Sensors segment. All other costs are included in the TASER segment. Our Chief Executive Officer, who is the Chief Operating Decision Maker (the “CODM”), is not provided asset information or sales, general, and administrative expense by segment. Reportable segments are determined based on discrete financial information reviewed by the CODM. We organize and review operations based on products and services. We perform an analysis of our reportable segments on at least an annual basis. Additional information related to our business segments is summarized in Note 15. |
Geographic Information and Major Customers | Geographic Information and Major Customers For the three months ended March 31, 2019 and 2018, no individual country outside the U.S. represented more than 10% of total net sales. Individual sales transactions in the international market are generally larger and occur more intermittently than in the domestic market due to the profile of our customers. |
Income per Common Share | Income per Common Share Basic income per common share is computed by dividing net income by the weighted average number of common shares outstanding during the periods presented. Potentially dilutive securities include outstanding stock options and unvested restricted stock units ("RSUs"). The dilutive effect of potentially dilutive securities is reflected in diluted earnings per share by application of the treasury stock method. Under the treasury stock method, an increase in the fair market value of our common stock can result in a greater dilutive effect from potentially dilutive securities. |
Standard Warranties | Standard Warranties We warranty our CEWs, Axon cameras and certain related accessories from manufacturing defects on a limited basis for a period of one year after purchase and, thereafter, will repair or replace any defective unit for a fee. Estimated costs for the standard warranty are charged to cost of products sold when revenue is recorded for the related product. Future warranty costs are estimated based on historical data related to warranty claims on a quarterly basis and this rate is applied to current product sales. Historically, reserve amounts have been increased if management becomes aware of a component failure or other issue that could result in larger than anticipated warranty claims from customers. The warranty reserve is reviewed quarterly to verify that it sufficiently reflects the remaining warranty obligations based on the anticipated expenditures over the balance of the warranty obligation period, and adjustments are made when actual warranty claim experience differs from estimates. The warranty reserve is included in accrued liabilities on the accompanying condensed consolidated balance sheets. |
Fair Value of Financial Instruments | Fair Value Measurements and Financial Instruments The fair value framework prioritizes the inputs to valuation techniques for measuring financial assets and liabilities measured on a recurring basis and for non-financial assets and liabilities when these items are re-measured. Fair value is considered to be the exchange price in an orderly transaction between market participants to sell an asset or transfer a liability at the measurement date. The hierarchy below lists three levels of fair value based on the extent to which inputs used in measuring fair value are observable in the market. We categorize each of our fair value measurements in one of these three levels based on the lowest level input that is significant to the fair value measurement in its entirety. These levels are: • Level 1 – Valuation techniques in which all significant inputs are unadjusted quoted prices from active markets for assets or liabilities that are identical to the assets or liabilities being measured. • Level 2 – Valuation techniques in which significant inputs include quoted prices from active markets for assets or liabilities that are similar to the assets or liabilities being measured and/or quoted prices for assets or liabilities that are identical or similar to the assets or liabilities being measured from markets that are not active. Also, model-derived valuations in which all significant inputs and significant value drivers are observable in active markets are Level 2 valuation techniques. • Level 3 – Valuation techniques in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are valuation technique inputs that reflect our own assumptions about inputs that market participants would use in pricing an asset or liability. We have cash equivalents and investments, which at March 31, 2019 and December 31, 2018 were comprised of money market funds and, at March 31, 2019, also included corporate bonds. See additional disclosure regarding the fair value of our cash equivalents and investments in Note 3. Included in the balance of other assets as of March 31, 2019 and December 31, 2018 was $3.9 million and $3.6 million , respectively, related to corporate-owned life insurance policies which are used to fund our deferred compensation plan. We determine the fair value of insurance contracts by obtaining the cash surrender value of the contracts from the issuer, a Level 2 valuation technique. Our financial instruments also include accounts and notes receivable, accounts payable and accrued liabilities. Due to the short-term nature of these instruments, their carrying values approximate their fair values on the accompanying condensed consolidated balance sheets. |
Valuation of Goodwill, Intangibles and Long-lived Assets | Valuation of Goodwill, Intangibles and Long-lived Assets We evaluate whether events and circumstances have occurred that indicate the remaining estimated useful life of long-lived assets and identifiable intangible assets, excluding goodwill and intangible assets with indefinite useful lives, may warrant revision or that the remaining balance of these assets may not be recoverable. Such circumstances could include, but are not limited to, a change in the product mix, a change in the way products are created, produced or delivered, or a significant change in the way products are branded and marketed. In performing the review for recoverability, we estimate the future undiscounted cash flows expected to result from the use of the assets and their eventual disposition. The amount of the impairment loss, if impairment exists, is calculated based on the excess of the carrying amounts of the assets over their estimated fair value computed using discounted cash flows. We do not amortize goodwill and intangible assets with indefinite useful lives; rather such assets are required to be tested for impairment at least annually or sooner whenever events or changes in circumstances indicate that the assets may be impaired. We perform our annual goodwill and intangible asset impairment tests in the fourth quarter of each year. |
Recently Issued Accounting Guidance | Recently Issued Accounting Guidance Recently Adopted Accounting Pronouncements In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-02, Leases (Topic 842), which is intended to increase transparency and comparability among organizations by requiring the recognition of right-of-use (“ROU”) assets and lease liabilities on the balance sheet. In July 2018, the FASB issued additional guidance which provided an additional transition method for adopting the updated guidance. Most prominent among the changes in the standard is the requirement for lessees to recognize ROU assets and lease liabilities for those leases that were classified as operating leases under previous U.S. GAAP. On January 1, 2019, we adopted Topic 842 by applying the non-comparative modified retrospective method of adoption. Under this method, financial information related to periods prior to adoption will be as originally reported under the then-current standard (Topic 840, Leases). Results for reporting periods beginning on or after January 1, 2019 are presented under Topic 842, while prior period amounts are not adjusted, and continue to be reported in accordance with our historic accounting under Topic 840. We elected to apply the package of practical expedients to not reassess whether a contract is or contains a lease, lease classification, or initial lease costs for all leases that commenced before the adoption date. The adoption had a material impact to our condensed consolidated balance sheet. The most significant impact was the recognition of ROU assets and lease liabilities for operating leases, while our accounting for finance leases remained substantially unchanged. There was no other impact from the adoption. The adjustments to the opening balance sheet were as follows (in thousands): December 31, 2018 Impact of Adoption of Topic 842 on Opening Balance Sheet January 1, 2019 (As reported) (As adjusted) Consolidated Balance Sheet Data: Other assets $ 22,999 $ 12,483 $ 35,482 Total assets 719,540 12,483 732,023 — Accrued liabilities 41,092 (1,138 ) 39,954 Other current liabilities 37 3,588 3,625 Total current liabilities 166,011 2,450 168,461 Other long-term liabilities 5,704 10,033 15,737 Total liabilities 252,216 12,483 264,699 Total liabilities and stockholders' equity 719,540 12,483 732,023 See Note 11 for further disclosures related to Topic 842. In June 2018, the FASB issued ASU 2018-07, Compensation - Stock Compensation (Topic 718), expanding the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. We adopted this standard on January 1, 2019 and the adoption had no impact on our condensed consolidated financial statements. Effective the first quarter of 2020: In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 includes an impairment model (known as the current expected credit loss model) on financial instruments and other commitments that is based on expected losses rather than incurred losses. Under the new guidance, an entity recognizes as an allowance its estimate of expected credit losses, which the FASB believes will result in more timely recognition of such losses. The use of forecasted information is intended to incorporate more timely information in the estimate of expected credit loss. This ASU will also require enhanced disclosures relating to significant estimates and judgments used in estimating credit losses, as well as credit quality. We are currently in the process of evaluating the impact of adoption of ASU 2016-13 on our condensed consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement. ASU 2018-13 eliminates, adds and modifies certain disclosure requirements for fair value measurements. The amendments apply to the disclosures of changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. Early adoption is permitted, and an entity is also permitted to early adopt any removed or modified disclosures and delay adoption of the additional disclosures until their effective date. As ASU 2018-13 only revises disclosure requirements, it is not expected to have a material impact on our condensed consolidated financial statements. |
Reclassification of Prior Year Presentation | Reclassification of Prior Year Presentation Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations. |
Organization and Summary of S_3
Organization and Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Weighted Average Number of Shares Outstanding and Income Per Share | The calculation of the weighted average number of shares outstanding and earnings per share are as follows (in thousands except per share data): Three Months Ended March 31, 2019 2018 Numerator for basic and diluted earnings per share: Net income $ 6,419 $ 12,926 Denominator: Weighted average shares outstanding 58,914 53,119 Dilutive effect of stock-based awards 837 1,413 Diluted weighted average shares outstanding 59,751 54,532 Anti-dilutive stock-based awards excluded 12,125 404 Net income per common share: Basic $ 0.11 $ 0.24 Diluted $ 0.11 $ 0.24 |
Summary of Changes in Estimated Product Warranty Liabilities | Changes in our estimated product warranty liabilities were as follows (in thousands): Three Months Ended March 31, 2019 2018 Balance, beginning of period $ 898 $ 644 Utilization of accrual (123 ) (93 ) Warranty expense 252 8 Balance, end of period $ 1,027 $ 559 |
Adjustments to Opening Balance Sheet | The adjustments to the opening balance sheet were as follows (in thousands): December 31, 2018 Impact of Adoption of Topic 842 on Opening Balance Sheet January 1, 2019 (As reported) (As adjusted) Consolidated Balance Sheet Data: Other assets $ 22,999 $ 12,483 $ 35,482 Total assets 719,540 12,483 732,023 — Accrued liabilities 41,092 (1,138 ) 39,954 Other current liabilities 37 3,588 3,625 Total current liabilities 166,011 2,450 168,461 Other long-term liabilities 5,704 10,033 15,737 Total liabilities 252,216 12,483 264,699 Total liabilities and stockholders' equity 719,540 12,483 732,023 |
Revenues (Tables)
Revenues (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Revenue by Product and Service Offering and Geography | The following table presents our revenues by primary product and service offering (in thousands): Three Months Ended March 31, 2019 Three Months Ended March 31, 2018 TASER Software and Sensors Total TASER Software and Sensors Total TASER 7 $ 9,954 $ — $ 9,954 $ — $ — $ — TASER X26P 15,872 — 15,872 16,474 — 16,474 TASER X2 13,085 — 13,085 23,932 — 23,932 TASER Pulse and Bolt 670 — 670 1,346 — 1,346 Single cartridges 19,160 — 19,160 16,114 — 16,114 Axon Body — 6,445 6,445 — 5,558 5,558 Axon Flex — 1,224 1,224 — 1,669 1,669 Axon Fleet — 3,516 3,516 — 2,116 2,116 Axon Dock — 3,312 3,312 — 3,035 3,035 Axon Evidence and cloud services 36 27,618 27,654 — 20,241 20,241 TASER Cam — 903 903 — 1,360 1,360 Extended warranties 4,316 4,930 9,246 3,706 2,490 6,196 Other 2,298 2,471 4,769 1,952 1,222 3,174 Total $ 65,391 $ 50,419 $ 115,810 $ 63,524 $ 37,691 $ 101,215 The following table presents our revenues disaggregated by geography (in thousands): Three Months Ended March 31, 2019 2018 United States $ 94,333 81 % $ 77,950 77 % Other countries 21,477 19 23,265 23 Total $ 115,810 100 % $ 101,215 100 % |
Contract with Customer, Assets and Liabilities | The following table presents our contract assets, contract liabilities and certain information related to these balances as of and for the three months ended March 31, 2019 (in thousands): March 31, 2019 Contract assets, net $ 18,257 Contract liabilities (deferred revenue) 184,847 Revenue recognized in the period from: Amounts included in contract liabilities at the beginning of the period 31,222 Contract liabilities (deferred revenue) consisted of the following (in thousands): March 31, 2019 December 31, 2018 Current Long-Term Total Current Long-Term Total Warranty: TASER $ 11,821 $ 15,770 $ 27,591 $ 12,797 $ 16,847 $ 29,644 Software and Sensors 8,779 6,060 14,839 8,273 6,516 14,789 20,600 21,830 42,430 21,070 23,363 44,433 Hardware: TASER 3,845 16,091 19,936 9,355 15,598 24,953 Software and Sensors 31,104 24,023 55,127 20,878 24,685 45,563 34,949 40,114 75,063 30,233 40,283 70,516 Services: TASER 75 438 513 — — — Software and Sensors 54,439 12,402 66,841 55,713 10,771 66,484 54,514 12,840 67,354 55,713 10,771 66,484 Total $ 110,063 $ 74,784 $ 184,847 $ 107,016 $ 74,417 $ 181,433 March 31, 2019 December 31, 2018 Current Long-Term Total Current Long-Term Total TASER $ 15,741 $ 32,299 $ 48,040 $ 22,152 $ 32,445 $ 54,597 Software and Sensors 94,322 42,485 136,807 84,864 41,972 126,836 Total $ 110,063 $ 74,784 $ 184,847 $ 107,016 $ 74,417 $ 181,433 |
Cash, Cash Equivalents and In_2
Cash, Cash Equivalents and Investments (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Cash and Cash Equivalents [Abstract] | |
Summary of Cash, Cash Equivalents and Held-to-Maturity Investments by Type | The following tables summarize our cash, cash equivalents, and held-to-maturity investments at March 31, 2019 and December 31, 2018 (in thousands): As of March 31, 2019 Amortized Cost Gross Unrealized Losses Fair Value Cash and Cash Equivalents Short-Term Investments Cash $ 123,098 $ — $ 123,098 $ 123,098 $ — Level 1: Money market funds 83,449 — 83,449 83,449 — Level 2: Corporate bonds 122,407 (56 ) 122,351 17,095 105,312 Total $ 328,954 $ (56 ) $ 328,898 $ 223,642 $ 105,312 As of December 31, 2018 Amortized Cost Gross Unrealized Losses Fair Value Cash and Cash Equivalents Short-Term Investments Cash $ 144,095 $ — $ 144,095 $ 144,095 $ — Level 1: Money market funds 205,367 — 205,367 205,367 — Total $ 349,462 $ — $ 349,462 $ 349,462 $ — |
Inventory (Tables)
Inventory (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Inventory | Inventory consisted of the following at March 31, 2019 and December 31, 2018 (in thousands): March 31, 2019 December 31, 2018 Raw materials $ 20,574 $ 19,670 Finished goods 17,013 14,093 Total inventory $ 37,587 $ 33,763 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The changes in the carrying amount of goodwill for the three months ended March 31, 2019 were as follows (in thousands): TASER Software and Sensors Total Balance, beginning of period $ 1,338 $ 23,643 $ 24,981 Foreign currency translation adjustment 18 18 36 Balance, end of period $ 1,356 $ 23,661 $ 25,017 |
Indefinite-Lived Intangible Assets Other than Goodwill | Intangible assets (other than goodwill) consisted of the following (in thousands): March 31, 2019 December 31, 2018 Useful Life Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Amortizable (definite-lived) intangible assets: Domain names 5-10 years $ 3,161 $ (808 ) $ 2,353 $ 3,161 $ (732 ) $ 2,429 Issued patents 4-15 years 2,982 (1,158 ) 1,824 2,940 (1,106 ) 1,834 Issued trademarks 3-11 years 922 (490 ) 432 1,053 (599 ) 454 Customer relationships 4-8 years 3,717 (1,027 ) 2,690 3,701 (880 ) 2,821 Non-compete agreements 3-4 years 452 (375 ) 77 540 (439 ) 101 Developed technology 3-7 years 10,660 (4,889 ) 5,771 13,404 (7,081 ) 6,323 Re-acquired distribution rights 2 years 2,031 (2,031 ) — 1,928 (1,813 ) 115 Total amortizable 23,925 (10,778 ) 13,147 26,727 (12,650 ) 14,077 Not amortizable (indefinite-lived) intangible assets: TASER trademark 900 900 900 900 Patents and trademarks pending 1,020 1,020 958 958 Total not amortizable 1,920 1,920 1,858 1,858 Total intangible assets $ 25,845 $ (10,778 ) $ 15,067 $ 28,585 $ (12,650 ) $ 15,935 |
Finite-Lived Intangible Assets Other than Goodwill | Intangible assets (other than goodwill) consisted of the following (in thousands): March 31, 2019 December 31, 2018 Useful Life Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Amortizable (definite-lived) intangible assets: Domain names 5-10 years $ 3,161 $ (808 ) $ 2,353 $ 3,161 $ (732 ) $ 2,429 Issued patents 4-15 years 2,982 (1,158 ) 1,824 2,940 (1,106 ) 1,834 Issued trademarks 3-11 years 922 (490 ) 432 1,053 (599 ) 454 Customer relationships 4-8 years 3,717 (1,027 ) 2,690 3,701 (880 ) 2,821 Non-compete agreements 3-4 years 452 (375 ) 77 540 (439 ) 101 Developed technology 3-7 years 10,660 (4,889 ) 5,771 13,404 (7,081 ) 6,323 Re-acquired distribution rights 2 years 2,031 (2,031 ) — 1,928 (1,813 ) 115 Total amortizable 23,925 (10,778 ) 13,147 26,727 (12,650 ) 14,077 Not amortizable (indefinite-lived) intangible assets: TASER trademark 900 900 900 900 Patents and trademarks pending 1,020 1,020 958 958 Total not amortizable 1,920 1,920 1,858 1,858 Total intangible assets $ 25,845 $ (10,778 ) $ 15,067 $ 28,585 $ (12,650 ) $ 15,935 |
Estimated Amortization Expense of Intangible Assets | Estimated amortization for intangible assets with definite lives for the remaining nine months of 2019 , the next five years ended December 31, and thereafter, is as follows (in thousands): 2019 Remaining $ 2,501 2020 3,293 2021 2,846 2022 1,244 2023 946 2024 862 Thereafter 1,455 Total $ 13,147 |
Other Assets (Tables)
Other Assets (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Other Assets | Other assets consisted of the following at March 31, 2019 and December 31, 2018 (in thousands): March 31, 2019 December 31, 2018 Cash surrender value of corporate-owned life insurance policies $ 3,919 $ 3,596 Deferred commissions (1) 16,141 15,530 Restricted cash 659 661 Operating lease assets 11,659 — Prepaid expenses, deposits and other 3,378 3,212 Total other long-term assets $ 35,756 $ 22,999 (1) Represents assets for the incremental costs of obtaining contracts with customers, which consist primarily of sales commissions. These costs are ascribed to or allocated to the underlying performance obligations in the contracts and amortized consistent with the recognition timing of the revenue for the underlying performance obligations. |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities | Accrued liabilities consisted of the following at March 31, 2019 and December 31, 2018 (in thousands): March 31, 2019 December 31, 2018 Accrued salaries, benefits and bonus $ 13,993 $ 19,063 Accrued professional, consulting and lobbying fees 4,476 4,894 Accrued warranty expense 1,027 898 Accrued income and other taxes 4,392 4,167 Other accrued liabilities 12,460 12,070 Accrued liabilities $ 36,348 $ 41,092 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Equity Compensation Goals | Eight Separate Revenue Goals (1) (in thousands) Eight Separate Adjusted EBITDA (CEO Performance Award) Goals (in thousands) Goal #1, $710,058 Goal #9, $125,000 Goal #2, $860,058 Goal #10, $155,000 Goal #3, $1,010,058 Goal #11, $175,000 Goal #4, $1,210,058 Goal #12, $190,000 Goal #5, $1,410,058 Goal #13, $200,000 Goal #6, $1,610,058 Goal #14, $210,000 Goal #7, $1,810,058 Goal #15, $220,000 Goal #8, $2,010,058 Goal #16, $230,000 (1) In connection with the business acquisition that was completed during the three months ended June 30, 2018, the revenue goals have been adjusted for the acquiree's Target Revenue, as defined in the CEO Performance Award agreement. |
Summary of Restricted Stock Unit Activity | The following table summarizes RSU activity for the three months ended March 31, 2019 (number of units and aggregate intrinsic value in thousands): Number of Units Weighted Average Grant-Date Fair Value Aggregate Units outstanding, beginning of year 1,655 $ 28.34 Granted 5,667 34.32 Released (290 ) 20.91 Forfeited (46 ) 34.43 Units outstanding, end of period 6,986 33.47 $ 380,123 |
Summary of the Stock Option Activity | The following table summarizes stock option activity for the three months ended March 31, 2019 (number of units and aggregate intrinsic value in thousands): Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life (years) Aggregate Options outstanding, beginning of year 6,458 $ 28.24 Granted — — Exercised (24 ) 4.20 Expired / terminated — — Options outstanding, end of period 6,434 28.33 8.83 $ 167,827 Options exercisable, end of period 68 4.54 1.69 3,397 |
Stock-Based Compensation | The following table summarizes the composition of stock-based compensation for the three months ended March 31, 2019 and 2018 (in thousands): Three Months Ended March 31, 2019 2018 Cost of products sold and services delivered $ 226 $ 141 Sales, general and administrative expenses 4,681 2,304 Research and development expenses 2,998 1,648 Total stock-based compensation $ 7,905 $ 4,093 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Balance Sheet Disclosures | Leases (in thousands) Classification March 31, 2019 Assets Operating lease assets Other assets $ 11,659 Liabilities Current Operating Other current liabilities $ 3,877 Noncurrent Operating Other long-term liabilities 8,897 Total lease liabilities $ 12,774 |
Components of Lease Expense | The components of lease expense were as follows (in thousands): Classification Three Months Ended March 31, 2019 Operating lease expense (1) Sales, general and administrative expenses (2) $ 1,017 Sublease income Other income (42 ) Net lease expense $ 975 (1) Includes short-term leases, which are immaterial. (2) An immaterial portion of operating lease expense is included within research and development expenses and cost of sales. Other information related to leases was as follows (in thousands, except lease term and discount rate): Three Months Ended March 31, 2019 Supplemental Cash Flows Information Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 961 Right-of-use assets obtained in exchange for lease liabilities Operating leases 84 Weighted average remaining lease term Operating leases 3.2 years Weighted average discount rate Operating leases 3.6 % |
Schedule of Future Minimum Rental Payments For Operating Leases | Future minimum lease payments under non-cancellable leases as of March 31, 2019 were as follows (in thousands): Operating Sublease income Net 2019 Remaining $ 3,419 $ (246 ) $ 3,173 2020 4,203 (82 ) 4,121 2021 3,325 — 3,325 2022 2,449 — 2,449 2023 1,173 — 1,173 2024 — — — Thereafter — — — Total minimum lease payments 14,569 (328 ) 14,241 Less: Amount representing interest (1,467 ) Present value of lease payments $ 12,774 |
Lessor, Operating Lease, Payments to be Received, Maturity | Future minimum lease payments under non-cancellable leases as of March 31, 2019 were as follows (in thousands): Operating Sublease income Net 2019 Remaining $ 3,419 $ (246 ) $ 3,173 2020 4,203 (82 ) 4,121 2021 3,325 — 3,325 2022 2,449 — 2,449 2023 1,173 — 1,173 2024 — — — Thereafter — — — Total minimum lease payments 14,569 (328 ) 14,241 Less: Amount representing interest (1,467 ) Present value of lease payments $ 12,774 |
Schedule of Future Minimum Lease Payments for Capital Leases | Future minimum lease payments under non-cancelable leases at December 31, 2018, were as follows (in thousands): Operating Capital 2019 $ 3,670 $ 40 2020 3,572 36 2021 2,961 — 2022 2,001 — 2023 573 — Thereafter — — Total minimum lease payments $ 12,777 76 Less: Amount representing interest (6 ) Capital lease obligation $ 70 |
Schedule of Future Minimum Rental Payments for Operating Leases | Future minimum lease payments under non-cancelable leases at December 31, 2018, were as follows (in thousands): Operating Capital 2019 $ 3,670 $ 40 2020 3,572 36 2021 2,961 — 2022 2,001 — 2023 573 — Thereafter — — Total minimum lease payments $ 12,777 76 Less: Amount representing interest (6 ) Capital lease obligation $ 70 |
Segment Data (Tables)
Segment Data (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
Summary of Operational Information Relative to the Company's Reportable Segments | Information relative to our reportable segments was as follows (in thousands): Three Months Ended March 31, 2019 Three Months Ended March 31, 2018 TASER Software and Sensors Total TASER Software and Sensors Total Net sales from products $ 65,301 $ 22,788 $ 88,089 $ 63,524 $ 17,450 $ 80,974 Net sales from services 90 27,631 27,721 — 20,241 20,241 Net sales 65,391 50,419 115,810 63,524 37,691 101,215 Cost of product sales 23,278 16,322 39,600 20,543 11,891 32,434 Cost of service sales — 7,293 7,293 — 4,320 4,320 Cost of sales 23,278 23,615 46,893 20,543 16,211 36,754 Gross margin 42,113 26,804 68,917 42,981 21,480 64,461 Research and development 3,712 19,642 23,354 2,960 12,159 15,119 |
Organization and Summary of S_4
Organization and Summary of Significant Accounting Policies - Additional Information (Detail) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019USD ($)segment | Dec. 31, 2018USD ($) | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Number of reportable segments | segment | 2 | |
Warranty period | 1 year | |
Corporate owned life insurance policies fair value | $ 3,919 | $ 3,596 |
Restricted cash balance | 659 | 661 |
Prepaid Expenses and Other Current Assets | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Restricted cash balance | 900 | 900 |
Other Current Assets | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Restricted cash balance | $ 700 | $ 700 |
Organization and Summary of S_5
Organization and Summary of Significant Accounting Policies - Weighted Average Number of Shares Outstanding and Income Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Numerator for basic and diluted earnings per share: | ||
Net income | $ 6,419 | $ 12,926 |
Denominator: | ||
Weighted average shares outstanding—basic (in shares) | 58,914 | 53,119 |
Dilutive effect of stock-based awards (in shares) | 837 | 1,413 |
Diluted weighted average shares outstanding (in shares) | 59,751 | 54,532 |
Anti-dilutive stock-based awards excluded (in shares) | 12,125 | 404 |
Net income per common share: | ||
Basic (in dollars per share) | $ 0.11 | $ 0.24 |
Diluted (in dollars per share) | $ 0.11 | $ 0.24 |
Organization and Summary of S_6
Organization and Summary of Significant Accounting Policies - Summary of Changes in Estimated Product Warranty Liabilities (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Movement in Standard and Extended Product Warranty Accrual, Increase (Decrease) [Roll Forward] | ||
Balance, beginning of period | $ 898 | $ 644 |
Utilization of accrual | (123) | (93) |
Warranty expense | 252 | 8 |
Balance, end of period | $ 1,027 | $ 559 |
Organization and Summary of S_7
Organization and Summary of Significant Accounting Policies Organization and Summary of Significant Accounting Policies - Adjustments to Opening Balance Sheet (Detail) - USD ($) $ in Thousands | Mar. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
Assets | |||
Other assets | $ 35,756 | $ 35,482 | $ 22,999 |
Total assets | 739,195 | 732,023 | 719,540 |
Liabilities and Equity | |||
Accrued liabilities | 36,348 | 39,954 | 41,092 |
Other current liabilities | 3,914 | 3,625 | 37 |
Total current liabilities | 163,794 | 168,461 | 166,011 |
Other long-term liabilities | 13,247 | 15,737 | 5,704 |
Total liabilities | 258,656 | 264,699 | 252,216 |
Total liabilities and stockholders’ equity | $ 739,195 | 732,023 | $ 719,540 |
Accounting Standards Update 2016-02 | |||
Assets | |||
Other assets | 12,483 | ||
Total assets | 12,483 | ||
Liabilities and Equity | |||
Accrued liabilities | (1,138) | ||
Other current liabilities | 3,588 | ||
Total current liabilities | 2,450 | ||
Other long-term liabilities | 10,033 | ||
Total liabilities | 12,483 | ||
Total liabilities and stockholders’ equity | $ 12,483 |
Revenues - Revenues By Products
Revenues - Revenues By Products And Service Offerings (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | $ 115,810 | $ 101,215 |
TASER 7 | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 9,954 | 0 |
TASER X26P | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 15,872 | 16,474 |
TASER X2 | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 13,085 | 23,932 |
TASER Pulse and Bolt | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 670 | 1,346 |
Single cartridges | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 19,160 | 16,114 |
Axon Body | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 6,445 | 5,558 |
Axon Flex | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 1,224 | 1,669 |
Axon Fleet | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 3,516 | 2,116 |
Axon Dock | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 3,312 | 3,035 |
Axon Evidence and cloud services | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 27,654 | 20,241 |
TASER Cam | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 903 | 1,360 |
Extended warranties | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 9,246 | 6,196 |
Other | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 4,769 | 3,174 |
TASER | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 65,391 | 63,524 |
TASER | TASER 7 | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 9,954 | 0 |
TASER | TASER X26P | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 15,872 | 16,474 |
TASER | TASER X2 | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 13,085 | 23,932 |
TASER | TASER Pulse and Bolt | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 670 | 1,346 |
TASER | Single cartridges | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 19,160 | 16,114 |
TASER | Axon Body | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 0 | 0 |
TASER | Axon Flex | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 0 | 0 |
TASER | Axon Fleet | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 0 | 0 |
TASER | Axon Dock | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 0 | 0 |
TASER | Axon Evidence and cloud services | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 36 | 0 |
TASER | TASER Cam | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 0 | 0 |
TASER | Extended warranties | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 4,316 | 3,706 |
TASER | Other | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 2,298 | 1,952 |
Software and Sensors | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 50,419 | 37,691 |
Software and Sensors | TASER 7 | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 0 | 0 |
Software and Sensors | TASER X26P | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 0 | 0 |
Software and Sensors | TASER X2 | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 0 | 0 |
Software and Sensors | TASER Pulse and Bolt | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 0 | 0 |
Software and Sensors | Single cartridges | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 0 | 0 |
Software and Sensors | Axon Body | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 6,445 | 5,558 |
Software and Sensors | Axon Flex | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 1,224 | 1,669 |
Software and Sensors | Axon Fleet | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 3,516 | 2,116 |
Software and Sensors | Axon Dock | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 3,312 | 3,035 |
Software and Sensors | Axon Evidence and cloud services | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 27,618 | 20,241 |
Software and Sensors | TASER Cam | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 903 | 1,360 |
Software and Sensors | Extended warranties | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | 4,930 | 2,490 |
Software and Sensors | Other | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Revenue from contract with customers | $ 2,471 | $ 1,222 |
Revenues - Revenues By Geograph
Revenues - Revenues By Geographic Area (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customers | $ 115,810 | $ 101,215 |
United States | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customers | 94,333 | 77,950 |
Other countries | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customers | $ 21,477 | $ 23,265 |
Revenue from Contract with Customer | Geographic Concentration Risk | ||
Disaggregation of Revenue [Line Items] | ||
Concentration risk, percentage | 100.00% | 100.00% |
Revenue from Contract with Customer | Geographic Concentration Risk | United States | ||
Disaggregation of Revenue [Line Items] | ||
Concentration risk, percentage | 81.00% | 77.00% |
Revenue from Contract with Customer | Geographic Concentration Risk | Other countries | ||
Disaggregation of Revenue [Line Items] | ||
Concentration risk, percentage | 19.00% | 23.00% |
Revenues - Contract Assets, Con
Revenues - Contract Assets, Contract Liabilities (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Dec. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | ||
Contract asset | $ 18,257 | |
Contract liabilities (deferred revenue) | 184,847 | $ 181,433 |
Revenue recognized in the period from: | ||
Amounts included in contract liabilities at the beginning of the period | $ 31,222 |
Revenues - Schedule Of Contract
Revenues - Schedule Of Contract Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Disaggregation of Revenue [Line Items] | ||
Current | $ 110,063 | $ 107,016 |
Long-Term | 74,784 | 74,417 |
Total | 184,847 | 181,433 |
TASER | ||
Disaggregation of Revenue [Line Items] | ||
Current | 15,741 | 22,152 |
Long-Term | 32,299 | 32,445 |
Total | 48,040 | 54,597 |
Software and Sensors | ||
Disaggregation of Revenue [Line Items] | ||
Current | 94,322 | 84,864 |
Long-Term | 42,485 | 41,972 |
Total | 136,807 | 126,836 |
Warranty | ||
Disaggregation of Revenue [Line Items] | ||
Current | 20,600 | 21,070 |
Long-Term | 21,830 | 23,363 |
Total | 42,430 | 44,433 |
Warranty | TASER | ||
Disaggregation of Revenue [Line Items] | ||
Current | 11,821 | 12,797 |
Long-Term | 15,770 | 16,847 |
Total | 27,591 | 29,644 |
Warranty | Software and Sensors | ||
Disaggregation of Revenue [Line Items] | ||
Current | 8,779 | 8,273 |
Long-Term | 6,060 | 6,516 |
Total | 14,839 | 14,789 |
Hardware | ||
Disaggregation of Revenue [Line Items] | ||
Current | 34,949 | 30,233 |
Long-Term | 40,114 | 40,283 |
Total | 75,063 | 70,516 |
Hardware | TASER | ||
Disaggregation of Revenue [Line Items] | ||
Current | 3,845 | 9,355 |
Long-Term | 16,091 | 15,598 |
Total | 19,936 | 24,953 |
Hardware | Software and Sensors | ||
Disaggregation of Revenue [Line Items] | ||
Current | 31,104 | 20,878 |
Long-Term | 24,023 | 24,685 |
Total | 55,127 | 45,563 |
Software and Sensors | ||
Disaggregation of Revenue [Line Items] | ||
Current | 54,514 | 55,713 |
Long-Term | 12,840 | 10,771 |
Total | 67,354 | 66,484 |
Software and Sensors | TASER | ||
Disaggregation of Revenue [Line Items] | ||
Current | 75 | 0 |
Long-Term | 438 | 0 |
Total | 513 | 0 |
Software and Sensors | Software and Sensors | ||
Disaggregation of Revenue [Line Items] | ||
Current | 54,439 | 55,713 |
Long-Term | 12,402 | 10,771 |
Total | $ 66,841 | $ 66,484 |
Revenues - Revenue Performance
Revenues - Revenue Performance Obligations (Details) $ in Millions | Mar. 31, 2019USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-10-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 5 years |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-10-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 7 years |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: (nil) | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | $ 930 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: (nil) | Minimum | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation to be recognized in the next twelve months, percent | 15.00% |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: (nil) | Maximum | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation to be recognized in the next twelve months, percent | 20.00% |
Cash, Cash Equivalents, and Inv
Cash, Cash Equivalents, and Investments - Summary of Cash, Cash Equivalents and Held-to-Maturity Investments by Type (Detail) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Amortized Cost | $ 328,954 | $ 349,462 |
Gross Unrealized Losses | (56) | 0 |
Fair Value | 328,898 | 349,462 |
Cash and Cash Equivalents | 223,642 | 349,462 |
Short-term investments | 105,312 | 0 |
Fair Value, Inputs, Level 2 | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Amortized Cost | 122,407 | |
Gross Unrealized Losses | (56) | |
Fair Value | 122,351 | |
Cash and Cash Equivalents | 17,095 | |
Short-term investments | 105,312 | |
Cash | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Amortized Cost | 123,098 | 144,095 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | 123,098 | 144,095 |
Cash and Cash Equivalents | 123,098 | 144,095 |
Short-term investments | 0 | 0 |
Money market funds | Fair Value, Inputs, Level 1 | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Amortized Cost | 83,449 | 205,367 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | 83,449 | 205,367 |
Cash and Cash Equivalents | 83,449 | 205,367 |
Short-term investments | $ 0 | $ 0 |
Inventory (Detail)
Inventory (Detail) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Inventory, finished goods, trial and evaluation, gross | $ 1,300 | $ 1,400 |
Raw materials | 20,574 | 19,670 |
Finished goods | 17,013 | 14,093 |
Total inventory | $ 37,587 | $ 33,763 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Schedule of Goodwill (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Goodwill [Roll Forward] | |
Balance, beginning of period | $ 24,981 |
Foreign currency translation adjustment | 36 |
Balance, end of period | 25,017 |
TASER Weapons | |
Goodwill [Roll Forward] | |
Balance, beginning of period | 1,338 |
Foreign currency translation adjustment | 18 |
Balance, end of period | 1,356 |
Software and Sensors | |
Goodwill [Roll Forward] | |
Balance, beginning of period | 23,643 |
Foreign currency translation adjustment | 18 |
Balance, end of period | $ 23,661 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Intangible Assets Other than Goodwill (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Dec. 31, 2018 | |
Indefinite-lived Intangible Assets [Line Items] | ||
Not amortized intangible assets, Carrying Amount | $ 1,920 | $ 1,858 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 23,925 | 26,727 |
Accumulated Amortization | (10,778) | (12,650) |
Total | 13,147 | 14,077 |
Intangible assets, Gross Carrying Amount | 25,845 | 28,585 |
Intangible assets, Net Carrying Amount | 15,067 | 15,935 |
TASER trademark | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Not amortized intangible assets, Carrying Amount | 900 | 900 |
Patents and trademarks pending | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Not amortized intangible assets, Carrying Amount | 1,020 | 958 |
Domain names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 3,161 | 3,161 |
Accumulated Amortization | (808) | (732) |
Total | $ 2,353 | 2,429 |
Domain names | Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 5 years | |
Domain names | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 10 years | |
Issued patents | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 2,982 | 2,940 |
Accumulated Amortization | (1,158) | (1,106) |
Total | $ 1,824 | 1,834 |
Issued patents | Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 4 years | |
Issued patents | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 15 years | |
Issued trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 922 | 1,053 |
Accumulated Amortization | (490) | (599) |
Total | $ 432 | 454 |
Issued trademarks | Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 3 years | |
Issued trademarks | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 11 years | |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 3,717 | 3,701 |
Accumulated Amortization | (1,027) | (880) |
Total | $ 2,690 | 2,821 |
Customer relationships | Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 4 years | |
Customer relationships | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 8 years | |
Non-compete agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 452 | 540 |
Accumulated Amortization | (375) | (439) |
Total | $ 77 | 101 |
Non-compete agreements | Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 3 years | |
Non-compete agreements | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 4 years | |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 10,660 | 13,404 |
Accumulated Amortization | (4,889) | (7,081) |
Total | $ 5,771 | 6,323 |
Developed technology | Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 3 years | |
Developed technology | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 7 years | |
Re-acquired distribution rights | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 2 years | |
Gross Carrying Amount | $ 2,031 | 1,928 |
Accumulated Amortization | (2,031) | (1,813) |
Total | $ 0 | $ 115 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets Goodwill and Intangible Assets - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expense of intangible assets | $ 1 | $ 1.4 |
Goodwill and Intangible asset_5
Goodwill and Intangible assets - Estimated Amortization Expense of Intangible Assets (Detail) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2019 Remaining | $ 2,501 | |
2020 | 3,293 | |
2021 | 2,846 | |
2022 | 1,244 | |
2023 | 946 | |
2024 | 862 | |
Thereafter | 1,455 | |
Total | $ 13,147 | $ 14,077 |
Other Assets (Details)
Other Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||
Cash surrender value of corporate-owned life insurance policies | $ 3,919 | $ 3,596 | |
Deferred commissions | 16,141 | 15,530 | |
Restricted cash | 659 | 661 | |
Operating lease assets | 11,659 | ||
Prepaid expenses, deposits and other | 3,378 | 3,212 | |
Total other long-term assets | $ 35,756 | $ 35,482 | $ 22,999 |
Accrued Liabilities (Detail)
Accrued Liabilities (Detail) - USD ($) $ in Thousands | Mar. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2017 |
Payables and Accruals [Abstract] | |||||
Accrued salaries, benefits and bonus | $ 13,993 | $ 19,063 | |||
Accrued professional, consulting and lobbying fees | 4,476 | 4,894 | |||
Accrued warranty expense | 1,027 | 898 | $ 559 | $ 644 | |
Accrued income and other taxes | 4,392 | 4,167 | |||
Other accrued liabilities | 12,460 | 12,070 | |||
Accrued liabilities | $ 36,348 | $ 39,954 | $ 41,092 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) $ in Millions | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Tax Credit Carryforward [Line Items] | |
Deferred tax assets, net | $ 18.8 |
Unrecognized tax benefits | 5.7 |
Research and development tax credit studies | $ 2.7 |
Overall effective tax rate, after discrete period adjustments (as a percentage) | (28.80%) |
Effective tax rate, before discrete period adjustment (as a percentage) | 21.10% |
Write off of certain deferred tax assets | $ 0 |
Restricted Stock Units (RSUs) | |
Tax Credit Carryforward [Line Items] | |
Discrete tax benefit, stock-based compensation | 2.7 |
State Tax | |
Tax Credit Carryforward [Line Items] | |
Unrecognized tax benefits recognized during period | 5.7 |
Federal Income Tax | |
Tax Credit Carryforward [Line Items] | |
Unrecognized tax benefits recognized during period | $ 0.1 |
Shareholders' Equity - CEO Perf
Shareholders' Equity - CEO Performance Award - Additional Information (Details) $ in Thousands | May 24, 2018USD ($)trancheshares | Mar. 31, 2019USD ($)shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
First tranche | $ 2,500,000 | |
Tranche incremental increase | $ 1,000,000 | |
Revenue goal number 1 | $ 710,058 | |
Revenue goal number 2 | 860,058 | |
Revenue goal number 3 | 1,010,058 | |
Revenue goal number 4 | 1,210,058 | |
Revenue goal number 5 | 1,410,058 | |
Revenue goal number 6 | 1,610,058 | |
Revenue goal number 7 | 1,810,058 | |
Revenue goal number 8 | 2,010,058 | |
Adjusted EBITDA goal number 9 | 125,000 | |
Adjusted EBITDA goal number 10 | 155,000 | |
Adjusted EBITDA goal number 11 | 175,000 | |
Adjusted EBITDA goal number 12 | 190,000 | |
Adjusted EBITDA goal number 13 | 200,000 | |
Adjusted EBITDA goal number 14 | 210,000 | |
Adjusted EBITDA goal number 15 | 220,000 | |
Adjusted EBITDA goal number 16 | 230,000 | |
Total revenue | 710,100 | |
Adjusted EBITDA | 125,000 | |
Recorded share-based compensation expense | $ 4,700 | |
Number of options expected to vest | shares | 1,100,000 | |
Weighted average period over which costs are recognized | 7 years | |
Chief Executive Officer | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of vesting tranches | tranche | 12 | |
Performance Shares | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Performance shares authorized (in shares) | shares | 6,365,856 | |
Unrecognized share-based compensation cost related to unvested stock option awards, probable of achievement | $ 40,500 | |
Unrecognized share-based compensation cost related to unvested stock option awards, not probable of achievement | $ 200,700 |
Stockholders' Equity Stockholde
Stockholders' Equity Stockholders' Equity - eXponential Stock Performance Plan (Details) $ in Millions | May 24, 2018USD ($)shares | Jan. 31, 2019shares | Mar. 31, 2019USD ($)trancheshares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
First tranche | $ 2,500 | ||
Tranche incremental increase | $ 1,000 | ||
Recorded share-based compensation expense | $ 4.7 | ||
Number of options expected to vest | shares | 1,100,000 | ||
Weighted average period over which costs are recognized | 7 years | ||
Performance Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance shares authorized (in shares) | shares | 6,365,856 | ||
Unrecognized share-based compensation cost related to unvested stock option awards, probable of achievement | $ 40.5 | ||
Unrecognized share-based compensation cost related to unvested stock option awards, not probable of achievement | $ 200.7 | ||
2019 eXponential Stock Performance Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted average period over which costs are recognized | 7 years | ||
2019 eXponential Stock Performance Plan | eXponential Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance shares authorized (in shares) | shares | 5,200,000 | ||
Number of vesting tranches | tranche | 12 | ||
First tranche | $ 2,500 | ||
Tranche incremental increase | 1,000 | ||
Recorded share-based compensation expense | $ 0.7 | ||
Number of options expected to vest | shares | 900,000 | ||
Post-vest holding period | 2 years 6 months | ||
Expected term | 9 years | ||
Dividend yield (as a percentage) | 0.00% | ||
2019 eXponential Stock Performance Plan | Performance Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Unrecognized share-based compensation cost related to unvested stock option awards, probable of achievement | $ 36.8 | ||
Unrecognized share-based compensation cost related to unvested stock option awards, not probable of achievement | $ 137 | ||
2019 eXponential Stock Performance Plan | Minimum | eXponential Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Liquidity discount (as a percentage) | 10.00% | ||
Risk-free interest rate (as a percentage) | 2.47% | ||
Expected volatility (as a percentage) | 44.96% | ||
2019 eXponential Stock Performance Plan | Maximum | eXponential Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Liquidity discount (as a percentage) | 16.80% | ||
Risk-free interest rate (as a percentage) | 2.62% | ||
Expected volatility (as a percentage) | 45.47% |
Stockholders' Equity - Summary
Stockholders' Equity - Summary of Restricted Stock Unit Activity (Detail) - Restricted Stock $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($)$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding [Roll Forward] | |
Number of Units outstanding, beginning of year (in shares) | shares | 1,655 |
Units released due to performance criteria threshold (in shares) | shares | (290) |
Number of Units, Forfeited (in shares) | shares | (46) |
Number of Units outstanding, end of period (in shares) | shares | 6,986 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |
Weighted Average Grant Date Fair Value, Units outstanding, beginning of year (in dollars per share) | $ 28.34 |
Weighted Average Grant Date Fair Value, Granted (in dollars per share) | 34.32 |
Weighted Average Grant Date Fair Value, Released (in dollars per share) | 20.91 |
Weighted Average Grant Date Fair Value, Forfeited (in dollars per share) | 34.43 |
Weighted Average Grant Date Fair Value, Units outstanding, end of period (in dollars per share) | $ 33.47 |
Aggregate intrinsic value at end of period | $ | $ 380,123 |
Stockholders' Equity - Restrict
Stockholders' Equity - Restricted Stock Units - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted average period over which costs are recognized | 7 years | ||
Tax payments, for net share settlement of share based award | $ 1,259 | $ 3,777 | |
Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Aggregate intrinsic value price per share (in dollars per share) | $ 54.41 | ||
Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Unrecognized stock-based compensation expense related to non-vested stock options | $ 84,900 | ||
Weighted average period over which costs are recognized | 4 years 7 months 2 days | ||
Units released due to performance criteria threshold (in shares) | 290,000 | ||
Number of units outstanding (as a percentage) | 6,986,000 | 1,655,000 | |
Performance Based Restricted Stock Unit | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of units, granted (in shares) | 5,400,000 | ||
Units released due to performance criteria threshold (in shares) | 5,000 | ||
Number of units outstanding (as a percentage) | 5,700,000 | ||
Maximum additional shares to be issued (in shares) | 300,000 | ||
eXponential Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of units, granted (in shares) | 5,200,000 | ||
Restricted Stock Units (RSUs) | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of units, granted (in shares) | 5,667,207 | ||
Shares withheld, for net share settlement of share based award (in shares) | 15,000 | ||
Tax payments, for net share settlement of share based award | $ 1,300 | ||
Service Based Restricted Stock Unit | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of units, granted (in shares) | 300,000 | ||
Minimum | Performance Based Restricted Stock Unit | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percentage of targeted shares vested | 0.00% | ||
Maximum | Performance Based Restricted Stock Unit | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percentage of targeted shares vested | 200.00% |
Stockholders' Equity - Summar_2
Stockholders' Equity - Summary of the Company's Stock Options Activity (Detail) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($)$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |
Number of options expected to vest | 1,100 |
Stock Options | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |
Number of options, Options outstanding, beginning of year (in shares) | 6,458 |
Number of options, Granted (in shares) | 0 |
Number of options, Exercised (in shares) | (24) |
Number of options, Expired / terminated (in shares) | 0 |
Number of options, Options outstanding, end of year (in shares) | 6,434 |
Number of options, Options exercisable, end of period (in shares) | 68 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | |
Weighted average exercise price, Options outstanding, beginning of year (in dollars per share) | $ / shares | $ 28.24 |
Weighted average exercise price, Granted (in dollars per share) | $ / shares | 0 |
Weighted average exercise price, Exercised (in dollars per share) | $ / shares | 4.20 |
Weighted average exercise price, Expired / terminated (in dollars per share) | $ / shares | 0 |
Weighted average exercise price, Options outstanding, end of period (in dollars per share) | $ / shares | 28.33 |
Weighted average exercise price, Options exercisable, end of period (in dollars per share) | $ / shares | $ 4.54 |
Weighted average remaining contractual life, Options outstanding, end of period | 8 years 9 months 29 days |
Weighted average remaining contractual life, Options exercisable, end of period | 1 year 8 months 9 days |
Aggregate intrinsic value, Options outstanding, end of period | $ | $ 167,827 |
Aggregate intrinsic value, Options exercisable, end of period | $ | $ 3,397 |
Stockholders' Equity - Stock Op
Stockholders' Equity - Stock Option Activity - Additional Information (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Aggregate intrinsic value price per share (in dollars per share) | $ 54.41 | ||
Total intrinsic value of options exercised | $ 1 | $ 2 | |
Number of options outstanding (in shares) | 6,434 | 6,458 | |
Performance Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of options outstanding (in shares) | 6,400 | ||
Options related to tranches considered probable of achievement | 1,100 |
Stockholders' Equity - Reported
Stockholders' Equity - Reported Share-Based Compensation (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense | $ 7,905 | $ 4,093 |
Cost of products sold and services delivered | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense | 226 | 141 |
Sales, general and administrative expenses | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense | 4,681 | 2,304 |
Research and development expenses | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense | $ 2,998 | $ 1,648 |
Stockholders' Equity - Stock Re
Stockholders' Equity - Stock Repurchase Plan - Additional Information (Detail) - USD ($) | 3 Months Ended | |||
Mar. 31, 2019 | Mar. 31, 2018 | Feb. 01, 2019 | Feb. 29, 2016 | |
2019 Stock Incentive Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Additional authorized shares (in shares) | 2,200,000 | 6,000,000 | ||
2016 Stock Incentive Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Outstanding common stock repurchase program authorized amount (up to) | $ 50,000,000 | |||
Shares repurchased during period (in shares) | 0 | 0 | ||
Stock Repurchase Program, Remaining Authorized Repurchase Amount | $ 16,300,000 |
Line of Credit - Additional Inf
Line of Credit - Additional Information (Detail) | 3 Months Ended | |
Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
Debt Instrument [Line Items] | ||
Maximum ratio of total liabilities to tangible net worth | 2.50 | |
Line of Credit | ||
Debt Instrument [Line Items] | ||
Available borrowing under letter of credit | $ 46,900,000 | |
Line of Credit Facility, Increase (Decrease), Net | 100,000,000 | |
Line of credit borrowings | 0 | $ 0 |
Letters of credit outstanding amount | $ 3,100,000 | |
Company's leverage ratio | 0.001 | |
Unsecured Revolving Line of Credit | Line of Credit | ||
Debt Instrument [Line Items] | ||
Total availability under line of credit agreement | $ 50,000,000 | |
Letter of Credit | Line of Credit | ||
Debt Instrument [Line Items] | ||
Available borrowing under letter of credit | $ 10,000,000 | |
Minimum | London Interbank Offered Rate (LIBOR) | Line of Credit | ||
Debt Instrument [Line Items] | ||
Debt instrument basis spread on variable rate | 1.00% | |
Maximum | London Interbank Offered Rate (LIBOR) | Line of Credit | ||
Debt Instrument [Line Items] | ||
Debt instrument basis spread on variable rate | 1.50% |
Leases Leases - Narrative (Deta
Leases Leases - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Lessee, Lease, Description [Line Items] | |||
Renewal term | 2 years | ||
Termination period | 1 year | ||
Rent expense | $ 4.2 | $ 2.9 | |
Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Remaining terms | 1 year | ||
Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Remaining terms | 4 years |
Leases Leases - Balance Sheet (
Leases Leases - Balance Sheet (Details) $ in Thousands | Mar. 31, 2019USD ($) |
ASSETS | |
Operating lease assets, other assets | $ 11,659 |
Current | |
Operating lease, current liabilities | 3,877 |
Noncurrent | |
Operating lease, noncurrent liabilites | 8,897 |
Total lease liabilities | $ 12,774 |
Leases Leases - Lease Expense (
Leases Leases - Lease Expense (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Leases [Abstract] | |
Operating lease cost | $ 1,017 |
Sublease income | (42) |
Net lease expense | $ 975 |
Leases Leases - Supplemental Ca
Leases Leases - Supplemental Cash Flow and Balance Sheet Information (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Cash Flow, Lessee [Abstract] | |
Operating cash flows from operating leases | $ 961 |
Right-Of-Use Asset Obtained In Exchange For Lease Liability [Abstract] | |
Operating leases | $ 84 |
Weighted Average Remaining Lease Term [Abstract] | |
Operating leases (in years) | 3 years 2 months 3 days |
Leases, Weighted Average Discount Rate [Abstract] | |
Operating leases (as a percentage) | 3.60% |
Leases Leases - Minimum Lease P
Leases Leases - Minimum Lease Payments (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Operating Leases, After Adoption of 842 | ||
2019 Remaining | $ 3,419 | |
2020 | 4,203 | |
2021 | 3,325 | |
2022 | 2,449 | |
2023 | 1,173 | |
2024 | 0 | |
Thereafter | 0 | |
Total minimum lease payments | 14,569 | |
Sublease income, After Adoption of 842 | ||
2019 Remaining | (246) | |
2020 | (82) | |
2021 | 0 | |
2022 | 0 | |
2023 | 0 | |
2024 | 0 | |
Thereafter | 0 | |
Total minimum lease payments | (328) | |
Net, After Adoption of 842 | ||
2019 Remaining | 3,173 | |
2020 | 4,121 | |
2021 | 3,325 | |
2022 | 2,449 | |
2023 | 1,173 | |
2024 | 0 | |
Thereafter | 0 | |
Lessee, Operating Lease, Liability, Payments, Net Of Sublease Income, Due | 14,241 | |
Less: Amount representing interest | (1,467) | |
Present value of lease payments | $ 12,774 | |
Operating Leases, Before Adoption of 842 | ||
2019 | $ 3,670 | |
2020 | 3,572 | |
2021 | 2,961 | |
2022 | 2,001 | |
2023 | 573 | |
Thereafter | 0 | |
Total minimum lease payments | 12,777 | |
Capital Leases, Before Adoption of 842 | ||
2019 | 40 | |
2020 | 36 | |
2021 | 0 | |
2022 | 0 | |
2023 | 0 | |
Thereafter | 0 | |
Total minimum lease payments | 76 | |
Less: Amount representing interest | (6) | |
Capital lease obligation | $ 70 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019USD ($)lawsuit | Mar. 31, 2018USD ($) | |
Loss Contingencies [Line Items] | ||
Purchases of intangible assets | $ 162 | $ 34 |
Prepaid rent under the lease | 10,900 | |
Initial deposit | $ 200 | |
Number of lawsuits against Company | lawsuit | 7 | |
Self insurance on product claim | $ 5,000 | |
Surety Bond | ||
Loss Contingencies [Line Items] | ||
Bonds outstanding | 24,600 | |
Expiring in 2019 | Surety Bond | ||
Loss Contingencies [Line Items] | ||
Bonds outstanding | 400 | |
Expiring in 2020 | Surety Bond | ||
Loss Contingencies [Line Items] | ||
Bonds outstanding | 700 | |
Expiring in 2021 | Surety Bond | ||
Loss Contingencies [Line Items] | ||
Bonds outstanding | 2,300 | |
Expiring in 2022 | Surety Bond | ||
Loss Contingencies [Line Items] | ||
Bonds outstanding | 3,200 | |
Expiring in 2023 | Surety Bond | ||
Loss Contingencies [Line Items] | ||
Bonds outstanding | 7,500 | |
Expiring in 2024 | Surety Bond | ||
Loss Contingencies [Line Items] | ||
Bonds outstanding | 10,500 | |
Line of Credit | ||
Loss Contingencies [Line Items] | ||
Letters of credit outstanding amount | 3,100 | |
Lease Agreements | ||
Loss Contingencies [Line Items] | ||
Purchases of intangible assets | $ 13,100 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Related Party Transaction [Line Items] | ||
Outstanding amount due to related parties | $ 0.1 | |
Software Licensing and Subscription | Officer | ||
Related Party Transaction [Line Items] | ||
Quarterly payments | $ 0.5 | $ 0.4 |
Employee Benefit Plans - Additi
Employee Benefit Plans - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Employee deferrals deemed vested percentage upon contribution | 100.00% | |
Defined contribution plan, cost | $ 1.4 | $ 0.8 |
Maximum | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Deferral percentage of base salary (up to) | 80.00% | |
Deferral percentage of other compensation (up to) | 100.00% |
Segment Data - Additional Infor
Segment Data - Additional Information (Detail) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019USD ($)segment | Mar. 31, 2018USD ($) | |
Segment Reporting [Abstract] | ||
Number of reportable segments of company | segment | 2 | |
Segment Reporting Information [Line Items] | ||
Net sales | $ 115,810 | $ 101,215 |
Cost of sales | 46,893 | 36,754 |
Gross margin | 68,917 | 64,461 |
Research and development | 23,354 | 15,119 |
TASER | ||
Segment Reporting Information [Line Items] | ||
Net sales | 65,391 | 63,524 |
Cost of sales | 23,278 | 20,543 |
Gross margin | 42,113 | 42,981 |
Research and development | 3,712 | 2,960 |
Software and Sensors | ||
Segment Reporting Information [Line Items] | ||
Net sales | 50,419 | 37,691 |
Cost of sales | 23,615 | 16,211 |
Gross margin | 26,804 | 21,480 |
Research and development | 19,642 | 12,159 |
Product | ||
Segment Reporting Information [Line Items] | ||
Net sales | 88,089 | 80,974 |
Cost of sales | 39,600 | 32,434 |
Product | TASER | ||
Segment Reporting Information [Line Items] | ||
Net sales | 65,301 | 63,524 |
Cost of sales | 23,278 | 20,543 |
Product | Software and Sensors | ||
Segment Reporting Information [Line Items] | ||
Net sales | 22,788 | 17,450 |
Cost of sales | 16,322 | 11,891 |
Service | ||
Segment Reporting Information [Line Items] | ||
Net sales | 27,721 | 20,241 |
Cost of sales | 7,293 | 4,320 |
Service | TASER | ||
Segment Reporting Information [Line Items] | ||
Net sales | 90 | 0 |
Cost of sales | 0 | 0 |
Service | Software and Sensors | ||
Segment Reporting Information [Line Items] | ||
Net sales | 27,631 | 20,241 |
Cost of sales | $ 7,293 | $ 4,320 |
Uncategorized Items - aaxn-2019
Label | Element | Value |
Restricted Cash and Cash Equivalents | us-gaap_RestrictedCashAndCashEquivalents | $ 2,468,000 |
Restricted Cash and Cash Equivalents | us-gaap_RestrictedCashAndCashEquivalents | 1,568,000 |
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 18,994,000 |
Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 18,994,000 |