Cover Page
Cover Page - shares | 3 Months Ended | |
Jun. 30, 2019 | Aug. 01, 2019 | |
Cover page. | ||
Entity File Number | 000-26251 | |
Entity Address, Address Line One | 310 Littleton Road | |
Entity Shell Company | false | |
Entity Current Reporting Status | Yes | |
Security Exchange Name | NASDAQ | |
Title of 12(b) Security | Common Stock, $0.001 Par value per share | |
Entity Incorporation, State or Country Code | DE | |
Document Transition Report | false | |
Document Quarterly Report | true | |
Entity Registrant Name | NETSCOUT SYSTEMS, INC. | |
Entity Central Index Key | 0001078075 | |
Current Fiscal Year End Date | --03-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2019 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | NTCT | |
Amendment Flag | false | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Entity Common Stock, Shares Outstanding | 75,861,198 | |
Entity Tax Identification Number | 04-2837575 | |
Entity Interactive Data Current | Yes | |
Entity Address, City or Town | Westford | |
Entity Address, State or Province | MA | |
Entity Address, Postal Zip Code | 01886 | |
City Area Code | 978 | |
Local Phone Number | 614-4000 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2019 | Mar. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 353,721 | $ 409,632 |
Marketable securities | 84,354 | 76,344 |
Accounts receivable and unbilled costs, net of allowance for doubtful accounts of $1,690 and $1,583 at June 30, 2019 and March 31, 2019, respectively | 160,039 | 235,318 |
Inventories and deferred costs | 26,479 | 26,270 |
Prepaid income taxes | 19,614 | 18,000 |
Prepaid expenses and other current assets | 31,643 | 35,658 |
Total current assets | 675,850 | 801,222 |
Fixed assets, net | 56,393 | 58,951 |
Operating lease right-of-use assets | 67,536 | |
Goodwill | 1,717,945 | 1,715,485 |
Intangible assets, net | 648,997 | 669,118 |
Deferred income taxes | 7,110 | 7,218 |
Long-term marketable securities | 5,087 | 1,012 |
Other assets | 15,083 | 16,988 |
Total assets | 3,194,001 | 3,269,994 |
Current liabilities: | ||
Accounts payable | 25,578 | 24,582 |
Accrued compensation | 41,379 | 58,501 |
Accrued other | 23,545 | 23,027 |
Income taxes payable | 1,517 | 1,318 |
Deferred revenue and customer deposits | 246,498 | 272,508 |
Current portion of operating lease liabilities | 11,066 | |
Total current liabilities | 349,583 | 379,936 |
Other long-term liabilities | 6,191 | 19,493 |
Deferred tax liability | 124,870 | 124,229 |
Accrued long-term retirement benefits | 35,811 | 36,284 |
Long-term deferred revenue and customer deposits | 95,529 | 94,619 |
Operating lease liabilities, net of current portion | 70,582 | |
Long-term debt | 500,000 | 550,000 |
Total liabilities | 1,182,566 | 1,204,561 |
Commitments and contingencies (Note 14) | ||
Stockholders' equity: | ||
Preferred stock, $0.001 par value: 5,000,000 shares authorized; no shares issued or outstanding at June 30, 2019 and March 31, 2019 | 0 | 0 |
Common stock, $0.001 par value: 300,000,000 shares authorized; 120,123,018 and 119,760,132 shares issued and 76,603,398 and 77,610,361 shares outstanding at June 30, 2019 and March 31, 2019, respectively | 120 | 120 |
Additional paid-in capital | 2,841,001 | 2,828,922 |
Accumulated other comprehensive loss | (3,184) | (2,639) |
Treasury stock at cost, 43,568,720 and 42,149,771 shares at June 30, 2019 and March 31, 2019, respectively | (1,155,252) | (1,119,063) |
Retained earnings | 328,750 | 358,093 |
Total stockholders' equity | 2,011,435 | 2,065,433 |
Total liabilities and stockholders' equity | $ 3,194,001 | $ 3,269,994 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2019 | Mar. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance for doubtful accounts | $ 1,690 | $ 1,583 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 300,000,000 | 300,000,000 |
Common stock, shares issued (in shares) | 120,123,018 | 119,760,132 |
Common stock, shares outstanding (in shares) | 76,554,298 | 77,610,361 |
Treasury stock, shares (in shares) | 43,568,720 | 42,149,771 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Revenue: | ||
Total revenue | $ 186,024 | $ 205,111 |
Cost of revenue: | ||
Total cost of revenue | 54,743 | 62,027 |
Gross profit | 131,281 | 143,084 |
Operating expenses: | ||
Research and development | 43,727 | 55,463 |
Sales and marketing | 73,525 | 78,132 |
General and administrative | 22,211 | 26,059 |
Amortization of acquired intangible assets | 16,143 | 23,465 |
Restructuring charges | 123 | 1,147 |
Impairment of intangible assets | 0 | 35,871 |
Total operating expenses | 155,729 | 220,137 |
Loss from operations | (24,448) | (77,053) |
Interest and other expense, net: | ||
Interest income | 1,658 | 941 |
Interest expense | (6,365) | (5,888) |
Other income | 308 | 254 |
Total interest and other expense, net | (4,399) | (4,693) |
Loss before income tax expense (benefit) | (28,847) | (81,746) |
Income tax expense (benefit) | 496 | (19,242) |
Net loss | $ (29,343) | $ (62,504) |
Basic net loss per share (in dollars per share) | $ (0.38) | $ (0.78) |
Diluted net loss per share (in dollars per share) | $ (0.38) | $ (0.78) |
Weighted average common shares outstanding used in computing: | ||
Net loss per share - basic (in shares) | 77,302 | 80,358 |
Net loss per share - diluted (in shares) | 77,302 | 80,358 |
Product | ||
Revenue: | ||
Total revenue | $ 75,719 | $ 96,927 |
Cost of revenue: | ||
Total cost of revenue | 26,935 | 32,965 |
Service | ||
Revenue: | ||
Total revenue | 110,305 | 108,184 |
Cost of revenue: | ||
Total cost of revenue | $ 27,808 | $ 29,062 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (29,343) | $ (62,504) |
Other comprehensive income (loss): | ||
Cumulative translation adjustments | (561) | (2,708) |
Changes in market value of investments: | ||
Changes in unrealized gains, net of taxes of $6 and $29, respectively | 35 | 28 |
Total net change in market value of investments | 35 | 28 |
Changes in market value of derivatives: | ||
Changes in market value of derivatives, net of benefits of ($19) and ($126), respectively | (54) | (393) |
Reclassification adjustment for net gains included in net loss, net of taxes of $11 and $23, respectively | 35 | 71 |
Total net change in market value of derivatives | (19) | (322) |
Other comprehensive loss | (545) | (3,002) |
Total comprehensive loss | $ (29,888) | $ (65,506) |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Statement of Comprehensive Income [Abstract] | ||
Changes in unrealized (losses) gains, (benefit) tax | $ 6 | $ 29 |
Changes in market value of derivatives, tax (benefit) | (19) | (126) |
Reclassification adjustment for net gains included in net income (loss), taxes | $ 11 | $ 23 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common stock Voting | Additional Paid In Capital | Accumulated Other Comprehensive Income (Loss) | Treasury stock | Retained Earnings |
Beginning balance at Mar. 31, 2018 | $ 2,068,782 | $ 117 | $ 2,665,120 | $ 2,895 | $ (995,843) | $ 396,493 |
Beginning balance (in shares) at Mar. 31, 2018 | 117,744,913 | 37,474,890 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (62,504) | (62,504) | ||||
Unrealized net investment gains | 28 | 28 | ||||
Unrealized net losses on derivative financial instruments | (322) | (322) | ||||
Cumulative translation adjustments | (2,708) | (2,708) | ||||
Issuance of common stock pursuant to vesting of restricted stock units | 0 | $ 0 | ||||
Issuance of common stock pursuant to vesting of restricted stock units (in shares) | 394,369 | |||||
Stock-based compensation expense for restricted stock units granted to employees | 11,262 | 11,262 | ||||
Repurchase of treasury stock | (3,486) | $ (3,486) | ||||
Repurchase of treasury stock (in shares) | 129,115 | |||||
Ending balance at Jun. 30, 2018 | 2,045,201 | $ 117 | 2,676,382 | (107) | $ (999,329) | 368,138 |
Ending balance (in shares) at Jun. 30, 2018 | 118,139,282 | 37,604,005 | ||||
Beginning balance at Mar. 31, 2019 | 2,065,433 | $ 120 | 2,828,922 | (2,639) | $ (1,119,063) | 358,093 |
Beginning balance (in shares) at Mar. 31, 2019 | 119,760,132 | 42,149,771 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (29,343) | (29,343) | ||||
Unrealized net investment gains | 35 | 35 | ||||
Unrealized net losses on derivative financial instruments | (19) | (19) | ||||
Cumulative translation adjustments | (561) | (561) | ||||
Issuance of common stock pursuant to vesting of restricted stock units | 0 | $ 0 | ||||
Issuance of common stock pursuant to vesting of restricted stock units (in shares) | 362,886 | |||||
Stock-based compensation expense for restricted stock units granted to employees | 12,079 | 12,079 | ||||
Repurchase of treasury stock | (36,189) | $ (36,189) | ||||
Repurchase of treasury stock (in shares) | 1,418,949 | |||||
Ending balance at Jun. 30, 2019 | $ 2,011,435 | $ 120 | $ 2,841,001 | $ (3,184) | $ (1,155,252) | $ 328,750 |
Ending balance (in shares) at Jun. 30, 2019 | 120,123,018 | 43,568,720 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Cash flows from operating activities: | ||
Net loss | $ (29,343) | $ (62,504) |
Adjustments to reconcile net loss to cash provided by operating activities, net of the effects of acquisitions: | ||
Depreciation and amortization | 29,335 | 40,347 |
Operating lease right-of-use assets | 2,552 | 0 |
Loss on disposal of fixed assets | 0 | 63 |
Deal-related compensation expense and accretion charges | 0 | 38 |
Share-based compensation expense | 12,743 | 12,965 |
Net change in fair value of contingent and contractual liabilities | 541 | 0 |
Accretion of contingent consideration | (18) | 0 |
Impairment of intangible assets | 0 | 35,871 |
Deferred income taxes | 830 | (14,306) |
Other gains | (81) | (206) |
Changes in assets and liabilities | ||
Accounts receivable and unbilled costs | 75,092 | 47,939 |
Due from related party | 0 | 1,536 |
Inventories | (1,208) | (138) |
Prepaid expenses and other assets | 4,238 | (3,426) |
Accounts payable | (634) | (5,206) |
Accrued compensation and other expenses | (16,332) | 5,566 |
Operating lease liabilities | (3,425) | |
Due to related party | 0 | 250 |
Income taxes payable | 85 | (1,882) |
Deferred revenue | (24,917) | (31,387) |
Net cash provided by operating activities | 49,458 | 25,520 |
Cash flows from investing activities: | ||
Purchase of marketable securities | (41,039) | (69,211) |
Proceeds from maturity of marketable securities | 28,995 | 41,573 |
Purchase of fixed assets | (3,287) | (6,468) |
Decrease in deposits | 0 | 4 |
Acquisition of businesses | (4,154) | 0 |
Net cash used in investing activities | (19,485) | (34,102) |
Cash flows from financing activities: | ||
Repayment of long-term debt | (50,000) | 0 |
Treasury stock repurchases | (30,708) | 0 |
Tax withholding on restricted stock units | (3,012) | (3,486) |
Net cash used in financing activities | (83,720) | (3,486) |
Effect of exchange rate changes on cash and cash equivalents | (1,163) | (4,337) |
Net decrease in cash and cash equivalents and restricted cash | (54,910) | (16,405) |
Cash and cash equivalents and restricted cash, beginning of period | 409,820 | 370,731 |
Cash and cash equivalents and restricted cash, end of period | 354,910 | 354,326 |
Supplemental disclosures: | ||
Cash paid for interest | 5,639 | 5,412 |
Cash paid for income taxes | 3,211 | 3,882 |
Non-cash transactions: | ||
Transfers of inventory to fixed assets | 862 | 1,589 |
Additions to property, plant and equipment included in accounts payable | 794 | 54 |
Tenant improvement allowance | 0 | 6,788 |
Contingent consideration related to acquisition, included in accrued other | 1,000 | 0 |
Unsettled share repurchases, included in accounts payable | $ 2,469 | $ 0 |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 3 Months Ended |
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION | BASIS OF PRESENTATION The accompanying unaudited interim consolidated financial statements have been prepared by NetScout Systems, Inc. (NetScout or the Company). Certain information and footnote disclosures normally included in financial statements prepared under United States generally accepted accounting principles (GAAP) have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). In the opinion of management, the unaudited interim consolidated financial statements include all adjustments, consisting of normal recurring adjustments, necessary for a fair statement of the Company's financial position and stockholders' equity, results of operations and cash flows. The year-end consolidated balance sheet data and statement of stockholders' equity was derived from the Company's audited financial statements, but does not include all disclosures required by GAAP. The results reported in these unaudited interim consolidated financial statements are not necessarily indicative of results that may be expected for the entire year. All significant intercompany accounts and transactions are eliminated in consolidation. These unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements, including the notes thereto, included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2019 filed with the Securities and Exchange Commission on May 28, 2019. Recent Accounting Pronouncements In August 2018, the FASB issued ASU 2018-14, Compensation – Retirement Benefits – Defined Benefit Plans – General (Subtopic 715-20): Disclosure Framework—Changes to the Disclosure Requirements for Defined Benefit Plans. This ASU adds, modifies and clarifies several disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans. This guidance is effective for fiscal years ending after December 15, 2020. ASU 2018-14 is effective for NetScout beginning April 1, 2021. Early adoption is permitted. The Company is currently assessing the effect that ASU 2018-14 will have on its financial position, results of operations, and disclosures. 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 adds, modifies and removes several disclosure requirements relative to the three levels of inputs used to measure fair value in accordance with Topic 820, Fair Value Measurement. This guidance is effective for fiscal years beginning after December 15, 2019, including interim periods within that fiscal year. ASU 2018-13 is effective for NetScout beginning April 1, 2020. Early adoption is permitted. The Company is currently assessing the effect that ASU 2018-13 will have on its financial position, results of operations, and disclosures. In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815), Targeted Improvements to Accounting for Hedging Activities (ASU 2017-12). ASU 2017-12 provides guidance to better align an entity's risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. The amendments expand and refine hedge accounting for both non-financial and financial risk components and align the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. This standard is effective for financial statements issued for fiscal years beginning after December 15, 2018. The Company adopted ASU 2017-12 effective April 1, 2019. The adoption has had an immaterial impact on the Company's consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) Section A - Leases: Amendments to the FASB Accounting Standards Codification (ASU 2016-02) and issued subsequent amendments to initial guidance in July 2018 within ASU 2018-10, Codification Improvements to Topic 842, Leases and ASU 2018-11, Leases (Topic 842): Targeted Improvements (collectively, ASC 842). ASC 842 aims to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The Company adopted the guidance as of April 1, 2019 using the modified retrospective method. Please refer to Note 13, "Leases" for further details. |
REVENUE RECOGNITION
REVENUE RECOGNITION | 3 Months Ended |
Jun. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE RECOGNITION | REVENUE RECOGNITION Revenue Recognition Policy The Company exercises judgment and uses estimates in connection with determining the amounts of product and service revenues to be recognized in each accounting period. The Company derives revenues primarily from the sale of network management tools and security solutions for service provider and enterprise customers, which include hardware, software and service offerings. The majority of the Company's product sales consist of hardware products with embedded software that are essential to providing customers the intended functionality of the solutions. The Company also sells software offerings decoupled from the underlying hardware and software solutions to provide customers with enhanced functionality. The Company accounts for revenue once a legally enforceable contract with a customer has been approved by the parties and the related promises to transfer products or services have been identified. A contract is defined by the Company as an arrangement with commercial substance identifying payment terms, each party’s rights and obligations regarding the products or services to be transferred and the amount the Company deems probable of collection. Customer contracts may include promises to transfer multiple products and services to a customer. Determining whether the products and services are considered distinct performance obligations that should be accounted for separately or as one combined performance obligation may require significant judgment. Revenue is recognized when control of the products or services are transferred to the Company's customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for products and services. Product revenue is typically recognized upon shipment, provided a legally enforceable contract exists, control has passed to the customer, and in the case of software products, when the customer has the rights and ability to access the software, and collection of the related receivable is probable. If any significant obligations to the customer remain post-delivery, typically involving obligations relating to installation and acceptance by the customer, revenue recognition is deferred until such obligations have been fulfilled. The Company's service offerings include installation, integration, extended warranty and maintenance services, post-contract customer support, stand-ready software-as-a-service (SAAS) and other professional services including consulting and training. The Company generally provides software and/or hardware support as part of product sales. Revenue related to the initial bundled software and hardware support is recognized ratably over the support period. In addition, customers can elect to purchase extended support agreements for periods after the initial software/hardware warranty expiration. Support services generally include rights to unspecified upgrades (when and if available), telephone and internet-based support, updates, bug fixes and hardware repair and replacement. Consulting services are recognized upon delivery or completion of performance depending on the terms of the underlying contract. Reimbursements of out-of-pocket expenditures incurred in connection with providing consulting services are included in services revenue, with the offsetting expense recorded in cost of service revenue. Training services include on-site and classroom training. Training revenues are recognized upon delivery of the training. Generally, the Company's contracts are accounted for individually. However, when contracts are closely interrelated and dependent on each other, it may be necessary to account for two or more contracts as one to reflect the substance of the group of contracts. Bundled arrangements are concurrent customer purchases of a combination of the Company's product and service offerings that may be delivered at various points in time. The Company allocates the transaction price among the performance obligations in an amount that depicts the relative standalone selling prices (SSP) of each obligation. Judgment is required to determine the SSP for each distinct performance obligation. The Company uses a range of amounts to estimate SSP when it sells each of the products and services separately based on the element’s historical pricing. The Company also considers its overall pricing objectives and practices across different sales channels and geographies, and market conditions. Generally, the Company has established SSP for a majority of its service elements based on historical standalone sales. In certain instances, the Company has established SSP for services based upon an estimate of profitability and the underlying cost to fulfill those services. Further, for certain service engagements, the Company considers quoted prices as part of multi-element arrangements of those engagements as a basis for establishing SSP. SSP has been established for product elements as the average or median selling price the element was recently sold for, whether sold alone or sold as part of a multiple element transaction. The Company reviews sales of the product elements on a quarterly basis and updates, when appropriate, its SSP for such elements to ensure that it reflects recent pricing experience. The Company's products are distributed through its direct sales force and indirect distribution channels through alliances with resellers and distributors. Revenue arrangements with resellers and distributors are recognized on a sell-in basis; that is, when control of the product transfers to the reseller or distributor. The Company records consideration given to a reseller or distributor as a reduction of revenue to the extent they have recorded revenue from the reseller or distributor. With limited exceptions, the Company's return policy does not allow product returns for a refund. Returns have been insignificant to date. In addition, the Company has a history of successfully collecting receivables from its resellers and distributors. During the three months ended June 30, 2019 , the Company recognized revenue of $97.2 million related to the Company's deferred revenue balance reported at March 31, 2019 . Performance Obligations Customer contracts may include promises to transfer multiple products and services to a customer. Determining whether the products and services are considered distinct performance obligations that should be accounted for separately or as one combined performance obligation may require significant judgment. The transaction price is allocated among performance obligations in bundled contracts in an amount that depicts the relative standalone selling prices of each obligation. For contracts involving distinct hardware and software licenses, the performance obligations are satisfied at a point in time when control is transferred to the customer. For standalone maintenance and post-contract support (PCS) the performance obligation is satisfied ratably over the contract term as a stand-ready obligation. For consulting and training services, the performance obligation may be satisfied over the contract term as a stand-ready obligation, satisfied over a period of time as those services are delivered, or satisfied at the completion of the service when control has transferred or the services have expired unused. Payments for hardware, software licenses, one-year maintenance, PCS and consulting services, are typically due up front with payment terms of 30 to 90 days. However, the Company does have contracts pursuant to which billings occur ratably over a period of years following the transfer of control for the contracted performance obligations. Payments on multi-year maintenance, PCS and consulting services are typically due in annual installments over the contract term. The Company did not have any material variable consideration such as obligations for returns or refunds at June 30, 2019 . At June 30, 2019 , the Company had total deferred revenue of $342.0 million , which represents the aggregate total contract price allocated to undelivered performance obligations. The Company expects to recognize $246.5 million, or 72% , of this revenue during the next 12 months, and expects to recognize the remaining $95.5 million, or 28% , of this revenue thereafter. Because of NetScout's revenue recognition policies, there are circumstances for which the Company does not recognize revenue relating to sales transactions that have been billed, but the related account receivable has not been collected. While the receivable represents an enforceable obligation, for balance sheet presentation purposes, the Company has not recognized the deferred revenue or the related account receivable and no amounts appear in the consolidated balance sheets for such transactions because control of the underlying deliverable has not transferred. The aggregate amount of unrecognized accounts receivable and deferred revenue was $7.0 million and $23.3 million at June 30, 2019 and March 31, 2019 , respectively. NetScout expects that the amount of billed and unbilled deferred revenue will change from quarter to quarter for several reasons, including the specific timing, duration and size of large customer support and service agreements, varying billing cycles of such agreements, the specific timing of customer renewals, and foreign currency fluctuations. The Company did not have any significant financing components, or variable consideration or performance obligations satisfied in a prior period recognized during the three months ended June 30, 2019 . Contract Balances The Company receives payments from customers based on a billing schedule as established by the Company’s contracts. Contract assets relate to performance obligations where control has transferred to the customer in advance of scheduled billings. The Company records unbilled accounts receivable representing the right to consideration in exchange for goods or services that have been transferred to a customer conditional on the passage of time. Deferred revenue relates to payments received in advance of performance under the contract. Costs to Obtain Contracts The Company has determined that the only significant incremental costs incurred to obtain contracts with customers within the scope of Topic 606 are sales commissions paid to its employees. Sales commissions are recorded as an asset and amortized to expense ratably over the remaining performance periods of the related contracts with remaining performance obligations. The Company expenses costs as incurred for sales commissions when the amortization period would have been one year or less. At June 30, 2019 , the consolidated balance sheet included $6.7 million in assets related to sales commissions to be expensed in future periods. A balance of $4.3 million was included in prepaid expenses and other current assets, and a balance of $2.4 million was included as other assets in the Company's consolidated balance sheet at June 30, 2019 . At March 31, 2019 , the consolidated balance sheet included $6.4 million in assets related to sales commissions to be expensed in future periods. A balance of $3.8 million was included in prepaid expenses and other current assets, and a balance of $2.6 million was included as other assets in the Company's consolidated balance sheet at March 31, 2019 . During the three months ended June 30, 2019 and 2018 , respectively, the Company recognized $1.6 million and $0.6 million of amortization related to this sales commission asset, which is included in the sales and marketing expense line in the Company's consolidated statements of operations. |
CONCENTRATION OF CREDIT RISK AN
CONCENTRATION OF CREDIT RISK AND SIGNIFICANT CUSTOMERS | 3 Months Ended |
Jun. 30, 2019 | |
Risks and Uncertainties [Abstract] | |
CONCENTRATION OF CREDIT RISK AND SIGNIFICANT CUSTOMERS | CONCENTRATION OF CREDIT RISK AND SIGNIFICANT CUSTOMERS Financial instruments that potentially subject the Company to concentration of credit risk consist primarily of investments, trade accounts receivable and accounts payable. The Company's cash, cash equivalents, and marketable securities are placed with financial institutions with high credit standings. At June 30, 2019 and March 31, 2019 , the Company had no direct customers or indirect channel partners which accounted for more than 10% of the accounts receivable balance. During the three months ended June 30, 2019 and June 30, 2018 , no direct customers or indirect channel partners accounted for more than 10% of the Company's total revenue. Historically, the Company has not experienced any significant failure of its customers' ability to meet their payment obligations nor does the Company anticipate material non-performance by its customers in the future; accordingly, the Company does not require collateral from its customers. However, if the Company's assumptions are incorrect, there could be an adverse impact on its allowance for doubtful accounts. |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 3 Months Ended |
Jun. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | |
SHARE-BASED COMPENSATION | SHARE-BASED COMPENSATION The following is a summary of share-based compensation expense including restricted stock units granted pursuant to the Company's 2007 Equity Incentive Plan, as amended, and employee stock purchases made under the Company's 2011 Employee Stock Purchase Plan, as amended, (ESPP) based on estimated fair values within the applicable cost and expense lines identified below (in thousands): Three Months Ended June 30, 2019 2018 Cost of product revenue $ 267 $ 269 Cost of service revenue 1,467 1,330 Research and development 3,819 4,151 Sales and marketing 4,135 4,359 General and administrative 3,055 2,856 $ 12,743 $ 12,965 Employee Stock Purchase Plan – The Company maintains the ESPP for all eligible employees as described in the Company's Annual Report on Form 10-K for the year ended March 31, 2019 . Under the ESPP, shares of the Company's common stock may be purchased on the last day of each bi-annual offering period at 85% of the fair value on the last day of such offering period. The offering periods run from March 1st through August 31st and from September 1st through the last day of February each year. |
CASH, CASH EQUIVALENTS, RESTRIC
CASH, CASH EQUIVALENTS, RESTRICTED CASH AND MARKETABLE SECURITIES | 3 Months Ended |
Jun. 30, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
CASH, CASH EQUIVALENTS, RESTRICTED CASH AND MARKETABLE SECURITIES | CASH, CASH EQUIVALENTS, RESTRICTED CASH AND MARKETABLE SECURITIES The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents and those investments with original maturities greater than three months to be marketable securities. Cash and cash equivalents consisted of money market instruments and cash maintained with various financial institutions at June 30, 2019 and March 31, 2019 . Cash, Cash Equivalents and Restricted Cash The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statements of cash flows (in thousands): June 30, March 31, 2019 June 30, March 31, Cash and cash equivalents $ 353,721 $ 409,632 $ 353,416 $ 369,821 Restricted cash 1,189 188 910 910 Total cash, cash equivalents and restricted cash $ 354,910 $ 409,820 $ 354,326 $ 370,731 The Company's restricted cash includes cash balances which are legally or contractually restricted. The Company's restricted cash is included within prepaid and other current assets and consists of amounts related to holdbacks associated with prior acquisitions. Marketable Securities The following is a summary of marketable securities held by NetScout at June 30, 2019 , classified as short-term and long-term (in thousands): Amortized Cost Unrealized Gains Fair Value Type of security: U.S. government and municipal obligations $ 44,101 $ 31 $ 44,132 Commercial paper 37,553 — 37,553 Corporate bonds 2,663 6 2,669 Total short-term marketable securities 84,317 37 84,354 U.S. government and municipal obligations 5,067 20 5,087 Total long-term marketable securities 5,067 20 5,087 Total marketable securities $ 89,384 $ 57 $ 89,441 The following is a summary of marketable securities held by NetScout at March 31, 2019 , classified as short-term and long-term (in thousands): Amortized Cost Unrealized Gains Fair Value Type of security: U.S. government and municipal obligations $ 27,610 $ 12 $ 27,622 Commercial paper 48,722 — 48,722 Total short-term marketable securities 76,332 12 76,344 Corporate bonds 1,007 5 1,012 Total long-term marketable securities 1,007 5 1,012 Total marketable securities $ 77,339 $ 17 $ 77,356 Contractual maturities of the Company's marketable securities held at June 30, 2019 and March 31, 2019 were as follows (in thousands): June 30, March 31, Available-for-sale securities: Due in 1 year or less $ 84,354 $ 76,344 Due after 1 year through 5 years 5,087 1,012 $ 89,441 $ 77,356 |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Jun. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS The fair value hierarchy has three levels based on the reliability of the inputs used to determine fair value. Level 1 refers to fair values determined based on quoted prices in active markets for identical assets. Level 2 refers to fair values estimated using significant other observable inputs, and Level 3 includes fair values estimated using significant non-observable inputs. The following tables present the Company's financial assets and liabilities measured on a recurring basis using the fair value hierarchy at June 30, 2019 and March 31, 2019 (in thousands): Fair Value Measurements at June 30, 2019 Level 1 Level 2 Level 3 Total ASSETS: Cash and cash equivalents $ 353,721 $ — $ — $ 353,721 U.S. government and municipal obligations 47,145 2,074 — 49,219 Commercial paper — 37,553 — 37,553 Corporate bonds 2,669 — — 2,669 Derivative financial instruments — 18 — 18 Contingent consideration — — 239 239 $ 403,535 $ 39,645 $ 239 $ 443,419 LIABILITIES: Contingent purchase consideration $ — $ — $ (1,000 ) $ (1,000 ) Derivative financial instruments — (51 ) — (51 ) $ — $ (51 ) $ (1,000 ) $ (1,051 ) Fair Value Measurements at March 31, 2019 Level 1 Level 2 Level 3 Total ASSETS: Cash and cash equivalents $ 409,632 $ — $ — $ 409,632 U.S. government and municipal obligations 10,732 16,890 — 27,622 Commercial paper — 48,722 — 48,722 Corporate bonds 1,012 — — 1,012 Derivative financial instruments — 58 — 58 Contingent consideration — — 762 762 $ 421,376 $ 65,670 $ 762 $ 487,808 LIABILITIES: Derivative financial instruments $ — $ (68 ) $ — $ (68 ) $ — $ (68 ) $ — $ (68 ) This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. On a recurring basis, the Company measures certain financial assets and liabilities at fair value, including marketable securities and derivative financial instruments. The Company's Level 1 investments are classified as such because they are valued using quoted market prices or alternative pricing sources with reasonable levels of price transparency. The Company's Level 2 investments are classified as such because fair value is calculated using market observable data for similar but not identical instruments, or a discounted cash flow model using the contractual interest rate as compared to the underlying interest yield curve. The Company classifies municipal obligations as Level 2 because the fair values are determined using quoted prices from markets the Company considers to be inactive. Commercial paper is classified as Level 2 because the Company uses market information from similar but not identical instruments and discounted cash flow models based on interest rate yield curves to determine fair value. The Company's derivative financial instruments consist of forward foreign exchange contracts and are classified as Level 2 because the fair values of these derivatives are determined using models based on market observable inputs, including spot prices for foreign currencies and credit derivatives, as well as an interest rate factor. The Company's Level 3 assets consist of contingent consideration related to the divestiture of the Company's handheld network test (HNT) tools business in September 2018. The contingent consideration represents potential future earnout payments to the Company of up to $4.0 million over two years that are contingent on the HNT tools business achieving certain milestones. The Company recorded a $0.5 million change in the fair value of the contingent consideration for the three months ended June 30, 2019 , which is included in other expense, net within the Company's consolidated statement of operations for the three months ended June 30, 2019 . The fair value of the contingent consideration was $0.2 million and $0.8 million at June 30, 2019 and March 31, 2019 respectively. The contingent consideration is included in other assets within the Company’s consolidated balance sheet at June 30, 2019 and March 31, 2019 . The Company's Level 3 liability consists of contingent purchase consideration related to the acquisition of certain assets and liabilities of Eastwind Networks, Inc. (Eastwind) in April 2019. The contingent purchase consideration represents amounts deposited into an escrow account, which was established to cover damages NetScout may suffer related to any liabilities that NetScout did not agree to assume or as a result of the breach of representations and warranties of the seller as described in the acquisition agreement. The contingent purchase consideration is included as accrued other in the Company's consolidated balance sheet at June 30, 2019 . The following table sets forth a reconciliation of changes in the fair value of the Company's Level 3 financial assets and liabilities for the three months ended June 30, 2019 (in thousands): Contingent Consideration Contingent Purchase Consideration Balance at March 31, 2019 $ 762 $ — Additions to Level 3 — (1,000 ) Change in fair value of contingent consideration (523 ) — Balance at June 30, 2019 $ 239 $ (1,000 ) Accretion income related to the contingent consideration received as partial consideration for the divestiture of the HNT tools business for the three months ended June 30, 2019 was $18 thousand and was included within interest income. |
INVENTORIES
INVENTORIES | 3 Months Ended |
Jun. 30, 2019 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | INVENTORIES Inventories are stated at the lower of actual cost or net realizable value. Cost is determined by using the first in, first out (FIFO) method. Inventories consist of the following (in thousands): June 30, March 31, Raw materials $ 18,825 $ 14,432 Work in process 410 1,181 Finished goods 6,228 7,738 Deferred costs 1,016 2,919 $ 26,479 $ 26,270 |
ACQUISITIONS & DIVESTITURES
ACQUISITIONS & DIVESTITURES | 3 Months Ended |
Jun. 30, 2019 | |
Business Combinations [Abstract] | |
ACQUISITIONS & DIVESTITURES | ACQUISITIONS & DIVESTITURES Eastwind Acquisition On April 3, 2019 (the Eastwind Closing Date), the Company completed the acquisition of certain assets and liabilities of Eastwind for $5.2 million . Eastwind's breach analytics cloud analyzes data to identify malicious activity, insider threats and data leakage. The Company has completed the purchase accounting related to the Eastwind acquisition as of June 30, 2019. Goodwill and intangible assets recorded as part of the acquisition are deductible for tax purposes. Initial cash payment $ 4,154 Estimated fair value of contingent purchase consideration 1,000 Estimated purchase price $ 5,154 The following table reflects the estimated fair value of assets acquired and liabilities assumed (in thousands): Property, plant and equipment $ 17 Intangible assets 4,230 Accrued other liabilities (96 ) Goodwill $ 1,003 Of the total consideration, $1.0 million was deposited into an escrow account. The escrow account was established to cover damages NetScout may suffer related to any liabilities that NetScout did not agree to assume or as a result of the breach of representations and warranties of the seller as described in the acquisition agreement. Generally, indemnification claims that Eastwind would be liable for are limited to the total amount of the escrow account, which shall be the sole source for the satisfaction of any damages to the Company for such claims, but such limitation does not apply with respect to the seller's breach of certain fundamental representations or related to other specified indemnity items, for which certain of Eastwind's shareholders may be liable for additional amounts in excess of the escrow amount. Except to the extent that valid indemnification claims are made prior to such time, the $1.0 million will be paid to the seller in April 2020. In connection with the Eastwind acquisition, certain former employees of Eastwind received cash retention payments totaling $0.3 million on the Eastwind Closing Date. Because these employees were not required to provide future services to the Company, the cash retention payments were accounted for as part of the purchase price. These former Eastwind employees will also receive cash retention payments subject to such employee's continued employment with the Company through the next regularly scheduled payroll dates following each of the first and second anniversaries of the Eastwind Closing Date. The cash retention payment liability related to these future cash retention payments were accounted for separately from the business combination as the cash retention payment is automatically forfeited upon termination of employment. The Company will record the liability over the period it is earned as compensation expense for post-combination services. The fair value of intangible assets was based on a valuation using a cost method approach. The underlying assumptions include estimates of cost to replace or reproduce the asset, less adjustments for physical deterioration and functional obsolescence, if relevant. This fair value measurement was based on significant inputs not observable in the market and thus represents Level 3 fair value measurements. The following table reflects the fair value of the acquired identifiable intangible asset and related estimated useful life (in thousands): Fair Value Useful Life (Years) Developed technology $ 4,230 10 The weighted average useful life of the developed technology acquired from Eastwind is 10 years . HNT Tools Business Divestiture On September 14, 2018 (the HNT Divestiture Date), the Company divested its HNT tools business. As part of the divestiture, the Company recorded contingent consideration which represents potential future earnout payments of up to $4.0 million over two years that are contingent on the HNT tools business achieving certain milestones. The Company recorded a $0.5 million change in the fair value of the contingent consideration, which is included in other expense, net within the Company’s consolidated statements of operations for the three months ended June 30, 2019 . The fair value of the contingent consideration was $0.2 million and $0.8 million at June 30, 2019 and March 31, 2019 , respectively. The contingent consideration is included within other assets within the Company’s consolidated balance sheet. In connection with the divestiture, the Company has entered into a transitional services agreement with the buyer to provide certain services for a period of up to eighteen months . Income associated with the transitional services agreement for the three months ended June 30, 2019 was $0.9 million and included within other income in the Company's consolidated statement of operations. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 3 Months Ended |
Jun. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS | GOODWILL AND INTANGIBLE ASSETS Goodwill The Company has two reporting units: (1) Service Assurance and (2) Security. The Company assesses goodwill for impairment at the reporting unit level at least annually, or on an interim basis if an event occurs or circumstances change that would, more likely than not, reduce the fair value of the reporting unit below its carrying value. The Company completed its annual impairment test on January 31, 2019. At June 30, 2019 goodwill attributable to our Service Assurance and Security reporting units was $1.2 billion and $555.9 million , respectively. At March 31, 2019 , goodwill attributable to our Service Assurance and Security reporting units was $1.2 billion and $551.1 million , respectively. The change in the carrying amount of goodwill for the three months ended June 30, 2019 is due to the acquisition of Eastwind and the impact of foreign currency translation adjustments related to asset balances that are recorded in currencies other than the U.S. Dollar. The changes in the carrying amount of goodwill for the three months ended June 30, 2019 are as follows (in thousands): Balance at March 31, 2019 $ 1,715,485 Goodwill attributed to the Eastwind acquisition 1,003 Foreign currency translation impact 1,457 Balance at June 30, 2019 $ 1,717,945 Intangible Assets The net carrying amounts of intangible assets were $649.0 million and $ 669.1 million at June 30, 2019 and March 31, 2019 , respectively. Intangible assets acquired in a business combination are recorded under the acquisition method of accounting at their estimated fair values at the date of acquisition. The Company amortizes intangible assets over their estimated useful lives, except for the acquired trade name which resulted from the Network General acquisition, which has an indefinite life and thus is not amortized. The carrying value of the indefinite-lived trade name is evaluated for potential impairment annually, or more frequently if events or changes in circumstances indicate that the asset might be impaired. The Company completed its annual impairment test on January 31, 2019. During the three months ended June 30, 2018, the Company performed a quantitative analysis on certain intangible assets related to the HNT tools business, which has since been divested. The fair value for the intangible assets related to the HNT tools business was calculated considering a range of potential transaction prices which the Company considers to be a Level 3 measurement. The fair value of these intangible assets was determined to be less than the carrying value, and as a result, the Company recognized an impairment charge of $35.9 million in the three months ended June 30, 2018 . The impairment charge was recorded within a separate operating expense line item in the Company's consolidated statements of operations during the three months ended June 30, 2018 . Intangible assets include the indefinite-lived trade name with a carrying value of $18.6 million and the following amortizable intangible assets at June 30, 2019 (in thousands): Cost Accumulated Amortization Net Developed technology $ 246,052 $ (174,164 ) $ 71,888 Customer relationships 771,415 (232,409 ) 539,006 Distributor relationships and technology licenses 6,855 (5,568 ) 1,287 Definite-lived trademark and trade name 39,236 (22,003 ) 17,233 Core technology 7,192 (6,902 ) 290 Net beneficial leases 336 (336 ) — Non-compete agreements 292 (292 ) — Leasehold interest 500 (500 ) — Backlog 16,349 (16,349 ) — Capitalized software 3,317 (2,905 ) 412 Other 1,208 (927 ) 281 $ 1,092,752 $ (462,355 ) $ 630,397 Intangible assets include the indefinite-lived trade name with a carrying value of $18.6 million and the following amortizable intangible assets at March 31, 2019 (in thousands): Cost Accumulated Amortization Net Developed technology $ 242,259 $ (168,289 ) $ 73,970 Customer relationships 772,969 (218,043 ) 554,926 Distributor relationships and technology licenses 6,882 (5,237 ) 1,645 Definite-lived trademark and trade name 39,304 (20,586 ) 18,718 Core technology 7,192 (6,845 ) 347 Net beneficial leases 336 (336 ) — Non-compete agreements 292 (292 ) — Leasehold interest 500 (500 ) — Backlog 16,397 (16,397 ) — Capitalized software 3,317 (2,690 ) 627 Other 1,208 (923 ) 285 $ 1,090,656 $ (440,138 ) $ 650,518 Amortization included as cost of product revenue consists of amortization of developed technology, distributor relationships and technology licenses, core technology and software. Amortization included as operating expense consists of all other intangible assets. The following table provides a summary of amortization expense for the three months ended June 30, 2019 and 2018, respectively (in thousands): Three Months Ended June 30, 2019 2018 Amortization of intangible assets included as: Cost of product revenue $ 6,802 $ 9,191 Operating expense 16,148 23,470 $ 22,950 $ 32,661 The following is the expected future amortization expense at June 30, 2019 for the fiscal years ending March 31 (in thousands): 2020 (remaining nine months) $ 68,244 2021 79,923 2022 69,523 2023 61,814 2024 53,717 Thereafter 297,176 $ 630,397 The weighted-average amortization period of developed technology and core technology is 11.3 years . The weighted-average amortization period for customer and distributor relationships is 15.9 years . The weighted-average amortization period for trademarks and trade names is 8.6 years . The weighted-average amortization period for capitalized software is 3.0 years . The weighted-average amortization period for amortizing all intangible assets is 14.6 years . |
DERIVATIVE INSTRUMENTS AND HEDG
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 3 Months Ended |
Jun. 30, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES NetScout operates internationally and, in the normal course of business, is exposed to fluctuations in foreign currency exchange rates. The exposures result from costs that are denominated in currencies other than the U.S. Dollar, primarily the Euro, British Pound, Canadian Dollar, and Indian Rupee. The Company manages its foreign cash flow risk by hedging forecasted cash flows for operating expenses denominated in foreign currencies for up to twelve months , within specified guidelines through the use of forward contracts. The Company enters into foreign currency exchange contracts to hedge cash flow exposures from costs that are denominated in currencies other than the U.S. Dollar. These hedges are designated as cash flow hedges at inception. All of the Company's derivative instruments are utilized for risk management purposes, and the Company does not use derivatives for speculative trading purposes. These contracts will mature over the next twelve months and are expected to impact earnings on or before maturity. The notional amounts and fair values of derivative instruments in the consolidated balance sheets at June 30, 2019 and March 31, 2019 were as follows (in thousands): Notional Amounts (a) Prepaid Expenses and Other Current Assets Accrued Other June 30, March 31, June 30, March 31, June 30, March 31, Derivatives Designated as Hedging Instruments: Forward contracts $ 2,070 $ 4,550 $ 18 $ 58 $ 51 $ 68 (a) Notional amounts represent the gross contract/notional amount of the derivatives outstanding. The following table provides the effect foreign exchange forward contracts had on other comprehensive income (loss) (OCI) and results of operations for the three months ended June 30, 2019 and 2018 (in thousands): Loss Recognized in Gain (Loss) Reclassified from June 30, 2019 June 30, 2018 Location June 30, 2019 June 30, 2018 Forward contracts $ (73 ) $ (519 ) Research and development $ (5 ) $ 30 Sales and marketing 51 64 $ (73 ) $ (519 ) $ 46 $ 94 (a) The amount represents the change in fair value of derivative contracts due to changes in spot rates. (b) The amount represents reclassification from other comprehensive income to earnings that occurs when the hedged item affects earnings. |
LONG-TERM DEBT
LONG-TERM DEBT | 3 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | LONG-TERM DEBT On January 16, 2018, the Company amended and expanded its existing credit agreement (Amended Credit Agreement) with a syndicate of lenders by and among: the Company; JPMorgan Chase Bank, N.A. (JPMorgan), as administrative agent and collateral agent; J.P. Morgan Securities LLC, KeyBanc Capital Markets, Merrill Lynch, Pierce, Fenner & Smith Incorporated, RBC Capital Markets and Wells Fargo Securities, LLC, as joint lead arrangers and joint bookrunners; Fifth Third Bank, Santander Bank, N.A., SunTrust Bank, N.A. and U.S. Bank National Association, as co-documentation agents; and the lenders party thereto. The Amended Credit Agreement provides for a five -year, $1.0 billion senior secured revolving credit facility, including a letter of credit sub-facility of up to $75.0 million . The Company may elect to use the new credit facility for general corporate purposes or to finance the repurchase of up to twenty-five million shares of the Company's common stock under the Company's common stock repurchase plan. The commitments under the Amended Credit Agreement will expire on January 16, 2023, and any outstanding loans will be due on that date. During the three months ended June 30, 2019 , the Company repaid $50.0 million of borrowings under the Amended Credit Agreement. At June 30, 2019 , $500 million was outstanding under the Amended Credit Agreement. At the Company's election, revolving loans under the Amended Credit Agreement bear interest at either (a) an Alternate Base Rate per annum equal to the greatest of (1) JPMorgan's prime rate, (2) 0.50% in excess of the New York Federal Reserve Bank (NYFRB) rate, or (3) an adjusted one month LIBOR rate plus 1% ; or (b) such adjusted LIBOR rate (for the interest period selected by the Company), in each case plus an applicable margin. For the period from the delivery of the Company's financial statements for the quarter ended March 31, 2019, until the Company has delivered financial statements for the quarter ended June 30, 2019 , the applicable margin will be 1.50% per annum for LIBOR loans and 0.50% per annum for Alternate Base Rate loans, and thereafter the applicable margin will vary depending on the Company's leverage ratio, ranging from 1.00% per annum for Base Rate loans and 2.00% per annum for LIBOR loans if the Company's consolidated leverage ratio is greater than 3.50 to 1.00, down to 0.00% per annum for Alternate Base Rate loans and 1.00% per annum for LIBOR loans if the Company's consolidated leverage ratio is equal to or less than 1.50 to 1.00. On July 27, 2017, the U.K. Financial Conduct Authority (FCA) announced that it will no longer require banks to submit rates for the calculation of LIBOR after 2021. The Company's Amended Credit Agreement provides for the Administrative Agent to determine if (i) adequate and reasonable means do not exist for ascertaining the LIBOR rate or (ii) the FCA or Government Authority having jurisdiction over the Administrative Agent has made a public statement identifying a specific date after which the LIBOR rate shall no longer be used for determining interest rates for loans and the Administrative Agent determines that (i) and (ii) above are unlikely to be temporary then the Administrative Agent and the Company would agree to transition to an Alternate Base Rate Borrowing or amend the Credit Agreement to establish an alternate rate of interest to LIBOR that gives due consideration to the then prevailing market convention for determining a rate of interest for syndicated loans in the United States at such time. The Company's consolidated leverage ratio is the ratio of its total funded debt compared to its consolidated adjusted EBITDA. Consolidated adjusted EBITDA includes certain adjustments, including, without limitation, adjustments relating to extraordinary, unusual or non-recurring charges, certain restructuring charges, non-cash charges, certain transaction costs and expenses and certain pro forma adjustments in connection with material acquisitions and dispositions, all as set forth in detail in the definition of consolidated adjusted EBITDA in the Amended Credit Agreement. Commitment fees will accrue on the daily unused amount of the credit facility. For the period from the delivery of the Company's financial statements for the quarter ended March 31, 2019 until the Company has delivered financial statements for the quarter ended June 30, 2019 , the commitment fee will be 0.25% per annum, and thereafter the commitment fee will vary depending on the Company's consolidated leverage ratio, ranging from 0.30% per annum if the Company's consolidated leverage ratio is greater than 2.75 to 1.00, down to 0.15% per annum if the Company's consolidated leverage ratio is equal to or less than 1.50 to 1.00. Letter of credit participation fees are payable to each lender on the amount of such lender’s letter of credit exposure, during the period from the closing date of the Amended Credit Agreement to but excluding the date which is the later of (i) the date on which such lender’s commitment terminates or (ii) the date on which such lender ceases to have any letter of credit exposure, at a rate per annum equal to the applicable margin for LIBOR loans. Additionally, the Company will pay a fronting fee to each issuing bank in amounts to be agreed to between the Company and the applicable issuing bank. Interest on Alternate Base Rate loans is payable at the end of each calendar quarter. Interest on LIBOR loans is payable at the end of each interest rate period or at the end of each three-month interval within an interest rate period if the period is longer than three months. The Company may also prepay loans under the Amended Credit Agreement at any time, without penalty, subject to certain notice requirements. Debt is recorded at the amount drawn on the revolving credit facility plus interest based on floating rates reflective of changes in the market which approximates fair value. The loans and other obligations under the credit facility are (a) guaranteed by each of the Company's wholly owned material domestic restricted subsidiaries, subject to certain exceptions, and (b) are secured by substantially all of the assets of the Company and the subsidiary guarantors, including a pledge of all the capital stock of material subsidiaries held directly by the Company and the subsidiary guarantors (which pledge, in the case of any foreign subsidiary, is limited to 65% of the voting stock), subject to certain customary exceptions and limitations. The Amended Credit Agreement generally prohibits any other liens on the assets of the Company and its restricted subsidiaries, subject to certain exceptions as described in the Amended Credit Agreement. The Amended Credit Agreement contains certain covenants applicable to the Company and its restricted subsidiaries, including, without limitation, limitations on additional indebtedness, liens, various fundamental changes, dividends and distributions, investments (including acquisitions), transactions with affiliates, asset sales, including sale-leaseback transactions, speculative hedge agreements, payment of junior financing, changes in business and other limitations customary in senior secured credit facilities. In addition, the Company is required to maintain certain consolidated leverage and interest coverage ratios. These covenants and limitations are more fully described in the Amended Credit Agreement. At June 30, 2019 , the Company was in compliance with all of these covenants. The Amended Credit Agreement provides that events of default will exist in certain circumstances, including failure to make payment of principal or interest on the loans when required, failure to perform certain obligations under the Amended Credit Agreement and related documents, defaults under certain other indebtedness, certain insolvency events, certain events arising under ERISA, a change of control and certain other events. Upon an event of default, the administrative agent with the consent of, or at the request of, the holders of more than 50% in principal amount of the loans and commitments may terminate the commitments and accelerate the maturity of the loans and enforce certain other remedies under the Amended Credit Agreement and the other loan documents. In connection with the Company's Amended Credit Agreement described above, the Company terminated its previous term loan dated as of July 14, 2015, by and among the Company; JPMorgan Chase Bank, N.A. (JPMorgan), as administrative agent and collateral agent; J.P. Morgan Securities LLC, KeyBanc Capital Markets, Merrill Lynch, Pierce, Fenner & Smith Incorporated, RBC Capital Markets and Wells Fargo Securities, LLC, as joint lead arrangers and joint bookrunners; Santander Bank, N.A., SunTrust Bank, N.A. and U.S. Bank National Association, as co-documentation agents; and the lenders party thereto. The Company has capitalized debt issuance costs totaling $12.2 million at June 30, 2019 , which are being amortized over the life of the revolving credit facility. The unamortized balance was $6.2 million as of June 30, 2019 . The balance of $1.8 million was included as prepaid expenses and other current assets and a balance of $4.4 million |
RESTRUCTURING CHARGES
RESTRUCTURING CHARGES | 3 Months Ended |
Jun. 30, 2019 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING CHARGES | RESTRUCTURING CHARGES During the third quarter of fiscal year ended March 31, 2018, the Company restructured certain departments to better align functions resulting in the termination of sixty-one employees. As a result of the workforce reduction, the Company recorded a restructuring charge during the three months ended June 30, 2018 totaling $1.1 million related to one-time termination benefits for the employees that were notified during the period as well as facilities-related costs. The one-time termination benefits were paid in full during the fiscal year ended March 31, 2019. During the second quarter of fiscal year ending March 31, 2019, the Company implemented a voluntary separation program (VSP) for employees who met certain age and service requirements to reduce overall headcount. As a result of the related workforce reduction, one hundred fifty-five employees voluntarily terminated their employment with the Company during the fiscal year ended March 31, 2019. Additional one-time termination benefit charges of $0.1 million was recorded during the three months ended June 30, 2019. These one-time termination benefits were paid in full by the end of the first quarter of fiscal year 2020. The following table provides a summary of the activity related to the restructuring plan and the related restructuring liability (in thousands): VSP Employee-Related Balance at March 31, 2019 $ — Restructuring charges to operations 123 Cash payments (123 ) Balance at June 30, 2019 $ — |
LEASES
LEASES | 3 Months Ended |
Jun. 30, 2019 | |
Leases [Abstract] | |
LEASES | LEASES In February 2016, the FASB issued ASC 842 to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The Company adopted the guidance on April 1, 2019 using the modified retrospective method and as a result did not adjust comparative periods or modify disclosures in those comparative periods. The new guidance provides a number of optional practical expedients in transition. The Company elected the package of practical expedients, which does not require the reassessment of prior conclusions about lease identification, lease classification and initial direct costs. Further, the Company elected the practical expedients to combine lease and non-lease components, and to not recognize right-of-use (ROU) assets and lease liabilities for short-term leases. Leases with an initial term of 12 months or less are classified as short-term leases. The Company did not elect the hindsight practical expedient to determine the lease term for existing leases. The adoption of ASC 842 on April 1, 2019 resulted in the recognition of operating lease ROU assets of approximately $68.2 million , operating lease liabilities of approximately $83.2 million and the elimination of deferred rent of approximately $15.0 million . Operating leases are included in operating lease ROU assets and lease liabilities on the Company’s balance sheets. The adoption of ASC 842 did not have a material impact on the Company’s consolidated statement of operations, consolidated statement of stockholders' equity, consolidated statement of comprehensive income (loss) or consolidated statement of cash flows. The new standard had no material impact on liquidity and had no impact on the Company’s debt-covenant compliance under its current debt agreements. The Company determines if an arrangement is a lease at inception. ROU assets represent the Company’s right to use an underlying asset for the duration of the lease term. Lease liabilities represent the Company’s contractual obligation to make lease payments over the lease term. ROU assets are recorded and recognized at commencement for the lease liability amount, plus initial direct costs incurred less lease incentives received. Lease liabilities are recorded at the present value of future lease payments over the lease term at commencement. The discount rate used is generally the Company’s estimated incremental borrowing rate unless the lessor’s implicit rate is readily determinable. Incremental borrowing rates are calculated periodically to estimate the rate the Company would pay to borrow the funds necessary to obtain an asset of similar value over a similar term. Lease expenses relating to operating leases are recognized on a straight-line basis over the lease term. The Company has operating leases for administrative, research and development, sales and marketing and manufacturing facilities and equipment under various non-cancelable lease agreements. The Company’s leases have remaining lease terms ranging from 1 year to 11 years . The Company’s lease terms may include options to extend or terminate the lease where it is reasonably certain that the Company will exercise those options. The Company considers several economic factors when making this determination, including but not limited to, the significance of leasehold improvements incurred in the office space, the difficulty in replacing the asset, underlying contractual obligations, or specific characteristics unique to a particular lease. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. Most of the Company’s lease agreements contain variable payments, primarily for common area maintenance (CAM), which are expensed as incurred and not included in the measurement of the ROU assets and lease liabilities. The components of operating lease cost for the three months ended June 30, 2019 were as follows (in thousands): Lease cost under long-term operating leases $ 3,245 Lease cost under short-term operating leases 852 Variable lease cost under short-term and long-term operating leases 1,212 Total operating lease cost $ 5,309 The table below presents supplemental cash flow information related to leases during the three months ended June 30, 2019 (in thousands): Cash paid for amounts included in the measurement of lease liabilities $ 3,425 Right-of-use assets obtained in exchange for new operating lease liabilities $ 1,827 Weighted average remaining lease term in years and weighted average discount rate are as follows: Weighted average remaining lease term in years - operating leases 9.28 Weighted average discount rate - operating leases 4.2 % Future minimum payments under non-cancellable leases at June 30, 2019 are as follows (in thousands): Year ending March 31: 2020 (remaining nine months) $ 10,249 2021 12,275 2022 11,454 2023 9,928 2024 9,049 Thereafter 45,483 Total lease payments $ 98,438 Less imputed interest (16,790 ) Present value of lease liabilities $ 81,648 As previously disclosed in the Company’s fiscal year Form 10-K and under the previous lease accounting standard, ASC 840, Leases, the following table summarizes the future non-cancelable minimum lease commitments (including office space, copiers, and automobiles) at March 31, 2019 (in thousands): Year ending March 31: 2020 $ 16,102 2021 11,059 2022 9,804 2023 8,807 2024 8,500 Thereafter 43,997 Total $ 98,269 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Jun. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Acquisition and divestiture related – The Company has a contingent consideration asset related to the divestiture of its HNT tools business in September 2018. The contingent consideration asset represents potential future earnout payments to the Company of up to $4.0 million over two years that are contingent on the HNT tools business achieving certain milestones. The fair value of the contingent consideration asset at June 30, 2019 and March 31, 2019 was $0.2 million and $0.8 million , respectively. The Company had a contingent liability at June 30, 2019 for $1.0 million related to the acquisition of Eastwind in April 2019 for which an escrow account was established to cover damages NetScout may suffer related to any liabilities that NetScout did not agree to assume or as a result of the breach of representations and warranties of the seller as described in the merger agreement. Except to the extent that valid indemnification claims are made prior to such time, the $1.0 million will be paid to the seller in April 2020. Legal – From time to time, NetScout is subject to legal proceedings and claims in the ordinary course of business. In the opinion of management, the amount of ultimate expense with respect to any current legal proceedings and claims, if determined adversely, will not have a material adverse effect on the Company’s financial condition, results of operations or cash flows. As previously disclosed, in March 2016, Packet Intelligence LLC (Packet Intelligence or Plaintiff) filed a Complaint against NetScout and two subsidiary entities in the United States District Court for the Eastern District of Texas asserting infringement of five United States patents. Plaintiff’s Complaint alleged that legacy Tektronix GeoProbe products, including the G10 and GeoBlade products, infringed these patents. NetScout filed an Answer denying Plaintiff’s allegations and asserting that Plaintiff’s patents were, among other things, invalid, not infringed, and unenforceable due to inequitable conduct. In October 2017, a jury trial was held to address the parties’ claims and counterclaims regarding infringement of three patents by the G10 and GeoBlade products, invalidity of these patents, and damages. On October 13, 2017, the jury rendered a verdict finding in favor of the Plaintiff and that Plaintiff was entitled to $3,500,000 for pre-suit damages and $2,250,000 for post-suit damages. The jury indicated that the awarded damages amounts were intended to reflect a running royalty. In September 2018, the Court entered judgment and "enhanced" the jury verdict in the amount of $2.8 million as a result of a jury finding. The judgment also awards pre- and post judgment interest, and a running royalty on the G10 and GeoBlade products until the expiration of the patents at issue, the last date being June 2022. The Court denied the Plaintiff's motion for fees. Following additional motions for judgment as a matter of law, the court entered final judgment. On June 12, 2019, NetScout filed its Notice of Appeal of the judgment and all other adverse findings. NetScout has concluded that the risk of loss from this matter is currently neither remote nor probable, and therefore, under GAAP definitions, the risk of loss is termed "reasonably possible." Therefore, accounting rules require NetScout to provide an estimate for the range of potential liability. NetScout currently estimates that the estimated range of liability is between $0 |
PENSION BENEFIT PLANS
PENSION BENEFIT PLANS | 3 Months Ended |
Jun. 30, 2019 | |
Retirement Benefits [Abstract] | |
PENSION BENEFIT PLANS | PENSION BENEFIT PLANS Certain of the Company's non-U.S. employees participate in noncontributory defined benefit pension plans. No ne of the Company's employees in the U.S. participate in any noncontributory defined benefit pension plans. In general, these plans are funded based on considerations relating to legal requirements, underlying asset returns, the plan's funded status, the anticipated deductibility of the contribution, local practices, market conditions, interest rates and other factors. The following sets forth the components of the Company's net periodic pension cost of the noncontributory defined benefit pension plans for the three months ended June 30, 2019 and 2018 (in thousands): Three Months Ended June 30, 2019 2018 Service cost $ 41 $ 63 Interest cost 96 121 Net periodic pension cost $ 137 $ 184 Expected Contributions During the three months ended June 30, 2019 , the Company made contributions of $0.1 million to its defined benefit pension plans. During the fiscal year ending March 31, 2020 , the Company's cash contribution requirements for its defined benefit pension plans are expected to be less than $1.0 million . As a majority of the participants within the Company's plans are all active employees, the benefit payments are not expected to be material in the foreseeable future. |
TREASURY STOCK
TREASURY STOCK | 3 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
TREASURY STOCK | TREASURY STOCK On May 19, 2015, the Company's board of directors approved a share repurchase program. This program enabled the Company to repurchase up to 20 million shares of its common stock. This plan became effective on July 14, 2015. The Company was not obligated to acquire any specific amount of common stock within any particular timeframe under this program. Through March 31, 2018, the Company had repurchased 20,000,000 shares totaling $607.6 million in the open market under this stock repurchase plan. At March 31, 2018, there were no shares of common stock that remained available to be purchased under the plan. On October 24, 2017, the Company’s Board of Directors approved a new share repurchase program that enables the Company to repurchase up to twenty-five million shares of its common stock. This new program became effective when the Company’s previously disclosed twenty million share repurchase program was completed. The Company is not obligated to acquire any specific amount of common stock within any particular timeframe as a result of this new share repurchase program. On February 1, 2018, the Company entered into ASR agreements with two third-party financial institutions (the Dealers) to repurchase an aggregate of $300 million of the Company's common stock via accelerated stock repurchase transactions under the Company’s twenty million share repurchase program (until such program was completed) and the twenty-five million share repurchase program. The Company borrowed $300 million against its Amended Credit Facility to finance the payment of the initial purchase price to each of the Dealers. Under the terms of the ASR, the Company made a $150 million payment to each of the Dealers on February 2, 2018, and received an initial delivery of 3,693,931 shares from each of the Dealers, or 7,387,862 shares in the aggregate, which was approximately 70 percent of the total number of shares of the Company's common stock expected to be repurchased under the ASR. As part of this purchase, 970,650 shares for $27.6 million were deducted under the twenty million share repurchase program and 6,417,212 shares for $182.4 million were deducted from the twenty-five million share repurchase program during the fiscal year ended March 31, 2018. Final settlement of the ASR agreements was completed in August 2018. As a result, the Company received an additional 3,679,947 shares of its common stock for $96.8 million , which reduced the number of shares available to be purchased from the twenty-five million share repurchase program during the year ended March 31, 2019. In total, 11,067,809 shares of the Company's common stock were repurchased under the ASR at an average cost per share of $27.11 . Through June 30, 2019, the Company has repurchased 11,937,810 shares for $295.0 million in the open market under the twenty-five million share repurchase program. At June 30, 2019 , 13,062,190 shares of common stock remained available to be purchased under the current repurchase program. The Company repurchased 1,297,400 shares for $33.2 million during the three months ended June 30, 2019 under the twenty-five million share repurchase program. In connection with the delivery of shares of the Company's common stock upon vesting of restricted stock units, the Company withheld 121,549 shares and 129,115 shares at a cost of $3.0 million and $3.5 million related to minimum statutory tax withholding requirements on these restricted stock units during the three months ended June 30, 2019 and 2018 , respectively. These withholding transactions do not fall under the repurchase program described above, and therefore do not reduce the amount that is available for repurchase under that program. |
NET LOSS PER SHARE
NET LOSS PER SHARE | 3 Months Ended |
Jun. 30, 2019 | |
Earnings Per Share [Abstract] | |
NET LOSS PER SHARE | NET LOSS PER SHARE Calculations of the basic and diluted net loss per share and potential common shares are as follows (in thousands, except for per share data): Three Months Ended June 30, 2019 2018 Numerator: Net loss $ (29,343 ) $ (62,504 ) Denominator: Denominator for basic net loss per share - weighted average common shares outstanding 77,302 80,358 Dilutive common equivalent shares: Weighted average restricted stock units — — Denominator for diluted net loss per share - weighted average shares outstanding 77,302 80,358 Net loss per share: Basic net loss per share $ (0.38 ) $ (0.78 ) Diluted net loss per share $ (0.38 ) $ (0.78 ) The following table sets forth restricted stock units excluded from the calculation of diluted net loss per share, since their inclusion would be anti-dilutive (in thousands): Three Months Ended June 30, 2019 2018 Restricted stock units 1,184 1,065 Basic net loss per share is calculated by dividing net loss by the weighted average number of shares outstanding during the period. Unvested restricted shares, although legally issued and outstanding, are not considered outstanding for purposes of calculating basic earnings per share. Diluted net loss per share is calculated by dividing net loss by the weighted average number of shares outstanding plus the dilutive effect, if any, of outstanding stock options, restricted shares and restricted stock units using the treasury stock method. The calculation of the dilutive effect of outstanding equity awards under the treasury stock method includes consideration of proceeds from the assumed exercise of stock options and unrecognized compensation expense as additional proceeds. As we incurred a net loss during the three months ended June 30, 2019 and 2018, all outstanding restricted stock units have an anti-dilutive effect and are therefore excluded from the computation of diluted weighted average shares outstanding. The delivery of approximately 7.4 million |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Jun. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The Company's effective income tax rates were 1.7% and 23.5% for the three months ended June 30, 2019 and 2018 , respectively. Generally, the effective tax rate differs from the statutory tax rate due to state income taxes, foreign withholding taxes, the Base Erosion Anti-Abuse Tax and the Global Intangible Low Taxes Income inclusion partially offset by the tax benefit associated with research and development tax credits, foreign tax credits, Foreign Derived Intangible Income deduction and earnings in jurisdictions subject to tax rates lower than the U.S. statutory rate. The effective tax rate for the three months ended June 30, 2019 is lower than the effective rate for the three months ended June 30, 2018 , primarily due to a significant discrete item recorded in the quarter. As a result of the Tax Legislation, in fiscal 2019, several of our foreign subsidiaries made tax elections to be treated as U.S. branches for federal income tax purposes (commonly referred to as “check-the-box” elections) effective beginning in fiscal 2020. As a result of making these check-the-box elections in the first quarter of fiscal 2020, we recorded a tax expense of approximately $6.0 million due to establishing new U.S. net deferred tax liabilities resulting from the difference between the GAAP basis and the U.S. federal tax carryover basis of the existing assets and liabilities of those foreign subsidiaries. |
SEGMENT AND GEOGRAPHIC INFORMAT
SEGMENT AND GEOGRAPHIC INFORMATION | 3 Months Ended |
Jun. 30, 2019 | |
Segment Reporting [Abstract] | |
SEGMENT AND GEOGRAPHIC INFORMATION | SEGMENT AND GEOGRAPHIC INFORMATION The Company reports revenues and income under one reportable segment. The Company manages its business in the following geographic areas: United States, Europe, Asia and the rest of the world. In accordance with United States export control regulations, the Company does not sell or do business with countries subject to economic sanctions and export controls. Total revenue by geography is as follows (in thousands): Three Months Ended June 30, 2019 2018 United States $ 107,103 $ 127,246 Europe 31,309 31,021 Asia 12,552 17,900 Rest of the world 35,060 28,944 $ 186,024 $ 205,111 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Jun. 30, 2019 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS On August 6, 2019, the Company repaid $50.0 million of borrowings under the Amended Credit Agreement. |
BASIS OF PRESENTATION (Policies
BASIS OF PRESENTATION (Policies) | 3 Months Ended |
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | The accompanying unaudited interim consolidated financial statements have been prepared by NetScout Systems, Inc. (NetScout or the Company). Certain information and footnote disclosures normally included in financial statements prepared under United States generally accepted accounting principles (GAAP) have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). In the opinion of management, the unaudited interim consolidated financial statements include all adjustments, consisting of normal recurring adjustments, necessary for a fair statement of the Company's financial position and stockholders' equity, results of operations and cash flows. The year-end consolidated balance sheet data and statement of stockholders' equity was derived from the Company's audited financial statements, but does not include all disclosures required by GAAP. The results reported in these unaudited interim consolidated financial statements are not necessarily indicative of results that may be expected for the entire year. All significant intercompany accounts and transactions are eliminated in consolidation. These unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements, including the notes thereto, included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2019 filed with the Securities and Exchange Commission on May 28, 2019. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In August 2018, the FASB issued ASU 2018-14, Compensation – Retirement Benefits – Defined Benefit Plans – General (Subtopic 715-20): Disclosure Framework—Changes to the Disclosure Requirements for Defined Benefit Plans. This ASU adds, modifies and clarifies several disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans. This guidance is effective for fiscal years ending after December 15, 2020. ASU 2018-14 is effective for NetScout beginning April 1, 2021. Early adoption is permitted. The Company is currently assessing the effect that ASU 2018-14 will have on its financial position, results of operations, and disclosures. 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 adds, modifies and removes several disclosure requirements relative to the three levels of inputs used to measure fair value in accordance with Topic 820, Fair Value Measurement. This guidance is effective for fiscal years beginning after December 15, 2019, including interim periods within that fiscal year. ASU 2018-13 is effective for NetScout beginning April 1, 2020. Early adoption is permitted. The Company is currently assessing the effect that ASU 2018-13 will have on its financial position, results of operations, and disclosures. In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815), Targeted Improvements to Accounting for Hedging Activities (ASU 2017-12). ASU 2017-12 provides guidance to better align an entity's risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. The amendments expand and refine hedge accounting for both non-financial and financial risk components and align the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. This standard is effective for financial statements issued for fiscal years beginning after December 15, 2018. The Company adopted ASU 2017-12 effective April 1, 2019. The adoption has had an immaterial impact on the Company's consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) Section A - Leases: Amendments to the FASB Accounting Standards Codification (ASU 2016-02) and issued subsequent amendments to initial guidance in July 2018 within ASU 2018-10, Codification Improvements to Topic 842, Leases and ASU 2018-11, Leases (Topic 842): Targeted Improvements (collectively, ASC 842). ASC 842 aims to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The Company adopted the guidance as of April 1, 2019 using the modified retrospective method. Please refer to Note 13, "Leases" for further details. |
Revenue Recognition Policy | Revenue Recognition Policy The Company exercises judgment and uses estimates in connection with determining the amounts of product and service revenues to be recognized in each accounting period. The Company derives revenues primarily from the sale of network management tools and security solutions for service provider and enterprise customers, which include hardware, software and service offerings. The majority of the Company's product sales consist of hardware products with embedded software that are essential to providing customers the intended functionality of the solutions. The Company also sells software offerings decoupled from the underlying hardware and software solutions to provide customers with enhanced functionality. The Company accounts for revenue once a legally enforceable contract with a customer has been approved by the parties and the related promises to transfer products or services have been identified. A contract is defined by the Company as an arrangement with commercial substance identifying payment terms, each party’s rights and obligations regarding the products or services to be transferred and the amount the Company deems probable of collection. Customer contracts may include promises to transfer multiple products and services to a customer. Determining whether the products and services are considered distinct performance obligations that should be accounted for separately or as one combined performance obligation may require significant judgment. Revenue is recognized when control of the products or services are transferred to the Company's customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for products and services. Product revenue is typically recognized upon shipment, provided a legally enforceable contract exists, control has passed to the customer, and in the case of software products, when the customer has the rights and ability to access the software, and collection of the related receivable is probable. If any significant obligations to the customer remain post-delivery, typically involving obligations relating to installation and acceptance by the customer, revenue recognition is deferred until such obligations have been fulfilled. The Company's service offerings include installation, integration, extended warranty and maintenance services, post-contract customer support, stand-ready software-as-a-service (SAAS) and other professional services including consulting and training. The Company generally provides software and/or hardware support as part of product sales. Revenue related to the initial bundled software and hardware support is recognized ratably over the support period. In addition, customers can elect to purchase extended support agreements for periods after the initial software/hardware warranty expiration. Support services generally include rights to unspecified upgrades (when and if available), telephone and internet-based support, updates, bug fixes and hardware repair and replacement. Consulting services are recognized upon delivery or completion of performance depending on the terms of the underlying contract. Reimbursements of out-of-pocket expenditures incurred in connection with providing consulting services are included in services revenue, with the offsetting expense recorded in cost of service revenue. Training services include on-site and classroom training. Training revenues are recognized upon delivery of the training. Generally, the Company's contracts are accounted for individually. However, when contracts are closely interrelated and dependent on each other, it may be necessary to account for two or more contracts as one to reflect the substance of the group of contracts. Bundled arrangements are concurrent customer purchases of a combination of the Company's product and service offerings that may be delivered at various points in time. The Company allocates the transaction price among the performance obligations in an amount that depicts the relative standalone selling prices (SSP) of each obligation. Judgment is required to determine the SSP for each distinct performance obligation. The Company uses a range of amounts to estimate SSP when it sells each of the products and services separately based on the element’s historical pricing. The Company also considers its overall pricing objectives and practices across different sales channels and geographies, and market conditions. Generally, the Company has established SSP for a majority of its service elements based on historical standalone sales. In certain instances, the Company has established SSP for services based upon an estimate of profitability and the underlying cost to fulfill those services. Further, for certain service engagements, the Company considers quoted prices as part of multi-element arrangements of those engagements as a basis for establishing SSP. SSP has been established for product elements as the average or median selling price the element was recently sold for, whether sold alone or sold as part of a multiple element transaction. The Company reviews sales of the product elements on a quarterly basis and updates, when appropriate, its SSP for such elements to ensure that it reflects recent pricing experience. The Company's products are distributed through its direct sales force and indirect distribution channels through alliances with resellers and distributors. Revenue arrangements with resellers and distributors are recognized on a sell-in basis; that is, when control of the product transfers to the reseller or distributor. The Company records consideration given to a reseller or distributor as a reduction of revenue to the extent they have recorded revenue from the reseller or distributor. With limited exceptions, the Company's return policy does not allow product returns for a refund. Returns have been insignificant to date. In addition, the Company has a history of successfully collecting receivables from its resellers and distributors. |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Summary of Share-Based Compensation Expense | The following is a summary of share-based compensation expense including restricted stock units granted pursuant to the Company's 2007 Equity Incentive Plan, as amended, and employee stock purchases made under the Company's 2011 Employee Stock Purchase Plan, as amended, (ESPP) based on estimated fair values within the applicable cost and expense lines identified below (in thousands): Three Months Ended June 30, 2019 2018 Cost of product revenue $ 267 $ 269 Cost of service revenue 1,467 1,330 Research and development 3,819 4,151 Sales and marketing 4,135 4,359 General and administrative 3,055 2,856 $ 12,743 $ 12,965 |
CASH, CASH EQUIVALENTS, RESTR_2
CASH, CASH EQUIVALENTS, RESTRICTED CASH AND MARKETABLE SECURITIES (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Cash, Cash Equivalents | The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statements of cash flows (in thousands): June 30, March 31, 2019 June 30, March 31, Cash and cash equivalents $ 353,721 $ 409,632 $ 353,416 $ 369,821 Restricted cash 1,189 188 910 910 Total cash, cash equivalents and restricted cash $ 354,910 $ 409,820 $ 354,326 $ 370,731 |
Schedule of Restricted Cash | The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statements of cash flows (in thousands): June 30, March 31, 2019 June 30, March 31, Cash and cash equivalents $ 353,721 $ 409,632 $ 353,416 $ 369,821 Restricted cash 1,189 188 910 910 Total cash, cash equivalents and restricted cash $ 354,910 $ 409,820 $ 354,326 $ 370,731 |
Summary of Marketable Securities | The following is a summary of marketable securities held by NetScout at June 30, 2019 , classified as short-term and long-term (in thousands): Amortized Cost Unrealized Gains Fair Value Type of security: U.S. government and municipal obligations $ 44,101 $ 31 $ 44,132 Commercial paper 37,553 — 37,553 Corporate bonds 2,663 6 2,669 Total short-term marketable securities 84,317 37 84,354 U.S. government and municipal obligations 5,067 20 5,087 Total long-term marketable securities 5,067 20 5,087 Total marketable securities $ 89,384 $ 57 $ 89,441 The following is a summary of marketable securities held by NetScout at March 31, 2019 , classified as short-term and long-term (in thousands): Amortized Cost Unrealized Gains Fair Value Type of security: U.S. government and municipal obligations $ 27,610 $ 12 $ 27,622 Commercial paper 48,722 — 48,722 Total short-term marketable securities 76,332 12 76,344 Corporate bonds 1,007 5 1,012 Total long-term marketable securities 1,007 5 1,012 Total marketable securities $ 77,339 $ 17 $ 77,356 |
Summary of Contractual Maturities of Marketable Securities | Contractual maturities of the Company's marketable securities held at June 30, 2019 and March 31, 2019 were as follows (in thousands): June 30, March 31, Available-for-sale securities: Due in 1 year or less $ 84,354 $ 76,344 Due after 1 year through 5 years 5,087 1,012 $ 89,441 $ 77,356 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Assets and Liabilities | The following tables present the Company's financial assets and liabilities measured on a recurring basis using the fair value hierarchy at June 30, 2019 and March 31, 2019 (in thousands): Fair Value Measurements at June 30, 2019 Level 1 Level 2 Level 3 Total ASSETS: Cash and cash equivalents $ 353,721 $ — $ — $ 353,721 U.S. government and municipal obligations 47,145 2,074 — 49,219 Commercial paper — 37,553 — 37,553 Corporate bonds 2,669 — — 2,669 Derivative financial instruments — 18 — 18 Contingent consideration — — 239 239 $ 403,535 $ 39,645 $ 239 $ 443,419 LIABILITIES: Contingent purchase consideration $ — $ — $ (1,000 ) $ (1,000 ) Derivative financial instruments — (51 ) — (51 ) $ — $ (51 ) $ (1,000 ) $ (1,051 ) Fair Value Measurements at March 31, 2019 Level 1 Level 2 Level 3 Total ASSETS: Cash and cash equivalents $ 409,632 $ — $ — $ 409,632 U.S. government and municipal obligations 10,732 16,890 — 27,622 Commercial paper — 48,722 — 48,722 Corporate bonds 1,012 — — 1,012 Derivative financial instruments — 58 — 58 Contingent consideration — — 762 762 $ 421,376 $ 65,670 $ 762 $ 487,808 LIABILITIES: Derivative financial instruments $ — $ (68 ) $ — $ (68 ) $ — $ (68 ) $ — $ (68 ) |
Schedule of Reconciliation of Changes in Fair Value of Level III Financial Assets | The following table sets forth a reconciliation of changes in the fair value of the Company's Level 3 financial assets and liabilities for the three months ended June 30, 2019 (in thousands): Contingent Consideration Contingent Purchase Consideration Balance at March 31, 2019 $ 762 $ — Additions to Level 3 — (1,000 ) Change in fair value of contingent consideration (523 ) — Balance at June 30, 2019 $ 239 $ (1,000 ) |
INVENTORIES (Tables)
INVENTORIES (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories consist of the following (in thousands): June 30, March 31, Raw materials $ 18,825 $ 14,432 Work in process 410 1,181 Finished goods 6,228 7,738 Deferred costs 1,016 2,919 $ 26,479 $ 26,270 |
ACQUISITIONS & DIVESTITURES (Ta
ACQUISITIONS & DIVESTITURES (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Business Combinations [Abstract] | |
Goodwill and Intangible Assets Record for Eastman Acquisition | Initial cash payment $ 4,154 Estimated fair value of contingent purchase consideration 1,000 Estimated purchase price $ 5,154 |
Estimated Fair Values of Acquired Assets and Liabilities Assumed | The following table reflects the estimated fair value of assets acquired and liabilities assumed (in thousands): Property, plant and equipment $ 17 Intangible assets 4,230 Accrued other liabilities (96 ) Goodwill $ 1,003 The following table reflects the fair value of the acquired identifiable intangible asset and related estimated useful life (in thousands): Fair Value Useful Life (Years) Developed technology $ 4,230 10 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill for the three months ended June 30, 2019 are as follows (in thousands): Balance at March 31, 2019 $ 1,715,485 Goodwill attributed to the Eastwind acquisition 1,003 Foreign currency translation impact 1,457 Balance at June 30, 2019 $ 1,717,945 |
Schedule of Intangible Assets | Intangible assets include the indefinite-lived trade name with a carrying value of $18.6 million and the following amortizable intangible assets at June 30, 2019 (in thousands): Cost Accumulated Amortization Net Developed technology $ 246,052 $ (174,164 ) $ 71,888 Customer relationships 771,415 (232,409 ) 539,006 Distributor relationships and technology licenses 6,855 (5,568 ) 1,287 Definite-lived trademark and trade name 39,236 (22,003 ) 17,233 Core technology 7,192 (6,902 ) 290 Net beneficial leases 336 (336 ) — Non-compete agreements 292 (292 ) — Leasehold interest 500 (500 ) — Backlog 16,349 (16,349 ) — Capitalized software 3,317 (2,905 ) 412 Other 1,208 (927 ) 281 $ 1,092,752 $ (462,355 ) $ 630,397 Intangible assets include the indefinite-lived trade name with a carrying value of $18.6 million and the following amortizable intangible assets at March 31, 2019 (in thousands): Cost Accumulated Amortization Net Developed technology $ 242,259 $ (168,289 ) $ 73,970 Customer relationships 772,969 (218,043 ) 554,926 Distributor relationships and technology licenses 6,882 (5,237 ) 1,645 Definite-lived trademark and trade name 39,304 (20,586 ) 18,718 Core technology 7,192 (6,845 ) 347 Net beneficial leases 336 (336 ) — Non-compete agreements 292 (292 ) — Leasehold interest 500 (500 ) — Backlog 16,397 (16,397 ) — Capitalized software 3,317 (2,690 ) 627 Other 1,208 (923 ) 285 $ 1,090,656 $ (440,138 ) $ 650,518 |
Finite-lived Intangible Assets Amortization Expense | The following table provides a summary of amortization expense for the three months ended June 30, 2019 and 2018, respectively (in thousands): Three Months Ended June 30, 2019 2018 Amortization of intangible assets included as: Cost of product revenue $ 6,802 $ 9,191 Operating expense 16,148 23,470 $ 22,950 $ 32,661 |
Schedule of Expected Future Amortization Expense | The following is the expected future amortization expense at June 30, 2019 for the fiscal years ending March 31 (in thousands): 2020 (remaining nine months) $ 68,244 2021 79,923 2022 69,523 2023 61,814 2024 53,717 Thereafter 297,176 $ 630,397 |
DERIVATIVE INSTRUMENTS AND HE_2
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Summary of Notional Amounts and Fair Values of Derivative Instruments on Consolidated Balance Sheet | The notional amounts and fair values of derivative instruments in the consolidated balance sheets at June 30, 2019 and March 31, 2019 were as follows (in thousands): Notional Amounts (a) Prepaid Expenses and Other Current Assets Accrued Other June 30, March 31, June 30, March 31, June 30, March 31, Derivatives Designated as Hedging Instruments: Forward contracts $ 2,070 $ 4,550 $ 18 $ 58 $ 51 $ 68 (a) Notional amounts represent the gross contract/notional amount of the derivatives outstanding. |
Summary of Effect of Foreign Exchange Forward Contracts on OCI and Results of Operations | The following table provides the effect foreign exchange forward contracts had on other comprehensive income (loss) (OCI) and results of operations for the three months ended June 30, 2019 and 2018 (in thousands): Loss Recognized in Gain (Loss) Reclassified from June 30, 2019 June 30, 2018 Location June 30, 2019 June 30, 2018 Forward contracts $ (73 ) $ (519 ) Research and development $ (5 ) $ 30 Sales and marketing 51 64 $ (73 ) $ (519 ) $ 46 $ 94 (a) The amount represents the change in fair value of derivative contracts due to changes in spot rates. (b) The amount represents reclassification from other comprehensive income to earnings that occurs when the hedged item affects earnings. |
RESTRUCTURING CHARGES (Tables)
RESTRUCTURING CHARGES (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Liability | The following table provides a summary of the activity related to the restructuring plan and the related restructuring liability (in thousands): VSP Employee-Related Balance at March 31, 2019 $ — Restructuring charges to operations 123 Cash payments (123 ) Balance at June 30, 2019 $ — |
LEASES (Tables)
LEASES (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Leases [Abstract] | |
Components of Operating Lease Cost and Supplemental Cash Flow Information | The components of operating lease cost for the three months ended June 30, 2019 were as follows (in thousands): Lease cost under long-term operating leases $ 3,245 Lease cost under short-term operating leases 852 Variable lease cost under short-term and long-term operating leases 1,212 Total operating lease cost $ 5,309 The table below presents supplemental cash flow information related to leases during the three months ended June 30, 2019 (in thousands): Cash paid for amounts included in the measurement of lease liabilities $ 3,425 Right-of-use assets obtained in exchange for new operating lease liabilities $ 1,827 Weighted average remaining lease term in years and weighted average discount rate are as follows: Weighted average remaining lease term in years - operating leases 9.28 Weighted average discount rate - operating leases 4.2 % |
ASC 842 Future Minimum Payments Under Non-Cancellable Leases | Future minimum payments under non-cancellable leases at June 30, 2019 are as follows (in thousands): Year ending March 31: 2020 (remaining nine months) $ 10,249 2021 12,275 2022 11,454 2023 9,928 2024 9,049 Thereafter 45,483 Total lease payments $ 98,438 Less imputed interest (16,790 ) Present value of lease liabilities $ 81,648 |
ASC 840 Future Non-Cancelable Minimum Lease Commitments | As previously disclosed in the Company’s fiscal year Form 10-K and under the previous lease accounting standard, ASC 840, Leases, the following table summarizes the future non-cancelable minimum lease commitments (including office space, copiers, and automobiles) at March 31, 2019 (in thousands): Year ending March 31: 2020 $ 16,102 2021 11,059 2022 9,804 2023 8,807 2024 8,500 Thereafter 43,997 Total $ 98,269 |
PENSION BENEFIT PLANS (Tables)
PENSION BENEFIT PLANS (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Retirement Benefits [Abstract] | |
Schedule of Net Periodic Pension Costs of Noncontributory Defined Benefit Pension Plans | The following sets forth the components of the Company's net periodic pension cost of the noncontributory defined benefit pension plans for the three months ended June 30, 2019 and 2018 (in thousands): Three Months Ended June 30, 2019 2018 Service cost $ 41 $ 63 Interest cost 96 121 Net periodic pension cost $ 137 $ 184 |
NET LOSS PER SHARE (Tables)
NET LOSS PER SHARE (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of Calculations of the Basic and Diluted Net Income (Loss) Per Share and Potential Common Shares | Calculations of the basic and diluted net loss per share and potential common shares are as follows (in thousands, except for per share data): Three Months Ended June 30, 2019 2018 Numerator: Net loss $ (29,343 ) $ (62,504 ) Denominator: Denominator for basic net loss per share - weighted average common shares outstanding 77,302 80,358 Dilutive common equivalent shares: Weighted average restricted stock units — — Denominator for diluted net loss per share - weighted average shares outstanding 77,302 80,358 Net loss per share: Basic net loss per share $ (0.38 ) $ (0.78 ) Diluted net loss per share $ (0.38 ) $ (0.78 ) |
Summary of Antidilutive Securities Excluded from Computation of Diluted EPS | The following table sets forth restricted stock units excluded from the calculation of diluted net loss per share, since their inclusion would be anti-dilutive (in thousands): Three Months Ended June 30, 2019 2018 Restricted stock units 1,184 1,065 |
SEGMENT AND GEOGRAPHIC INFORM_2
SEGMENT AND GEOGRAPHIC INFORMATION (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Segment Reporting [Abstract] | |
Summary of Total Revenue by Geography | Total revenue by geography is as follows (in thousands): Three Months Ended June 30, 2019 2018 United States $ 107,103 $ 127,246 Europe 31,309 31,021 Asia 12,552 17,900 Rest of the world 35,060 28,944 $ 186,024 $ 205,111 |
REVENUE RECOGNITION - Additiona
REVENUE RECOGNITION - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Mar. 31, 2019 | |
Disaggregation of Revenue [Line Items] | |||
Revenue recognized | $ 97.2 | ||
Deferred revenue | 342 | ||
Unrecognized accounts receivable and deferred revenue | 7 | $ 23.3 | |
Capitalized contract cost | 6.7 | 6.4 | |
Amortization of capitalized costs to obtain contracts | $ 1.6 | $ 0.6 | |
Minimum | |||
Disaggregation of Revenue [Line Items] | |||
Payment terms | 30 days | ||
Maximum | |||
Disaggregation of Revenue [Line Items] | |||
Payment terms | 90 days | ||
Prepaid expenses and other current assets | |||
Disaggregation of Revenue [Line Items] | |||
Capitalized contract cost | $ 4.3 | 3.8 | |
Other assets | |||
Disaggregation of Revenue [Line Items] | |||
Capitalized contract cost | $ 2.4 | $ 2.6 |
REVENUE RECOGNITION - Performan
REVENUE RECOGNITION - Performance Obligations (Details) $ in Millions | Jun. 30, 2019USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-07-01 | |
Revenue from Contract with Customer [Abstract] | |
Revenue, remaining performance obligation, amount | $ 246.5 |
Revenue, remaining performance obligation, percentage | 72.00% |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-07-01 | |
Revenue from Contract with Customer [Abstract] | |
Revenue, remaining performance obligation, amount | $ 95.5 |
Revenue, remaining performance obligation, percentage | 28.00% |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, expected timing of satisfaction, period |
SHARE-BASED COMPENSATION (Detai
SHARE-BASED COMPENSATION (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Share-based compensation expense | $ 12,743 | $ 12,965 |
ESPP | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Percentage of common stock price for employees | 85.00% | |
Cost of product revenue | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Share-based compensation expense | $ 267 | 269 |
Cost of service revenue | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Share-based compensation expense | 1,467 | 1,330 |
Research and development | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Share-based compensation expense | 3,819 | 4,151 |
Sales and marketing | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Share-based compensation expense | 4,135 | 4,359 |
General and administrative | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Share-based compensation expense | $ 3,055 | $ 2,856 |
CASH, CASH EQUIVALENTS, RESTR_3
CASH, CASH EQUIVALENTS, RESTRICTED CASH AND MARKETABLE SECURITIES - Summary of Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 | Mar. 31, 2018 |
Investments, Debt and Equity Securities [Abstract] | ||||
Cash and cash equivalents | $ 353,721 | $ 409,632 | $ 353,416 | $ 369,821 |
Restricted cash | 1,189 | 188 | 910 | 910 |
Total cash, cash equivalents and restricted cash | $ 354,910 | $ 409,820 | $ 354,326 | $ 370,731 |
CASH, CASH EQUIVALENTS, RESTR_4
CASH, CASH EQUIVALENTS, RESTRICTED CASH AND MARKETABLE SECURITIES - Summary of Marketable Securities (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Mar. 31, 2019 |
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | $ 89,384 | $ 77,339 |
Unrealized Gains | 57 | 17 |
Fair Value | 89,441 | 77,356 |
U.S. government and municipal obligations | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 49,219 | 27,622 |
Commercial paper | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 37,553 | 48,722 |
Corporate bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fair Value | 2,669 | 1,012 |
Short-term marketable securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 84,317 | 76,332 |
Unrealized Gains | 37 | 12 |
Fair Value | 84,354 | 76,344 |
Short-term marketable securities | U.S. government and municipal obligations | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 44,101 | 27,610 |
Unrealized Gains | 31 | 12 |
Fair Value | 44,132 | 27,622 |
Short-term marketable securities | Commercial paper | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 37,553 | 48,722 |
Unrealized Gains | 0 | 0 |
Fair Value | 37,553 | 48,722 |
Short-term marketable securities | Corporate bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 2,663 | |
Unrealized Gains | 6 | |
Fair Value | 2,669 | |
Long-term marketable securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 5,067 | 1,007 |
Unrealized Gains | 20 | 5 |
Fair Value | 5,087 | 1,012 |
Long-term marketable securities | U.S. government and municipal obligations | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 5,067 | |
Unrealized Gains | 20 | |
Fair Value | $ 5,087 | |
Long-term marketable securities | Corporate bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 1,007 | |
Unrealized Gains | 5 | |
Fair Value | $ 1,012 |
CASH, CASH EQUIVALENTS, RESTR_5
CASH, CASH EQUIVALENTS, RESTRICTED CASH AND MARKETABLE SECURITIES - Summary of Contractual Maturities of Marketable Securities (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Mar. 31, 2019 |
Available-for-sale securities: | ||
Due in 1 year or less | $ 84,354 | $ 76,344 |
Due after 1 year through 5 years | 5,087 | 1,012 |
Available-for-sale Securities | $ 89,441 | $ 77,356 |
FAIR VALUE MEASUREMENTS - Sched
FAIR VALUE MEASUREMENTS - Schedule of Financial Assets and Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Mar. 31, 2019 |
ASSETS: | ||
Cash and cash equivalents | $ 353,721 | $ 409,632 |
Available-for-sale securities | 89,441 | 77,356 |
Derivative financial instruments | 18 | 58 |
Contingent consideration | 239 | 762 |
Total assets | 443,419 | 487,808 |
LIABILITIES: | ||
Contingent purchase consideration | (1,000) | |
Derivative financial instruments | (51) | (68) |
Total liabilities | (1,051) | (68) |
U.S. government and municipal obligations | ||
ASSETS: | ||
Available-for-sale securities | 49,219 | 27,622 |
Commercial paper | ||
ASSETS: | ||
Available-for-sale securities | 37,553 | 48,722 |
Corporate bonds | ||
ASSETS: | ||
Available-for-sale securities | 2,669 | 1,012 |
Level 1 | ||
ASSETS: | ||
Cash and cash equivalents | 353,721 | 409,632 |
Derivative financial instruments | 0 | 0 |
Contingent consideration | 0 | 0 |
Total assets | 403,535 | 421,376 |
LIABILITIES: | ||
Contingent purchase consideration | 0 | |
Derivative financial instruments | 0 | 0 |
Total liabilities | 0 | 0 |
Level 1 | U.S. government and municipal obligations | ||
ASSETS: | ||
Available-for-sale securities | 47,145 | 10,732 |
Level 1 | Commercial paper | ||
ASSETS: | ||
Available-for-sale securities | 0 | 0 |
Level 1 | Corporate bonds | ||
ASSETS: | ||
Available-for-sale securities | 2,669 | 1,012 |
Level 2 | ||
ASSETS: | ||
Cash and cash equivalents | 0 | 0 |
Derivative financial instruments | 18 | 58 |
Contingent consideration | 0 | 0 |
Total assets | 39,645 | 65,670 |
LIABILITIES: | ||
Contingent purchase consideration | 0 | |
Derivative financial instruments | (51) | (68) |
Total liabilities | (51) | (68) |
Level 2 | U.S. government and municipal obligations | ||
ASSETS: | ||
Available-for-sale securities | 2,074 | 16,890 |
Level 2 | Commercial paper | ||
ASSETS: | ||
Available-for-sale securities | 37,553 | 48,722 |
Level 2 | Corporate bonds | ||
ASSETS: | ||
Available-for-sale securities | 0 | 0 |
Level 3 | ||
ASSETS: | ||
Cash and cash equivalents | 0 | 0 |
Derivative financial instruments | 0 | 0 |
Contingent consideration | 239 | 762 |
Total assets | 239 | 762 |
LIABILITIES: | ||
Contingent purchase consideration | (1,000) | |
Derivative financial instruments | 0 | 0 |
Total liabilities | (1,000) | 0 |
Level 3 | U.S. government and municipal obligations | ||
ASSETS: | ||
Available-for-sale securities | 0 | 0 |
Level 3 | Commercial paper | ||
ASSETS: | ||
Available-for-sale securities | 0 | 0 |
Level 3 | Corporate bonds | ||
ASSETS: | ||
Available-for-sale securities | $ 0 | $ 0 |
FAIR VALUE MEASUREMENTS - Narra
FAIR VALUE MEASUREMENTS - Narrative (Details) - USD ($) | Sep. 14, 2018 | Jun. 30, 2019 | Mar. 31, 2019 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Change in fair value contingent consideration in other expense | $ 500,000 | ||
HNT tools business | Disposed of by Sale | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Contingent consideration related to the divestiture, measurement period | 2 years | ||
Change in fair value contingent consideration in other expense | 500,000 | ||
Disposal group, not discontinued aperation, change in amount of contingent consideration, asset | 200,000 | $ 800,000 | |
Contingent consideration, change in fair value of contingent consideration | $ 18,000 | ||
HNT tools business | Disposed of by Sale | Maximum | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Contingent consideration related to the divestiture | $ 4,000,000 |
FAIR VALUE MEASUREMENTS - Recon
FAIR VALUE MEASUREMENTS - Reconciliation of Changes in Level 3 Assets and Liabilities (Details) - Fair value, measurements, recurring $ in Thousands | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Contingent Consideration | |
Balance at March 31, 2019 | $ 762 |
Change in fair value of contingent consideration | (523) |
Balance at June 30, 2019 | 239 |
Contingent Purchase Consideration | |
Balance at March 31, 2019 | 0 |
Additions to Level 3 | (1,000) |
Balance at June 30, 2019 | $ (1,000) |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Mar. 31, 2019 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 18,825 | $ 14,432 |
Work in process | 410 | 1,181 |
Finished goods | 6,228 | 7,738 |
Deferred costs | 1,016 | 2,919 |
Total inventories | $ 26,479 | $ 26,270 |
ACQUISITIONS & DIVESTITURES - E
ACQUISITIONS & DIVESTITURES - Eastwind Acquisition (Details) - USD ($) $ in Thousands | Apr. 03, 2019 | Jun. 30, 2019 |
Business Acquisition [Line Items] | ||
Estimated fair value of contingent purchase consideration | $ 1,000 | |
Eastwind | ||
Business Acquisition [Line Items] | ||
Initial cash payment | $ 4,154 | |
Estimated fair value of contingent purchase consideration | 1,000 | $ 1,000 |
Estimated purchase price | $ 5,154 |
ACQUISITIONS & DIVESTITURES -_2
ACQUISITIONS & DIVESTITURES - Eastwind Estimated Fair Value of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Apr. 03, 2019 | Mar. 31, 2019 |
Business Acquisition [Line Items] | |||
Goodwill | $ 1,717,945 | $ 1,715,485 | |
Eastwind | |||
Business Acquisition [Line Items] | |||
Property, plant and equipment | $ 17 | ||
Intangible assets | 4,230 | ||
Accrued other liabilities | (96) | ||
Goodwill | $ 1,003 |
ACQUISITIONS & DIVESTITURES -_3
ACQUISITIONS & DIVESTITURES - Eastwind Acquisition Narrative (Details) - USD ($) $ in Thousands | Apr. 03, 2019 | Jun. 30, 2019 |
Business Acquisition [Line Items] | ||
Useful Life (Years) | 14 years 7 months 6 days | |
Estimated fair value of contingent purchase consideration | $ 1,000 | |
Eastwind | ||
Business Acquisition [Line Items] | ||
Estimated purchase price | $ 5,154 | |
Estimated fair value of contingent purchase consideration | 1,000 | $ 1,000 |
Cash retention payments | $ 300 | |
Developed technology | Eastwind | ||
Business Acquisition [Line Items] | ||
Useful Life (Years) | 10 years |
ACQUISITIONS & DIVESTITURES -_4
ACQUISITIONS & DIVESTITURES - Eastwind Acquired Indentifiable Intangible Asset (Details) - USD ($) $ in Thousands | Apr. 03, 2019 | Jun. 30, 2019 |
Business Acquisition [Line Items] | ||
Useful Life (Years) | 14 years 7 months 6 days | |
Developed technology | Eastwind | ||
Business Acquisition [Line Items] | ||
Fair Value | $ 4,230 | |
Useful Life (Years) | 10 years |
ACQUISITIONS & DIVESTITURES - H
ACQUISITIONS & DIVESTITURES - HNT Tools Business Divestiture (Details) - USD ($) | Sep. 14, 2018 | Jun. 30, 2019 | Mar. 31, 2019 |
Business Acquisition [Line Items] | |||
Change in fair value contingent consideration in other expense | $ 500,000 | ||
Transitional services, period (up to) | 18 months | ||
Income from divestiture | $ 900,000 | ||
HNT tools business | Disposed of by Sale | |||
Business Acquisition [Line Items] | |||
Change in fair value contingent consideration in other expense | 500,000 | ||
Contingent consideration related to the divestiture, measurement period | 2 years | ||
Disposal group, not discontinued aperation, change in amount of contingent consideration, asset | $ 200,000 | $ 800,000 | |
HNT tools business | Disposed of by Sale | Maximum | |||
Business Acquisition [Line Items] | |||
Contingent consideration related to the divestiture | $ 4,000,000 |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS - Narrative (Details) $ in Thousands | 3 Months Ended | ||
Jun. 30, 2019USD ($)reporting_unit | Jun. 30, 2018USD ($) | Mar. 31, 2019USD ($) | |
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Number of reporting units | reporting_unit | 2 | ||
Goodwill | $ 1,717,945 | $ 1,715,485 | |
Carrying value of intangible assets | 648,997 | 669,118 | |
Impairment of intangible assets | $ 0 | $ 35,871 | |
Weighted average useful life of acquired intangible assets | 14 years 7 months 6 days | ||
Developed and core technology | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Weighted average useful life of acquired intangible assets | 11 years 3 months 18 days | ||
Customer and distributor relationships | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Weighted average useful life of acquired intangible assets | 15 years 10 months 24 days | ||
Trademarks and trade names | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Weighted average useful life of acquired intangible assets | 8 years 7 months 6 days | ||
Capitalized software | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Weighted average useful life of acquired intangible assets | 3 years | ||
Trade name | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Indefinite-lived intangible assets | $ 18,600 | 18,600 | |
Service Assurance | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Goodwill | 1,200,000 | 1,200,000 | |
Security | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Goodwill | $ 555,900 | $ 551,100 |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS - Schedule of Changes in Carrying Amount of Goodwill (Details) $ in Thousands | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Goodwill [Roll Forward] | |
Balance at March 31, 2019 | $ 1,715,485 |
Goodwill attributed to the Eastwind acquisition | 1,003 |
Foreign currency translation impact | 1,457 |
Balance at June 30, 2019 | $ 1,717,945 |
GOODWILL AND INTANGIBLE ASSET_4
GOODWILL AND INTANGIBLE ASSETS - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Mar. 31, 2019 |
Finite-Lived Intangible Assets [Line Items] | ||
Cost | $ 1,092,752 | $ 1,090,656 |
Accumulated Amortization | (462,355) | (440,138) |
Net | 630,397 | 650,518 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 246,052 | 242,259 |
Accumulated Amortization | (174,164) | (168,289) |
Net | 71,888 | 73,970 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 771,415 | 772,969 |
Accumulated Amortization | (232,409) | (218,043) |
Net | 539,006 | 554,926 |
Distributor relationships and technology licenses | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 6,855 | 6,882 |
Accumulated Amortization | (5,568) | (5,237) |
Net | 1,287 | 1,645 |
Definite-lived trademark and trade name | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 39,236 | 39,304 |
Accumulated Amortization | (22,003) | (20,586) |
Net | 17,233 | 18,718 |
Core technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 7,192 | 7,192 |
Accumulated Amortization | (6,902) | (6,845) |
Net | 290 | 347 |
Net beneficial leases | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 336 | 336 |
Accumulated Amortization | (336) | (336) |
Net | 0 | 0 |
Non-compete agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 292 | 292 |
Accumulated Amortization | (292) | (292) |
Net | 0 | 0 |
Leasehold interest | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 500 | 500 |
Accumulated Amortization | (500) | (500) |
Net | 0 | 0 |
Backlog | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 16,349 | 16,397 |
Accumulated Amortization | (16,349) | (16,397) |
Net | 0 | 0 |
Capitalized software | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 3,317 | 3,317 |
Accumulated Amortization | (2,905) | (2,690) |
Net | 412 | 627 |
Other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 1,208 | 1,208 |
Accumulated Amortization | (927) | (923) |
Net | $ 281 | $ 285 |
GOODWILL AND INTANGIBLE ASSET_5
GOODWILL AND INTANGIBLE ASSETS - Schedule of Amortization Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Finite-Lived Intangible Assets [Line Items] | ||
Amortization of acquired intangible assets | $ 22,950 | $ 32,661 |
Cost of product revenue | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization of acquired intangible assets | 6,802 | 9,191 |
Operating expense | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization of acquired intangible assets | $ 16,148 | $ 23,470 |
GOODWILL AND INTANGIBLE ASSET_6
GOODWILL AND INTANGIBLE ASSETS - Schedule of Expected Future Amortization Expense (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Mar. 31, 2019 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||
2020 (remaining nine months) | $ 68,244 | |
2021 | 79,923 | |
2022 | 69,523 | |
2023 | 61,814 | |
2024 | 53,717 | |
Thereafter | 297,176 | |
Net | $ 630,397 | $ 650,518 |
DERIVATIVE INSTRUMENTS AND HE_3
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Narrative (Details) | 3 Months Ended |
Jun. 30, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Managing period of hedging forecasted cash flows for operating expenses denominated in foreign currencies | 12 months |
Contract maturity period | 12 months |
DERIVATIVE INSTRUMENTS AND HE_4
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Summary of Notional Amounts and Fair Values of Derivative Instruments on Consolidated Balance Sheet (Details) - Forward contracts - Cash flow hedges - Designated as hedging instrument - USD ($) $ in Thousands | Jun. 30, 2019 | Mar. 31, 2019 |
Derivatives, Fair Value [Line Items] | ||
Notional Amounts | $ 2,070 | $ 4,550 |
Prepaid Expenses and Other Current Assets | ||
Derivatives, Fair Value [Line Items] | ||
Prepaid Expenses and Other Current Assets | 18 | 58 |
Accrued Other | ||
Derivatives, Fair Value [Line Items] | ||
Accrued Other | $ 51 | $ 68 |
DERIVATIVE INSTRUMENTS AND HE_5
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Summary of Effect of Foreign Exchange Forward Contracts on Other Comprehensive Income and Results of Operations (Details) - Forward contracts - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Loss Recognized in OCI on Derivative | $ (73) | |
Loss Recognized in OCI on Derivative | $ (519) | |
Gain (Loss) Reclassified from Accumulated OCI into Income | 46 | |
Research and development | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Loss Recognized in OCI on Derivative | (73) | |
Loss Recognized in OCI on Derivative | (519) | |
Gain (Loss) Reclassified from Accumulated OCI into Income | (5) | |
Sales and marketing | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Loss Recognized in OCI on Derivative | ||
Loss Recognized in OCI on Derivative | ||
Gain (Loss) Reclassified from Accumulated OCI into Income | $ 51 | |
Cash flow hedges | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (Loss) Reclassified from Accumulated OCI into Income | 94 | |
Cash flow hedges | Research and development | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (Loss) Reclassified from Accumulated OCI into Income | 30 | |
Cash flow hedges | Sales and marketing | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (Loss) Reclassified from Accumulated OCI into Income | $ 64 |
LONG-TERM DEBT (Details)
LONG-TERM DEBT (Details) | Jan. 16, 2018USD ($)shares | Jul. 14, 2015 | Jun. 30, 2019USD ($) | Feb. 01, 2018USD ($) |
Debt Instrument [Line Items] | ||||
Stock authorized to repurchase under stock repurchase program (in shares) | shares | 25,000,000 | |||
Repaid borrowings | $ 50,000,000 | |||
Senior secured revolving credit facility | Line of credit | ||||
Debt Instrument [Line Items] | ||||
Debt term | 5 years | |||
Credit facility | $ 1,000,000,000 | |||
Amount outstanding under credit facility | $ 500,000,000 | $ 300,000,000 | ||
Commitment fee percentage | 0.25% | |||
Debt default, acceleration clause, required consent percentage | 50.00% | |||
Debt issuance cost, gross | $ 12,200,000 | |||
Unamortized debt issuance costs | 6,200,000 | |||
Senior secured revolving credit facility | Line of credit | Prepaid expenses and other current assets | ||||
Debt Instrument [Line Items] | ||||
Unamortized debt issuance costs | 1,800,000 | |||
Senior secured revolving credit facility | Line of credit | Other assets | ||||
Debt Instrument [Line Items] | ||||
Unamortized debt issuance costs | $ 4,400,000 | |||
Senior secured revolving credit facility | Line of credit | Maximum | ||||
Debt Instrument [Line Items] | ||||
Leverage ratio | 3.50 | 2.75 | ||
Commitment fee percentage | 0.30% | |||
Senior secured revolving credit facility | Line of credit | Maximum | Foreign Subsidiaries | ||||
Debt Instrument [Line Items] | ||||
Voting stock pledge limit for any foreign subsidiary | 65.00% | |||
Senior secured revolving credit facility | Line of credit | Minimum | ||||
Debt Instrument [Line Items] | ||||
Leverage ratio | 1.50 | 1.50 | ||
Commitment fee percentage | 0.15% | |||
Senior secured revolving credit facility | Line of credit | Federal funds effective rate | ||||
Debt Instrument [Line Items] | ||||
Interest rate in excess of effective rate | 0.50% | |||
Senior secured revolving credit facility | Line of credit | LIBOR | ||||
Debt Instrument [Line Items] | ||||
Interest rate in excess of effective rate | 1.00% | |||
Senior secured revolving credit facility | Line of credit | LIBOR | LIBOR loans | ||||
Debt Instrument [Line Items] | ||||
Interest rate in excess of effective rate | 1.50% | |||
Senior secured revolving credit facility | Line of credit | LIBOR | LIBOR loans | Maximum | ||||
Debt Instrument [Line Items] | ||||
Interest rate in excess of effective rate | 2.00% | |||
Senior secured revolving credit facility | Line of credit | LIBOR | LIBOR loans | Minimum | ||||
Debt Instrument [Line Items] | ||||
Interest rate in excess of effective rate | 1.00% | |||
Senior secured revolving credit facility | Line of credit | Base rate | Base rate loans | ||||
Debt Instrument [Line Items] | ||||
Interest rate in excess of effective rate | 0.50% | |||
Senior secured revolving credit facility | Line of credit | Base rate | Base rate loans | Maximum | ||||
Debt Instrument [Line Items] | ||||
Interest rate in excess of effective rate | 1.00% | |||
Senior secured revolving credit facility | Line of credit | Base rate | Base rate loans | Minimum | ||||
Debt Instrument [Line Items] | ||||
Interest rate in excess of effective rate | 0.00% | |||
Letter of credit sub-facility | Line of credit | ||||
Debt Instrument [Line Items] | ||||
Credit facility | $ 75,000,000 |
RESTRUCTURING CHARGES - Narrati
RESTRUCTURING CHARGES - Narrative (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Jun. 30, 2019USD ($) | Dec. 31, 2018employee | Jun. 30, 2018USD ($) | Mar. 31, 2019employee | |
Restructuring Cost and Reserve [Line Items] | ||||
Number of employees terminated | employee | 61 | |||
Restructuring charges | $ 123 | $ 1,147 | ||
Employee-Related | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | $ 1,100 | |||
VSP | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Number of employees terminated | employee | 155 | |||
Restructuring charges | $ 100 |
RESTRUCTURING CHARGES - Schedul
RESTRUCTURING CHARGES - Schedule of Restructuring Liability (Details) - VSP - Employee-Related $ in Thousands | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Restructuring Reserve [Roll Forward] | |
Balance at March 31, 2019 | $ 0 |
Restructuring charges to operations | 123 |
Cash payments | (123) |
Balance at June 30, 2019 | $ 0 |
LEASES - Narrative (Details)
LEASES - Narrative (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Apr. 01, 2019 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating lease right-of-use assets | $ 67,536 | |
Operating lease liabilities | $ 81,648 | |
ASU 2016-02 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating lease right-of-use assets | $ 68,200 | |
Operating lease liabilities | 83,200 | |
Elimination of deferred rent | $ 15,000 | |
Minimum | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Remaining lease terms | 1 year | |
Maximum | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Remaining lease terms | 11 years |
LEASES - Operating Lease Cost (
LEASES - Operating Lease Cost (Details) $ in Thousands | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Leases [Abstract] | |
Lease cost under long-term operating leases | $ 3,245 |
Lease cost under short-term operating leases | 852 |
Variable lease cost under short-term and long-term operating leases | 1,212 |
Total operating lease cost | $ 5,309 |
LEASES - Supplemental Cash Flow
LEASES - Supplemental Cash Flow Information (Details) $ in Thousands | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Leases [Abstract] | |
Cash paid for amounts included in the measurement of lease liabilities | $ 3,425 |
Right-of-use assets obtained in exchange for new operating lease liabilities | $ 1,827 |
Weighted average remaining lease term in years - operating leases | 9 years 3 months 10 days |
Weighted average discount rate - operating leases | 4.20% |
LEASES - Future Minimum Payment
LEASES - Future Minimum Payments Under Non-Cancellable Leases (Details) $ in Thousands | Jun. 30, 2019USD ($) |
Leases [Abstract] | |
2020 (remaining nine months) | $ 10,249 |
2021 | 12,275 |
2022 | 11,454 |
2023 | 9,928 |
2024 | 9,049 |
Thereafter | 45,483 |
Total lease payments | 98,438 |
Less imputed interest | (16,790) |
Present value of lease liabilities | $ 81,648 |
LEASES - ASC 840 Future Non-Can
LEASES - ASC 840 Future Non-Cancelable Minimum Lease Commitments (Details) $ in Thousands | Mar. 31, 2019USD ($) |
Leases [Abstract] | |
2020 | $ 16,102 |
2021 | 11,059 |
2022 | 9,804 |
2023 | 8,807 |
2024 | 8,500 |
Thereafter | 43,997 |
Total | $ 98,269 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) | Sep. 14, 2018USD ($) | Oct. 13, 2017USD ($) | Sep. 30, 2018USD ($) | Oct. 31, 2017patent | Mar. 31, 2016patentsubsidiary | Jun. 30, 2019USD ($) | Apr. 03, 2019USD ($) | Mar. 31, 2019USD ($) |
Commitments and Contingencies Disclosure [Line Items] | ||||||||
Estimated fair value of contingent purchase consideration | $ 1,000,000 | |||||||
Number of subsidiary entities | subsidiary | 2 | |||||||
Number of patents allegedly infringed | patent | 3 | 5 | ||||||
Damages sought | $ 2,800,000 | |||||||
Minimum | ||||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||||
Estimated litigation liability | 0 | |||||||
Pre-suit damages | ||||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||||
Damages sought | $ 3,500,000 | |||||||
Post-suit damages | ||||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||||
Damages sought | $ 2,250,000 | |||||||
Eastwind | ||||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||||
Estimated fair value of contingent purchase consideration | 1,000,000 | $ 1,000,000 | ||||||
Disposed of by Sale | HNT tools business | ||||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||||
Contingent consideration related to the divestiture, measurement period | 2 years | |||||||
Disposal group, not discontinued aperation, change in amount of contingent consideration, asset | $ 200,000 | $ 800,000 | ||||||
Disposed of by Sale | HNT tools business | Maximum | ||||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||||
Contingent consideration related to the divestiture | $ 4,000,000 |
PENSION BENEFIT PLANS - Narrati
PENSION BENEFIT PLANS - Narrative (Details) $ in Millions | 3 Months Ended |
Jun. 30, 2019USD ($)employee | |
Defined Benefit Plan Disclosure [Line Items] | |
Contributions to defined benefit pension plans | $ 0.1 |
Expected cash contribution requirements for defined benefit pension plans, less than | $ 1 |
United States | |
Defined Benefit Plan Disclosure [Line Items] | |
Number of employees participating in noncontributory defined benefit pension plans | employee | 0 |
PENSION BENEFIT PLANS - Net Per
PENSION BENEFIT PLANS - Net Periodic Pension Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Retirement Benefits [Abstract] | ||
Service cost | $ 41 | $ 63 |
Interest cost | 96 | 121 |
Net periodic pension cost | $ 137 | $ 184 |
TREASURY STOCK (Details)
TREASURY STOCK (Details) $ / shares in Units, $ in Thousands | Feb. 02, 2018USD ($)shares | Feb. 01, 2018USD ($)dealer | Jun. 30, 2019USD ($)shares | Jun. 30, 2018USD ($)shares | Aug. 31, 2018$ / sharesshares | Jun. 30, 2019USD ($)shares | Mar. 31, 2018USD ($)shares | Mar. 31, 2018USD ($)shares | Mar. 31, 2019shares | Jan. 16, 2018shares | Oct. 24, 2017shares | May 19, 2015shares |
Equity, Class of Treasury Stock [Line Items] | ||||||||||||
Stock authorized to repurchase under stock repurchase program (in shares) | 25,000,000 | |||||||||||
Shares repurchased during the period, value | $ | $ 30,708 | $ 0 | ||||||||||
Restricted stock units | ||||||||||||
Equity, Class of Treasury Stock [Line Items] | ||||||||||||
Shares paid for tax withholding (in shares) | 121,549 | 129,115 | ||||||||||
Cost related to tax withholding | $ | $ 3,000 | $ 3,500 | ||||||||||
Senior secured revolving credit facility | Line of credit | ||||||||||||
Equity, Class of Treasury Stock [Line Items] | ||||||||||||
Amount borrowed for repurchase | $ | $ 300,000 | $ 500,000 | $ 500,000 | |||||||||
Share repurchase program, May 2015 | ||||||||||||
Equity, Class of Treasury Stock [Line Items] | ||||||||||||
Stock authorized to repurchase under stock repurchase program (in shares) | 20,000,000 | |||||||||||
Shares repurchased during the period (in shares) | 970,650 | 20,000,000 | ||||||||||
Shares repurchased during the period, value | $ | $ 27,600 | $ 607,600 | ||||||||||
Stock remaining to be purchased (in shares) | 0 | |||||||||||
Share repurchase program, October 2017 | ||||||||||||
Equity, Class of Treasury Stock [Line Items] | ||||||||||||
Stock authorized to repurchase under stock repurchase program (in shares) | 25,000,000 | |||||||||||
Shares repurchased during the period (in shares) | 1,297,400 | 11,937,810 | 6,417,212 | |||||||||
Shares repurchased during the period, value | $ | $ 33,200 | $ 295,000 | $ 182,400 | |||||||||
ASR Agreements | ||||||||||||
Equity, Class of Treasury Stock [Line Items] | ||||||||||||
Shares repurchased during the period (in shares) | 7,387,862 | 3,679,947 | 7,400,000 | 11,067,809 | ||||||||
Shares repurchased during the period, value | $ | $ 150,000 | $ 300,000 | $ 96,800 | |||||||||
Stock remaining to be purchased (in shares) | 13,062,190 | 13,062,190 | ||||||||||
Stock repurchase program, number of dealers | dealer | 2 | |||||||||||
Number of shares acquired from each of dealers (in shares) | 3,693,931 | |||||||||||
Percentage of total number of shares expected to be repurchased | 70.00% | |||||||||||
Shares repurchased during the period, average cost per share (in dollars per share) | $ / shares | $ 27.11 |
NET LOSS PER SHARE - Schedule o
NET LOSS PER SHARE - Schedule of Calculations of EPS (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Numerator: | ||
Net loss | $ (29,343) | $ (62,504) |
Denominator: | ||
Denominator for basic net loss per share - weighted average common shares outstanding (in shares) | 77,302 | 80,358 |
Dilutive common equivalent shares: | ||
Weighted average restricted stock units (in shares) | 0 | 0 |
Denominator for diluted net loss per share - weighted average shares outstanding (in shares) | 77,302 | 80,358 |
Net loss per share: | ||
Basic net loss per share (in dollars per share) | $ (0.38) | $ (0.78) |
Diluted net loss per share (in dollars per share) | $ (0.38) | $ (0.78) |
NET LOSS PER SHARE - Antidiluti
NET LOSS PER SHARE - Antidilutive Securities Excluded from Computation (Details) - shares shares in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Restricted stock units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 1,184 | 1,065 |
NET LOSS PER SHARE - Narrative
NET LOSS PER SHARE - Narrative (Details) - shares | Feb. 02, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Aug. 31, 2018 |
ASR Agreements | ||||
Accelerated Share Repurchases [Line Items] | ||||
Repurchase of treasury stock (in shares) | 7,387,862 | 3,679,947 | 7,400,000 | 11,067,809 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | ||
Effective income tax rate | (1.70%) | 23.50% |
Income tax expense due to new U.S. net deferred tax liabilities | $ 6 |
SEGMENT AND GEOGRAPHIC INFORM_3
SEGMENT AND GEOGRAPHIC INFORMATION (Details) $ in Thousands | 3 Months Ended | |
Jun. 30, 2019USD ($)segment | Jun. 30, 2018USD ($) | |
Segment Reporting Information [Line Items] | ||
Number of reportable segments | segment | 1 | |
Total revenue | $ 186,024 | $ 205,111 |
United States | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 107,103 | 127,246 |
Europe | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 31,309 | 31,021 |
Asia | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 12,552 | 17,900 |
Rest of the world | ||
Segment Reporting Information [Line Items] | ||
Total revenue | $ 35,060 | $ 28,944 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) $ in Millions | Aug. 06, 2019 | Jun. 30, 2019 |
Subsequent Event [Line Items] | ||
Repaid borrowings | $ 50 | |
Subsequent Event | ||
Subsequent Event [Line Items] | ||
Repaid borrowings | $ 50 |
Uncategorized Items - ntct-2019
Label | Element | Value |
Accounting Standards Update 2014-09 [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 34,149,000 |
Accounting Standards Update 2014-09 [Member] | Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 34,149,000 |