Cover Page
Cover Page - shares | 9 Months Ended | |
Dec. 31, 2021 | Feb. 04, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Dec. 31, 2021 | |
Entity File Number | 001-31321 | |
Entity Registrant Name | NAUTILUS, INC. | |
Entity Incorporation, State or Country Code | WA | |
Entity Tax Identification Number | 94-3002667 | |
Entity Address, Address Line One | 17750 S.E. 6th Way | |
Entity Address, City or Town | Vancouver | |
Entity Address, State or Province | WA | |
Entity Address, Postal Zip Code | 98683 | |
City Area Code | 360 | |
Local Phone Number | 859-2900 | |
Title of 12(b) Security | Common Stock, no par value | |
Trading Symbol | NLS | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 31,248,298 | |
Entity Central Index Key | 0001078207 | |
Current Fiscal Year End Date | --03-31 | |
Amendment Flag | false | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2022 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Dec. 31, 2021 | Mar. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 18,402 | $ 38,441 |
Restricted cash | 1,339 | 1,339 |
Available-for-sale securities | 0 | 73,448 |
Trade receivables, net of allowances of $657 and $1,177 | 93,611 | 88,657 |
Inventories | 128,113 | 68,085 |
Prepaids and other current assets | 10,981 | 25,840 |
Income taxes receivable | 8,103 | 0 |
Total current assets | 260,549 | 295,810 |
Property, plant and equipment, net | 30,976 | 24,496 |
Operating lease right-of-use assets | 24,534 | 19,108 |
Goodwill | 24,510 | 0 |
Other intangible assets, net | 9,319 | 9,365 |
Deferred income tax assets, non-current | 4,554 | 2,144 |
Income Taxes Receivable, Noncurrent | 5,673 | 0 |
Other Restricted Assets | 3,887 | 0 |
Other assets | 2,963 | 3,307 |
Total assets | 366,965 | 354,230 |
Liabilities and Shareholders' Equity | ||
Trade payables | 61,850 | 98,878 |
Accrued liabilities | 25,232 | 19,627 |
Operating lease liabilities, current portion | 4,653 | 3,384 |
Finance lease obligations, net of current portion | 119 | 0 |
Warranty obligations, current portion | 5,724 | 7,243 |
Income taxes payable, current portion | 914 | 5,709 |
Debt payable, current portion, net of unamortized debt issuance costs of $83 and $83 | 2,217 | 3,000 |
Total current liabilities | 100,709 | 137,841 |
Operating lease liabilities, non-current | 21,855 | 17,875 |
Finance lease obligations | 423 | 0 |
Warranty obligations, non-current | 1,401 | 1,408 |
Income taxes payable, non-current | 3,997 | 3,657 |
Other non-current liabilities | 4,301 | 607 |
Debt payable, non-current, net of unamortized debt issuance costs of $173 and $236 | 53,594 | 10,297 |
Total liabilities | 186,280 | 171,685 |
Commitments and contingencies (Note 16) | ||
Shareholders' equity: | ||
Common stock - no par value, 75,000 shares authorized, 31,245 and 30,576 shares issued and outstanding | 4,879 | 2,176 |
Retained earnings | 176,307 | 180,524 |
Accumulated other comprehensive loss | (501) | (155) |
Total shareholders' equity | 180,685 | 182,545 |
Total liabilities and shareholders' equity | $ 366,965 | $ 354,230 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parentheticals) - USD ($) $ in Thousands | Dec. 31, 2021 | Mar. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful trade receivables | $ 657 | $ 1,177 |
Debt Issuance Costs, Current, Net | 83 | 83 |
Debt Issuance Costs, Noncurrent, Net | $ 173 | $ 236 |
Common stock, par value (in dollars per share) | $ 0 | $ 0 |
Common stock, shares authorized | 75,000,000 | 75,000,000 |
Common stock, shares issued | 31,245,000 | 30,576,000 |
Common stock, shares outstanding | 31,245,000 | 30,576,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Statement [Abstract] | ||||
Net sales | $ 147,258 | $ 189,259 | $ 469,810 | $ 458,838 |
Cost of sales | 117,342 | 111,388 | 342,336 | 265,633 |
Gross profit | 29,916 | 77,871 | 127,474 | 193,205 |
Operating expenses: | ||||
Selling and marketing | 32,395 | 21,998 | 75,634 | 53,651 |
General and administrative | 11,456 | 10,364 | 39,355 | 28,520 |
Research and development | 5,379 | 4,029 | 15,882 | 11,997 |
Loss on disposal group | 0 | 0 | 0 | 20,668 |
Total operating expenses | 49,230 | 36,391 | 130,871 | 114,836 |
Operating (loss) income | (19,314) | 41,480 | (3,397) | 78,369 |
Other expense: | ||||
Interest income | 1 | 7 | 34 | 9 |
Interest expense | (354) | (280) | (1,149) | (871) |
Other, net | (789) | (3,367) | (815) | (3,628) |
Total other expense, net | (1,142) | (3,640) | (1,930) | (4,490) |
(Loss) income from continuing operations before income taxes | (20,456) | 37,840 | (5,327) | 73,879 |
Income tax expense (benefit) | (7,001) | 8,588 | (1,321) | 15,644 |
(Loss) income from continuing operations | (13,455) | 29,252 | (4,006) | 58,235 |
Discontinued operations: | ||||
Loss from discontinued operations before income taxes | (118) | (65) | (195) | (128) |
Income tax (benefit) expense of discontinued operations | (74) | 251 | 16 | 443 |
Loss from discontinued operations | (44) | (316) | (211) | (571) |
Net (loss) income | $ (13,499) | $ 28,936 | $ (4,217) | $ 57,664 |
Earnings Per Share, Basic [Abstract] | ||||
Basic income (loss) per share from continuing operations (in dollars per share) | $ (0.43) | $ 0.97 | $ (0.13) | $ 1.94 |
Basic loss per share from discontinued operation (in dollars per share) | 0 | (0.01) | (0.01) | (0.02) |
Basic net income (loss) per share (in dollars per share) | (0.43) | 0.96 | (0.14) | 1.92 |
Earnings Per Share, Diluted [Abstract] | ||||
Diluted income (loss) per share from continuing operations (in dollars per share) | (0.43) | 0.90 | (0.13) | 1.80 |
Diluted loss per share from discontinued operation (in dollars per share) | 0 | (0.01) | (0.01) | (0.02) |
Diluted net income (loss) per share (in dollars per share) | $ (0.43) | $ 0.89 | $ (0.14) | $ 1.78 |
Shares used in per share calculations: | ||||
Basic (in shares) | 31,199 | 30,284 | 30,955 | 30,077 |
Diluted (in shares) | 31,199 | 32,633 | 30,955 | 32,336 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive (Loss) Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | |
Statement of Comprehensive Income [Abstract] | ||||
Net (loss) income | $ (13,499) | $ 28,936 | $ (4,217) | $ 57,664 |
Other comprehensive income: | ||||
Unrealized loss on available-for-sale securities, net of income tax expense of $—, $—, $— and $— | 0 | (4) | (4) | (4) |
Foreign currency translation, net of income tax (expense) benefit of $(2), $(10), $2 and $(4) | (148) | 760 | (342) | 1,330 |
Net other comprehensive income (loss) during period | (148) | 756 | (346) | 1,326 |
Comprehensive (loss) income | $ (13,647) | $ 29,692 | $ (4,563) | $ 58,990 |
Condensed Condensed Consolidate
Condensed Condensed Consolidated Statements of Comprehensive Income (Unaudited) (Parentheticals) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | |
Statement of Comprehensive Income [Abstract] | ||||||||
Unrealized gain (loss) on marketable securities, tax (benefit) expense | $ 0 | $ 7 | $ (7) | $ 0 | $ 0 | $ 0 | ||
Foreign currency translation, tax (benefit) expense | $ 2 | $ 21 | $ (13) | $ (2) | $ (13) | $ 15 | $ 10 | $ 4 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Retained Earnings | Accumulated Other Comprehensive Income (Loss) |
Beginning balance at Mar. 31, 2020 | $ 92,925 | $ 1,781 | $ 92,456 | $ (1,312) |
Balance, shares at Mar. 31, 2020 | 29,817 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net (loss) income | (5,110) | (5,110) | ||
Foreign currency translation adjustment, including income tax expense (benefit) | 353 | 353 | ||
Stock-based compensation expense | 865 | $ 865 | 0 | |
Common stock issued under equity compensation plan, net of shares withheld for tax payments (in shares) | 87 | |||
Common stock issued under equity compensation plan, net of shares withheld for tax payments | 0 | $ 0 | ||
Common stock issued under employee stock purchase plan, shares | 63 | |||
Common stock issued under employee stock purchase plan | 83 | $ 83 | ||
Balance, shares at Jun. 30, 2020 | 29,967 | |||
Ending balance at Jun. 30, 2020 | 89,116 | $ 2,729 | 87,346 | (959) |
Beginning balance at Mar. 31, 2020 | 92,925 | $ 1,781 | 92,456 | (1,312) |
Balance, shares at Mar. 31, 2020 | 29,817 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net (loss) income | 57,664 | |||
Unrealized loss on marketable securities, net of income tax benefit | (4) | |||
Foreign currency translation adjustment, including income tax expense (benefit) | 1,330 | |||
Balance, shares at Dec. 31, 2020 | 30,330 | |||
Ending balance at Dec. 31, 2020 | 153,195 | $ 3,061 | 150,120 | 14 |
Beginning balance at Jun. 30, 2020 | 89,116 | $ 2,729 | 87,346 | (959) |
Balance, shares at Jun. 30, 2020 | 29,967 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net (loss) income | 33,838 | 33,838 | ||
Foreign currency translation adjustment, including income tax expense (benefit) | 217 | 217 | ||
Stock-based compensation expense | 1,071 | $ 1,071 | 0 | |
Common stock issued under equity compensation plan, shares | 290 | |||
Common stock issued under equity compensation plan, net of shares withheld for tax payments | $ (796) | |||
Balance, shares at Sep. 30, 2020 | 30,257 | |||
Ending balance at Sep. 30, 2020 | 123,446 | $ 3,004 | 121,184 | (742) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net (loss) income | 28,936 | 28,936 | ||
Unrealized loss on marketable securities, net of income tax benefit | (4) | (4) | ||
Foreign currency translation adjustment, including income tax expense (benefit) | 760 | 760 | ||
Stock-based compensation expense | 1,234 | $ 1,234 | 0 | |
Common stock issued under equity compensation plan, net of shares withheld for tax payments (in shares) | 42 | |||
Common stock issued under equity compensation plan, net of shares withheld for tax payments | (1,350) | $ (1,350) | ||
Common stock issued under employee stock purchase plan, shares | 31 | |||
Common stock issued under employee stock purchase plan | 173 | $ 173 | ||
Balance, shares at Dec. 31, 2020 | 30,330 | |||
Ending balance at Dec. 31, 2020 | 153,195 | $ 3,061 | 150,120 | 14 |
Beginning balance at Mar. 31, 2021 | 182,545 | $ 2,176 | 180,524 | (155) |
Balance, shares at Mar. 31, 2021 | 30,576 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net (loss) income | 13,884 | 13,884 | ||
Unrealized loss on marketable securities, net of income tax benefit | 0 | 0 | ||
Foreign currency translation adjustment, including income tax expense (benefit) | 217 | 217 | ||
Stock-based compensation expense | 1,225 | $ 1,225 | 0 | |
Common stock issued under equity compensation plan, net of shares withheld for tax payments (in shares) | 201 | |||
Common stock issued under equity compensation plan, net of shares withheld for tax payments | (1,259) | $ (1,259) | ||
Common stock issued under employee stock purchase plan, shares | 17 | |||
Common stock issued under employee stock purchase plan | 269 | $ 269 | ||
Balance, shares at Jun. 30, 2021 | 30,794 | |||
Ending balance at Jun. 30, 2021 | 196,881 | $ 2,411 | 194,408 | 62 |
Beginning balance at Mar. 31, 2021 | 182,545 | $ 2,176 | 180,524 | (155) |
Balance, shares at Mar. 31, 2021 | 30,576 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net (loss) income | (4,217) | |||
Unrealized loss on marketable securities, net of income tax benefit | (4) | |||
Foreign currency translation adjustment, including income tax expense (benefit) | (342) | |||
Balance, shares at Dec. 31, 2021 | 31,245 | |||
Ending balance at Dec. 31, 2021 | 180,685 | $ 4,879 | 176,307 | (501) |
Beginning balance at Jun. 30, 2021 | 196,881 | $ 2,411 | 194,408 | 62 |
Balance, shares at Jun. 30, 2021 | 30,794 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net (loss) income | (4,602) | (4,602) | ||
Unrealized loss on marketable securities, net of income tax benefit | (4) | (4) | ||
Foreign currency translation adjustment, including income tax expense (benefit) | (411) | (411) | ||
Stock-based compensation expense | 1,540 | $ 1,540 | 0 | |
Common stock issued under employee stock purchase plan, shares | 0 | |||
Common stock issued under employee stock purchase plan | 0 | $ 0 | ||
Common stock issued under equity compensation plan, shares | 365 | |||
Common stock issued under equity compensation plan, net of shares withheld for tax payments | $ (893) | |||
Balance, shares at Sep. 30, 2021 | 31,159 | |||
Ending balance at Sep. 30, 2021 | 192,511 | $ 3,058 | 189,806 | (353) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net (loss) income | (13,499) | (13,499) | ||
Unrealized loss on marketable securities, net of income tax benefit | 0 | |||
Foreign currency translation adjustment, including income tax expense (benefit) | (148) | (148) | ||
Stock-based compensation expense | 1,846 | $ 1,846 | 0 | |
Common stock issued under employee stock purchase plan, shares | 29 | |||
Common stock issued under employee stock purchase plan | 217 | $ 217 | ||
Common stock issued under equity compensation plan, shares | 57 | |||
Common stock issued under equity compensation plan, net of shares withheld for tax payments | $ (242) | |||
Balance, shares at Dec. 31, 2021 | 31,245 | |||
Ending balance at Dec. 31, 2021 | $ 180,685 | $ 4,879 | $ 176,307 | $ (501) |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Stockholders' Equity - Parenthetical (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | |
Statement of Stockholders' Equity [Abstract] | ||||||||
Unrealized gain (loss) on marketable securities, tax (benefit) expense | $ 0 | $ 7 | $ (7) | $ 0 | $ 0 | $ 0 | ||
Foreign currency translation tax expense (benefit) | $ 2 | $ 21 | $ (13) | $ (2) | $ (13) | $ 15 | $ 10 | $ 4 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2020 | Jun. 30, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2021 | |
Cash flows from operating activities: | |||||||
(Loss) income from continuing operations | $ (13,455) | $ 29,252 | $ (4,006) | $ 58,235 | |||
Loss from discontinued operations | (44) | (316) | (211) | (571) | |||
Net (loss) income | (13,499) | $ 13,884 | 28,936 | $ (5,110) | (4,217) | 57,664 | |
Adjustments to reconcile net (loss) income to cash (used in) provided by operating activities: | |||||||
Depreciation and amortization | 5,987 | 6,638 | |||||
Benefit for allowance for doubtful accounts | (468) | (42) | |||||
Inventory lower of cost or net realizable value | 291 | 1,409 | |||||
Stock-based compensation expense | 4,611 | 3,170 | |||||
Deferred income taxes, net of valuation allowances | (2,938) | (8,037) | |||||
Other | 610 | (1,160) | |||||
Loss on asset dispositions | 0 | 709 | |||||
Loss on disposal group | 0 | 20,668 | |||||
Loss on other investment in non-controlled affiliates impairment | 0 | 2,500 | |||||
Changes in operating assets and liabilities: | |||||||
Trade receivables | (4,298) | (61,830) | |||||
Inventories | (59,258) | (28,529) | |||||
Prepaids and other assets | 10,059 | (8,616) | |||||
Income taxes receivable | (13,774) | 6,128 | |||||
Trade payables | (36,366) | 62,090 | |||||
Accrued liabilities and other liabilities, including warranty obligations | 8,178 | 12,573 | |||||
Net cash (used in) provided by operating activities | (91,583) | 65,335 | |||||
Cash flows from investing activities: | |||||||
Proceeds from sales and maturities of available-for-sale securities | 73,448 | 0 | |||||
Acquisition of business, net of cash acquired | (26,012) | 0 | |||||
Purchases of property, plant and equipment | (9,136) | (8,033) | |||||
Purchases of available-for-sale securities | 0 | (36,199) | |||||
Proceeds from the sale of disposal group | 0 | 21,410 | |||||
Net cash provided by (used in) investing activities | 38,300 | (22,822) | |||||
Cash flows from financing activities: | |||||||
Proceeds from long-term debt | 63,652 | 1,616 | |||||
Payments on long-term debt | (22,477) | (14,815) | |||||
Payment of debt issuance costs | (577) | (19) | |||||
Payments on finance lease liabilities | (30) | 0 | $ 0 | ||||
Proceeds from employee stock purchases | 486 | 256 | |||||
Proceeds from exercise of stock options | 472 | 50 | |||||
Tax payments related to stock award issuances | (2,866) | (2,196) | |||||
Net cash provided by (used in) financing activities | 38,660 | (15,108) | |||||
Effect of exchange rate changes | (1,529) | 4,059 | |||||
Net (decrease) increase in cash, cash equivalents and restricted cash | (16,152) | 31,464 | |||||
Cash, cash equivalents and restricted cash: | |||||||
Cash, cash equivalents and restricted cash at beginning of period | $ 39,780 | $ 26,456 | 39,780 | 26,456 | 26,456 | ||
Cash, cash equivalents and restricted cash at end of period | 23,628 | 57,920 | 23,628 | 57,920 | 39,780 | ||
Supplemental disclosure of cash flow information: | |||||||
Cash paid for interest | 639 | 651 | |||||
Cash paid for income taxes, net | 19,857 | 17,257 | |||||
Supplemental disclosure of non-cash investing activities: | |||||||
Capital expenditures incurred but not yet paid | 333 | 908 | |||||
The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the Condensed Consolidated Balance Sheets to the total of the same amounts shown above: | |||||||
Cash and cash equivalents | 18,402 | 56,581 | 18,402 | 56,581 | 38,441 | ||
Restricted cash | 1,339 | 1,339 | 1,339 | 1,339 | 1,339 | ||
Other assets - restricted, non-current | 3,887 | 0 | 3,887 | 0 | |||
Total cash, cash equivalents and restricted cash | $ 23,628 | $ 57,920 | $ 23,628 | $ 57,920 | $ 39,780 |
General Information
General Information | 9 Months Ended |
Dec. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
General Information | GENERAL INFORMATION Basis of Consolidation and Presentation The accompanying condensed consolidated financial statements present the financial position, results of operations and cash flows of Nautilus, Inc. and its subsidiaries, all of which are wholly owned. Intercompany transactions and balances have been eliminated in consolidation. On December 30, 2020, our Board of Directors approved a change in our fiscal year end from December 31st to March 31st. This document reflects our third fiscal quarter, which ended December 31, 2021, of our fiscal year from April 1, 2021 through March 31, 2022. The accompanying condensed consolidated financial statements have not been audited. We have condensed or omitted certain information and footnote disclosures normally included in financial statements presented in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Management believes the disclosures contained herein are adequate to make the information presented not misleading. However, these condensed consolidated financial statements should be read in conjunction with our consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2020 (the “2020 Form 10-K”). The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Uncertainties regarding such estimates and assumptions are inherent in the preparation of financial statements and actual results could differ from those estimates. These uncertainties will be heightened by the COVID-19 pandemic, as we may be unable to accurately predict the impact of COVID-19 going forward and as a result our estimates may change in the near term. Further information regarding significant estimates can be found in our 2020 Form 10-K. In the opinion of management, the accompanying condensed consolidated financial statements reflect all adjustments necessary to present fairly our financial position as of December 31, 2021 and March 31, 2021, and our results of operations, comprehensive (loss) income and shareholders' equity for the three and nine-month periods ended December 31, 2021 and 2020 and our cash flows for the nine-month period ended December 31, 2021 and 2020. Interim results are not necessarily indicative of results for a full year. Our revenues typically vary seasonally, and this seasonality can have a significant effect on operating results, inventory levels and working capital needs. Unless indicated otherwise, all information regarding our operating results pertain to our continuing operations. Update to Significant Accounting Policies Goodwill Goodwill consists of the excess of acquisition costs over the fair values of net assets acquired in business combinations. We review goodwill for impairment in the fourth quarter of each year and when events or changes in circumstances indicate that the carrying amount may be impaired. For this purpose, goodwill is evaluated at the reporting unit level. For further information regarding goodwill, see Note 2, Business Acquisition and Note 8, Goodwill and Other Intangible Assets. Recent Accounting Pronouncements Recently Adopted Pronouncements ASU 2019-12 In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes.” The amendments in ASU 2019-12 introduce the following new guidance: (1) provides a policy election to not allocate consolidated income taxes when a member of a consolidated tax return is not subject to income tax; and (2) provides guidance to evaluate whether a step-up in tax basis of goodwill relates to a business combination in which book goodwill was recognized or a separate transaction. The amendments in ASU 2019-12 make changes to the following current guidance: (1) making an intra-period allocation if there is a loss in continuing operations and a gain outside of continuing operations; (2) determining when a deferred tax liability is recognized after an investor in a foreign entity transitions to or from the equity method of accounting; (3) accounting for tax law changes and year-to-date losses in interim periods; and (4) determining how to apply the income tax guidance to franchise taxes that are partially based on income. ASU 2019-12 is effective for public business entities' fiscal years, including interim periods within those fiscal years, beginning after December 15, 2020 with early adoption permitted. Our adoption of ASU 2019-12 as of January 1, 2021 had no material impact on our financial position, results of operations or cash flows. Recently Issued Pronouncements Not Yet Adopted ASU 2020-04 and ASU 2021-01 In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848),” which provides optional guidance related to reference rate reform and provides practical expedients for contract modifications and certain hedging relationships associated with the transition from reference rates that are expected to be discontinued. This guidance is applicable for our borrowing instruments, which use London Inter-bank Offered Rate (“LIBOR”) as a reference rate, which is effective beginning on March 12, 2020, and we may elect to apply the amendments prospectively through December 31, 2022. In January 2021, the FASB issued ASU 2021-01, “Reference Rate Reform (Topic 848),” which permits entities to apply optional expedients in Topic 848 to derivative instruments modified because of discounting transition resulting from reference rate reform. We do not expect the adoption of this guidance to have a material impact on our financial position, results of operations and cash flows. ASU 2020-01 In January 2020, the FASB issued ASU 2020-01, “Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815).” The amendments in ASU 2020-01 clarify certain interactions between the guidance to account for certain equity securities under Topic 321, the guidance to account for investments under the equity method of accounting in Topic 323, and the guidance in Topic 815, which could change how an entity accounts for an equity security under the measurement alternative or a forward contract or purchased option to purchase securities that, upon settlement of the forward contract or exercise of the purchased option, would be accounted for under the equity method of accounting or the fair value option in accordance with Topic 825, Financial Instruments. These amendments improve current GAAP by reducing diversity in practice and increasing comparability of the accounting for these interactions. ASU 2020-01 is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. We do not expect the adoption of this guidance would have a material impact on our financial position, results of operations and cash flows. ASU 2016-13 In June 2016, the FASB issued ASU 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 requires companies to measure credit losses utilizing a methodology that reflects expected credit losses and requires a consideration of a broader range of reasonable and supportable information to inform credit loss estimates. In May 2019, the FASB issued ASU 2019-05, which provides entities to have certain instruments with an option to irrevocably elect the fair value option. In November 2019 , the FASB issued ASU 2019-11, which provides clarification and addresses specific issues about certain aspects of ASU 2016-13. In March 2020, the FASB issued ASC 2020-03, which provides an update to clarify or address specific issues. ASU 2016-13 is effective for fiscal years beginning after December 15, 2022, including interim periods within those years. We do not expect the adoption of this guidance would have a material impact on our financial position, results of operations and cash flows. |
Business Acquisition
Business Acquisition | 9 Months Ended |
Dec. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Business Acquisition | BUSINESS ACQUISITION On September 17, 2021, we acquired VAY AG (“VAY”) for an aggregate purchase consideration of approximately $26.9 million using cash on hand. Headquartered in Zurich, Switzerland, VAY specializes in computer vision and AI technology solutions and has developed software solutions for human motion analysis using any normal RGB (red-green-blue) camera from a device, such as a laptop, smartphone, or tablet. With a mission to democratize professional human motion analysis, VAY enables clients in fitness and health industries to understand and analyze human movement, providing personalized feedback on repetitions and form in real-time. We accounted for the transaction as a business combination. Goodwill from the acquisition of $24.5 million represents the excess of the purchase price over the fair value of the net tangible and intangible assets and liabilities assumed and is not deductible for tax purposes. Goodwill recorded in connection with this acquisition is primarily attributable to VAY intellectual property base, employee workforce and application to future digital technologies. Acquired assets were recorded at estimated fair value as of the acquisition date. Certain liabilities were acquired as part of the transaction and were recorded at estimated fair value. Total acquisition costs incurred through the nine-months ended December 31, 2021 were $1.0 million and were expensed in general and administrative costs. Since the acquisition occurred on September 17, 2021, no material amount of net sales or net income related to the VAY business was included in our reported December 31, 2021 financial statements. The sellers of VAY have the opportunity to earn additional contingency consideration subject to the achievement of continued employment over an 18 month period and a total of twenty software engineers. The contingent consideration arrangement of $3.9 million will be paid to the former owners of VAY upon achievement of these milestones and recognized as compensatory expense over the service period. An escrow account was funded for the contingency consideration and is reported on the Condensed Consolidated Balance Sheets as Other assets - restricted, non-current. Purchase Price Allocation The purchase price allocation was determined based on the fair values of the assets and liabilities identified as of the acquisition date and may be adjusted, within a period of no more than 12 months from the acquisition date, if the final fair values change as a result of circumstances existing at the acquisition date, and upon receipt of final appraisals and valuations. Such fair value adjustments may arise in respect of property, plant and equipment upon completion of the necessary valuations and physical verifications of such assets. The following table summarizes the preliminary fair values of the net assets acquired and liabilities assumed and measurement period adjustments since September 17, 2021, the acquisition date (in thousands): Preliminary valuation at September 17, 2021 Measurement period adjustments Adjusted valuation at December 31, 2021 Cash $ 230 $ 637 $ 867 Accounts receivable 9 — 9 Prepaid expenses 15 (2) 13 Deferred tax assets 58 1 59 Developed technology (included in property, plant and equipment) 3,000 — 3,000 Identifiable assets acquired 3,312 636 3,948 Accrued liabilities 187 745 932 Unearned revenue 53 3 56 Deferred tax liabilities, non-current 591 — 591 Total liabilities assumed 831 748 1,579 Net identifiable assets acquired 2,481 (112) 2,369 Goodwill 24,508 2 24,510 Total assets acquired $ 26,989 $ (110) $ 26,879 The allocation of the purchase price is preliminary and is based upon valuation information available and estimates and assumptions made as of December 31, 2021. We are still in the process of verifying data and finalizing information including valuation and recording of the assets acquired and liabilities assumed, and the resulting amount of recognized goodwill |
Revenues
Revenues | 9 Months Ended |
Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | REVENUES Our revenues from contracts with customers disaggregated by revenue source, excluding sales-based taxes, were as follows (in thousands): Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 Product sales $ 141,885 $ 183,642 $ 454,822 $ 444,876 Extended warranties and services 1,841 2,852 4,985 6,222 Other (1) 3,532 2,765 10,003 7,740 Net sales $ 147,258 $ 189,259 $ 469,810 $ 458,838 (1) Other revenue is primarily subscription revenue, freight and delivery and royalty income. Our revenues disaggregated by geographic region, based on ship-to address, were as follows (in thousands): Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 United States $ 110,870 $ 153,919 $ 360,540 $ 381,571 Canada 22,912 17,955 60,126 36,947 Europe, the Middle East and Africa 9,874 14,024 37,456 31,022 All other 3,602 3,361 11,688 9,298 Net sales $ 147,258 $ 189,259 $ 469,810 $ 458,838 As of December 31, 2021, estimated revenue expected to be recognized in the future totaled $53.0 million, primarily related to customer order backlog, which includes firm orders for future shipment and unfulfilled orders to our Retail customers, as well as unfulfilled consumer orders within the Direct channel. Direct orders of $8.8 million and Retail orders of $44.2 million comprised our backlog as of December 31, 2021, compared to Direct orders of $46.5 million and Retail orders of $208.7 million as of December 31, 2020. The estimated future revenues are net of contractual rebates and consideration payable for applicable Retail customers, and net of current promotional programs and sales discounts for our Direct customers. The following table provides information about our liabilities from contracts with customers, primarily customer deposits and deferred revenue for which advance consideration is received prior to the transfer of control. Revenue is recognized when transfer of control occurs. All customer deposits and deferred revenue received are short-term in nature and were recorded on the condensed consolidated balance sheets as accrued liabilities. Significant changes in contract liabilities balances, including revenue recognized in the reporting period that was included in opening contract liabilities, are shown below (in thousands): Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 Balance, beginning of period $ 3,453 $ 3,639 $ 5,551 $ 2,050 Cash additions 4,203 3,496 8,749 7,049 Revenue recognition (1,378) (743) (8,022) (2,707) Balance, end of period $ 6,278 $ 6,392 $ 6,278 $ 6,392 |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | FAIR VALUE MEASUREMENTS Factors used in determining the fair value of financial assets and liabilities are summarized into three broad categories: • Level 1 - observable inputs such as quoted prices (unadjusted) in active liquid markets for identical securities as of the reporting date; • Level 2 - other significant directly or indirectly observable inputs, including quoted prices for similar securities, interest rates, prepayment speeds and credit risk, or observable market prices in markets with insufficient volume and/or infrequent transactions; and • Level 3 - significant inputs that are generally unobservable inputs for which there is little or no market data available, including our own assumptions in determining fair value. Assets and liabilities measured at fair value on a recurring basis were as follows (in thousands): December 31, 2021 Level 1 Level 2 Level 3 Total Assets: Derivatives Foreign currency forward contracts $ — $ 19 $ — $ 19 Total assets measured at fair value $ — $ 19 $ — $ 19 Liabilities: Derivatives Foreign currency forward contracts $ — $ 36 $ — $ 36 Total liabilities measured at fair value $ — $ 36 $ — $ 36 March 31, 2021 Level 1 Level 2 Level 3 Total Assets: Cash Equivalents Money market funds $ 9,679 $ — $ — $ 9,679 Total cash equivalents 9,679 — — 9,679 Available-for-Sale Securities Commercial paper — 9,994 — 9,994 Corporate bonds — 8,227 — 8,227 U.S. government bonds — 55,227 — 55,227 Total available-for-sale securities — 73,448 — 73,448 Total assets measured at fair value $ 9,679 $ 73,448 $ — $ 83,127 Liabilities: Derivatives Foreign currency forward contracts $ — $ 672 $ — $ 672 Total liabilities measured at fair value $ — $ 672 $ — $ 672 For our assets measured at fair value on a recurring basis, we recognize transfers between levels at the actual date of the event or change in circumstance that caused the transfer. There were no transfers between levels during the nine-month period ended December 31, 2021, nor for the year ended March 31, 2021. We classify our marketable securities as available-for-sale and, accordingly, record them at fair value. Level 1 investment valuations are obtained from real-time quotes for transactions in active exchange markets involving identical assets. Level 2 investment valuations are obtained from inputs, other than quoted market prices in active markets for identical assets, that are directly or indirectly observable in the marketplace and quoted prices in markets with limited volume or infrequent transactions. The factors or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. Unrealized holding gains and losses are excluded from earnings and are reported net of tax in comprehensive income until realized. The fair values of our foreign currency forward contracts are calculated as the present value of estimated future cash flows using discount factors derived from relevant Level 2 market inputs, including forward curves and volatility levels. We did not have any changes to our valuation techniques during the during the nine-month period ended December 31, 2021, nor for the year ended March 31, 2021. We recognize or disclose the fair value of certain assets, such as non-financial assets, primarily property, plant and equipment, goodwill, other intangible assets and certain other long-lived assets in connection with impairment evaluations. All of our nonrecurring valuations use significant unobservable inputs and therefore fall under Level 3 of the fair value hierarchy. Other than assets acquired, see Note 2, Business Acquisition, we determined the fair value of our developed technology included in property, plant and equipment using the cost approach which considers how much it would cost to replace an asset of equivalent utility. We did not perform any valuations on assets or liabilities that are valued at fair value on a nonrecurring basis. Other than our annual goodwill and indefinite-lived trade names impairment assessments and valuations, we did not perform any assessments or valuations on assets or liabilities that are valued at fair value on a nonrecurring basis. As of December 31, 2021 and March 31, 2021, there were no assets or liabilities that were recorded at fair value on a nonrecurring basis. The carrying values of cash and cash equivalents, restricted cash, trade receivables, prepaids and other current assets, trade payables and accrued liabilities approximate fair value due to their short maturities. The carrying value of our debt approximates its fair value and falls under Level 2 of the fair value hierarchy, as the interest rate is variable and based on current market rates. |
Derivatives
Derivatives | 9 Months Ended |
Dec. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives | DERIVATIVES From time to time, we enter into foreign exchange forward contracts to offset the earnings impacts of exchange rate fluctuations on certain monetary assets and liabilities. We do not enter into derivative instruments for any purpose other than to manage foreign currency exposure. That is, we do not engage in currency exchange rate speculation using derivative instruments. We may hedge our net recognized foreign currency assets and liabilities with forward foreign exchange contracts to reduce the risk that our earnings and cash flows will be adversely affected by changes in foreign currency exchange rates. These derivative instruments hedge assets and liabilities that are denominated in foreign currencies and are carried at fair value with changes in the fair value recorded as other income. These derivative instruments do not subject us to material balance sheet risk due to exchange rate movements because gains and losses on these derivatives are intended to offset gains and losses on the assets and liabilities being hedged. As of December 31, 2021, total outstanding contract notional amounts were $30.2 million and had maturities of 109 days or less. The fair value of our derivative instruments was included in our condensed consolidated balance sheets as follows (in thousands): Balance Sheet Classification As of December 31, 2021 March 31, 2021 Derivative instruments not designated as cash flow hedges: Foreign currency forward contracts Prepaids and other current assets $ 19 $ — Foreign currency forward contracts Accrued liabilities 36 672 The effect of derivative instruments on our condensed consolidated statements of operations was as follows (in thousands): Statement of Operations Classification Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 Derivative instruments not designated as cash flow hedges: Income (loss) recognized in earnings Other, net $ 797 $ (1,981) $ (163) $ (2,406) Income tax (benefit) expense Income tax (benefit) expense (194) 488 40 594 |
Inventories
Inventories | 9 Months Ended |
Dec. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Inventories | INVENTORIES Inventories are stated at the lower of cost and net realizable value, with cost determined based on the first-in, first-out method. Our inventories consisted of the following (in thousands): As of December 31, 2021 March 31, 2021 Finished goods (1) $ 121,073 $ 63,918 Parts and components 7,040 4,167 Total inventories $ 128,113 $ 68,085 (1) The increase in finished goods was driven by the strategic decision to increase on-hand inventory levels ahead of the fitness season given continued disruption in global logistics. |
Property, Plant and Equipment
Property, Plant and Equipment | 9 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consisted of the following (in thousands): Estimated As of December 31, 2021 March 31, 2021 Automobiles 5 $ 23 $ 23 Leasehold improvements 4 to 20 3,150 3,059 Computer software and equipment 2 to 7 42,231 36,956 Machinery and equipment 3 to 5 16,466 15,699 Furniture and fixtures 5 to 20 2,635 2,586 Work in progress (1) N/A 7,430 1,314 Total cost 71,935 59,637 Accumulated depreciation (40,959) (35,141) Total property, plant and equipment, net $ 30,976 $ 24,496 (1) Work in progress includes information technology assets and production tooling. Depreciation expense was as follows (in thousands): Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 Depreciation expense $ 1,993 $ 2,114 $ 5,941 $ 5,772 |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 9 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill The roll forward of goodwill was as follows (in thousands): Total Balance, April 1, 2021 $ — Business acquisition (Note 2) 24,508 Balance, September 30, 2021 24,508 Business acquisition (Note 2) - measurement period adjustments 2 Balance, December 31, 2021 $ 24,510 ASC 350 — Intangibles — Goodwill and Other, we perform our goodwill and indefinite-lived trade names impairment valuations annually, on March 31,or sooner if triggering events are identified. While our stock price and related market capitalization remained above our reporting unit carrying values as of December 31, 2021, we are observing continued market volatility including declines in our market capitalization subsequent to December 31, 2021 which, in part, could increase the possibility of a future impairment charge. Based on our analysis, including our market capitalization during the period, we determined there were no triggering events during the quarter ended December 31, 2021. Should the facts and circumstances surrounding our assumptions change, our goodwill impairment analysis may fail. Assumptions and estimates to determine far values are complex and often subjective. They can be affected by a variety of factors, including external factors such as industry and economic trends, and internal factors such as changes in our business strategy and our internal forecasts. For example, if our future operating results do not meet current forecasts or if we continue to experience a sustained decline in our market capitalization, adjusted for estimated control premium, that is determined to be indicative of a reduction in fair value one or more of our reporting units, we may be required to record future impairment charges for goodwill. An impairment could have a material effect on our consolidated balance sheet and results of operations Other Intangible Assets Other intangible assets consisted of the following (in thousands): Estimated As of December 31, 2021 March 31, 2021 Indefinite-lived trademarks N/A $ 9,052 $ 9,052 Patents 7 to 24 1,443 1,443 10,495 10,495 Accumulated amortization - definite-lived intangible assets (1,176) (1,130) Other intangible assets, net $ 9,319 $ 9,365 Amortization expense was as follows (in thousands): Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 Amortization expense $ 15 $ 25 $ 46 $ 866 Future amortization of definite-lived intangible assets is as follows (in thousands): 2022 $ 15 2023 61 2024 61 2025 61 2026 47 Thereafter 22 $ 267 |
Leases
Leases | 9 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Leases | LEASES We have several non-cancellable operating leases, primarily for office space, that expire at various dates over the next nine years. These leases generally contain renewal options to extend for one lease term of five years. For leases that we are reasonably certain we will exercise the lease renewal options, the options were considered in determining the lease term, and associated potential option payments are included in the lease payments. The payments used in the renewal term were estimated using the percentage rate increase of historical rent payments for each location where the renewal will be exercised. Payments due under the lease contracts include annual fixed payments for office space. Variable payments including payments for our proportionate share of the building’s property taxes, insurance, and common area maintenance are treated as non-lease components and are recognized in the period for which the costs occur. Lease expense was as follows (in thousands): Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 Operating lease expense $ 1,465 $ 1,072 $ 4,397 $ 3,269 Amortization of finance lease assets 29 — 29 — Total lease expense $ 1,494 $ 1,072 $ 4,426 $ 3,269 Leases with an initial term of 12 months or less (“short-term lease”) are not recorded on the balance sheet and are recognized on a straight-line basis over the lease term. Other information related to leases was as follows (dollars in thousands): As of December 31, 2021 March 31, 2021 Supplemental cash flow information related to leases was as follows: Operating leases: Operating lease right-of-use-assets $ 24,534 $ 19,108 Operating lease liabilities 21,855 17,875 Operating lease liabilities, net of current portion 4,653 3,384 Total operating lease liabilities $ 26,508 $ 21,259 Finance leases: Property, plant and equipment, at cost $ 569 $ — Accumulated depreciation (29) — Property, plant and equipment, net $ 540 $ — Finance lease obligations $ 423 $ — Finance lease obligations, net of current portion 119 — Total finance lease liabilities $ 542 $ — Cash paid for amounts included in the measurement of lease liabilities: Operating cash flow from operating leases $ 1,724 $ 1,076 Finance cash flows from finance leases 30 — Additional lease information: ROU assets obtained in exchange for operating lease obligations $ 1,032 $ — ROU assets obtained in exchange for finance lease obligations 569 — Reductions to ROU assets resulting from reductions to operating lease obligations 329 268 Weighted Average Remaining Lease Term: Operating leases 5.89 6.94 Finance leases 4.75 — Weighted Average Discount Rate: Operating leases 5.00% 4.95% Finance leases 2.08% —% We determined the discount rate for leases using a portfolio approach to determine an incremental borrowing rate to calculate the right-of-use assets and lease liabilities. Maturities of lease liabilities under non-cancellable leases were as follows (in thousands): As of December 31, 2021 Operating leases Finance leases 2022 $ 1,344 $ 120 2023 5,859 120 2024 5,422 120 2025 5,584 120 2026 4,520 90 Thereafter 8,158 — Total undiscounted lease payments 30,887 570 Less imputed interest (4,379) (28) Total lease liabilities $ 26,508 $ 542 |
Accrued Liabilities
Accrued Liabilities | 9 Months Ended |
Dec. 31, 2021 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities | ACCRUED LIABILITIES Accrued liabilities consisted of the following (in thousands): As of December 31, 2021 March 31, 2021 Deferred revenue $ 6,278 $ 5,551 Reserves (1) 5,230 2,624 Payroll and related liabilities 4,818 6,616 Legal settlement (2) 4,250 — Other 4,656 4,836 Total accrued liabilities $ 25,232 $ 19,627 (1) Reserves primarily consists of inventory, sales return, sales tax and product liability reserves. |
Product Warranties
Product Warranties | 9 Months Ended |
Dec. 31, 2021 | |
Product Warranties Disclosures [Abstract] | |
Product Warranties | PRODUCT WARRANTIES Our products carry defined warranties for defects in materials or workmanship which, according to their terms, generally obligate us to pay the costs of supplying and shipping replacement parts to customers and, in certain instances, pay for labor and other costs to service products. Outstanding product warranty periods range from thirty days to, in limited circumstances, the lifetime of certain product components. We record a liability at the time of sale for the estimated costs of fulfilling future warranty claims. If necessary, we adjust the liability for specific warranty-related matters when they become known and are reasonably estimable. Estimated warranty expense is included in cost of sales, based on historical warranty claim experience and available product quality data. Warranty expense is affected by the performance of new products, significant manufacturing or design defects not discovered until after the product is delivered to the customer, product failure rates, and higher or lower than expected repair costs. If warranty expense differs from previous estimates, or if circumstances change such that the assumptions inherent in previous estimates are no longer valid, the amount of product warranty obligations is adjusted accordingly. Changes in our product warranty obligations were as follows (in thousands): Nine-Months Ended December 31, 2021 2020 Balance, beginning of period $ 8,651 $ 6,250 Accruals 4,416 2,791 Payments (5,942) (3,843) Balance, end of period $ 7,125 $ 5,198 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 9 Months Ended |
Dec. 31, 2021 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Loss | ACCUMULATED OTHER COMPREHENSIVE LOSS The following tables set forth the changes in accumulated other comprehensive loss, net of tax (in thousands): Unrealized Loss on Available-for-Sale Securities Foreign Currency Translation Adjustments Accumulated Other Comprehensive Loss Balance, March 31, 2021 $ (8) $ (147) $ (155) Current period other comprehensive loss before reclassifications (4) (342) (346) Net other comprehensive loss during period (4) (342) (346) Balance, December 31, 2021 $ (12) $ (489) $ (501) Unrealized Loss on Available-for-Sale Securities Foreign Currency Translation Adjustments Accumulated Other Comprehensive Loss Balance, September 30, 2021 $ (12) $ (341) $ (353) Current period other comprehensive loss before reclassifications — (148) (148) Net other comprehensive loss during period — (148) (148) Balance, December 31, 2021 $ (12) $ (489) $ (501) Unrealized Loss on Available-for-Sale Securities Foreign Currency Translation Adjustments Accumulated Other Comprehensive (Loss) Income Balance, March 31, 2020 $ — $ (1,312) $ (1,312) Current period other comprehensive (loss) income before reclassifications (4) 1,330 1,326 Net other comprehensive (loss) income during period (4) 1,330 1,326 Balance, December 31, 2020 $ (4) $ 18 $ 14 Unrealized Loss on Available-for-Sale Securities Foreign Currency Translation Adjustments Accumulated Other Comprehensive (Loss) Income Balance, September 30, 2020 $ — $ (742) $ (742) Current period other comprehensive (loss) income before reclassifications (4) 760 756 Net other comprehensive income during period (4) 760 756 Balance, December 31, 2020 $ (4) $ 18 $ 14 |
(Loss) Income Per Share
(Loss) Income Per Share | 9 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
(Loss) Income Per Share | (LOSS) INCOME PER SHARE Basic per share amounts were computed using the weighted average number of common shares outstanding. Diluted per share amounts were calculated using the number of basic weighted average shares outstanding increased by dilutive potential common shares related to stock-based awards, as determined by the treasury stock method. Basic income per share amounts were computed using the weighted average number of common shares outstanding. Diluted income per share amounts were calculated using the number of basic weighted average shares outstanding increased by dilutive potential common shares related to stock-based awards, as determined by the treasury stock method. The weighted average numbers of shares outstanding used to compute (loss) income per share were as follows (in thousands): Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 Shares used to calculate basic income per share 31,199 30,284 30,955 30,077 Dilutive effect of outstanding stock options, performance stock units and restricted stock units — 2,349 — 2,259 Shares used to calculate diluted income per share 31,199 32,633 30,955 32,336 The weighted average numbers of shares outstanding listed in the table below were anti-dilutive and excluded from the computation of diluted per share due to loss from continuing operations, as such, the exercise or conversion of any potential shares would increase the number of shares in the denominator and result in a lower loss per share (in thousands): Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 Restricted stock units 673 — 1,024 — Stock options 357 — 504 — The weighted average numbers of shares outstanding listed in the table below were anti-dilutive and excluded from the computation of diluted income per share. In the case of restricted stock units, this is because unrecognized compensation expense exceeds the current value of the awards (i.e., grant date market value was higher than current average market price). In the case of stock options, this is because the average market price did not exceed the exercise price. These shares may be anti-dilutive potential common shares in the future (in thousands): Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 Restricted stock units 1,168 31 333 15 Stock options 2 — 2 3 |
Segment and Enterprise-wide Inf
Segment and Enterprise-wide Information | 9 Months Ended |
Dec. 31, 2021 | |
Segment Reporting [Abstract] | |
Segment and Enterprise-wide Information | SEGMENT AND ENTERPRISE-WIDE INFORMATION We have two operating segments, Direct and Retail. There were no changes in our operating segments during the nine-months ended December 31, 2021. We evaluate performance of the operating segments using several factors, of which the primary financial measures are net sales and reportable segment contribution. Contribution is the measure of profit or loss, defined as net sales less product costs and directly attributable expenses. Directly attributable expenses include selling and marketing expenses, general and administrative expenses, and research and development expenses that are directly related to segment operations. Segment assets are those directly assigned to an operating segment's operations, primarily accounts receivable, inventories and other intangible assets. Unallocated assets primarily include cash, cash equivalents and restricted cash, derivative securities, shared information technology infrastructure, distribution centers, corporate headquarters, prepaids and other current assets, deferred income tax assets and other assets. Capital expenditures directly attributable to the Direct and Retail segments were not significant in any period. Following is summary information by reportable segment (in thousands): Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 Net sales: Direct $ 60,705 $ 82,158 $ 161,954 $ 193,785 Retail 85,701 106,320 305,338 262,423 Royalty 852 781 2,518 2,630 Consolidated net sales $ 147,258 $ 189,259 $ 469,810 $ 458,838 Contribution: Direct $ (8,980) $ 23,584 $ (4,056) $ 58,167 Retail 3,270 25,338 44,101 60,393 Royalty 852 781 2,518 2,630 Consolidated contribution $ (4,858) $ 49,703 $ 42,563 $ 121,190 Reconciliation of consolidated contribution to (loss) income from continuing operations: Consolidated contribution $ (4,858) $ 49,703 $ 42,563 $ 121,190 Amounts not directly related to segments: Operating expenses (14,456) (8,223) (45,960) (42,821) Other expense, net (1,142) (3,640) (1,930) (4,490) Income tax benefit (expense) 7,001 (8,588) 1,321 (15,644) (Loss) income from continuing operations $ (13,455) $ 29,252 $ (4,006) $ 58,235 As of December 31, 2021 March 31, 2021 Assets: Direct $ 50,585 $ 47,002 Retail 198,791 146,001 Unallocated corporate 117,589 161,227 Total assets $ 366,965 $ 354,230 The following customers accounted for 10% or more of total net sales as follows: Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 Amazon.com * 13.5% 14.4% 17.8% Best Buy 14.0% * 16.6% * Dick's Sporting Goods * 14.0% * 10.7% *Less than 10% of total net sales. |
Borrowings
Borrowings | 9 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Borrowings | BORROWINGS Wells Fargo Bank Credit Agreement On October 29, 2021, we amended our Credit Agreement dated May 13, 2021 which amended our original Credit Agreement, dated January 31, 2020, with Wells Fargo Bank, National Association (“Wells Fargo”) and lenders from time to time party thereto (collectively with Wells Fargo the “Lenders”) (the “Credit Agreement”), pursuant to which the Lenders have agreed, among other things, to make available to us an asset-based revolving loan facility, subject to a borrowing base (the “ABL Revolving Facility”), and a term loan facility (the “Term Loan Facility” and together with the ABL Revolving Facility, the “Credit Facility”), in each case, as such amounts may increase or decrease in accordance with the terms of the Credit Agreement. The amendment increased the aggregate principal amount available under the ABL Revolving Facility from $55.0 million to $100.0 million (the “Revolver”), subject to a borrowing base. The maturity date of the Credit Facility was extended to October 29, 2026. The unamortized balance on the Term Loan was $11.5 million, as of the effective date of the amendment, and will amortize on a new 60-month straight line basis to coincide with the extended maturity date. In connection with the October 29, 2021 credit amendment we recorded $0.6 million in new financing costs as Other assets on our Condensed Consolidated Balance Sheet. The repayment of obligations under the Credit Agreement is secured by substantially all of our assets. Principal and interest amounts are required to be paid as scheduled. Other structural improvements to the Credit Agreement include amending the definition of Springing Trigger Event to mean the greater of (i) 10.0% of the lesser of (a) the Revolver Commitment and (b) the Borrowing Base as of such date of determination and (ii) $7.5 million. The Springing Trigger Event pertains to the period in which a Fixed Charge Coverage Ratio test will apply and be tested. Consistent with the Credit Agreement before the amendment, there continues to be no additional financial maintenance covenants. Additionally, the borrowing base definitions were favorably amended to change the eligible in-transit inventory sublimit from $10.0 million to $22.5 million and the total inventory sublimit from $35.0 million to $65.0 million. As of December 31, 2021, outstanding borrowings totaled $56.1 million, with $10.9 million and $45.2 million under our Term Loan Facility and Revolver, respectively. As of December 31, 2021, we were in compliance with the financial covenants of the Credit Agreement and $54.9 million was available for borrowing under the ABL Revolving Facility. Interest on the Revolver will accrue at Secured Overnight Financing Rate (“SOFR”) plus a margin of 1.86% to 2.36% (based on average quarterly availability) and interest on the Term Loan Facility will accrue at SOFR plus 4.50%. As of December 31, 2021, our interest rate was 1.97% for the Revolver and 4.60% for the Term Loan Facility. The balance sheet classification of the borrowings under the revolving loan credit facility has been determined in accordance with ASC 470, Debt |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Guarantees, Commitments and Off-Balance Sheet Arrangements As of December 31, 2021, we had standby letters of credit of $0.9 million. We have long lead times for inventory purchases and, therefore, must secure factory capacity from our vendors in advance. As of December 31, 2021, we had approximately $59.2 million compared to $216.3 million as of March 31, 2021 in non-cancellable market-based purchase obligations, primarily to secure additional factory capacity for inventory purchases in the next twelve months. The decrease in purchase obligations was primarily due to having received much of the inventory we have ordered for the season. Purchase obligations can vary from quarter-to-quarter and versus the same period in prior years due to a number of factors, including the amount of products that are shipped directly to Retail customer warehouses versus through Nautilus warehouses. In the ordinary course of business, we enter into agreements that require us to indemnify counterparties against third-party claims. These may include: agreements with vendors and suppliers, under which we may indemnify them against claims arising from use of their products or services; agreements with customers, under which we may indemnify them against claims arising from their use or sale of our products; real estate and equipment leases, under which we may indemnify lessors against third-party claims relating to the use of their property; agreements with licensees or licensors, under which we may indemnify the licensee or licensor against claims arising from their use of our intellectual property or our use of their intellectual property; and agreements with parties to debt arrangements, under which we may indemnify them against claims relating to their participation in the transactions. The nature and terms of these indemnification obligations vary from contract to contract, and generally a maximum obligation is not stated within the agreements. We hold insurance policies that mitigate potential losses arising from certain types of indemnification obligations. Management does not deem these obligations to be significant to our financial position, results of operations or cash flows, and therefore, no related liabilities were recorded as of December 31, 2021. Legal Matters From time to time, in the ordinary course of business, we may be involved in various claims, lawsuits and other proceedings. These legal and tax proceedings involve uncertainty as to the eventual outcomes and losses which may be realized when one or more future events occur or fail to occur. We regularly monitor our estimated exposure to these contingencies and, as additional information becomes known, may change our estimates accordingly. We evaluate, on a quarterly basis, developments in legal proceedings, investigations or claims that could affect the amount of any accrual, as well as any developments that would make a loss probable or reasonably possible, and whether the amount of a probable or reasonably possible loss is estimable. Among other factors, we evaluate the advice of internal and external counsel, the outcomes from similar litigation, the current status of the lawsuits (including settlement initiatives), legislative developments and other factors. Due to the numerous variables associated with these judgments and assumptions, both the precision and reliability of the resulting estimates of the related loss contingencies are subject to substantial uncertainties. Further, while we face contingencies that are reasonably possible to occur, other than as discussed below, we are unable to estimate the possible loss or range of loss at this time. During the second quarter of fiscal 2022, we recorded a $4.7 million loss contingency related to a legal settlement involving a class action lawsuit related to advertisement of our treadmills. The settlement includes damages, a one-year free membership to JRNY ® |
General Information (Policies)
General Information (Policies) | 9 Months Ended |
Dec. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
New Accounting Pronouncements | Recent Accounting Pronouncements Recently Adopted Pronouncements ASU 2019-12 In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes.” The amendments in ASU 2019-12 introduce the following new guidance: (1) provides a policy election to not allocate consolidated income taxes when a member of a consolidated tax return is not subject to income tax; and (2) provides guidance to evaluate whether a step-up in tax basis of goodwill relates to a business combination in which book goodwill was recognized or a separate transaction. The amendments in ASU 2019-12 make changes to the following current guidance: (1) making an intra-period allocation if there is a loss in continuing operations and a gain outside of continuing operations; (2) determining when a deferred tax liability is recognized after an investor in a foreign entity transitions to or from the equity method of accounting; (3) accounting for tax law changes and year-to-date losses in interim periods; and (4) determining how to apply the income tax guidance to franchise taxes that are partially based on income. ASU 2019-12 is effective for public business entities' fiscal years, including interim periods within those fiscal years, beginning after December 15, 2020 with early adoption permitted. Our adoption of ASU 2019-12 as of January 1, 2021 had no material impact on our financial position, results of operations or cash flows. Recently Issued Pronouncements Not Yet Adopted ASU 2020-04 and ASU 2021-01 In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848),” which provides optional guidance related to reference rate reform and provides practical expedients for contract modifications and certain hedging relationships associated with the transition from reference rates that are expected to be discontinued. This guidance is applicable for our borrowing instruments, which use London Inter-bank Offered Rate (“LIBOR”) as a reference rate, which is effective beginning on March 12, 2020, and we may elect to apply the amendments prospectively through December 31, 2022. In January 2021, the FASB issued ASU 2021-01, “Reference Rate Reform (Topic 848),” which permits entities to apply optional expedients in Topic 848 to derivative instruments modified because of discounting transition resulting from reference rate reform. We do not expect the adoption of this guidance to have a material impact on our financial position, results of operations and cash flows. ASU 2020-01 In January 2020, the FASB issued ASU 2020-01, “Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815).” The amendments in ASU 2020-01 clarify certain interactions between the guidance to account for certain equity securities under Topic 321, the guidance to account for investments under the equity method of accounting in Topic 323, and the guidance in Topic 815, which could change how an entity accounts for an equity security under the measurement alternative or a forward contract or purchased option to purchase securities that, upon settlement of the forward contract or exercise of the purchased option, would be accounted for under the equity method of accounting or the fair value option in accordance with Topic 825, Financial Instruments. These amendments improve current GAAP by reducing diversity in practice and increasing comparability of the accounting for these interactions. ASU 2020-01 is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. We do not expect the adoption of this guidance would have a material impact on our financial position, results of operations and cash flows. ASU 2016-13 In June 2016, the FASB issued ASU 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 requires companies to measure credit losses utilizing a methodology that reflects expected credit losses and requires a consideration of a broader range of reasonable and supportable information to inform credit loss estimates. In May 2019, the FASB issued ASU 2019-05, which provides entities to have certain instruments with an option to irrevocably elect the fair value option. In November 2019 , the FASB issued ASU 2019-11, which provides clarification and addresses specific issues about certain aspects of ASU 2016-13. In March 2020, the FASB issued ASC 2020-03, which provides an update to clarify or address specific issues. ASU 2016-13 is effective for fiscal years beginning after December 15, 2022, including interim periods within those years. We do not expect the adoption of this guidance would have a material impact on our financial position, results of operations and cash flows. |
Business Acquisition (Tables)
Business Acquisition (Tables) | 9 Months Ended |
Dec. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Business Acquisitions, by Acquisition | The following table summarizes the preliminary fair values of the net assets acquired and liabilities assumed and measurement period adjustments since September 17, 2021, the acquisition date (in thousands): Preliminary valuation at September 17, 2021 Measurement period adjustments Adjusted valuation at December 31, 2021 Cash $ 230 $ 637 $ 867 Accounts receivable 9 — 9 Prepaid expenses 15 (2) 13 Deferred tax assets 58 1 59 Developed technology (included in property, plant and equipment) 3,000 — 3,000 Identifiable assets acquired 3,312 636 3,948 Accrued liabilities 187 745 932 Unearned revenue 53 3 56 Deferred tax liabilities, non-current 591 — 591 Total liabilities assumed 831 748 1,579 Net identifiable assets acquired 2,481 (112) 2,369 Goodwill 24,508 2 24,510 Total assets acquired $ 26,989 $ (110) $ 26,879 |
Revenues (Tables)
Revenues (Tables) | 9 Months Ended |
Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | Our revenues from contracts with customers disaggregated by revenue source, excluding sales-based taxes, were as follows (in thousands): Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 Product sales $ 141,885 $ 183,642 $ 454,822 $ 444,876 Extended warranties and services 1,841 2,852 4,985 6,222 Other (1) 3,532 2,765 10,003 7,740 Net sales $ 147,258 $ 189,259 $ 469,810 $ 458,838 (1) Other revenue is primarily subscription revenue, freight and delivery and royalty income. Our revenues disaggregated by geographic region, based on ship-to address, were as follows (in thousands): Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 United States $ 110,870 $ 153,919 $ 360,540 $ 381,571 Canada 22,912 17,955 60,126 36,947 Europe, the Middle East and Africa 9,874 14,024 37,456 31,022 All other 3,602 3,361 11,688 9,298 Net sales $ 147,258 $ 189,259 $ 469,810 $ 458,838 |
Contract with Customer, Asset and Liability | The following table provides information about our liabilities from contracts with customers, primarily customer deposits and deferred revenue for which advance consideration is received prior to the transfer of control. Revenue is recognized when transfer of control occurs. All customer deposits and deferred revenue received are short-term in nature and were recorded on the condensed consolidated balance sheets as accrued liabilities. Significant changes in contract liabilities balances, including revenue recognized in the reporting period that was included in opening contract liabilities, are shown below (in thousands): Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 Balance, beginning of period $ 3,453 $ 3,639 $ 5,551 $ 2,050 Cash additions 4,203 3,496 8,749 7,049 Revenue recognition (1,378) (743) (8,022) (2,707) Balance, end of period $ 6,278 $ 6,392 $ 6,278 $ 6,392 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Assets measured at fair value on a recurring basis | Assets and liabilities measured at fair value on a recurring basis were as follows (in thousands): December 31, 2021 Level 1 Level 2 Level 3 Total Assets: Derivatives Foreign currency forward contracts $ — $ 19 $ — $ 19 Total assets measured at fair value $ — $ 19 $ — $ 19 Liabilities: Derivatives Foreign currency forward contracts $ — $ 36 $ — $ 36 Total liabilities measured at fair value $ — $ 36 $ — $ 36 March 31, 2021 Level 1 Level 2 Level 3 Total Assets: Cash Equivalents Money market funds $ 9,679 $ — $ — $ 9,679 Total cash equivalents 9,679 — — 9,679 Available-for-Sale Securities Commercial paper — 9,994 — 9,994 Corporate bonds — 8,227 — 8,227 U.S. government bonds — 55,227 — 55,227 Total available-for-sale securities — 73,448 — 73,448 Total assets measured at fair value $ 9,679 $ 73,448 $ — $ 83,127 Liabilities: Derivatives Foreign currency forward contracts $ — $ 672 $ — $ 672 Total liabilities measured at fair value $ — $ 672 $ — $ 672 |
Derivatives (Tables)
Derivatives (Tables) | 9 Months Ended |
Dec. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The fair value of our derivative instruments was included in our condensed consolidated balance sheets as follows (in thousands): Balance Sheet Classification As of December 31, 2021 March 31, 2021 Derivative instruments not designated as cash flow hedges: Foreign currency forward contracts Prepaids and other current assets $ 19 $ — Foreign currency forward contracts Accrued liabilities 36 672 |
Derivative Instruments, Gain (Loss) | The effect of derivative instruments on our condensed consolidated statements of operations was as follows (in thousands): Statement of Operations Classification Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 Derivative instruments not designated as cash flow hedges: Income (loss) recognized in earnings Other, net $ 797 $ (1,981) $ (163) $ (2,406) Income tax (benefit) expense Income tax (benefit) expense (194) 488 40 594 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Dec. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories, Net of Valuation Allowances | Our inventories consisted of the following (in thousands): As of December 31, 2021 March 31, 2021 Finished goods (1) $ 121,073 $ 63,918 Parts and components 7,040 4,167 Total inventories $ 128,113 $ 68,085 (1) The increase in finished goods was driven by the strategic decision to increase on-hand inventory levels ahead of the fitness season given continued disruption in global logistics. |
Property, Plant, and Equipment
Property, Plant, and Equipment (Tables) | 9 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | Property, plant and equipment consisted of the following (in thousands): Estimated As of December 31, 2021 March 31, 2021 Automobiles 5 $ 23 $ 23 Leasehold improvements 4 to 20 3,150 3,059 Computer software and equipment 2 to 7 42,231 36,956 Machinery and equipment 3 to 5 16,466 15,699 Furniture and fixtures 5 to 20 2,635 2,586 Work in progress (1) N/A 7,430 1,314 Total cost 71,935 59,637 Accumulated depreciation (40,959) (35,141) Total property, plant and equipment, net $ 30,976 $ 24,496 (1) Work in progress includes information technology assets and production tooling. |
Schedule Of Depreciation Expense | Depreciation expense was as follows (in thousands): Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 Depreciation expense $ 1,993 $ 2,114 $ 5,941 $ 5,772 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 9 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The roll forward of goodwill was as follows (in thousands): Total Balance, April 1, 2021 $ — Business acquisition (Note 2) 24,508 Balance, September 30, 2021 24,508 Business acquisition (Note 2) - measurement period adjustments 2 Balance, December 31, 2021 $ 24,510 |
Schedule of Finite-Lived Intangible Assets | Other intangible assets consisted of the following (in thousands): Estimated As of December 31, 2021 March 31, 2021 Indefinite-lived trademarks N/A $ 9,052 $ 9,052 Patents 7 to 24 1,443 1,443 10,495 10,495 Accumulated amortization - definite-lived intangible assets (1,176) (1,130) Other intangible assets, net $ 9,319 $ 9,365 |
Schedule of Indefinite-Lived Intangible Assets | Other intangible assets consisted of the following (in thousands): Estimated As of December 31, 2021 March 31, 2021 Indefinite-lived trademarks N/A $ 9,052 $ 9,052 Patents 7 to 24 1,443 1,443 10,495 10,495 Accumulated amortization - definite-lived intangible assets (1,176) (1,130) Other intangible assets, net $ 9,319 $ 9,365 |
Amortization Expense | Amortization expense was as follows (in thousands): Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 Amortization expense $ 15 $ 25 $ 46 $ 866 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | Future amortization of definite-lived intangible assets is as follows (in thousands): 2022 $ 15 2023 61 2024 61 2025 61 2026 47 Thereafter 22 $ 267 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Lease, Cost | Lease expense was as follows (in thousands): Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 Operating lease expense $ 1,465 $ 1,072 $ 4,397 $ 3,269 Amortization of finance lease assets 29 — 29 — Total lease expense $ 1,494 $ 1,072 $ 4,426 $ 3,269 |
Lessee, Supplemental Cash Flows Information | Other information related to leases was as follows (dollars in thousands): As of December 31, 2021 March 31, 2021 Supplemental cash flow information related to leases was as follows: Operating leases: Operating lease right-of-use-assets $ 24,534 $ 19,108 Operating lease liabilities 21,855 17,875 Operating lease liabilities, net of current portion 4,653 3,384 Total operating lease liabilities $ 26,508 $ 21,259 Finance leases: Property, plant and equipment, at cost $ 569 $ — Accumulated depreciation (29) — Property, plant and equipment, net $ 540 $ — Finance lease obligations $ 423 $ — Finance lease obligations, net of current portion 119 — Total finance lease liabilities $ 542 $ — Cash paid for amounts included in the measurement of lease liabilities: Operating cash flow from operating leases $ 1,724 $ 1,076 Finance cash flows from finance leases 30 — Additional lease information: ROU assets obtained in exchange for operating lease obligations $ 1,032 $ — ROU assets obtained in exchange for finance lease obligations 569 — Reductions to ROU assets resulting from reductions to operating lease obligations 329 268 Weighted Average Remaining Lease Term: Operating leases 5.89 6.94 Finance leases 4.75 — Weighted Average Discount Rate: Operating leases 5.00% 4.95% Finance leases 2.08% —% |
Lessee, Operating Lease, Liability, Maturity | Maturities of lease liabilities under non-cancellable leases were as follows (in thousands): As of December 31, 2021 Operating leases Finance leases 2022 $ 1,344 $ 120 2023 5,859 120 2024 5,422 120 2025 5,584 120 2026 4,520 90 Thereafter 8,158 — Total undiscounted lease payments 30,887 570 Less imputed interest (4,379) (28) Total lease liabilities $ 26,508 $ 542 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 9 Months Ended |
Dec. 31, 2021 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Liabilities | Accrued liabilities consisted of the following (in thousands): As of December 31, 2021 March 31, 2021 Deferred revenue $ 6,278 $ 5,551 Reserves (1) 5,230 2,624 Payroll and related liabilities 4,818 6,616 Legal settlement (2) 4,250 — Other 4,656 4,836 Total accrued liabilities $ 25,232 $ 19,627 (1) Reserves primarily consists of inventory, sales return, sales tax and product liability reserves. |
Product Warranties (Tables)
Product Warranties (Tables) | 9 Months Ended |
Dec. 31, 2021 | |
Product Warranties Disclosures [Abstract] | |
Schedule of Product Warranty Liability | Changes in our product warranty obligations were as follows (in thousands): Nine-Months Ended December 31, 2021 2020 Balance, beginning of period $ 8,651 $ 6,250 Accruals 4,416 2,791 Payments (5,942) (3,843) Balance, end of period $ 7,125 $ 5,198 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss (Tables) | 9 Months Ended |
Dec. 31, 2021 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | The following tables set forth the changes in accumulated other comprehensive loss, net of tax (in thousands): Unrealized Loss on Available-for-Sale Securities Foreign Currency Translation Adjustments Accumulated Other Comprehensive Loss Balance, March 31, 2021 $ (8) $ (147) $ (155) Current period other comprehensive loss before reclassifications (4) (342) (346) Net other comprehensive loss during period (4) (342) (346) Balance, December 31, 2021 $ (12) $ (489) $ (501) Unrealized Loss on Available-for-Sale Securities Foreign Currency Translation Adjustments Accumulated Other Comprehensive Loss Balance, September 30, 2021 $ (12) $ (341) $ (353) Current period other comprehensive loss before reclassifications — (148) (148) Net other comprehensive loss during period — (148) (148) Balance, December 31, 2021 $ (12) $ (489) $ (501) Unrealized Loss on Available-for-Sale Securities Foreign Currency Translation Adjustments Accumulated Other Comprehensive (Loss) Income Balance, March 31, 2020 $ — $ (1,312) $ (1,312) Current period other comprehensive (loss) income before reclassifications (4) 1,330 1,326 Net other comprehensive (loss) income during period (4) 1,330 1,326 Balance, December 31, 2020 $ (4) $ 18 $ 14 Unrealized Loss on Available-for-Sale Securities Foreign Currency Translation Adjustments Accumulated Other Comprehensive (Loss) Income Balance, September 30, 2020 $ — $ (742) $ (742) Current period other comprehensive (loss) income before reclassifications (4) 760 756 Net other comprehensive income during period (4) 760 756 Balance, December 31, 2020 $ (4) $ 18 $ 14 |
(Loss) Income Per Share (Tables
(Loss) Income Per Share (Tables) | 9 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The weighted average numbers of shares outstanding used to compute (loss) income per share were as follows (in thousands): Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 Shares used to calculate basic income per share 31,199 30,284 30,955 30,077 Dilutive effect of outstanding stock options, performance stock units and restricted stock units — 2,349 — 2,259 Shares used to calculate diluted income per share 31,199 32,633 30,955 32,336 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The weighted average numbers of shares outstanding listed in the table below were anti-dilutive and excluded from the computation of diluted per share due to loss from continuing operations, as such, the exercise or conversion of any potential shares would increase the number of shares in the denominator and result in a lower loss per share (in thousands): Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 Restricted stock units 673 — 1,024 — Stock options 357 — 504 — The weighted average numbers of shares outstanding listed in the table below were anti-dilutive and excluded from the computation of diluted income per share. In the case of restricted stock units, this is because unrecognized compensation expense exceeds the current value of the awards (i.e., grant date market value was higher than current average market price). In the case of stock options, this is because the average market price did not exceed the exercise price. These shares may be anti-dilutive potential common shares in the future (in thousands): Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 Restricted stock units 1,168 31 333 15 Stock options 2 — 2 3 |
Segment and Enterprise-wide I_2
Segment and Enterprise-wide Information (Tables) | 9 Months Ended |
Dec. 31, 2021 | |
Segment Reporting [Abstract] | |
Summary Information by Reportable Segments | Following is summary information by reportable segment (in thousands): Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 Net sales: Direct $ 60,705 $ 82,158 $ 161,954 $ 193,785 Retail 85,701 106,320 305,338 262,423 Royalty 852 781 2,518 2,630 Consolidated net sales $ 147,258 $ 189,259 $ 469,810 $ 458,838 Contribution: Direct $ (8,980) $ 23,584 $ (4,056) $ 58,167 Retail 3,270 25,338 44,101 60,393 Royalty 852 781 2,518 2,630 Consolidated contribution $ (4,858) $ 49,703 $ 42,563 $ 121,190 Reconciliation of consolidated contribution to (loss) income from continuing operations: Consolidated contribution $ (4,858) $ 49,703 $ 42,563 $ 121,190 Amounts not directly related to segments: Operating expenses (14,456) (8,223) (45,960) (42,821) Other expense, net (1,142) (3,640) (1,930) (4,490) Income tax benefit (expense) 7,001 (8,588) 1,321 (15,644) (Loss) income from continuing operations $ (13,455) $ 29,252 $ (4,006) $ 58,235 As of December 31, 2021 March 31, 2021 Assets: Direct $ 50,585 $ 47,002 Retail 198,791 146,001 Unallocated corporate 117,589 161,227 Total assets $ 366,965 $ 354,230 |
Schedules of Concentration of Risk, by Risk Factor | The following customers accounted for 10% or more of total net sales as follows: Three-Months Ended Nine-Months Ended 2021 2020 2021 2020 Amazon.com * 13.5% 14.4% 17.8% Best Buy 14.0% * 16.6% * Dick's Sporting Goods * 14.0% * 10.7% *Less than 10% of total net sales. |
General Information (Details)
General Information (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Mar. 31, 2021 | Dec. 31, 2020 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Restricted cash | $ 1,339 | $ 1,339 | $ 1,339 |
Business Acquisition (Details)
Business Acquisition (Details) $ in Thousands | Sep. 17, 2021USD ($)engineer | Dec. 31, 2021USD ($) | Sep. 30, 2021USD ($) | Mar. 31, 2021USD ($) |
Business Acquisition [Line Items] | ||||
Goodwill | $ 24,510 | $ 24,508 | $ 0 | |
Goodwill | 24,510 | $ 24,508 | $ 0 | |
VAY AG | ||||
Business Acquisition [Line Items] | ||||
Purchase price | $ 26,900 | |||
Goodwill | 24,508 | 24,510 | ||
Acquisition related costs | 1,000 | |||
Contingent consideration | $ 3,900 | |||
Continued employment period | 18 months | |||
Number of software engineers | engineer | 20 | |||
Cash | $ 230 | 867 | ||
Accounts receivable | 9 | 9 | ||
Prepaid expenses | 15 | 13 | ||
Deferred tax assets | 58 | 59 | ||
Developed technology (included in property, plant and equipment) | 3,000 | 3,000 | ||
Identifiable assets acquired | 3,312 | 3,948 | ||
Accrued liabilities | 187 | 932 | ||
Unearned revenue | 53 | 56 | ||
Deferred tax liabilities, non-current | 591 | 591 | ||
Total liabilities assumed | 831 | 1,579 | ||
Net identifiable assets acquired | 2,481 | 2,369 | ||
Goodwill | 24,508 | 24,510 | ||
Total assets acquired | $ 26,989 | 26,879 | ||
VAY AG | Measurement period adjustments | ||||
Business Acquisition [Line Items] | ||||
Goodwill | 2 | |||
Cash | 637 | |||
Accounts receivable | 0 | |||
Prepaid expenses | (2) | |||
Deferred tax assets | 1 | |||
Developed technology (included in property, plant and equipment) | 0 | |||
Identifiable assets acquired | 636 | |||
Accrued liabilities | 745 | |||
Unearned revenue | 3 | |||
Deferred tax liabilities, non-current | 0 | |||
Total liabilities assumed | 748 | |||
Net identifiable assets acquired | (112) | |||
Goodwill | 2 | |||
Total assets acquired | $ (110) |
Revenues (Details)
Revenues (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | |
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 147,258 | $ 189,259 | $ 469,810 | $ 458,838 |
Remaining performance obligation | 53,000 | 53,000 | ||
Change In Contract With Customer Liability [Roll Forward] | ||||
Balance, beginning of period | 3,453 | 3,639 | 5,551 | 2,050 |
Cash additions | 4,203 | 3,496 | 8,749 | 7,049 |
Revenue recognition | (1,378) | (743) | (8,022) | (2,707) |
Balance, end of period | 6,278 | 6,392 | 6,278 | 6,392 |
United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 110,870 | 153,919 | 360,540 | 381,571 |
Canada | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 22,912 | 17,955 | 60,126 | 36,947 |
Europe, the Middle East and Africa | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 9,874 | 14,024 | 37,456 | 31,022 |
All other | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 3,602 | 3,361 | 11,688 | 9,298 |
Product sales | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 141,885 | 183,642 | 454,822 | 444,876 |
Extended warranties and services | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 1,841 | 2,852 | 4,985 | 6,222 |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 3,532 | 2,765 | 10,003 | 7,740 |
Retail Orders | ||||
Disaggregation of Revenue [Line Items] | ||||
Remaining performance obligation | 44,200 | 208,700 | 44,200 | 208,700 |
Direct Orders | ||||
Disaggregation of Revenue [Line Items] | ||||
Remaining performance obligation | $ 8,800 | $ 46,500 | $ 8,800 | $ 46,500 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Dec. 31, 2021 | Mar. 31, 2021 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash Equivalents | $ 9,679 | |
Available-for-Sale Securities | 73,448 | |
Total assets measured at fair value | $ 19 | 83,127 |
Total liabilities measured at fair value | 36 | 672 |
Money Market Funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash Equivalents | 9,679 | |
Commercial Paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-Sale Securities | 9,994 | |
Corporate Bond Securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-Sale Securities | 8,227 | |
US Treasury and Government | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-Sale Securities | 55,227 | |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash Equivalents | 9,679 | |
Available-for-Sale Securities | 0 | |
Total assets measured at fair value | 0 | 9,679 |
Total liabilities measured at fair value | 0 | 0 |
Level 1 | Money Market Funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash Equivalents | 9,679 | |
Level 1 | Commercial Paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-Sale Securities | 0 | |
Level 1 | Corporate Bond Securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-Sale Securities | 0 | |
Level 1 | US Treasury and Government | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-Sale Securities | 0 | |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash Equivalents | 0 | |
Available-for-Sale Securities | 73,448 | |
Total assets measured at fair value | 19 | 73,448 |
Total liabilities measured at fair value | 36 | 672 |
Level 2 | Money Market Funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash Equivalents | 0 | |
Level 2 | Commercial Paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-Sale Securities | 9,994 | |
Level 2 | Corporate Bond Securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-Sale Securities | 8,227 | |
Level 2 | US Treasury and Government | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-Sale Securities | 55,227 | |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash Equivalents | 0 | |
Available-for-Sale Securities | 0 | |
Total assets measured at fair value | 0 | 0 |
Total liabilities measured at fair value | 0 | 0 |
Level 3 | Money Market Funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash Equivalents | 0 | |
Level 3 | Commercial Paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-Sale Securities | 0 | |
Level 3 | Corporate Bond Securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-Sale Securities | 0 | |
Level 3 | US Treasury and Government | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-Sale Securities | 0 | |
Foreign currency forward contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign currency forward contracts | 19 | |
Foreign currency forward contracts | 36 | 672 |
Foreign currency forward contracts | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign currency forward contracts | 0 | |
Foreign currency forward contracts | 0 | 0 |
Foreign currency forward contracts | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign currency forward contracts | 19 | |
Foreign currency forward contracts | 36 | 672 |
Foreign currency forward contracts | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign currency forward contracts | 0 | |
Foreign currency forward contracts | $ 0 | $ 0 |
Derivatives - Narrative (Detail
Derivatives - Narrative (Details) - Foreign currency forward contracts $ in Millions | 9 Months Ended |
Dec. 31, 2021USD ($) | |
Derivative [Line Items] | |
Derivative, notional amount | $ 30.2 |
Derivative, term of contract | 109 days |
Derivatives - Fair value of der
Derivatives - Fair value of derivative instruments (Details) - Foreign currency forward contracts - Derivative instruments not designated as cash flow hedges: - USD ($) $ in Thousands | Dec. 31, 2021 | Mar. 31, 2021 |
Accrued liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Fair value of liability derivatives | $ 36 | $ 672 |
Prepaids and other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Foreign currency forward contracts | $ 19 | $ 0 |
Derivatives - Effect On Condens
Derivatives - Effect On Condensed Consolidated Statements of Operations (Details) - Not Designated as Hedging Instruments - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | |
Other, net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Income (loss) recognized in earnings | $ 797 | $ (1,981) | $ (163) | $ (2,406) |
Income tax expense | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Income tax benefit | $ (194) | $ 488 | $ 40 | $ 594 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Mar. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Finished goods (1) | $ 121,073 | $ 63,918 |
Parts and components | 7,040 | 4,167 |
Total inventories | $ 128,113 | $ 68,085 |
Property, Plant and Equipment (
Property, Plant and Equipment (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Dec. 31, 2021 | Mar. 31, 2021 | |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 71,935 | $ 59,637 |
Accumulated depreciation | (40,959) | (35,141) |
Total property, plant and equipment, net | 30,976 | 24,496 |
Automobiles | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 23 | 23 |
Automobiles | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 5 years | |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 3,150 | 3,059 |
Leasehold improvements | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 4 years | |
Leasehold improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 20 years | |
Computer software and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 42,231 | 36,956 |
Computer software and equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 2 years | |
Computer software and equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 7 years | |
Machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 16,466 | 15,699 |
Machinery and equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 3 years | |
Machinery and equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 5 years | |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 2,635 | 2,586 |
Furniture and fixtures | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 5 years | |
Furniture and fixtures | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 20 years | |
Work in Progress | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 7,430 | $ 1,314 |
Property, Plant and Equipment -
Property, Plant and Equipment - Depreciation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation | $ 1,993 | $ 2,114 | $ 5,941 | $ 5,772 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Goodwill (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Dec. 31, 2021 | Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Goodwill, beginning balance | $ 24,508 | $ 0 |
Business acquisition (Note 2) | 2 | 24,508 |
Goodwill, ending balance | $ 24,510 | $ 24,510 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Dec. 31, 2021 | Mar. 31, 2021 | |
Goodwill [Line Items] | ||
Indefinite-lived trademarks | $ 9,052 | $ 9,052 |
Total other intangible assets, gross | 10,495 | 10,495 |
Accumulated amortization - definite-lived intangible assets | (1,176) | (1,130) |
Other intangible assets, net | 9,319 | 9,365 |
Patents | ||
Goodwill [Line Items] | ||
Finite-lived intangible assets, gross | $ 1,443 | $ 1,443 |
Patents | Minimum | ||
Goodwill [Line Items] | ||
Estimated Useful Life (in years) | 7 years | |
Patents | Maximum | ||
Goodwill [Line Items] | ||
Estimated Useful Life (in years) | 24 years |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Patent amortization (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization expense | $ 15 | $ 25 | $ 46 | $ 866 |
Goodwill and Other Intangible_6
Goodwill and Other Intangible Assets - Future intangible amortization (Details) $ in Thousands | Dec. 31, 2021USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2022 | $ 15 |
2023 | 61 |
2024 | 61 |
2025 | 61 |
2026 | 47 |
Thereafter | 22 |
Finite-Lived Intangible Assets, Net | $ 267 |
Leases - Additional information
Leases - Additional information (Details) | Dec. 31, 2021term |
Leases [Abstract] | |
Operating lease, term of contract | 9 years |
Operating lease, number of renewal terms | 1 |
Operating lease, renewal term | 5 years |
Leases - Lease Cost (Details)
Leases - Lease Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | |
Leases [Abstract] | ||||
Operating lease expense | $ 1,465 | $ 1,072 | $ 4,397 | $ 3,269 |
Amortization of finance lease assets | 29 | 0 | 29 | 0 |
Total lease expense | $ 1,494 | $ 1,072 | $ 4,426 | $ 3,269 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2021 | |
Leases [Abstract] | |||
Operating lease right-of-use-assets | $ 24,534 | $ 19,108 | |
Operating lease liabilities | 21,855 | 17,875 | |
Operating lease liabilities, net of current portion | 4,653 | 3,384 | |
Total lease liabilities | 26,508 | 21,259 | |
Property, plant and equipment, at cost | 569 | 0 | |
Accumulated depreciation | (29) | 0 | |
Property, plant and equipment, net | 540 | 0 | |
Finance lease obligations | 423 | 0 | |
Finance lease obligations, net of current portion | 119 | 0 | |
Total finance lease liabilities | 542 | 0 | |
Operating cash flow from operating leases | 1,724 | 1,076 | |
Finance cash flows from finance leases | 30 | $ 0 | 0 |
ROU assets obtained in exchange for operating lease obligations | 1,032 | 0 | |
ROU assets obtained in exchange for finance lease obligations | 569 | 0 | |
Reductions to ROU assets resulting from reductions to operating lease obligations | $ 329 | $ 268 | |
Operating leases, Weighted Average Remaining Lease Term | 5 years 10 months 20 days | 6 years 11 months 8 days | |
Finance leases, Weighted Average Remaining Lease Term | 4 years 9 months | ||
Operating leases, Weighted Average Discount Rate, Percent | 5.00% | 4.95% | |
Finance leases, Weighted Average Discount Rate, Percent | 2.08% | 0.00% |
Leases - Maturity (Details)
Leases - Maturity (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Mar. 31, 2021 |
Operating leases | ||
2022 | $ 1,344 | |
2023 | 5,859 | |
2024 | 5,422 | |
2025 | 5,584 | |
2026 | 4,520 | |
Thereafter | 8,158 | |
Total undiscounted lease payments | 30,887 | |
Less imputed interest | (4,379) | |
Total lease liabilities | 26,508 | $ 21,259 |
Finance leases | ||
2022 | 120 | |
2023 | 120 | |
2024 | 120 | |
2025 | 120 | |
2026 | 90 | |
Thereafter | 0 | |
Total undiscounted lease payments | 570 | |
Less imputed interest | (28) | |
Total finance lease liabilities | $ 542 | $ 0 |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Mar. 31, 2021 |
Payables and Accruals [Abstract] | ||
Deferred revenue | $ 6,278 | $ 5,551 |
Reserves | 5,230 | 2,624 |
Payroll and related liabilities | 4,818 | 6,616 |
Legal settlement | 4,250 | 0 |
Other | 4,656 | 4,836 |
Total accrued liabilities | $ 25,232 | $ 19,627 |
Product Warranties (Details)
Product Warranties (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Movement in Product Warranty Liability [Roll Forward] | ||
Balance, beginning of period | $ 8,651 | $ 6,250 |
Accruals | 4,416 | 2,791 |
Payments | (5,942) | (3,843) |
Balance, end of period | $ 7,125 | $ 5,198 |
Minimum | ||
Product Liability Contingency [Line Items] | ||
Product warranty period | 30 days |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | $ 192,511 | $ 123,446 | $ 182,545 | $ 92,925 |
Current period other comprehensive income (loss) before reclassifications | (148) | 756 | (346) | 1,326 |
Net other comprehensive income (loss) during period | (148) | 756 | (346) | 1,326 |
Ending balance | 180,685 | 153,195 | 180,685 | 153,195 |
Unrealized Loss on Available-for-Sale Securities | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (12) | 0 | (8) | 0 |
Current period other comprehensive income (loss) before reclassifications | 0 | (4) | (4) | (4) |
Net other comprehensive income (loss) during period | 0 | (4) | (4) | (4) |
Ending balance | (12) | (4) | (12) | (4) |
Foreign Currency Translation Adjustments | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (341) | (742) | (147) | (1,312) |
Current period other comprehensive income (loss) before reclassifications | (148) | 760 | (342) | 1,330 |
Net other comprehensive income (loss) during period | (148) | 760 | (342) | 1,330 |
Ending balance | (489) | 18 | (489) | 18 |
Accumulated Other Comprehensive Loss | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (353) | (742) | (155) | (1,312) |
Ending balance | $ (501) | $ 14 | $ (501) | $ 14 |
(Loss) Income Per Share - Weigh
(Loss) Income Per Share - Weighted Average Number of Shares (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | |
Earnings Per Share [Abstract] | ||||
Shares used to calculate basic income (loss) per share (in shares) | 31,199 | 30,284 | 30,955 | 30,077 |
Dilutive effect of outstanding stock options, performance stock units and restricted stock units (in shares) | 0 | 2,349 | 0 | 2,259 |
Shares used to calculate diluted income per share (in shares) | 31,199 | 32,633 | 30,955 | 32,336 |
(Loss) Income Per Share - Anti-
(Loss) Income Per Share - Anti-dilutive Common Shares (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | |
Restricted stock units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share, weighted average, amount (shares) | 673 | 0 | 1,024 | 0 |
Anti-dilutive securities excluded from computation of diluted income per share (in shares) | 1,168 | 31 | 333 | 15 |
Stock options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share, weighted average, amount (shares) | 357 | 0 | 504 | 0 |
Anti-dilutive securities excluded from computation of diluted income per share (in shares) | 2 | 0 | 2 | 3 |
Segment and Enterprise-wide I_3
Segment and Enterprise-wide Information (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2021USD ($)segment | Dec. 31, 2020USD ($) | Mar. 31, 2021USD ($) | |
Segment Reporting Information [Line Items] | |||||
Number of operating segments | segment | 2 | ||||
Net sales | $ 147,258 | $ 189,259 | $ 469,810 | $ 458,838 | |
Contribution | (4,858) | 49,703 | |||
Reconciliation of consolidated contribution to income (loss) from continuing operations: | |||||
Operating expenses | (49,230) | (36,391) | (130,871) | (114,836) | |
Income tax benefit (expense) | 7,001 | (8,588) | 1,321 | (15,644) | |
(Loss) income from continuing operations | (13,455) | 29,252 | (4,006) | 58,235 | |
Assets | 366,965 | 366,965 | $ 354,230 | ||
Unallocated corporate | |||||
Reconciliation of consolidated contribution to income (loss) from continuing operations: | |||||
Assets | 117,589 | 117,589 | 161,227 | ||
Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 147,258 | 189,259 | 469,810 | 458,838 | |
Contribution | (4,858) | 49,703 | 42,563 | 121,190 | |
Operating Segments | Royalty | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 852 | 781 | 2,518 | 2,630 | |
Unallocated royalty income, net | 852 | 781 | 2,518 | 2,630 | |
Operating Segments | Direct | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 60,705 | 82,158 | 161,954 | 193,785 | |
Contribution | (8,980) | 23,584 | (4,056) | 58,167 | |
Reconciliation of consolidated contribution to income (loss) from continuing operations: | |||||
Assets | 50,585 | 50,585 | 47,002 | ||
Operating Segments | Retail | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 85,701 | 106,320 | 305,338 | 262,423 | |
Contribution | 3,270 | 25,338 | 44,101 | 60,393 | |
Reconciliation of consolidated contribution to income (loss) from continuing operations: | |||||
Assets | 198,791 | 198,791 | $ 146,001 | ||
Corporate, Non-Segment | |||||
Reconciliation of consolidated contribution to income (loss) from continuing operations: | |||||
Operating expenses | 14,456 | 8,223 | (45,960) | (42,821) | |
Other expense, net | (1,142) | (3,640) | (1,930) | (4,490) | |
Income tax benefit (expense) | $ (7,001) | $ 8,588 | $ 1,321 | $ (15,644) |
Segment and Enterprise-wide I_4
Segment and Enterprise-wide Information - Concentration (Details) - Sales Revenue, Net - Customer Concentration Risk | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | |
Amazon.com | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 13.50% | 14.40% | 17.80% | |
Best Buy | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 14.00% | 16.60% | ||
Dick's Sporting Goods | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 14.00% | 10.70% |
Borrowings (Loan Agreement) (De
Borrowings (Loan Agreement) (Details) - Line of Credit - Wells Fargo Bank - USD ($) | Oct. 29, 2021 | May 13, 2021 | Dec. 31, 2021 | Oct. 28, 2021 |
Line of Credit Facility [Line Items] | ||||
Amount outstanding | $ 56,100,000 | |||
Springing trigger event, threshold percent of total commitment or borrowing base | 10.00% | |||
Springing trigger event, amount | $ 7,500,000 | |||
In-transit inventory sublimit | 22,500,000 | $ 10,000,000 | ||
Total inventory sublimit | 65,000,000 | $ 35,000,000 | ||
ABL Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Maximum revolving secured credit line | 100,000,000 | $ 55,000,000 | ||
Amount outstanding | 45,200,000 | |||
Avaiable for borrowing under line of credit | $ 54,900,000 | |||
Borrowing rate under agreement, at period end | 1.97% | |||
Term Loan | ||||
Line of Credit Facility [Line Items] | ||||
Amount outstanding | $ 11,500,000 | $ 10,900,000 | ||
Debt instrument, term | 60 months | |||
Financing costs | $ 600,000 | |||
Borrowing rate under agreement, at period end | 4.60% | |||
London Interbank Offered Rate (LIBOR) | Term Loan | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 4.50% | |||
Minimum | London Interbank Offered Rate (LIBOR) | ABL Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 1.86% | |||
Maximum | London Interbank Offered Rate (LIBOR) | ABL Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 2.36% |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Sep. 30, 2021 | Dec. 31, 2021 | Mar. 31, 2021 | |
Purchase Commitment, Excluding Long-term Commitment [Line Items] | |||
Standby letters of credit outstanding | $ 900 | ||
Loss contingency | $ 4,700 | ||
Loss contingency liability | 4,300 | ||
Inventories | |||
Purchase Commitment, Excluding Long-term Commitment [Line Items] | |||
Non-cancelable market-based purchase obligation | $ 59,200 | $ 216,300 |