DOCUMENT AND ENTITY INFORMATION
DOCUMENT AND ENTITY INFORMATION | 12 Months Ended |
Dec. 31, 2019shares | |
Document Type | 20-F |
Amendment Flag | false |
Document Registration Statement | false |
Document Annual Report | true |
Document Transition Report | false |
Document Shell Company Report | false |
Document Period End Date | Dec. 31, 2019 |
Entity File Number | 000-30324 |
Entity Registrant Name | RADWARE LTD |
Entity Incorporation, State or Country Code | IL |
Entity Address, Address Line One | 22 Raoul Wallenberg Street |
Entity Address, City or Town | Tel Aviv |
Entity Address Country | IL |
Entity Address, Postal Zip Code | 6971917 |
Title of 12(b) Security | Ordinary Shares, NIS 0.05 par value per share |
Trading Symbol | RDWR |
Name of Exchange on which Security is Registered | NASDAQ |
Entity Common Stock, Shares Outstanding | 46,987,757 |
Entity Well-known Seasoned Issuer | Yes |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Emerging Growth Company | false |
Document Accounting Standard | U.S. GAAP |
Entity Shell Company | false |
Entity Central Index Key | 0001094366 |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Year Focus | 2019 |
Document Fiscal Period Focus | FY |
Business Contact [Member] | |
Contact Personnel Name | Doron Abramovitch |
Entity Registrant Name | RADWARE LTD |
Entity Address, Address Line One | 22 Raoul Wallenberg Street |
Entity Address, City or Town | Tel Aviv |
Entity Address Country | IL |
Entity Address, Postal Zip Code | 6971917 |
City Area Code | 972-3 |
Local Phone Number | 7668666 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 40,751 | $ 45,203 |
Marketable securities | 36,924 | 15,742 |
Short-term bank deposits | 100,276 | 255,454 |
Trade receivables, net | 22,610 | 17,166 |
Other current assets and prepaid expenses | 7,469 | 7,071 |
Inventories | 13,940 | 18,401 |
Total current assets | 221,970 | 359,037 |
LONG-TERM INVESTMENTS: | ||
Marketable securities | 112,696 | 84,669 |
Long-term bank deposits | 137,095 | |
Other assets | 2,300 | 2,973 |
Total long-term investments | 252,091 | 87,642 |
Property and equipment, net | 22,971 | 23,677 |
Operating lease right-of-use assets | 18,144 | |
Intangible assets, net | 14,481 | 9,467 |
Goodwill | 41,144 | 32,174 |
Other long-term assets | 24,398 | 20,724 |
Total assets | 595,199 | 532,721 |
CURRENT LIABILITIES: | ||
Trade payables | 6,315 | 4,483 |
Deferred revenues | 79,239 | 83,955 |
Operating lease liabilities | 5,193 | |
Employees and payroll accruals | 19,037 | 17,505 |
Other payables and accrued expenses | 15,757 | 12,091 |
Total current liabilities | 125,541 | 118,034 |
LONG-TERM LIABILITIES: | ||
Deferred revenues | 50,888 | 43,796 |
Operating lease liabilities | 13,914 | |
Other long-term liabilities | 9,525 | 6,934 |
Total long-term liabilities | 74,327 | 50,730 |
Share capital - | ||
Ordinary shares of NIS 0.05 par value - Authorized: 90,000,000 and 60,000,000 at December 31, 2019 and 2018, respectively; Issued: 57,931,770 and 56,293,017 shares at December 31, 2019 and 2018, respectively; Outstanding: 46,987,757 and 46,347,403 shares at December 31, 2019 and 2018, respectively | 710 | 693 |
Additional paid-in capital | 414,581 | 383,536 |
Treasury stock 10,944,013 and 9,945,614 of Ordinary shares at December 31, 2019 and 2018, respectively | (145,226) | (120,717) |
Accumulated other comprehensive income (loss) | 1,145 | (1,110) |
Retained earnings | 124,121 | 101,555 |
Total shareholders' equity | 395,331 | 363,957 |
Total liabilities and shareholders' equity | $ 595,199 | $ 532,721 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - ₪ / shares | Dec. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Ordinary shares, par value | ₪ 0.05 | ₪ 0.05 |
Ordinary shares, shares authorized | 90,000,000 | 60,000,000 |
Ordinary shares, shares issued | 57,931,770 | 56,293,017 |
Ordinary shares, shares outstanding | 46,987,757 | 46,347,403 |
Treasury stock, ordinary shares | 10,944,013 | 9,945,614 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME (LOSS) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenues: | |||
Total revenues | $ 252,072 | $ 234,404 | $ 211,369 |
Cost of revenues: | |||
Total cost of revenues | 45,174 | 41,675 | 39,616 |
Gross profit | 206,898 | 192,729 | 171,753 |
Operating expenses, net: | |||
Research and development, net | 61,841 | 57,674 | 59,003 |
Sales and marketing | 109,556 | 111,386 | 108,744 |
General and administrative | 18,584 | 16,145 | 17,577 |
Other income | (6,900) | ||
Total operating expenses, net | 189,981 | 185,205 | 178,424 |
Operating income (loss) | 16,917 | 7,524 | (6,671) |
Financial income, net | 8,792 | 7,274 | 4,830 |
Income (loss) before taxes on income | 25,709 | 14,798 | (1,841) |
Taxes on income | 3,143 | 3,063 | 5,652 |
Net income (loss) | $ 22,566 | $ 11,735 | $ (7,493) |
Basic net earnings (loss) per share | $ 0.48 | $ 0.26 | $ (0.17) |
Diluted net earnings (loss) per share | $ 0.47 | $ 0.25 | $ (0.17) |
Products [Member] | |||
Revenues: | |||
Total revenues | $ 133,605 | $ 118,062 | $ 117,968 |
Cost of revenues: | |||
Total cost of revenues | 35,056 | 30,803 | 30,862 |
Services [Member] | |||
Revenues: | |||
Total revenues | 118,467 | 116,342 | 93,401 |
Cost of revenues: | |||
Total cost of revenues | $ 10,118 | $ 10,872 | $ 8,754 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement of Comprehensive Income [Abstract] | |||
Net income (loss) | $ 22,566 | $ 11,735 | $ (7,493) |
Unrealized gains (losses) on available-for-sale debt securities: | |||
Changes in unrealized gains (losses) | 2,928 | (866) | (530) |
Less: reclassification adjustments for losses (gains) included in net income (loss) | (18) | ||
Other comprehensive income (loss) before tax | 2,928 | (866) | (548) |
Income tax benefits (income tax expenses) related to components of other comprehensive loss | (673) | 199 | 125 |
Other comprehensive income (loss), net of tax | 2,255 | (667) | (423) |
Comprehensive income (loss) | $ 24,821 | $ 11,068 | $ (7,916) |
STATEMENTS OF CHANGES IN SHAREH
STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Share capital [Member] | Additional paid-in capital [Member] | Treasury stock, at cost [Member] | Accumulated other comprehensive income (loss) [Member] | Retained earnings [Member] | Total |
Balance at Dec. 31, 2016 | $ 663 | $ 325,338 | $ (116,029) | $ (20) | $ 89,811 | $ 299,763 |
Balance, shares at Dec. 31, 2016 | 43,188,850 | |||||
Repurchase of ordinary shares | (413) | $ (413) | ||||
Repurchase of ordinary shares, shares | (25,782) | |||||
Issuance of shares upon exercise of stock options and vesting of restricted shares units | $ 10 | 10,881 | 10,891 | |||
Issuance of shares upon exercise of stock options and vesting of restricted shares units, shares | 970,886 | |||||
Stock based compensation | 13,031 | 13,031 | ||||
Other comprehensive income (loss), net of tax | (423) | (423) | ||||
Net income (loss) | (7,493) | (7,493) | ||||
Balance at Dec. 31, 2017 | $ 673 | 349,250 | (116,442) | (443) | 82,318 | $ 315,356 |
Balance, shares at Dec. 31, 2017 | 44,133,954 | |||||
Cumulative-effect adjustment from adoption of ASC 606 | 7,502 | $ 7,502 | ||||
Repurchase of ordinary shares | (4,275) | (4,275) | ||||
Repurchase of ordinary shares, shares | (194,704) | |||||
Issuance of shares upon exercise of stock options and vesting of restricted shares units | $ 20 | 21,783 | 21,803 | |||
Issuance of shares upon exercise of stock options and vesting of restricted shares units, shares | 2,408,153 | |||||
Stock based compensation | 12,503 | 12,503 | ||||
Other comprehensive income (loss), net of tax | (667) | (667) | ||||
Net income (loss) | 11,735 | 11,735 | ||||
Balance at Dec. 31, 2018 | $ 693 | 383,536 | (120,717) | (1,110) | 101,555 | $ 363,957 |
Balance, shares at Dec. 31, 2018 | 46,347,403 | |||||
Repurchase of ordinary shares | (24,509) | $ (24,509) | ||||
Repurchase of ordinary shares, shares | (998,399) | |||||
Issuance of shares upon exercise of stock options and vesting of restricted shares units | $ 17 | 17,981 | 17,998 | |||
Issuance of shares upon exercise of stock options and vesting of restricted shares units, shares | 1,638,753 | |||||
Stock based compensation | 13,064 | 13,064 | ||||
Other comprehensive income (loss), net of tax | 2,255 | 2,255 | ||||
Net income (loss) | 22,566 | 22,566 | ||||
Balance at Dec. 31, 2019 | $ 710 | $ 414,581 | $ (145,226) | $ 1,145 | $ 124,121 | $ 395,331 |
Balance, shares at Dec. 31, 2019 | 46,987,757 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cash flows from operating activities: | |||
Net income (loss) | $ 22,566 | $ 11,735 | $ (7,493) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||
Depreciation and amortization | 11,283 | 9,782 | 11,232 |
Stock based compensation | 13,064 | 12,503 | 13,031 |
Gain from sale of marketable securities | (18) | ||
Other gain | (537) | ||
Amortization of premiums, accretion of discounts and accrued interest on marketable securities, net | 618 | 1,395 | 1,546 |
Accrued interest on bank deposits | 2,123 | (2,391) | 226 |
Increase (decrease) in accrued severance pay, net | 888 | 323 | (210) |
Decrease (increase) in trade receivables, net | (2,407) | (1,169) | 3,390 |
Changes in deferred income taxes, net | (1,535) | (2,308) | 91 |
Decrease (increase) in other current assets and prepaid expenses | (5,454) | 5,035 | (7,969) |
Decrease (increase) in inventories | 4,461 | 371 | (1,658) |
Increase (decrease) in trade payables | 1,775 | (884) | (734) |
Increase in deferred revenues (short-term and long-term) | 2,260 | 14,440 | 28,781 |
Increase (decrease) in other payables and accrued expenses | 2,784 | 419 | (8,753) |
Operating lease right-of-use assets | 5,962 | ||
Operating lease liabilities | (4,999) | ||
Net cash provided by operating activities | 52,852 | 49,251 | 31,462 |
Cash flows from investing activities: | |||
Purchase of property and equipment | (8,155) | (8,869) | (7,210) |
Proceeds from (investing in) other long-term assets | 4 | 40 | (6) |
Proceeds from bank deposits | 320,025 | 151,324 | 265,987 |
Investment in bank deposits | (304,065) | (222,326) | (303,187) |
Purchase of marketable securities | (67,145) | (47,455) | (24,595) |
Proceeds from maturity of marketable securities | 17,005 | 41,783 | 20,075 |
Proceeds from sale of marketable securities | 3,777 | 863 | |
Payment for the acquisition of subsidiary, net of cash acquired | (12,239) | (8,269) | |
Net cash used in investing activities | (50,793) | (85,503) | (56,342) |
Cash flows from financing activities: | |||
Proceeds from exercise of stock options | 17,998 | 21,803 | 10,891 |
Payment of contingent consideration | (1,310) | ||
Repurchase of ordinary shares | (24,509) | (4,275) | (413) |
Net cash provided by (used in) financing activities | (6,511) | 16,218 | 10,478 |
Decrease in cash and cash equivalents | (4,452) | (20,034) | (14,402) |
Cash and cash equivalents at the beginning of the year | 45,203 | 65,237 | 79,639 |
Cash and cash equivalents at the end of the year | 40,751 | 45,203 | 65,237 |
Supplemental disclosure of cash flow information: | |||
Cash paid during the year for income taxes | 3,296 | 6,415 | 14,352 |
Non-cash investing activity | |||
Right-of-use asset recognized with corresponding lease liability | 24,105 | ||
Deferred consideration related to acquisition | 2,080 | ||
Cumulative-effect adjustment from adoption of ASC 606 | $ 7,502 |
GENERAL
GENERAL | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
GENERAL | NOTE 1:- GENERAL a. Radware Ltd. (the "Company"), an Israeli corporation commenced operations in April 1997. The Company and its b. The Company has established wholly-owned subsidiaries in various countries worldwide. The Company's c. The Company primarily relies on several original design a few vendors to supply certain hardware platforms and The Company depends on a sole single managed security service provider, which is a related party, to provide services as part of its protection services. If the managed security service provider fails to provide or delay the delivery of the services, the Company will be required to seek alternative sources of the services. A change in its managed security service provider could result in a possible loss of sales and, consequently, could adversely affect the Company's results of operations and financial position (see note 17). |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES The consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States ("U.S. GAAP"). a. Use of estimates: The preparation of the consolidated financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates, judgments and assumptions. The Company's management believes that the estimates, judgments and assumptions used are reasonable based upon information available at the time these estimates are made. These estimates, judgments and assumptions can affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. F - 12 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) b. Financial statements in United States dollars: A majority of the Group's revenues are denominated in United States dollars ("dollar" or "U.S. dollars"). In addition, a substantial portion of the Company's and certain of its subsidiaries' costs are denominated in dollar. The Company's management believes that the dollar is the primary currency of the economic environment in which the Company and its subsidiaries operate. Thus, the functional and reporting currency of the Company and its subsidiaries is the dollar. Accordingly, monetary accounts maintained in currencies other than the dollar are re-measured into dollars in accordance with Accounting Standards Codification ("ASC") No. 830 "Foreign Currency Matters". All transaction gains and losses from the re-measured monetary balance sheet items are reflected in the consolidated statements of income (loss) as financial income or expenses, as appropriate. c. Principles of consolidation: The consolidated financial statements include the accounts of the Group. Intercompany transactions and balances have been eliminated upon consolidation. d. Cash equivalents: Cash equivalents are short-term highly liquid investments that are readily convertible to cash with original maturities of three months or less, at acquisition. e. Bank deposits: Bank deposits with maturities of more than three months but less than one year are included in short-term bank deposits. Such short-term bank deposits are stated at cost which approximates market values. Bank deposits with maturities of more than one year are included in long-term bank deposits. Long-term bank deposits are stated at cost which approximates market values. f. Investment in debt marketable securities: The Company accounts for investments in marketable securities in accordance with ASC No. 320, "Investments - Debt and Equity Securities". Management determines the appropriate classification of its investments at the time of purchase and reevaluates such determinations at each balance sheet date. F - 13 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) The Company classified all of its debt securities as available-for-sale marketable securities. Debt securities are carried at fair value, with the unrealized gains and losses reported in "Accumulated other comprehensive income (loss)" in shareholders' equity. Realized gains and losses on sales of investments are included in financial income, net and are derived using the specific identification method for determining the cost of securities. The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity. Such amortization together with interest and dividends on securities are included in financial income, net. The Company recognizes an impairment charge when a decline in the fair value of its investments below the cost basis is judged to be other-than-temporary. The factors considered in making such a determination include the duration and severity of the impairment, the reason for the decline in value, the potential recovery period and the Company's intent to sell, including whether it is more likely than not that the Company will be required to sell the investment before recovery of cost basis. For securities that are deemed other-than-temporarily impaired, the amount of impairment recognized in the consolidated statements of income (loss) is limited to the amount related to credit losses, while impairment related to other factors is recognized in other comprehensive income (loss). During the years 2019, 2018 and 2017, the Company did not record other-than-temporary impairment loss (“OTTI”) with respect to its available-for-sale marketable securities. g. Investment in equity securities The Company accounts for its investments in equity securities in accordance with ASC Topic 321, “Investments-Equity Securities” (“ASC 321”), which requires investments in equity securities be measured at fair value with changes in unrealized gains and losses reported in the consolidated statements of income (loss). h. Inventories: Inventories are stated at the lower of cost or net realizable value. Inventory write-off is provided to cover risks arising from slow-moving items, technological obsolescence, excess inventories and discontinued products. Inventory write-offs totaled $3,267, $3,867 and $2,324 in 2019, 2018 and 2017, respectively, and have been included in cost of revenues of products. F - 14 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) Cost is determined as follows: Raw materials and components - using the "first-in, first-out" method. Work-in-progress and finished products - raw materials as above with the addition of subcontracting costs - calculated on the basis of direct subcontractors costs and with direct overhead costs. The Company assesses the carrying value of its inventory for each reporting period to ensure inventory is reported at the lower of cost or net realizable value in accordance with ASC No. 330-10-35, “Inventory”. Charges for obsolete and slow-moving inventories are recorded based upon an analysis of specific identification of obsolete inventory items and quantification of slow-moving inventory items. These assessments consider various factors, including historical usage rate, technological obsolescence, estimated current and future market values and new product introduction. In cases when there is evidence that the anticipated utility of goods, in their disposal in the ordinary course of business, will be less than the historical cost of the inventory, the Company recognizes the difference as a current period charge to earnings and carries the inventory at the reduced cost basis until it is sold or disposed of. i. Property and equipment, net: Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets at the following annual rates: % Computers, peripheral equipment and software 15 - 33 (mainly 33) Office furniture and equipment 6 - 20 (mainly 15) Leasehold improvements Over the shorter of the term ofthe lease or the useful life of the asset F - 15 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) j. Impairment of long-lived assets and intangible assets subject to amortization: Property and equipment and intangible assets subject to amortization are reviewed for impairment in accordance with ASC No. 360, "Accounting for the Impairment or Disposal of Long-Lived Assets," whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Intangible assets acquired in a business combination are recorded at fair value at the date of acquisition. Following initial recognition, intangible assets are carried at cost less any accumulated amortization and any accumulated impairment losses. The useful lives of intangible assets are assessed to be either finite or indefinite. Intangible assets that are not considered to have an indefinite useful life are amortized over their estimated useful lives, which range from 5 to 9 years. Some of the acquired customer arrangements are amortized over their estimated useful lives in proportion to the economic benefits realized. This accounting policy results in accelerated amortization of such customer arrangements as compared to the straight-line method. All other intangible assets are amortized over their estimated useful lives on a straight-line basis. During 2019, 2018 and 2017, no impairment losses were recorded. k. Goodwill: Goodwill represents the excess of the purchase price in a business combination over the fair value of the net tangible and intangible assets acquired. Under ASC No. 350 "Intangibles – Goodwill and Other" ("ASC 350"), goodwill is not amortized, but rather is subject to an annual impairment test. ASC 350 requires goodwill to be tested for impairment at least annually or between annual tests in certain circumstances and written down when impaired. Goodwill is tested for impairment by comparing the fair value of the reporting unit with its carrying value. ASC 350 allows an entity to first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. If the qualitative assessment does not result in a more likely than not indication of impairment, no further impairment testing is required. If it does result in a more likely than not indication of impairment, the two-step impairment test is performed. The Company operates in one operating segment, and this segment comprises its single reporting unit. The Company performs an assessment of qualitative factors during the fourth quarter of each fiscal year, or more frequently if impairment indicators are present. For the quantitative analysis, the Company compares the fair value of its reporting unit to its carrying value. If the estimated fair value exceeds book value, goodwill is considered not to be impaired and no additional steps are necessary. This analysis determined that no impairment existed for 2019, 2018 and 2017. F - 16 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) l. Leases: On January 1, 2019, the Company adopted Accounting Standards Update (ASU) No. 2016-02, Leases (“ASC 842”), using a modified retrospective transition approach and elected to use the effective date as the date of initial application. The Company adopted the ”package of practical expedients”, which permits it not to reassess under the new standard its prior conclusions about lease identification, lease classification and initial direct costs. As a result, the consolidated balance sheet as of December 31, 2018 was not restated, continue to be reported under ASC 840, which did not require recognition of operating lease assets and liabilities on the balance sheets, and are not comparative. The Company determines if an arrangement is a lease and the classification of that lease at inception based on: (1) whether the contract involves the use of a distinct identified asset, (2) whether the Company obtains the right to substantially all the economic benefits from the use of the asset throughout the period, and (3) whether the Company has a right to direct the use of the asset. The Company elected to not recognize a lease liability and a right-of-use (“ROU”) asset for leases with a term of twelve months or less. ROU assets and lease liabilities are recognized at commencement date based on the present value of remaining lease payments over the lease term. ROU assets are initially measured at amounts, which represents the discounted present value of the lease payments over the lease, plus any initial direct costs incurred. The lease liability is initially measured based on the discounted present value of remaining lease payments over the lease term. For this purpose, the Company considers only payments that are fixed and determinable at the time of commencement. The implicit rate within the operating leases is generally not determinable, therefore the Company uses the Incremental Borrowing Rate (“IBR”) based on the information available at commencement date in determining the present value of lease payments. The Company’s IBR is estimated to approximate the interest rate for collateralized borrowing with similar terms and payments and in economic environments where the leased asset is located. An option to extend the lease is considered in connection with determining the ROU asset and lease liability when it is reasonably certain that the Company will exercise that option. An option to terminate the lease is considered unless it is reasonably certain that the Company will not exercise the option. m. Contingencies The Company is currently involved in various claims and legal proceedings. The Company reviews the status of each matter and assesses its potential financial exposure. If the potential loss from any claim or legal proceeding is considered probable and the amount can be reasonably estimated, the Company accrues a liability for the estimated loss. F - 17 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) n. Revenue recognition: The Group's revenues are derived from sales of its products, services and subscriptions: • Revenues from physical products and software-based products are recognized upon shipment when control of the promised goods is transferred to the customer (at a point in time), generally when the product has been delivered. Revenues from product subscriptions, included as product revenues, are recognized ratably, on a straight-line basis, over the subscription period. • Revenues from post-contract customer support ("PCS"), which represent mainly, help-desk support and unit repairs or replacements, professional services, and emergency response team (“ERT”) services are recognized ratably, on a straight-line basis, over the term of the related contract, which is typically between one year and three years. Renewals of support contracts create new performance obligations that are satisfied over the term with the revenues recognized ratably, on a straight-line basis, over the renewed period. The Company's solutions are sold partially through distributors and resellers, all of which are considered end-users. The Company recognizes revenues in accordance with ASC No. 606, “Revenue from Contracts with Customers”. As such, the Company identifies a contract with a customer, identifies the performance obligations in the contract, determines the transaction price, allocates the transaction price to each performance obligation in the contract and recognizes revenues when (or as) the Company satisfies a performance obligation. The Company’s arrangements typically contain various combinations of its products and subscriptions and PCS, which are distinct and are accounted for as separate performance obligations. The Company allocates the transaction price to each performance obligation based on its relative standalone selling price (“SSP”). If the SSP is not observable, the Company estimates the SSP taking into account available information such as geographic specific factors and internally approved pricing guidelines related to the performance obligation. For PCS, the Company determines the standalone selling price based on renewals. Deferred revenues represent mainly the unrecognized revenue collected for subscriptions and for PCS. Such revenues are recognized ratably over the term of the related agreement. Out of the deferred revenues balance at the beginning of the year that ended December 31, 2019, an amount of $98,500 was recognized as revenues during that year. Out of the deferred revenues balance at the beginning of the year that ended December 31, 2018, an amount of $91,555 was recognized as revenues during that year. F - 18 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) As of December 31, 2019, the aggregate amount of remaining performance obligations from contracts with customers was $234,982. The Company expects to recognize approximately 56% of its remaining performance obligations as revenue over the next 12 months, with the remaining recognized up to 3 years. As of December 31, 2018, the aggregate amount of remaining performance obligations from contracts with customers was $222,094. Remaining performance obligations represent the amount of the transaction price under contracts with customers that are attributable to performance obligations that are unsatisfied or partially satisfied at the reporting date. This consists of future committed revenue for monthly, quarterly or annual periods within current contracts with customers, as well as deferred revenue arising from consideration invoiced in prior periods for which the related performance obligations have not been satisfied. The following table provides information about disaggregated revenues by major product line: December 31, 2019 2018 Products $ 86,512 $ 79,909 Services 110,698 112,778 Subscriptions 54,862 41,717 $ 252,072 $ 234,404 For information regarding disaggregated revenues by geographical market, please see Note 15 below. The balance of deferred revenues approximates the aggregate amount of the transaction price allocated to the remaining performance obligations at the end of reporting period. In general, the Company expects to recognize the long-term portion of deferred revenue mainly over the remaining service period of up to three years. The Company records a provision for estimated sale returns, credits and stock rotation granted to customers on products in the same period the related revenues are recorded. These estimates are based on historical sales returns, stock rotations and other known factors. Such provisions amounted to $2,687 and $1,537 as of December 31, 2019 and 2018, respectively. The provision for estimated sale returns and stock rotation as of December 31, 2019, is included in other payables and accrued expenses in the consolidated balance sheets. F - 19 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) Costs to obtain contracts: Sales commissions earned by the Company’s sales force are considered incremental and recoverable costs of obtaining a contract with a customer. Commission costs related to long-term service contracts and performance obligations satisfied over time are deferred and recognized on a systematic basis that is consistent with the transfer of the products or services to which the asset relates. Sales commissions paid for new contracts, which are not commensurate with sales commissions paid for renewal contracts, are capitalized and amortized over an expected period of benefit and are included in sales and marketing expenses in the accompanying consolidated statements of income (loss). The Company applies judgment in estimating the amortization period, by taking into consideration its product life term, history of renewals, expected length of customer relationship, as well as the useful life of the underlying technology and products. Accordingly, the Company has determined the expected period of benefit to be approximately 3.3 years. Deferred commission costs capitalized are periodically reviewed for impairment. As of December 31, 2019 and 2018, the amount of deferred commission was $15,596 and $12,640, respectively and is included in other long-term assets on the consolidated balance sheets. As of December 31, 2019 and 2018, the Company recorded amortization expenses in connection with deferred commissions in the amount of $8,568 and $6,821, respectively. Upon adoption of ASC 606 on January 1, 2018, deferred commissions costs included within other long-term assets in the consolidated balance sheets, were $10,171, out of which $3,199 and $5,121 of commissions expenses were recognized during the year ended December 31, 2019 and 2018, respectively. Adoption date impact: The cumulative effects of applying the new guidance to all contracts with customers that were not substantially completed as of January 1, 2018 was recorded as an adjustment to retained earnings as of the adoption date and were as follows: December 31, 2017 Adjustment due to Topic 606 January 1, 2018 Trade receivables, net 16,150 (153 ) 15,997 Other long-term assets 8,133 10,171 18,304 Deferred tax asset, net 7,451 (2,516 ) 4,935 F - 20 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) o. Shipping and handling fees and costs: Shipping and handling fees charged to the Company's customers are recognized as product revenue in the period shipped and the related costs for providing these services are recorded as a product cost of revenues. p. Cost of revenues: Cost of products is comprised of cost of software and hardware production, manuals, packaging, license fees paid to third parties, fees paid to managed security service provider (related parties), inventory write-offs and amortization of acquired technology. Cost of services is comprised of cost of post-sale customer support and hosting services. q. Warranty costs: The Company generally provides a one year warranty for all of its products. A provision is recorded for estimated warranty costs at the time revenues are recognized based on the Company's experience. Warranty expenses for the years ended December 31, 2019, 2018 and 2017 were immaterial. r. Research and development expenses, net: Research and development costs are charged to the consolidated statements of income (loss) as incurred. ASC No. 985-20, "Software - Costs of Software to Be Sold, Leased, or Marketed", requires capitalization of certain software development costs subsequent to the establishment of technological feasibility. Based on the Company's product development process, technological feasibility is established upon completion of a working model. Costs incurred by the Company between completion of the working models and the point at which the products are ready for general release, have been insignificant. Therefore, all research and development costs are expensed as incurred. s. Government grants: During 2017-2019, the Company received non-royalty-bearing grants from the Israel Innovation Authority ("IIA") for approved research and development projects. These grants are recognized at the time the Company is entitled to such grants on the basis of the costs incurred as provided by the relevant agreement and included as a deduction from research and development expenses, net. Research and development grants deducted from research and development expenses, net amounted to $937, $712 and $545 for the years ended December 31, 2019, 2018 and 2017, respectively. F - 21 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) t. Accounting for stock-based compensation: The Company accounts for stock-based compensation in accordance with ASC No. 718, "Compensation-Stock Compensation" ("ASC 718"). ASC 718 requires companies to estimate the fair value of equity-based payment awards on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as an expense over the requisite service periods in the Company's consolidated statements of income (loss). The Company recognizes compensation expenses for the value of its awards based on the accelerated attribution method over the requisite service period of each of the awards, net of estimated forfeitures. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Estimated forfeitures are based on actual historical pre-vesting forfeitures. The Company selected the Black-Scholes-Merton option pricing model to account for the fair value of its stock-options awards with only service conditions and whereas the fair value of the restricted share units awards ("RSUs") is based on the market value of the underlying shares at the date of grant. Compensation expense related to the performance based RSUs granted to the Chief Executive Officer of the Company is computed using the fair value of the awards at the date of grant. Potential shares to be issued for performance share awards granted in 2019 and 2018 are subject to a market condition based on the price of the Company’s ordinary share. The fair value of these awards was determined using a Monte Carlo simulation methodology. The option-pricing models require a number of assumptions, of which the most significant are the expected stock price volatility and the expected option term. Expected volatility was calculated based upon actual historical stock price movements over an historical period equivalent to the option's expected term. The expected option term represents the period of time that options are expected to be outstanding based on historical experience. The risk-free interest rate is based on the yield from U.S. treasury bonds with an equivalent term. The Company has historically not paid dividends and has no foreseeable plans to pay dividends. The fair value of the Company's stock options granted to employees and directors for the years ended December 31, 2019, 2018 and 2017 was estimated using the following weighted average assumptions: F - 22 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) Employees' stock option plan: Year ended December 31, 2019 2018 2017 Risk free interest rate 1.86% 2.78% 1.66% Dividend yields 0% 0% 0% Expected volatility 26% 30% 32% Weighted average expected term from grant date (in years) 3.83 3.78 3.80 On January 1, 2017, the Company adopted ASU No. 2016-09 (Topic 718) Compensation - Stock Compensation: Improvements to Employee Stock-Based Payment Accounting, (“ASU 2016-09”), which simplifies several aspects of the accounting for stock-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, forfeiture, statutory tax withholding requirements, and classification on the statements of cash flows. The impact of the adoption of ASU 2016-09 on the Company's consolidated financial statements was as follows: • Income tax accounting: The Company is required to record excess tax benefits and tax deficiencies related to stock-based compensation as income tax benefit or expense in the consolidated statements of income (loss) prospectively when share-based awards vest or are settled. Since the Company utilized the entire previously unrecognized excess tax benefits before the adoption, no a cumulative-effect was recorded in the opening retained earnings. • Cash flow presentation of excess tax benefits: The Company is required to classify excess tax benefits along with other income tax cash flows as an operating activity either prospectively or retrospectively. The Company elected to apply the change in presentation to the consolidated statements of cash flows prospectively from January 1, 2017. u. Income taxes: The Company accounts for income taxes in accordance with ASC No. 740, "Income Taxes" ("ASC 740"). This statement prescribes the use of the liability method whereby deferred tax assets and liability account balances are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value if it is more likely than not that a portion or all of the deferred tax assets will not be realized. F - 23 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) ASC 740 contains a two-step approach to recognizing and measuring a liability for uncertain tax positions. The first step is to evaluate the tax position taken or expected to be taken in a tax return by determining if the weight of available evidence indicates that it is more likely than not that, on an evaluation of the technical merits, the tax position will be sustained on audit, including resolution of any related appeals or litigation processes. The second step is only addressed if the first step has been satisfied (i.e. the position is more likely than not to be sustained) otherwise a full liability in respect of a tax position not meeting the more likely than not criteria is recognized. The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. The Company accrues interest and penalty, if any related to unrecognized tax benefits in its taxes on income. v. Concentrations of credit risks: Financial instruments that potentially subject the Company and its subsidiaries to concentrations of credit risk consist principally of cash and cash equivalents, bank deposits, marketable securities and trade receivables. The majority of the Group's cash, cash equivalents and bank deposits are invested in major banks in Israel and the U.S. The Israeli bank deposits are not insured, while the deposits made in the United States are in excess of insured limits and are not otherwise insured. Generally, these cash equivalents may be redeemed upon demand and, therefore management believes that it bears a lower risk. The short-term and long-term bank deposits are held in financial institutions which management believes are institutions with high credit standing, and accordingly, minimal credit risk from geographic or credit concentration exists with respect to these bank deposits. As of December 31, 2019, 25%, 32%, and 7% of the Company’s short and long-term bank deposits were deposited in major Israeli banks in Israel which are rated A, AAA and BBB+, respectively, as determined by the Israeli affiliate of Standard & Poor's ("S&P"), and 36% were deposited in the U.S. branch of another major Israeli bank which is also rated A, as determined by the Israeli affiliate of S&P. As of December 31, 2019, the maximal contractual duration of any of the Company's bank deposits was 2 years, the weighted average duration of the Company's deposits was 1.5 years, and the weighted average time to maturity was 1.1 years. The Company's marketable securities include investments in equity securities, foreign banks, government debentures and corporate debentures. The financial institutions that hold the Company's marketable securities are major U.S. financial institutions, located in the United States. The Company's management believes that the Company's marketable securities portfolio is a diverse portfolio of highly-rated securities and the Company's investment policy limits the amount the Company's may invest in each issuer, and accordingly, management believes that minimal credit risk exists from geographic or credit concentration with respect to these securities. F - 24 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL |
ACQUISITIONS
ACQUISITIONS | 12 Months Ended |
Dec. 31, 2019 | |
Acquisitions | |
ACQUISITIONS | NOTE 3:- ACQUISITIONS a. On January 30, 2017 (the “Closing Date"), the Company acquired Pro forma results of operations for this acquisition have not been presented because they are not material to the consolidated results of operations. b. On March 12, 2019 (the “Closing Date”), the Company completed the acquisition of all of the outstanding shares of The acquisition was accounted for as a business combination and the purchase consideration were allocated to assets acquired and liabilities assumed based on their estimated fair values, as presented in the following table: Consideration: Cash consideration paid on closing date, including working capital adjustments $ 12,239 Deferred consideration 2,080 Total purchase price $ 14,319 Identifiable assets acquired, and liabilities assumed: Technology $ 7,385 Goodwill 8,970 Other current assets 271 Deferred tax liability (2,307 ) $ 14,319 F - 29 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 3:- ACQUISITIONS (Cont.) The estimated useful life of the technology is approximately 9 years. The derived goodwill from this acquisition is attributable to additional capabilities of the Company to expand its products portfolio. Goodwill generated from this business combination is primarily attributable to synergies between the Company's and Shieldsquare’s respective products and services. Pro forma results of operations for this acquisition have not been presented because they are not material to the consolidated results of operations. |
MARKETABLE SECURITIES
MARKETABLE SECURITIES | 12 Months Ended |
Dec. 31, 2019 | |
Marketable Securities [Abstract] | |
MARKETABLE SECURITIES | NOTE 4:- MARKETABLE SECURITIES Debt securities with contractual maturities of less than one year are as follows: December 31, 2019 2018 Adjusted Gross unrealized Gross unrealized Market Adjusted Gross unrealized Gross unrealized Market cost losses gains value cost losses gains value Foreign banks and government debentures $ 18,193 $ - $ 96 $ 18,289 $ 6,759 $ (11 ) $ - $ 6,748 Corporate debentures 15,921 - 144 16,065 9,021 (27 ) - 8,994 Total marketable securities $ 34,114 $ - $ 240 $ 34,354 $ 15,780 $ (38 ) $ - $ 15,742 Debt securities with contractual maturities from one to three years are as follows: December 31, 2019 2018 Adjusted Gross unrealized Gross unrealized Market Adjusted Gross unrealized Gross unrealized Market cost losses gains value cost losses gains value Foreign banks and government debentures $ 56,201 $ - $ 721 $ 56,922 $ 43,266 $ (358 ) $ 6 $ 42,914 Corporate debentures 52,419 (19 ) 467 52,867 19,881 (338 ) 5 19,548 Total marketable securities $ 108,620 $ (19 ) $ 1,188 $ 109,789 $ 63,147 $ (696 ) $ 11 $ 62,462 F - 30 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 4:- MARKETABLE SECURITIES (Cont.) Debt securities with contractual maturities of more than three years are as follows: December 31, 2019 2018 Adjusted Gross unrealized Gross unrealized Market Adjusted Gross unrealized Gross unrealized Market cost losses gains value cost losses gains value Foreign banks and government debentures $ 1,062 $ - $ 19 $ 1,081 $ 11,926 $ (357 ) $ - $ 11,569 Corporate debentures 1,767 - 59 1,826 10,998 (360 ) - 10,638 Total marketable securities $ 2,829 $ - $ 78 $ 2,907 $ 22,924 $ (717 ) $ - $ 22,207 Debt securities with continuous unrealized losses for less than 12 months and 12 months or greater and their related fair values as of December 31, 2019 and 2018 were as follows: December 31, 2019 Investments with continuous unrealized losses for less than 12 months Investments with continuous unrealized losses for 12 months or greater Total investments with continuous unrealized losses Fair value Unrealized losses Fair value Unrealized losses Fair value Unrealized losses Corporate debentures $ 3,852 $ (13 ) $ 2,631 $ (6 ) $ 6,483 $ (19 ) Total marketable securities $ 3,852 $ (13 ) $ 2,631 $ (6 ) $ 6,483 $ (19 ) December 31, 2018 Investments with continuous unrealized losses for less than 12 months Investments with continuous unrealized losses for 12 months or greater Total investments with continuous unrealized losses Fair value Unrealized losses Fair value Unrealized losses Fair value Unrealized losses Foreign banks and government debentures $ 26,860 $ (177 ) $ 24,966 $ (550 ) $ 51,826 $ (727 ) Corporate debentures 11,947 (122 ) 23,605 (604 ) 35,552 (726 ) Total marketable securities $ 38,807 $ (299 ) $ 48,571 $ (1,154 ) $ 87,378 $ (1,453 ) As of December 31, 2019, and 2018, interest receivable amounted to $1,183 and $898, respectively, and is included within marketable securities in the consolidated balance sheets. Equity securities amounted to $2,570 and as of December 31, 2019 are carried at fair value based on Level 1 inputs. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | NOTE 5:- FAIR VALUE MEASUREMENTS In accordance with ASC No. 820, "Fair Value Measurements and Disclosures", the Company measures its cash equivalents, marketable securities and deferred consideration at fair value on recurring basis. Cash equivalents and marketable securities are classified within Level 1 or Level 2 since these assets are valued using quoted market prices or alternative pricing sources and models utilizing market observable inputs. The Company's financial assets and liabilities measured at fair value on a recurring basis, including interest receivable components consisted of the following types of instruments as of December 31, 2019, and 2018: December 31, 2019 Fair value measurements using input type Level 1 Level 2 Level 3 Total Assets Cash equivalents: Money market funds $ 783 $ - $ - $ 783 Marketable securities: Equity securities 2,570 - - 2,570 Foreign banks and government debentures - 76,293 - 76,293 Corporate debentures - 70,757 - 70,757 Total financial assets $ 3,353 $ 147,050 $ - $ 150,403 Liabilities Other accounts payable and accrued expenses: Deferred consideration $ - $ - $ 2,035 $ 2,035 Total liabilities $ - $ - $ 2,035 $ 2,035 F - 32 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 5:- FAIR VALUE MEASUREMENTS (Cont.) December 31, 2018 Fair value measurements using input type Level 1 Level 2 Level 3 Total Assets Cash equivalents: Money market funds $ 4,970 $ - $ - $ 4,970 Government debentures - 4,986 - 4,986 Marketable securities: Foreign banks and government debentures - 61,231 - 61,231 Corporate debentures - 39,180 - 39,180 Total financial assets $ 4,970 $ 105,397 $ - $ 110,367 |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | NOTE 6:- INVENTORIES Inventories are comprised of the following: December 31, 2019 2018 Raw materials and components $ 1,881 $ 2,140 Work-in-progress 1,306 1,894 Finished products 10,753 14,367 $ 13,940 $ 18,401 |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT, NET | NOTE 7:- PROPERTY AND EQUIPMENT, NET December 31, 2019 2018 Cost: Computer, peripheral equipment and software $ 95,930 $ 90,054 Office furniture and equipment 11,989 11,121 Leasehold improvements 6,621 6,188 114,540 107,363 Accumulated depreciation: Computer, peripheral equipment and software 78,711 72,236 Office furniture and equipment 8,677 7,710 Leasehold improvements 4,181 3,740 91,569 83,686 Property and equipment, net $ 22,971 $ 23,677 Depreciation expenses for the years ended December 31, 2019, 2018 and 2017 were $8,912, $8,834 and $10,001, respectively. |
INTANGIBLE ASSETS, NET
INTANGIBLE ASSETS, NET | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS, NET | NOTE 8:- INTANGIBLE ASSETS, NET a. Intangible assets: Weighted average amortization December 31, Period 2019 2018 (years) Cost: Acquired technology 8.5 $ 32,946 $ 25,561 Customers relationships and brand name 5.8 9,817 9,817 42,763 35,378 Accumulated amortization: Acquired technology 18,465 16,139 Customers relationships and brand name 9,817 9,772 28,282 25,911 Intangible assets, net $ 14,481 $ 9,467 Amortization expenses for the years ended December 31, 2019, 2018 and 2017 were $2,371, $948 and $1,231, respectively. F - 34 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 8:- INTANGIBLE ASSETS, NET (Cont.) Future estimated amortization expenses for the years ending: December 31, 2020 $ 1,891 2021 1,858 2022 1,858 2023 1,858 2024 and thereafter 7,016 Total $ 14,481 b. Goodwill: 2019 2018 Balance as of January 1 $ 32,174 $ 32,174 Acquisitions 8,970 - Balance as of December 31 $ 41,144 $ 32,174 |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
LEASE | NOTE 9:- LEASES The Company has various operating leases for office space, vehicles and warehouse space that expire on different dates through 2027 The adoption of the ASC 842 resulted in the recognition in its consolidated balance sheet at the date of the adoption of operating right-of-use assets, short term operating lease liabilities and long-term operating lease liabilities of $21,048, $5,040 and $16,008, respectively. The adoption did not impact the beginning retained earnings, or prior year consolidated statements of income (loss) and consolidated statements of cash flows. F - 35 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 9:- LEASES (Cont.) Aggregate lease payments for the right of use assets over the remaining lease period as of December 31, 2019 are as follows: 2020 $ 5,677 2021 4,437 2022 3,427 2023 2,622 2024 2,480 2025 and thereafter 1,668 Total undiscounted lease payments $ 20,311 Less: adjustment to discounted lease payments (1,204 ) Total discounted lease payments $ 19,107 The weighted average remaining lease terms and discount rates for all of operating leases were as follows as of December 31, 2019: Weighted average remaining lease term (years) 4.72 Weighted average discount rate 2.6 % Total rent expenses for the years ended December 31, 2019, 2018 and 2017 were $5,578, $6,047 and $6,161 respectively (see also Note 17b). |
OTHER PAYABLES AND ACCRUED EXPE
OTHER PAYABLES AND ACCRUED EXPENSES | 12 Months Ended |
Dec. 31, 2019 | |
Other Liabilities Disclosure [Abstract] | |
OTHER PAYABLES AND ACCRUED EXPENSES | NOTE 10:- OTHER PAYABLES AND ACCRUED EXPENSES December 31, 2019 2018 Accrued expenses and other $ 10,357 $ 7,068 Subcontractors accrual 1,627 1,160 Accrued taxes 1,738 3,863 Deferred consideration 2,035 - $ 15,757 $ 12,091 |
COMMITMENTS AND CONTINGENT LIAB
COMMITMENTS AND CONTINGENT LIABILITIES | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENT LIABILITIES | NOTE 11:- COMMITMENTS AND CONTINGENT LIABILITIES Litigation: 1. On April 4, 2016, F5 Networks, Inc. ("F5") filed a lawsuit against the Company’s Subsidiary ("Radware Inc.") in the 2. On August 29, 2013, F5 filed an amended answer and counterclaim in an action brought by the Company against F5 F - 37 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 11:- COMMITMENTS AND CONTINGENT LIABILITIES (Cont.) The Federal Circuit affirmed the entire judgment on September 18, 2017 and remanded the case to the District Court on October 25, 2017, upon expiration of the time allowed for either party to request reconsideration of the affirmance. Upon remand, the case was re-assigned to another judge in the Court on November 21, 2017. On November 28, 2017, the Company moved to release the bond posted by F5. On December 6, 2017, the Court granted the Company's motion. On January 16, 2018 the Company filed the necessary tax documents to collect the funds, which, together with interest amounted to $6,900 and which were in turn released by the Court to the Company on January 29, 2018. The above amount was recorded as other income in the consolidated statements of income (loss) for the year ended December 31, 2017. 3. From time to time, the Company is party to other various legal proceedings, claims and litigation that arise in the |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2019 | |
Stockholders' Equity Note [Abstract] | |
SHAREHOLDERS' EQUITY | NOTE 12:- SHAREHOLDERS' EQUITY The Company's shares are listed for trade on the NASDAQ Global Select Market under the symbol "RDWR". a. Rights of shares: Ordinary Shares: The ordinary shares confer upon the holders the right to receive notice to participate and vote in shareholders meetings of the Company and to receive dividend, if declared. b. Treasury stock: In April 2017 the Company's Board of Directors authorized a new plan for the repurchase of up to an aggregate of $40,000 of the Company's ordinary shares in the open market, subject to normal trading restrictions, or in privately negotiated transactions. This plan expired on April 24, 2018. In May 2018 the Company's board of directors authorized a new plan for the repurchase of up to an aggregate of $40,000 of the Company's ordinary shares in the open market, subject to normal trading restrictions, or in privately negotiated transactions. This plan expired on April 30, 2019. In May 2019 the Company's board of directors authorized a new plan for the repurchase of up to an aggregate of $40,000 of the Company's ordinary shares in the open market, subject to normal trading restrictions, or in privately negotiated transactions. This plan will expire on April 30, 2020. F - 38 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 12:- SHAREHOLDERS' EQUITY (Cont.) c. Dividends: Dividends, if any, will be paid in NIS. Dividends paid to shareholders outside Israel may be converted to U.S. dollars on the basis of the exchange rate prevailing at the date of the conversion. The Company does not intend to pay cash dividends in the foreseeable future. d. Stock Option Plans: The Company has two stock option plans, the Company's Key Employee Share Incentive Plan (1997) as amended and restated (the "1997 Plan") and the Directors and Consultants Option Plan (the "DC Plan" and together with the 1997 Plan, Stock Option Plans"). Under the Stock Option Plans, options may be granted to officers, directors, employees and consultants of the Group. The exercise price per share under the Stock Option Plans was generally not less than the market price of an ordinary share at the date of grant. The options vest primarily over four years. Each option is exercisable for one ordinary share. Any options, which are forfeited or not exercised before expiration, become available for future grants. Pursuant to the Stock Option Plans, the Company reserved for issuance 33,312,967 ordinary shares. RSUs: In addition to granting stock options, since 2013, the Company started to routinely grant RSUs under the 1997 Plan. RSUs vest primarily over a four years period of employment. RSUs that are cancelled or forfeited become available for future grants. The number of “Reserved and Authorized Shares” under the Equity Plans shall equal the sum of (i) the number of ordinary shares reserved and authorized under the Equity Incentive, and other awards granted under the Equity Incentive Plans as of such date, and (ii) the number of ordinary shares reserved, As of December 31, 2019, the number of Reserved and Authorized Shares under the Equity Incentive Plans is as detailed below: 2019 Stock options exercised and outstanding 28,286,653 RSUs vested and outstanding 2,741,853 Ordinary shares available for issuance under the Equity Incentive Plans 2,284,461 Total reserved and authorized shares as of December 31, 2019 33,312,967 F - 39 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 12:- SHAREHOLDERS' EQUITY (Cont.) A summary of employees and directors option activity under the Company's Stock Option Plans as of December 31, 2019 is as follows: Number of options Weighted-average exercise price Weighted- average remaining contractual term (in years) Aggregate intrinsic value Outstanding at January 1, 2019 4,855,203 $ 16.96 3.30 $ 29,774 Granted 1,207,866 24.05 Exercised (1,250,680 ) 14.43 Expired (2,875 ) 16.43 Forfeited (511,235 ) 18.24 Outstanding at December 31, 2019 4,298,279 $ 19.54 3.12 $ 27,514 Exercisable at December 31, 2019 1,185,612 $ 15.42 1.91 $ 12,361 Vested and expected to vest at December 31, 2019 3,980,155 $ 19.27 3.04 $ 26,549 The weighted-average grant-date fair value of options granted during the years ended December 31, 2019, 2018 and 2017 was $5.54, $6.67 and $4.31, respectively. As of December 31, 2019, there was approximately $7,614 of total unrecognized compensation costs related to non-vested share-based compensation arrangements granted under the Company's stock option plans. That cost is expected to be recognized over a weighted-average period of 1.54 years. The total intrinsic value of options exercised during the years 2019, 2018 and 2017 was 1,125,612, 1,112,589 and 2,068,522, respectively. The aggregate intrinsic value of the outstanding stock options at December 31, 2019 and 2018, represents the intrinsic value of 3,579,879 and 3,983,216, respectively, outstanding options that are in-the-money as of such dates. The remaining 718,400 and 871,987 outstanding options are out-of-the-money as of December 31, 2019 and 2018, respectively, and their intrinsic value was considered as zero. F - 40 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 12:- SHAREHOLDERS' EQUITY (Cont.) The options outstanding under the Company's Stock Option Plans as of December 31, 2019, have been separated into ranges of exercise price as follows: December 31, 2019 Outstanding Exercisable Ranges of exercise price Number of options Weighted average remaining contractual life (years) Weighted average exercise price Number of options Weighted Average Exercise price $ 10.04-14.74 1,291,709 1.73 $ 13.40 620,850 $ 13.31 $ 15.09-19.30 905,825 2.43 $ 16.78 490,075 $ 16.44 $ 20.62-27.15 2,100,745 4.28 $ 24.51 74,687 $ 26.29 4,298,279 1,185,612 The following table summarizes information relating to RSUs, as well as changes to such awards during 2019: Year ended December 31, 2019 Outstanding at January 1, 2019 1,077,909 Granted 802,513 Vested (388,073 ) Forfeited (125,436 ) Outstanding as of December 31, 2019 1,366,913 As of December 31, 2019, there was approximately $16,008 of total unrecognized compensation costs related to non-vested RSUs granted under the Company's stock option plans. That cost is expected to be recognized over a weighted-average period of 1.62 years. The weighted-average grant date fair value of RSUs granted during the year ended December 31, 2019, 2018 and 2017 were $23.41, $23.82 and $16.24, respectively. F - 41 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 12:- SHAREHOLDERS' EQUITY (Cont.) Stock-based compensation was recorded in the following items within the consolidated statements of income (loss): Year ended December 31, 2019 2018 2017 Cost of revenues $ 224 $ 221 $ 241 Research and development, net 2,855 3,123 3,867 Sales and marketing 6,953 7,072 6,894 General and administrative 3,032 2,087 2,029 Total expenses $ 13,064 $ 12,503 $ 13,031 |
EARNINGS (LOSS) PER SHARE
EARNINGS (LOSS) PER SHARE | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
EARNINGS (LOSS) PER SHARE | NOTE 13:- EARNINGS (LOSS) PER SHARE The following table sets forth the computation of basic and diluted net earnings (loss) per share: Year ended December 31, 2019 2018 2017 Numerator for basic and diluted net earnings (loss) per share: Net income (loss) $ 22,566 $ 11,735 $ (7,493 ) Weighted average shares outstanding, net of treasury stock: Denominator for basic net earnings (loss) per share 46,816,899 45,289,296 43,475,844 Effect of dilutive securities: Employee stock options and RSUs 1,706,221 2,402,572 - Denominator for diluted net earnings (loss) per share 48,523,120 47,691,868 43,475,844 Basic net earnings (loss) per share $ 0.48 $ 0.26 $ (0.17 ) Diluted net earnings (loss) per share $ 0.47 $ 0.25 $ (0.17 ) |
TAXES ON INCOME
TAXES ON INCOME | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
TAXES ON INCOME | NOTE 14:- TAXES ON INCOME a. General: A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: 2019 2018 Beginning balance $ 3,214 $ 1,534 Additions for prior year tax positions 484 221 Reclassified from current tax payable - 574 Decrease for prior year tax positions - (88 ) Additions for current year tax positions 1,899 973 Ending balance $ 5,597 $ 3,214 As of December 31, 2019, the entire amount of the unrecognized tax benefits could affect the Company's income tax provision and the effective tax rate. The Company adjusts the unrecognized tax benefit liability and income tax expense in the period in which the uncertain tax position is effectively settled, the statute of limitations expires or when new information is available. During the years ended December 31, 2019, 2018 and 2017 amounts of $484, $(88) and $290, respectively, were added (deducted from) to the unrecognized tax benefits derived from interest and exchange rate differences expenses related to prior years' uncertain tax positions. As of December 31, 2019, and 2018, the Company had accrued interest liability related to uncertain tax positions in the amounts of $460 and $214 respectively, which is included within income tax accrual on the consolidated balance sheets. Exchange rate differences are recorded within financial income, net, while interest is recorded within taxes on income expense. In July 2017 the Company reached a settlement with the Israeli Tax Authorities ("ITA") regarding the Company's corporate tax returns from the years 2012, 2013 and 2014. The settlement amounted to a total payment of $10,728 (NIS 37,727). The Company had provisions for the related years in the amount of $10,950. The amount in excess (approximately $200) was recorded as a tax benefit during 2017. As a result, the Company's Israeli tax returns have been examined for all years including and prior to fiscal year 2014, and the Company is no longer subject to audit for these periods. The Company's U.S subsidiary files income tax return in the U.S federal jurisdiction. As of December 31, 2019, the 2012 through 2018 tax years are open and may be subject to potential examinations in the U.S. F - 43 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 14:- TAXES ON INCOME (Cont.) The Company believes that it has adequately provided for any reasonably foreseeable outcome related to tax audits and settlement. The final tax outcome of its tax audits could be different from that which is reflected in the Company's income tax provisions and accruals. Such differences could have a material effect on the Company's income tax provision and net income in the period in which such determination is made. b. Israeli taxation: 1. Foreign Exchange Regulations: Commencing in taxable year 2003, the Company has elected to measure its taxable income and file its tax return under the Israeli Income Tax Regulations. Under the Foreign Exchange Regulations the Israeli company is calculating its tax liability in U.S. Dollars according to certain orders. The tax liability, as calculated in U.S. Dollars is translated into NIS according to the exchange rate as of December 31st of each year. 2. Tax rates: The Israeli corporate tax rate in 2019 and 2018 was 23%, and in 2017 was 24%. A company is taxable on its real capital gains at the corporate tax rate in the year of sale. 3. Tax benefits under the Law for the Encouragement of Capital Investments, 1959 ("the Law"): The Company elected to apply the Preferred Enterprise regime under the Law for the Encouragement of Capital Investment (the “Investment Law”) as of 2014 tax year. The election is irrevocable. Under the Preferred Enterprise regime, a preferred income of an Enterprise located in the center of Israel is subject to tax rate of 16%. Pursuant to Amendment 73 to the Investment Law adopted in 2017, a Company located in the Center of Israel that meets the conditions for “Preferred Technological Enterprises”, is subject to tax rate of 12% tax rate. The Company believes it meets those conditions. Income not eligible for Preferred Enterprise benefits is taxed at a regular rate, as follows: 2019 and 2018 – 23%, 2017 – 24%. Prior to 2014, most of the Company’s income was exempt from tax or subject to reduced tax rates under the Investment Law. Upon distribution of exempt income, the distributing company will be subject to corporate reduced tax rates ordinarily applicable to such income under the Investment Law. F - 44 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 14:- TAXES ON INCOME (Cont.) Reduced income under the Investment Law including the Preferred Enterprise Regime and Preferred Technological Enterprise Regime will be freely distributable as dividends, subject to a 15% or 20% withholding tax (or lower rate for non Israeli resident shareholder, under an applicable tax treaty). However, upon the distribution of a dividend from Preferred Income and Technological Preferred Enterprise to an Israeli company, no withholding tax will be remitted. Out of the Company's retained earnings as of December 31, 2019, $128,751 are tax-exempted attributable to its Privileged Enterprise programs. If such tax-exempt income is distributed in a manner other than upon complete liquidation of the Company, it would be taxed at the corporate tax rate applicable to such profits, and an income tax liability of up to $29,613 would be incurred as of December 31, 2019. The Company's board of directors has determined that it will not distribute any amounts of its undistributed tax-exempt income as dividend. The Company intends to reinvest its tax-exempt income and not to distribute such income as a dividend. Accordingly, no deferred income taxes have been provided on income attributable to the Company's Approved Enterprise and Privileged Enterprise programs as the undistributed tax-exempt income is essentially permanent by reinvestment. c. Taxes on income are comprised as follows: Year ended December 31, 2019 2018 2017 Current taxes $ 4,678 $ 5,371 $ 5,561 Deferred taxes (1,535 ) (2,308 ) 91 $ 3,143 $ 3,063 $ 5,652 Domestic $ 1,833 $ 2,049 $ 238 Foreign 1,310 1,014 5,414 $ 3,143 $ 3,063 $ 5,652 F - 45 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 14:- TAXES ON INCOME (Cont.) Year ended December 31, 2019 2018 2017 Domestic taxes: Current taxes $ 3,670 $ 2,206 $ 238 Deferred taxes (1,837 ) (157 ) - 1,833 2,049 238 Foreign taxes: Current taxes 1,008 3,165 5,323 Deferred taxes 302 (2,151 ) 91 1,310 1,014 5,414 $ 3,143 $ 3,063 $ 5,652 d. Deferred income taxes: Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company's and its subsidiaries' deferred tax liabilities and assets are as follows: December 31, 2019 2018 Carryforward losses and tax credit $ 7,175 $ 4,743 Deferred revenues 4,967 6,350 Temporary differences 4,484 5,093 Unrealized losses on marketable securities - 331 Deferred tax assets before valuation allowance 16,626 16,517 Valuation allowance (1,477 ) (3,247 ) Net deferred tax assets 15,149 13,270 Intangible assets, including goodwill (5,140 ) (4,047 ) Depreciable assets (1,497 ) (1,780 ) Unrealized gains on marketable securities (388 ) - Deferred tax liability (7,025 ) (5,827 ) Net deferred tax assets $ 8,124 $ 7,443 F - 46 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 14:- TAXES ON INCOME (Cont.) e. Foreign: On December 22, 2017, the U.S. enacted the Tax Cuts and Jobs Act (the “Act”), which among other provisions, reduced the U.S. corporate tax rate from 35% to 21%, effective January 1, 2018. Apportioned income is also subject to tax in various states. At December 31, 2017, the Company re-measured certain of its U.S. deferred tax assets and liabilities, based on the new rates at which they are expected to reverse in the future. The tax expense recorded in 2017 related to the re-measurement of the deferred tax balance was $3,247. Through December 31, 2019, the U.S. subsidiary had a U.S. federal loss carry forward of $7,250, which can be carried forward and offset against taxable income up to 20 years, expiring between fiscal 2023 2038 f. Income taxes of non-Israeli subsidiaries: Non-Israeli subsidiaries are taxed according to the tax laws in their respective countries of residence. The Company does not provide deferred tax liabilities when it intends to reinvest earnings of foreign subsidiaries indefinitely. F - 47 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 14:- TAXES ON INCOME (Cont.) g. A reconciliation between the theoretical tax expense, assuming all income is taxed at the statutory tax rate applicable Year endedDecember 31, 2019 2018 2017 Income (loss) before taxes, as reported in the consolidated statements of income (loss) $ 25,709 $ 14,798 $ (1,841 ) Statutory tax rate 23 % 23 % 24 % Theoretical tax expense (benefit) on the above amount at the Israeli statutory tax rate $ 5,913 $ 3,404 $ (442 ) Tax adjustment in respect of different tax rate of foreign subsidiary - 65 334 Non-deductible expenses and other permanent differences 188 (340 ) 375 Deferred taxes on losses for which valuation allowance was provided, net 592 743 1,288 Utilization of tax losses and deferred taxes for which valuation allowance was provided, net (2,175 ) (2,259 ) (709 ) Stock compensation relating to stock options per ASC No. 718 821 1,073 1,976 Income taxes in respect of prior years 330 273 (1,038 ) Change of tax rate - 696 3,249 Approved, Privileged and Preferred enterprise loss (benefits) (*) (2,783 ) (684 ) 347 Other 257 92 272 Actual tax expense $ 3,143 $ 3,063 $ 5,652 (*) Basic earnings per share amounts of the benefit resulting from the "Approved, Privileged and Preferred Enterprise" status $ 0.06 $ 0.00 $ 0.00 Diluted earnings per share amounts of the benefit resulting from the "Approved, Privileged and Preferred Enterprise" status $ 0.06 $ 0.00 $ 0.00 F - 48 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 14:- TAXES ON INCOME (Cont.) h. Income (loss) before taxes on income is comprised as follows: Year ended December 31, 2019 2018 2017 Domestic $ 19,185 $ 9,009 $ (5,918 ) Foreign 6,524 5,789 4,077 Income (loss) before taxes on income $ 25,709 $ 14,798 $ (1,841 ) |
GEOGRAPHIC INFORMATION
GEOGRAPHIC INFORMATION | 12 Months Ended |
Dec. 31, 2019 | |
Segments, Geographical Areas [Abstract] | |
GEOGRAPHIC INFORMATION | NOTE 15:- GEOGRAPHIC INFORMATION Summary information about geographic areas: The Company operates in one reportable segment (see Note 1 for a brief description of the Company's business). The total revenues are attributed to geographic areas based on the location of the end-users. The following table presents total revenues for the years ended December 31, 2019, 2018 and 2017 from a geographical perspective: Year ended December 31, 2019 2018 2017 Revenues from sales to customers located at: The United States $ 85,447 $ 82,990 $ 78,464 America - other 20,982 19,501 19,437 EMEA *) 75,275 75,751 56,589 Asia Pacific 70,368 56,162 56,879 $ 252,072 $ 234,404 $ 211,369 *) Europe, the Middle East and Africa. For the year ended December 31, 2018, revenues from sales to customers located in Germany amounted to $ 23,863. The following table presents long-lived assets as of December 31, 2019 and 2018 from a geographical perspective: December 31, 2019 2018 Long-lived assets, by geographic region: America (principally the United States) $ 1,401 $ 1,736 Israel 20,411 20,856 EMEA - other 246 253 Asia Pacific 913 832 $ 22,971 $ 23,677 |
SELECTED STATEMENTS OF INCOME D
SELECTED STATEMENTS OF INCOME DATA | 12 Months Ended |
Dec. 31, 2019 | |
SELECTED STATEMENTS OF INCOME DATA [Abstract] | |
SELECTED STATEMENTS OF INCOME DATA | NOTE 16:- SELECTED STATEMENTS OF INCOME DATA Financial income, net: Year ended December 31, 2019 2018 2017 Financial income, net: Interest on bank deposits and other $ 7,016 $ 5,279 $ 3,528 Amortization of premiums, accretion of discounts and interest on debt marketable securities, net 3,639 2,304 2,008 Other gain 537 - - Gain from sale of available-for-sale marketable securities - - 18 Bank charges (124 ) (113 ) (89 ) Foreign currency translation differences, net (2,276 ) (196 ) (635 ) $ 8,792 $ 7,274 $ 4,830 |
BALANCES AND TRANSACTIONS WITH
BALANCES AND TRANSACTIONS WITH RELATED PARTIES | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions [Abstract] | |
BALANCES AND TRANSACTIONS WITH RELATED PARTIES | NOTE 17:- BALANCES AND TRANSACTIONS WITH RELATED PARTIES Represents transactions and balances with other entities in which certain members of the Company's board of directors, management or shareholders have interest: a. The following related party balances are included in the consolidated balance sheets: December 31, 2019 2018 Trade receivables and prepaid expenses $ 3,982 $ 1,676 Trade payables and accrued expenses $ 1,419 $ 604 F - 50 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 17:- BALANCES AND TRANSACTIONS WITH RELATED PARTIES (Cont.) b. The following related party transactions are included in the consolidated statements of income (loss): Year ended December 31, 2019 2018 2017 Revenues (1) $ 4,476 $ 2,491 $ 2,547 Cost of revenues (2) $ 7,061 $ 6,956 $ 4,280 Operating expenses, net - primarily lease, sub-contractors and communications (3) $ 4,888 $ 4,757 $ 4,853 Purchase of property and equipment $ 1,944 $ 2,761 $ 1,663 (1) Distribution of the Company's products on a non-exclusive basis. (2) Related to cost of product purchased from one of the related companies. The Company depends on a sole (3) The Company leases office space and purchases other miscellaneous services from certain companies, which |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2019 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 18:- SUBSEQUENT EVENTS The recent outbreak of Coronavirus, a virus causing potentially deadly respiratory tract infections originating in China and spreading in various jurisdictions, may negatively affect economic conditions regionally as well as globally, disrupt operations situated in countries particularly exposed to the contagion, affect supply chains or otherwise impact our businesses. Governments in affected countries are imposing travel bans, quarantines and other emergency public safety measures. Those measures, though temporary in nature, may continue and increase depending on developments in the virus’ outbreak. The ultimate severity of the Coronavirus outbreak is uncertain at this time and therefore the Company cannot reasonably estimate the impact it may have on its end markets and its operations. |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Use of estimates | a. Use of estimates: The preparation of the consolidated financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates, judgments and assumptions. The Company's management believes that the estimates, judgments and assumptions used are reasonable based upon information available at the time these estimates are made. These estimates, judgments and assumptions can affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. |
Financial statements in United States dollars | b. Financial statements in United States dollars: A majority of the Group's revenues are denominated in United States dollars ("dollar" or "U.S. dollars"). In addition, a substantial portion of the Company's and certain of its subsidiaries' costs are denominated in dollar. The Company's management believes that the dollar is the primary currency of the economic environment in which the Company and its subsidiaries operate. Thus, the functional and reporting currency of the Company and its subsidiaries is the dollar. Accordingly, monetary accounts maintained in currencies other than the dollar are re-measured into dollars in accordance with Accounting Standards Codification ("ASC") No. 830 "Foreign Currency Matters". All transaction gains and losses from the re-measured monetary balance sheet items are reflected in the consolidated statements of income (loss) as financial income or expenses, as appropriate. |
Principles of consolidation | c. Principles of consolidation: The consolidated financial statements include the accounts of the Group. Intercompany transactions and balances have been eliminated upon consolidation. |
Cash equivalents | d. Cash equivalents: Cash equivalents are short-term highly liquid investments that are readily convertible to cash with original maturities of three months or less, at acquisition. |
Bank deposits | e. Bank deposits: Bank deposits with maturities of more than three months but less than one year are included in short-term bank deposits. Such short-term bank deposits are stated at cost which approximates market values. Bank deposits with maturities of more than one year are included in long-term bank deposits. Long-term bank deposits are stated at cost which approximates market values. |
Investment in debt marketable securities | f. Investment in debt marketable securities: The Company accounts for investments in marketable securities in accordance with ASC No. 320, "Investments - Debt and Equity Securities". Management determines the appropriate classification of its investments at the time of purchase and reevaluates such determinations at each balance sheet date. F - 13 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) The Company classified all of its debt securities as available-for-sale marketable securities. Debt securities are carried at fair value, with the unrealized gains and losses reported in "Accumulated other comprehensive income (loss)" in shareholders' equity. Realized gains and losses on sales of investments are included in financial income, net and are derived using the specific identification method for determining the cost of securities. The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity. Such amortization together with interest and dividends on securities are included in financial income, net. The Company recognizes an impairment charge when a decline in the fair value of its investments below the cost basis is judged to be other-than-temporary. The factors considered in making such a determination include the duration and severity of the impairment, the reason for the decline in value, the potential recovery period and the Company's intent to sell, including whether it is more likely than not that the Company will be required to sell the investment before recovery of cost basis. For securities that are deemed other-than-temporarily impaired, the amount of impairment recognized in the consolidated statements of income (loss) is limited to the amount related to credit losses, while impairment related to other factors is recognized in other comprehensive income (loss). During the years 2019, 2018 and 2017, the Company did not record other-than-temporary impairment loss (“OTTI”) with respect to its available-for-sale marketable securities. |
Investment in equity securities | g. Investment in equity securities The Company accounts for its investments in equity securities in accordance with ASC Topic 321, “Investments-Equity Securities” (“ASC 321”), which requires investments in equity securities be measured at fair value with changes in unrealized gains and losses reported in the consolidated statements of income (loss). |
Inventories | h. Inventories: Inventories are stated at the lower of cost or net realizable value. Inventory write-off is provided to cover risks arising from slow-moving items, technological obsolescence, excess inventories and discontinued products. Inventory write-offs totaled $3,267, $3,867 and $2,324 in 2019, 2018 and 2017, respectively, and have been included in cost of revenues of products. F - 14 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) Cost is determined as follows: Raw materials and components - using the "first-in, first-out" method. Work-in-progress and finished products - raw materials as above with the addition of subcontracting costs - calculated on the basis of direct subcontractors costs and with direct overhead costs. The Company assesses the carrying value of its inventory for each reporting period to ensure inventory is reported at the lower of cost or net realizable value in accordance with ASC No. 330-10-35, “Inventory”. Charges for obsolete and slow-moving inventories are recorded based upon an analysis of specific identification of obsolete inventory items and quantification of slow-moving inventory items. These assessments consider various factors, including historical usage rate, technological obsolescence, estimated current and future market values and new product introduction. In cases when there is evidence that the anticipated utility of goods, in their disposal in the ordinary course of business, will be less than the historical cost of the inventory, the Company recognizes the difference as a current period charge to earnings and carries the inventory at the reduced cost basis until it is sold or disposed of. |
Property and equipment, net | i. Property and equipment, net: Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets at the following annual rates: % Computers, peripheral equipment and software 15 - 33 (mainly 33) Office furniture and equipment 6 - 20 (mainly 15) Leasehold improvements Over the shorter of the term ofthe lease or the useful life of the asset |
Impairment of long-lived assets and intangible assets subject to amortization | j. Impairment of long-lived assets and intangible assets subject to amortization: Property and equipment and intangible assets subject to amortization are reviewed for impairment in accordance with ASC No. 360, "Accounting for the Impairment or Disposal of Long-Lived Assets," whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Intangible assets acquired in a business combination are recorded at fair value at the date of acquisition. Following initial recognition, intangible assets are carried at cost less any accumulated amortization and any accumulated impairment losses. The useful lives of intangible assets are assessed to be either finite or indefinite. Intangible assets that are not considered to have an indefinite useful life are amortized over their estimated useful lives, which range from 5 to 9 years. Some of the acquired customer arrangements are amortized over their estimated useful lives in proportion to the economic benefits realized. This accounting policy results in accelerated amortization of such customer arrangements as compared to the straight-line method. All other intangible assets are amortized over their estimated useful lives on a straight-line basis. During 2019, 2018 and 2017, no impairment losses were recorded. |
Goodwill | k. Goodwill: Goodwill represents the excess of the purchase price in a business combination over the fair value of the net tangible and intangible assets acquired. Under ASC No. 350 "Intangibles – Goodwill and Other" ("ASC 350"), goodwill is not amortized, but rather is subject to an annual impairment test. ASC 350 requires goodwill to be tested for impairment at least annually or between annual tests in certain circumstances and written down when impaired. Goodwill is tested for impairment by comparing the fair value of the reporting unit with its carrying value. ASC 350 allows an entity to first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. If the qualitative assessment does not result in a more likely than not indication of impairment, no further impairment testing is required. If it does result in a more likely than not indication of impairment, the two-step impairment test is performed. The Company operates in one operating segment, and this segment comprises its single reporting unit. The Company performs an assessment of qualitative factors during the fourth quarter of each fiscal year, or more frequently if impairment indicators are present. For the quantitative analysis, the Company compares the fair value of its reporting unit to its carrying value. If the estimated fair value exceeds book value, goodwill is considered not to be impaired and no additional steps are necessary. This analysis determined that no impairment existed for 2019, 2018 and 2017. |
Leases | l. Leases: On January 1, 2019, the Company adopted Accounting Standards Update (ASU) No. 2016-02, Leases (“ASC 842”), using a modified retrospective transition approach and elected to use the effective date as the date of initial application. The Company adopted the ”package of practical expedients”, which permits it not to reassess under the new standard its prior conclusions about lease identification, lease classification and initial direct costs. As a result, the consolidated balance sheet as of December 31, 2018 was not restated, continue to be reported under ASC 840, which did not require recognition of operating lease assets and liabilities on the balance sheets, and are not comparative. The Company determines if an arrangement is a lease and the classification of that lease at inception based on: (1) whether the contract involves the use of a distinct identified asset, (2) whether the Company obtains the right to substantially all the economic benefits from the use of the asset throughout the period, and (3) whether the Company has a right to direct the use of the asset. The Company elected to not recognize a lease liability and a right-of-use (“ROU”) asset for leases with a term of twelve months or less. ROU assets and lease liabilities are recognized at commencement date based on the present value of remaining lease payments over the lease term. ROU assets are initially measured at amounts, which represents the discounted present value of the lease payments over the lease, plus any initial direct costs incurred. The lease liability is initially measured based on the discounted present value of remaining lease payments over the lease term. For this purpose, the Company considers only payments that are fixed and determinable at the time of commencement. The implicit rate within the operating leases is generally not determinable, therefore the Company uses the Incremental Borrowing Rate (“IBR”) based on the information available at commencement date in determining the present value of lease payments. The Company’s IBR is estimated to approximate the interest rate for collateralized borrowing with similar terms and payments and in economic environments where the leased asset is located. An option to extend the lease is considered in connection with determining the ROU asset and lease liability when it is reasonably certain that the Company will exercise that option. An option to terminate the lease is considered unless it is reasonably certain that the Company will not exercise the option. |
Contingencies | m. Contingencies The Company is currently involved in various claims and legal proceedings. The Company reviews the status of each matter and assesses its potential financial exposure. If the potential loss from any claim or legal proceeding is considered probable and the amount can be reasonably estimated, the Company accrues a liability for the estimated loss. |
Revenue recognition | n. Revenue recognition: The Group's revenues are derived from sales of its products, services and subscriptions: • Revenues from physical products and software-based products are recognized upon shipment when control of the promised goods is transferred to the customer (at a point in time), generally when the product has been delivered. Revenues from product subscriptions, included as product revenues, are recognized ratably, on a straight-line basis, over the subscription period. • Revenues from post-contract customer support ("PCS"), which represent mainly, help-desk support and unit repairs or replacements, professional services, and emergency response team (“ERT”) services are recognized ratably, on a straight-line basis, over the term of the related contract, which is typically between one year and three years. Renewals of support contracts create new performance obligations that are satisfied over the term with the revenues recognized ratably, on a straight-line basis, over the renewed period. The Company's solutions are sold partially through distributors and resellers, all of which are considered end-users. The Company recognizes revenues in accordance with ASC No. 606, “Revenue from Contracts with Customers”. As such, the Company identifies a contract with a customer, identifies the performance obligations in the contract, determines the transaction price, allocates the transaction price to each performance obligation in the contract and recognizes revenues when (or as) the Company satisfies a performance obligation. The Company’s arrangements typically contain various combinations of its products and subscriptions and PCS, which are distinct and are accounted for as separate performance obligations. The Company allocates the transaction price to each performance obligation based on its relative standalone selling price (“SSP”). If the SSP is not observable, the Company estimates the SSP taking into account available information such as geographic specific factors and internally approved pricing guidelines related to the performance obligation. For PCS, the Company determines the standalone selling price based on renewals. Deferred revenues represent mainly the unrecognized revenue collected for subscriptions and for PCS. Such revenues are recognized ratably over the term of the related agreement. Out of the deferred revenues balance at the beginning of the year that ended December 31, 2019, an amount of $98,500 was recognized as revenues during that year. Out of the deferred revenues balance at the beginning of the year that ended December 31, 2018, an amount of $91,555 was recognized as revenues during that year. F - 18 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) As of December 31, 2019, the aggregate amount of remaining performance obligations from contracts with customers was $234,982. The Company expects to recognize approximately 56% of its remaining performance obligations as revenue over the next 12 months, with the remaining recognized up to 3 years. As of December 31, 2018, the aggregate amount of remaining performance obligations from contracts with customers was $222,094. Remaining performance obligations represent the amount of the transaction price under contracts with customers that are attributable to performance obligations that are unsatisfied or partially satisfied at the reporting date. This consists of future committed revenue for monthly, quarterly or annual periods within current contracts with customers, as well as deferred revenue arising from consideration invoiced in prior periods for which the related performance obligations have not been satisfied. The following table provides information about disaggregated revenues by major product line: December 31, 2019 2018 Products $ 86,512 $ 79,909 Services 110,698 112,778 Subscriptions 54,862 41,717 $ 252,072 $ 234,404 For information regarding disaggregated revenues by geographical market, please see Note 15 below. The balance of deferred revenues approximates the aggregate amount of the transaction price allocated to the remaining performance obligations at the end of reporting period. In general, the Company expects to recognize the long-term portion of deferred revenue mainly over the remaining service period of up to three years. The Company records a provision for estimated sale returns, credits and stock rotation granted to customers on products in the same period the related revenues are recorded. These estimates are based on historical sales returns, stock rotations and other known factors. Such provisions amounted to $2,687 and $1,537 as of December 31, 2019 and 2018, respectively. The provision for estimated sale returns and stock rotation as of December 31, 2019, is included in other payables and accrued expenses in the consolidated balance sheets. F - 19 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) Costs to obtain contracts: Sales commissions earned by the Company’s sales force are considered incremental and recoverable costs of obtaining a contract with a customer. Commission costs related to long-term service contracts and performance obligations satisfied over time are deferred and recognized on a systematic basis that is consistent with the transfer of the products or services to which the asset relates. Sales commissions paid for new contracts, which are not commensurate with sales commissions paid for renewal contracts, are capitalized and amortized over an expected period of benefit and are included in sales and marketing expenses in the accompanying consolidated statements of income (loss). The Company applies judgment in estimating the amortization period, by taking into consideration its product life term, history of renewals, expected length of customer relationship, as well as the useful life of the underlying technology and products. Accordingly, the Company has determined the expected period of benefit to be approximately 3.3 years. Deferred commission costs capitalized are periodically reviewed for impairment. As of December 31, 2019 and 2018, the amount of deferred commission was $15,596 and $12,640, respectively and is included in other long-term assets on the consolidated balance sheets. As of December 31, 2019 and 2018, the Company recorded amortization expenses in connection with deferred commissions in the amount of $8,568 and $6,821, respectively. Upon adoption of ASC 606 on January 1, 2018, deferred commissions costs included within other long-term assets in the consolidated balance sheets, were $10,171, out of which $3,199 and $5,121 of commissions expenses were recognized during the year ended December 31, 2019 and 2018, respectively. Adoption date impact: The cumulative effects of applying the new guidance to all contracts with customers that were not substantially completed as of January 1, 2018 was recorded as an adjustment to retained earnings as of the adoption date and were as follows: December 31, 2017 Adjustment due to Topic 606 January 1, 2018 Trade receivables, net 16,150 (153 ) 15,997 Other long-term assets 8,133 10,171 18,304 Deferred tax asset, net 7,451 (2,516 ) 4,935 |
Shipping and handling fees and costs | o. Shipping and handling fees and costs: Shipping and handling fees charged to the Company's customers are recognized as product revenue in the period shipped and the related costs for providing these services are recorded as a product cost of revenues. |
Cost of revenues | p. Cost of revenues: Cost of products is comprised of cost of software and hardware production, manuals, packaging, license fees paid to third parties, fees paid to managed security service provider (related parties), inventory write-offs and amortization of acquired technology. Cost of services is comprised of cost of post-sale customer support and hosting services. |
Warranty costs | q. Warranty costs: The Company generally provides a one year warranty for all of its products. A provision is recorded for estimated warranty costs at the time revenues are recognized based on the Company's experience. Warranty expenses for the years ended December 31, 2019, 2018 and 2017 were immaterial. |
Research and development expenses, net | r. Research and development expenses, net: Research and development costs are charged to the consolidated statements of income (loss) as incurred. ASC No. 985-20, "Software - Costs of Software to Be Sold, Leased, or Marketed", requires capitalization of certain software development costs subsequent to the establishment of technological feasibility. Based on the Company's product development process, technological feasibility is established upon completion of a working model. Costs incurred by the Company between completion of the working models and the point at which the products are ready for general release, have been insignificant. Therefore, all research and development costs are expensed as incurred. |
Government grants | s. Government grants: During 2017-2019, the Company received non-royalty-bearing grants from the Israel Innovation Authority ("IIA") for approved research and development projects. These grants are recognized at the time the Company is entitled to such grants on the basis of the costs incurred as provided by the relevant agreement and included as a deduction from research and development expenses, net. Research and development grants deducted from research and development expenses, net amounted to $937, $712 and $545 for the years ended December 31, 2019, 2018 and 2017, respectively. |
Accounting for stock-based compensation | t. Accounting for stock-based compensation: The Company accounts for stock-based compensation in accordance with ASC No. 718, "Compensation-Stock Compensation" ("ASC 718"). ASC 718 requires companies to estimate the fair value of equity-based payment awards on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as an expense over the requisite service periods in the Company's consolidated statements of income (loss). The Company recognizes compensation expenses for the value of its awards based on the accelerated attribution method over the requisite service period of each of the awards, net of estimated forfeitures. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Estimated forfeitures are based on actual historical pre-vesting forfeitures. The Company selected the Black-Scholes-Merton option pricing model to account for the fair value of its stock-options awards with only service conditions and whereas the fair value of the restricted share units awards ("RSUs") is based on the market value of the underlying shares at the date of grant. Compensation expense related to the performance based RSUs granted to the Chief Executive Officer of the Company is computed using the fair value of the awards at the date of grant. Potential shares to be issued for performance share awards granted in 2019 and 2018 are subject to a market condition based on the price of the Company’s ordinary share. The fair value of these awards was determined using a Monte Carlo simulation methodology. The option-pricing models require a number of assumptions, of which the most significant are the expected stock price volatility and the expected option term. Expected volatility was calculated based upon actual historical stock price movements over an historical period equivalent to the option's expected term. The expected option term represents the period of time that options are expected to be outstanding based on historical experience. The risk-free interest rate is based on the yield from U.S. treasury bonds with an equivalent term. The Company has historically not paid dividends and has no foreseeable plans to pay dividends. The fair value of the Company's stock options granted to employees and directors for the years ended December 31, 2019, 2018 and 2017 was estimated using the following weighted average assumptions: F - 22 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) Employees' stock option plan: Year ended December 31, 2019 2018 2017 Risk free interest rate 1.86% 2.78% 1.66% Dividend yields 0% 0% 0% Expected volatility 26% 30% 32% Weighted average expected term from grant date (in years) 3.83 3.78 3.80 On January 1, 2017, the Company adopted ASU No. 2016-09 (Topic 718) Compensation - Stock Compensation: Improvements to Employee Stock-Based Payment Accounting, (“ASU 2016-09”), which simplifies several aspects of the accounting for stock-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, forfeiture, statutory tax withholding requirements, and classification on the statements of cash flows. The impact of the adoption of ASU 2016-09 on the Company's consolidated financial statements was as follows: • Income tax accounting: The Company is required to record excess tax benefits and tax deficiencies related to stock-based compensation as income tax benefit or expense in the consolidated statements of income (loss) prospectively when share-based awards vest or are settled. Since the Company utilized the entire previously unrecognized excess tax benefits before the adoption, no a cumulative-effect was recorded in the opening retained earnings. • Cash flow presentation of excess tax benefits: The Company is required to classify excess tax benefits along with other income tax cash flows as an operating activity either prospectively or retrospectively. The Company elected to apply the change in presentation to the consolidated statements of cash flows prospectively from January 1, 2017. |
Income taxes | u. Income taxes: The Company accounts for income taxes in accordance with ASC No. 740, "Income Taxes" ("ASC 740"). This statement prescribes the use of the liability method whereby deferred tax assets and liability account balances are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value if it is more likely than not that a portion or all of the deferred tax assets will not be realized. F - 23 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) ASC 740 contains a two-step approach to recognizing and measuring a liability for uncertain tax positions. The first step is to evaluate the tax position taken or expected to be taken in a tax return by determining if the weight of available evidence indicates that it is more likely than not that, on an evaluation of the technical merits, the tax position will be sustained on audit, including resolution of any related appeals or litigation processes. The second step is only addressed if the first step has been satisfied (i.e. the position is more likely than not to be sustained) otherwise a full liability in respect of a tax position not meeting the more likely than not criteria is recognized. The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. The Company accrues interest and penalty, if any related to unrecognized tax benefits in its taxes on income. |
Concentrations of credit risks | v. Concentrations of credit risks: Financial instruments that potentially subject the Company and its subsidiaries to concentrations of credit risk consist principally of cash and cash equivalents, bank deposits, marketable securities and trade receivables. The majority of the Group's cash, cash equivalents and bank deposits are invested in major banks in Israel and the U.S. The Israeli bank deposits are not insured, while the deposits made in the United States are in excess of insured limits and are not otherwise insured. Generally, these cash equivalents may be redeemed upon demand and, therefore management believes that it bears a lower risk. The short-term and long-term bank deposits are held in financial institutions which management believes are institutions with high credit standing, and accordingly, minimal credit risk from geographic or credit concentration exists with respect to these bank deposits. As of December 31, 2019, 25%, 32%, and 7% of the Company’s short and long-term bank deposits were deposited in major Israeli banks in Israel which are rated A, AAA and BBB+, respectively, as determined by the Israeli affiliate of Standard & Poor's ("S&P"), and 36% were deposited in the U.S. branch of another major Israeli bank which is also rated A, as determined by the Israeli affiliate of S&P. As of December 31, 2019, the maximal contractual duration of any of the Company's bank deposits was 2 years, the weighted average duration of the Company's deposits was 1.5 years, and the weighted average time to maturity was 1.1 years. The Company's marketable securities include investments in equity securities, foreign banks, government debentures and corporate debentures. The financial institutions that hold the Company's marketable securities are major U.S. financial institutions, located in the United States. The Company's management believes that the Company's marketable securities portfolio is a diverse portfolio of highly-rated securities and the Company's investment policy limits the amount the Company's may invest in each issuer, and accordingly, management believes that minimal credit risk exists from geographic or credit concentration with respect to these securities. F - 24 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) From geographic prospective, 45% of the Company’s debt marketable securities portfolio was invested in debt securities of U.S. issuers, 29% was invested in debt securities of European issuers and 26% was invested in debt securities of other geographic-located issuers. As of December 31, 2019, 94% of the Company's debt marketable securities portfolio was rated A- or higher, as determined by S&P, 4% was rated BBB or BBB+ and 2% was rated BB-. The trade receivables of the Group are mainly derived from sales to customers located primarily in the United States, Europe, the Middle East, Africa and Asia Pacific. The Company performs ongoing credit evaluations of its customers. An allowance for doubtful accounts is determined with respect to those amounts that the Company has determined to be doubtful of collection. In certain circumstances, the Company may require from its customers letters of credit, other collateral or additional guarantees. For the years ended December 2019 and 2018, bad debt expenses were nil, and $109 for the year ended December 31, 2017. Total write offs during 2019, 2018 and 2017 amounted to $154, $100 and nil, respectively. |
Employee related benefits | w. Employee related benefits: Severance pay: Effective April 1, 2007, the Company's agreements with employees in Israel, are under Section 14 of the Severance Pay Law, 1963. The Company’s contributions for severance pay have extinguished its severance obligation. Upon contribution of the full amount based on the employee’s monthly salary for each year of service, no additional obligation exists regarding the matter of severance pay and no additional payments is made by the Company to the employee. Further, the related obligation and amounts deposited on behalf of the employee for such obligation are not stated on the balance sheets, as the Company is legally released from the obligation to pay severance amounts to employees once the required deposit amounts have been fully paid. Severance pay expenses for the years ended December 31, 2019, 2018 and 2017 amounted to approximately $4,066, $4,259 and $3,296, respectively. Accrued severance pay is included in other long-term liabilities in the consolidated balance sheets. |
Fair value of financial instruments | x. Fair value of financial instruments: The Company measures its cash equivalents, bank deposits, marketable securities and deferred consideration at fair value. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. A three-tier fair value hierarchy is established as a basis for considering such assumptions and for inputs used in the valuation methodologies in measuring fair value: F - 25 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) Level 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in Level 2 - Include other inputs that are directly or indirectly observable in the marketplace. Level 3 - Unobservable inputs which are supported by little or no market activity. The carrying amounts of cash equivalents, trade receivables, trade payables, short-term bank deposits, other current assets and prepaid expenses and other payables and accrued expenses, approximate at fair value because of their generally short maturities. |
Comprehensive income (loss) | y. Comprehensive income (loss): The Company accounts for comprehensive income (loss) in accordance with ASC No. 220, "Comprehensive Income." This statement establishes standards for the reporting and display of comprehensive income (loss) and its components in a full set of general purpose financial statements. Comprehensive income (loss) generally represents all changes in shareholders' equity during the period except those resulting from investments by, or distributions to, shareholders. The Company determined that its only item of other comprehensive income (loss) relates to available-for-sale debt marketable securities adjustment. |
Treasury stock | z. Treasury stock: The Company repurchases its ordinary shares from time to time on the open market and holds such shares as treasury stock. The Company presents the cost to repurchase treasury stock as a reduction of shareholders' equity. The voting rights attached to treasury stock are revoked. |
Basic and diluted net income (loss) per share | aa. Basic and diluted net income (loss) per share: Basic net income (loss) per share is computed based on the weighted average number of ordinary shares outstanding during each period. Diluted net income (loss) per share is computed based on the weighted average number of ordinary shares outstanding during each period, plus potential dilutive ordinary shares considered outstanding during the period, if any, in accordance with ASC No. 260, "Earnings Per Share". The total number of ordinary shares related to outstanding stock options excluded from the calculation of diluted income (loss) per share as they would have been anti-dilutive was 1,938,808, 1,166,488 and 981,750 for the years ended December 31, 2019, 2018 and 2017, respectively. |
Business combinations | ab. Business combinations: The Company accounted for business combination in accordance with ASC No. 805, "Business Combinations" ("ASC 805"). ASC No. 805 requires recognition of assets acquired, liabilities assumed, and any non-controlling interest at the acquisition date, measured at their fair values as of that date. Any excess of the fair value of net assets acquired over purchase price and any subsequent changes in estimated contingencies are to be recorded in earnings. In addition, changes in valuation allowance related to acquired deferred tax assets and in acquired income tax position are to be recognized in earnings. Under ASU No. 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business (“2017-01”), the Company first determines whether substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets. If this threshold is met, the single asset or group of assets, as applicable, is not a business. |
New accounting pronouncements not yet effective | ac. New accounting pronouncements not yet effective: In June 2016, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2016-13 (ASU 2016-13) “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 amends guidance on reporting credit losses for assets held at amortized cost basis and available for sale debt securities. ASU 2016-13 is effective in fiscal years beginning after December 15, 2019; early adoption is permitted. The Company does not expect that this new guidance will have a material impact on the Company’s consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-04 (ASU 2017-04) “Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (“ASU 2017-04”)”. ASU 2017-04 eliminates step two of the goodwill impairment test and specifies that goodwill impairment should be measured by comparing the fair value of a reporting unit with its carrying amount. Additionally, the amount of goodwill allocated to each reporting unit with a zero or negative carrying amount of net assets should be disclosed. ASU 2017-04 is effective for annual or interim goodwill impairment tests performed in fiscal years beginning after December 15, 2019; early adoption is permitted. The new guidance was effective for the Company on January 1, 2020. The adoption did not have a material impact on the Company’s consolidated financial statements. F - 27 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) In December 2019, the FASB issued ASU No. 2019-12 (ASU 2019-12), "Simplifying the Accounting for Income Taxes". The ASU eliminates certain exceptions to the guidance in ASC 740 related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. The new guidance also simplifies aspects of the accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. The guidance is effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years, with early adoption permitted. The Company is still evaluating the effect that this new guidance will have on the Company's consolidated financial statements. |
Impact of accounting standards recently adopted | ad. Impact of accounting standards recently adopted: In February 2016, the FASB issued ASU No. 2016-02, Leases (ASC 842). The standard requires the recognition of ROU assets and lease liabilities for all leases. The standard requires a modified retrospective transition approach to recognize and measure leases at the initial application. The Company adopted the standard as of January 1, 2019, using a modified retrospective transition approach and elected to use the effective date as the date of initial application. The Company adopted the ”package of practical expedients”, which permits it not to reassess under the new standard its prior conclusions about lease identification, lease classification and initial direct costs. As a result, the consolidated balance sheets as of December 31, 2018 were not restated, continue to be reported under ASC 840, which did not require recognition of operating lease assets and liabilities on the consolidated balance sheets, and are not comparative. |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Property and Equipment Annual Depreciation Rates | Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets at the following annual rates: % Computers, peripheral equipment and software 15 - 33 (mainly 33) Office furniture and equipment 6 - 20 (mainly 15) Leasehold improvements Over the shorter of the term ofthe lease or the useful life of the asset |
Schedule of disaggregated revenues by major product line | The following table provides information about disaggregated revenues by major product line: December 31, 2019 2018 Products $ 86,512 $ 79,909 Services 110,698 112,778 Subscriptions 54,862 41,717 $ 252,072 $ 234,404 |
Schedule of Cumulative Effects of Applying New Accounting Pronouncements | The cumulative effects of applying the new guidance to all contracts with customers that were not substantially completed as of January 1, 2018 was recorded as an adjustment to retained earnings as of the adoption date and were as follows: December 31, 2017 Adjustment due to Topic 606 January 1, 2018 Trade receivables, net 16,150 (153 ) 15,997 Other long-term assets 8,133 10,171 18,304 Deferred tax asset, net 7,451 (2,516 ) 4,935 |
Schedule of Weighted Average Assumptions Used to Calculate Fair Value of Company's Stock Options | Employees' stock option plan: Year ended December 31, 2019 2018 2017 Risk free interest rate 1.86% 2.78% 1.66% Dividend yields 0% 0% 0% Expected volatility 26% 30% 32% Weighted average expected term from grant date (in years) 3.83 3.78 3.80 |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Acquisitions | |
Schedule of Allocation of Purchase Price | The acquisition was accounted for as a business combination and the purchase consideration were allocated to assets acquired and liabilities assumed based on their estimated fair values, as presented in the following table: Consideration: Cash consideration paid on closing date, including working capital adjustments $ 12,239 Deferred consideration 2,080 Total purchase price $ 14,319 Identifiable assets acquired, and liabilities assumed: Technology $ 7,385 Goodwill 8,970 Other current assets 271 Deferred tax liability (2,307 ) $ 14,319 |
MARKETABLE SECURITIES (Tables)
MARKETABLE SECURITIES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Marketable Securities [Abstract] | |
Schedule of Marketable Securities With Contractual Maturities | Debt securities with contractual maturities of less than one year are as follows: December 31, 2019 2018 Adjusted Gross unrealized Gross unrealized Market Adjusted Gross unrealized Gross unrealized Market cost losses gains value cost losses gains value Foreign banks and government debentures $ 18,193 $ - $ 96 $ 18,289 $ 6,759 $ (11 ) $ - $ 6,748 Corporate debentures 15,921 - 144 16,065 9,021 (27 ) - 8,994 Total marketable securities $ 34,114 $ - $ 240 $ 34,354 $ 15,780 $ (38 ) $ - $ 15,742 Debt securities with contractual maturities from one to three years are as follows: December 31, 2019 2018 Adjusted Gross unrealized Gross unrealized Market Adjusted Gross unrealized Gross unrealized Market cost losses gains value cost losses gains value Foreign banks and government debentures $ 56,201 $ - $ 721 $ 56,922 $ 43,266 $ (358 ) $ 6 $ 42,914 Corporate debentures 52,419 (19 ) 467 52,867 19,881 (338 ) 5 19,548 Total marketable securities $ 108,620 $ (19 ) $ 1,188 $ 109,789 $ 63,147 $ (696 ) $ 11 $ 62,462 Debt securities with contractual maturities of more than three years are as follows: December 31, 2019 2018 Adjusted Gross unrealized Gross unrealized Market Adjusted Gross unrealized Gross unrealized Market cost losses gains value cost losses gains value Foreign banks and government debentures $ 1,062 $ - $ 19 $ 1,081 $ 11,926 $ (357 ) $ - $ 11,569 Corporate debentures 1,767 - 59 1,826 10,998 (360 ) - 10,638 Total marketable securities $ 2,829 $ - $ 78 $ 2,907 $ 22,924 $ (717 ) $ - $ 22,207 |
Summary of Investments With Continuous Unrealized Losses and Related Fair Values | Debt securities with continuous unrealized losses for less than 12 months and 12 months or greater and their related fair values as of December 31, 2019 and 2018 were as follows: December 31, 2019 Investments with continuous unrealized losses for less than 12 months Investments with continuous unrealized losses for 12 months or greater Total investments with continuous unrealized losses Fair value Unrealized losses Fair value Unrealized losses Fair value Unrealized losses Corporate debentures $ 3,852 $ (13 ) $ 2,631 $ (6 ) $ 6,483 $ (19 ) Total marketable securities $ 3,852 $ (13 ) $ 2,631 $ (6 ) $ 6,483 $ (19 ) December 31, 2018 Investments with continuous unrealized losses for less than 12 months Investments with continuous unrealized losses for 12 months or greater Total investments with continuous unrealized losses Fair value Unrealized losses Fair value Unrealized losses Fair value Unrealized losses Foreign banks and government debentures $ 26,860 $ (177 ) $ 24,966 $ (550 ) $ 51,826 $ (727 ) Corporate debentures 11,947 (122 ) 23,605 (604 ) 35,552 (726 ) Total marketable securities $ 38,807 $ (299 ) $ 48,571 $ (1,154 ) $ 87,378 $ (1,453 ) |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Financial Assets and Liabilities Measured at Fair Value on Recurring Basis | The Company's financial assets and liabilities measured at fair value on a recurring basis, including interest receivable components consisted of the following types of instruments as of December 31, 2019, and 2018: December 31, 2019 Fair value measurements using input type Level 1 Level 2 Level 3 Total Assets Cash equivalents: Money market funds $ 783 $ - $ - $ 783 Marketable securities: Equity securities 2,570 - - 2,570 Foreign banks and government debentures - 76,293 - 76,293 Corporate debentures - 70,757 - 70,757 Total financial assets $ 3,353 $ 147,050 $ - $ 150,403 Liabilities Other accounts payable and accrued expenses: Deferred consideration $ - $ - $ 2,035 $ 2,035 Total liabilities $ - $ - $ 2,035 $ 2,035 F - 32 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 5:- FAIR VALUE MEASUREMENTS (Cont.) December 31, 2018 Fair value measurements using input type Level 1 Level 2 Level 3 Total Assets Cash equivalents: Money market funds $ 4,970 $ - $ - $ 4,970 Government debentures - 4,986 - 4,986 Marketable securities: Foreign banks and government debentures - 61,231 - 61,231 Corporate debentures - 39,180 - 39,180 Total financial assets $ 4,970 $ 105,397 $ - $ 110,367 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of Current Inventories | Inventories are comprised of the following: December 31, 2019 2018 Raw materials and components $ 1,881 $ 2,140 Work-in-progress 1,306 1,894 Finished products 10,753 14,367 $ 13,940 $ 18,401 |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment, Net | December 31, 2019 2018 Cost: Computer, peripheral equipment and software $ 95,930 $ 90,054 Office furniture and equipment 11,989 11,121 Leasehold improvements 6,621 6,188 114,540 107,363 Accumulated depreciation: Computer, peripheral equipment and software 78,711 72,236 Office furniture and equipment 8,677 7,710 Leasehold improvements 4,181 3,740 91,569 83,686 Property and equipment, net $ 22,971 $ 23,677 |
INTANGIBLE ASSETS, NET (Tables)
INTANGIBLE ASSETS, NET (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets, Net | Weighted average amortization December 31, Period 2019 2018 (years) Cost: Acquired technology 8.5 $ 32,946 $ 25,561 Customers relationships and brand name 5.8 9,817 9,817 42,763 35,378 Accumulated amortization: Acquired technology 18,465 16,139 Customers relationships and brand name 9,817 9,772 28,282 25,911 Intangible assets, net $ 14,481 $ 9,467 |
Future Estimated Amortization Expenses | Future estimated amortization expenses for the years ending: December 31, 2020 $ 1,891 2021 1,858 2022 1,858 2023 1,858 2024 and thereafter 7,016 Total $ 14,481 |
Schedule of Changes in Goodwill | 2019 2018 Balance as of January 1 $ 32,174 $ 32,174 Acquisitions 8,970 - Balance as of December 31 $ 41,144 $ 32,174 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Schedule of Aggregate Lease Payments for Right of Use Assets Remaining Lease Period | Aggregate lease payments for the right of use assets over the remaining lease period as of December 31, 2019 are as follows: 2020 $ 5,677 2021 4,437 2022 3,427 2023 2,622 2024 2,480 2025 and thereafter 1,668 Total undiscounted lease payments $ 20,311 Less: adjustment to discounted lease payments (1,204 ) Total discounted lease payments $ 19,107 |
Schedule of Weighted Average Remaining Lease Terms and Discount Rates | The weighted average remaining lease terms and discount rates for all of operating leases were as follows as of December 31, 2019: Weighted average remaining lease term (years) 4.72 Weighted average discount rate 2.6 % |
OTHER PAYABLES AND ACCRUED EX_2
OTHER PAYABLES AND ACCRUED EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of Other Payables and Accrued Expenses | December 31, 2019 2018 Accrued expenses and other $ 10,357 $ 7,068 Subcontractors accrual 1,627 1,160 Accrued taxes 1,738 3,863 Deferred consideration 2,035 - $ 15,757 $ 12,091 |
SHAREHOLDERS' EQUITY (Tables)
SHAREHOLDERS' EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Number of Reserved and Authorized Shares In Equity Incentive Plans | As of December 31, 2019, the number of Reserved and Authorized Shares under the Equity Incentive Plans is as detailed below: 2019 Stock options exercised and outstanding 28,286,653 RSUs vested and outstanding 2,741,853 Ordinary shares available for issuance under the Equity Incentive Plans 2,284,461 Total reserved and authorized shares as of December 31, 2019 33,312,967 |
Summary of Stock Option Activity | A summary of employees and directors option activity under the Company's Stock Option Plans as of December 31, 2019 is as follows: Number of options Weighted-average exercise price Weighted- average remaining contractual term (in years) Aggregate intrinsic value Outstanding at January 1, 2019 4,855,203 $ 16.96 3.30 $ 29,774 Granted 1,207,866 24.05 Exercised (1,250,680 ) 14.43 Expired (2,875 ) 16.43 Forfeited (511,235 ) 18.24 Outstanding at December 31, 2019 4,298,279 $ 19.54 3.12 $ 27,514 Exercisable at December 31, 2019 1,185,612 $ 15.42 1.91 $ 12,361 Vested and expected to vest at December 31, 2019 3,980,155 $ 19.27 3.04 $ 26,549 |
Summary of Stock Options Outstanding by Exercise Price Range | The options outstanding under the Company's Stock Option Plans as of December 31, 2019, have been separated into ranges of exercise price as follows: December 31, 2019 Outstanding Exercisable Ranges of exercise price Number of options Weighted average remaining contractual life (years) Weighted average exercise price Number of options Weighted Average Exercise price $ 10.04-14.74 1,291,709 1.73 $ 13.40 620,850 $ 13.31 $ 15.09-19.30 905,825 2.43 $ 16.78 490,075 $ 16.44 $ 20.62-27.15 2,100,745 4.28 $ 24.51 74,687 $ 26.29 4,298,279 1,185,612 |
Summary of RSU Activity | The following table summarizes information relating to RSUs, as well as changes to such awards during 2019: Year ended December 31, 2019 Outstanding at January 1, 2019 1,077,909 Granted 802,513 Vested (388,073 ) Forfeited (125,436 ) Outstanding as of December 31, 2019 1,366,913 |
Summary of Stock-Based Compensation Expense | Stock-based compensation was recorded in the following items within the consolidated statements of income (loss): Year ended December 31, 2019 2018 2017 Cost of revenues $ 224 $ 221 $ 241 Research and development, net 2,855 3,123 3,867 Sales and marketing 6,953 7,072 6,894 General and administrative 3,032 2,087 2,029 Total expenses $ 13,064 $ 12,503 $ 13,031 |
EARNINGS (LOSS) PER SHARE (Tabl
EARNINGS (LOSS) PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Net Earnings Per Share | The following table sets forth the computation of basic and diluted net earnings (loss) per share: Year ended December 31, 2019 2018 2017 Numerator for basic and diluted net earnings (loss) per share: Net income (loss) $ 22,566 $ 11,735 $ (7,493 ) Weighted average shares outstanding, net of treasury stock: Denominator for basic net earnings (loss) per share 46,816,899 45,289,296 43,475,844 Effect of dilutive securities: Employee stock options and RSUs 1,706,221 2,402,572 - Denominator for diluted net earnings (loss) per share 48,523,120 47,691,868 43,475,844 Basic net earnings (loss) per share $ 0.48 $ 0.26 $ (0.17 ) Diluted net earnings (loss) per share $ 0.47 $ 0.25 $ (0.17 ) |
TAXES ON INCOME (Tables)
TAXES ON INCOME (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Reconciliation of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: 2019 2018 Beginning balance $ 3,214 $ 1,534 Additions for prior year tax positions 484 221 Reclassified from current tax payable - 574 Decrease for prior year tax positions - (88 ) Additions for current year tax positions 1,899 973 Ending balance $ 5,597 $ 3,214 |
Summary of Taxes on Income | c. Taxes on income are comprised as follows: Year ended December 31, 2019 2018 2017 Current taxes $ 4,678 $ 5,371 $ 5,561 Deferred taxes (1,535 ) (2,308 ) 91 $ 3,143 $ 3,063 $ 5,652 Domestic $ 1,833 $ 2,049 $ 238 Foreign 1,310 1,014 5,414 $ 3,143 $ 3,063 $ 5,652 F - 45 RADWARE LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands, except share and per share data NOTE 14:- TAXES ON INCOME (Cont.) Year ended December 31, 2019 2018 2017 Domestic taxes: Current taxes $ 3,670 $ 2,206 $ 238 Deferred taxes (1,837 ) (157 ) - 1,833 2,049 238 Foreign taxes: Current taxes 1,008 3,165 5,323 Deferred taxes 302 (2,151 ) 91 1,310 1,014 5,414 $ 3,143 $ 3,063 $ 5,652 |
Significant Components of Deferred Tax Liabilities and Assets | Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company's and its subsidiaries' deferred tax liabilities and assets are as follows: December 31, 2019 2018 Carryforward losses and tax credit $ 7,175 $ 4,743 Deferred revenues 4,967 6,350 Temporary differences 4,484 5,093 Unrealized losses on marketable securities - 331 Deferred tax assets before valuation allowance 16,626 16,517 Valuation allowance (1,477 ) (3,247 ) Net deferred tax assets 15,149 13,270 Intangible assets, including goodwill (5,140 ) (4,047 ) Depreciable assets (1,497 ) (1,780 ) Unrealized gains on marketable securities (388 ) - Deferred tax liability (7,025 ) (5,827 ) Net deferred tax assets $ 8,124 $ 7,443 |
Reconciliation Between Theoretical and Actual Tax Expense | g. A reconciliation between the theoretical tax expense, assuming all income is taxed at the statutory tax rate applicable Year endedDecember 31, 2019 2018 2017 Income (loss) before taxes, as reported in the consolidated statements of income (loss) $ 25,709 $ 14,798 $ (1,841 ) Statutory tax rate 23 % 23 % 24 % Theoretical tax expense (benefit) on the above amount at the Israeli statutory tax rate $ 5,913 $ 3,404 $ (442 ) Tax adjustment in respect of different tax rate of foreign subsidiary - 65 334 Non-deductible expenses and other permanent differences 188 (340 ) 375 Deferred taxes on losses for which valuation allowance was provided, net 592 743 1,288 Utilization of tax losses and deferred taxes for which valuation allowance was provided, net (2,175 ) (2,259 ) (709 ) Stock compensation relating to stock options per ASC No. 718 821 1,073 1,976 Income taxes in respect of prior years 330 273 (1,038 ) Change of tax rate - 696 3,249 Approved, Privileged and Preferred enterprise loss (benefits) (*) (2,783 ) (684 ) 347 Other 257 92 272 Actual tax expense $ 3,143 $ 3,063 $ 5,652 (*) Basic earnings per share amounts of the benefit resulting from the "Approved, Privileged and Preferred Enterprise" status $ 0.06 $ 0.00 $ 0.00 Diluted earnings per share amounts of the benefit resulting from the "Approved, Privileged and Preferred Enterprise" status $ 0.06 $ 0.00 $ 0.00 |
Schedule of Income Before Income Taxes | h. Income (loss) before taxes on income is comprised as follows: Year ended December 31, 2019 2018 2017 Domestic $ 19,185 $ 9,009 $ (5,918 ) Foreign 6,524 5,789 4,077 Income (loss) before taxes on income $ 25,709 $ 14,798 $ (1,841 ) |
GEOGRAPHIC INFORMATION (Tables)
GEOGRAPHIC INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Segments, Geographical Areas [Abstract] | |
Schedule of Total Revenues by Geographical Areas | The following table presents total revenues for the years ended December 31, 2019, 2018 and 2017 from a geographical perspective: Year ended December 31, 2019 2018 2017 Revenues from sales to customers located at: The United States $ 85,447 $ 82,990 $ 78,464 America - other 20,982 19,501 19,437 EMEA *) 75,275 75,751 56,589 Asia Pacific 70,368 56,162 56,879 $ 252,072 $ 234,404 $ 211,369 *) Europe, the Middle East and Africa. For the year ended December 31, 2018, revenues from sales to customers located in Germany amounted to $ 23,863. |
Schedule of Long-Lived Assets by Geographical Areas | The following table presents long-lived assets as of December 31, 2019 and 2018 from a geographical perspective: December 31, 2019 2018 Long-lived assets, by geographic region: America (principally the United States) $ 1,401 $ 1,736 Israel 20,411 20,856 EMEA - other 246 253 Asia Pacific 913 832 $ 22,971 $ 23,677 |
SELECTED STATEMENTS OF INCOME_2
SELECTED STATEMENTS OF INCOME DATA (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
SELECTED STATEMENTS OF INCOME DATA [Abstract] | |
Summary of Selected Statements of Income Data | Financial income, net: Year ended December 31, 2019 2018 2017 Financial income, net: Interest on bank deposits and other $ 7,016 $ 5,279 $ 3,528 Amortization of premiums, accretion of discounts and interest on debt marketable securities, net 3,639 2,304 2,008 Other gain 537 - - Gain from sale of available-for-sale marketable securities - - 18 Bank charges (124 ) (113 ) (89 ) Foreign currency translation differences, net (2,276 ) (196 ) (635 ) $ 8,792 $ 7,274 $ 4,830 |
BALANCES AND TRANSACTIONS WIT_2
BALANCES AND TRANSACTIONS WITH RELATED PARTIES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions [Abstract] | |
Summary of Related Party Transactions | a. The following related party balances are included in the consolidated balance sheets: December 31, 2019 2018 Trade receivables and prepaid expenses $ 3,982 $ 1,676 Trade payables and accrued expenses $ 1,419 $ 604 b. The following related party transactions are included in the consolidated statements of income (loss): Year ended December 31, 2019 2018 2017 Revenues (1) $ 4,476 $ 2,491 $ 2,547 Cost of revenues (2) $ 7,061 $ 6,956 $ 4,280 Operating expenses, net - primarily lease, sub-contractors and communications (3) $ 4,888 $ 4,757 $ 4,853 Purchase of property and equipment $ 1,944 $ 2,761 $ 1,663 (1) Distribution of the Company's products on a non-exclusive basis. (2) Related to cost of product purchased from one of the related companies. The Company depends on a sole (3) The Company leases office space and purchases other miscellaneous services from certain companies, which |
SIGNIFICANT ACCOUNTING POLICI_4
SIGNIFICANT ACCOUNTING POLICIES (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Other-than-temporary impairment loss for marketable securities | |||
Inventory write-offs included in cost of revenues | 3,267 | 3,867 | 2,324 |
Provision for estimated sales returns, credits, stock rotations and other customer rights | $ 2,687 | 1,537 | |
Warranty term | 1 year | ||
Governmental grants received | $ 937 | 712 | 545 |
Bank deposits, weighted-average duration of deposits | 1 year 6 months | ||
Bank deposits, weighted-average time to maturity | 1 year 1 month 6 days | ||
Bad debt expenses | 109 | ||
Write-off of bad debts | 154 | 100 | |
Severance expenses | $ 4,066 | $ 4,259 | $ 3,296 |
Anti-dilutive shares excluded from computation of earnings per share amount | 1,938,808 | 1,166,488 | 981,750 |
Amortization of deferred contract costs | $ 8,568 | $ 6,821 | |
Deferred commission costs capitalized | 15,596 | 12,640 | |
Deferred revenues recognized | $ 98,500 | 91,555 | |
Period of remaining service of deferred revenue | 3 years | ||
Commissions expenses recognized | $ 3,199 | 5,121 | $ 10,171 |
Remaining performance obligations | $ 234,982 | $ 222,094 | |
Percentage of remaining performance obligation that will be recognized as revenue over the next 12 months to total remaining performance obligation as of balance sheet date | 56.00% | ||
Expected period of benefit | 3 years 3 months 18 days | ||
S and P rating, A- or higher [Member] | |||
Marketable securities, rating of investment portfolio percentage | 94.00% | ||
S and P rating, BBB or BBB+ [Member] | |||
Marketable securities, rating of investment portfolio percentage | 4.00% | ||
S and P rating, BB- [Member] | |||
Marketable securities, rating of investment portfolio percentage | 2.00% | ||
Israel [Member] | S and P, A Rating [Member] | |||
Percent of company's short-term and long-term bank deposits held in major Israeli banks | 25.00% | ||
Israel [Member] | S and P, AAA Rating [Member] | |||
Percent of company's short-term and long-term bank deposits held in major Israeli banks | 32.00% | ||
Israel [Member] | S and P, BBB+ Rating [Member] | |||
Percent of company's short-term and long-term bank deposits held in major Israeli banks | 7.00% | ||
The United States [Member] | Debt Securities [Member] | |||
Marketable securities, percentage of portfolio distribution | 45.00% | ||
The United States [Member] | S and P, A Rating [Member] | |||
Percent of company's short-term and long-term bank deposits held in major Israeli banks | 36.00% | ||
Europe [Member] | Debt Securities [Member] | |||
Marketable securities, percentage of portfolio distribution | 29.00% | ||
Other [Member] | Debt Securities [Member] | |||
Marketable securities, percentage of portfolio distribution | 26.00% | ||
Minimum [Member] | |||
Finite-lived intangible assets, estimated useful lives | 5 years | ||
Customer support contracts, support period | 1 year | ||
Maximum [Member] | |||
Finite-lived intangible assets, estimated useful lives | 9 years | ||
Customer support contracts, support period | 3 years | ||
Bank deposits, maximum contractual term | 2 years |
SIGNIFICANT ACCOUNTING POLICI_5
SIGNIFICANT ACCOUNTING POLICIES (Property and Equipment Annual Depreciation Rates) (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Computers, peripheral equipment and software [Member] | |
Property, Plant and Equipment [Line Items] | |
Annual rate of depreciation on property and equipment | 33.00% |
Computers, peripheral equipment and software [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Annual rate of depreciation on property and equipment | 15.00% |
Computers, peripheral equipment and software [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Annual rate of depreciation on property and equipment | 33.00% |
Office furniture and equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Annual rate of depreciation on property and equipment | 15.00% |
Office furniture and equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Annual rate of depreciation on property and equipment | 6.00% |
Office furniture and equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Annual rate of depreciation on property and equipment | 20.00% |
Leasehold improvements [Member] | |
Property, Plant and Equipment [Line Items] | |
Annual depreciation period of property and equipment | Over the shorter of the term ofthe lease or the useful life of the asset |
SIGNIFICANT ACCOUNTING POLICI_6
SIGNIFICANT ACCOUNTING POLICIES (Schedule of Disaggregated Revenues By Major Product Line) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Total revenues | $ 252,072 | $ 234,404 | $ 211,369 |
Products [Member] | |||
Total revenues | 86,512 | 79,909 | |
Services [Member] | |||
Total revenues | 110,698 | 112,778 | |
Subscriptions [Member] | |||
Total revenues | $ 54,862 | $ 41,717 |
SIGNIFICANT ACCOUNTING POLICI_7
SIGNIFICANT ACCOUNTING POLICIES (Cumulative Balance Sheet and Income Statement Adjustments - Adoption of ASC No. 606) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Assets: | |||
Trade receivables, net | $ 22,610 | $ 17,166 | $ 16,150 |
Other long-term assets | $ 24,398 | $ 20,724 | 8,133 |
Deferred tax asset, net | 7,451 | ||
Impact of adoption [Member] | Accounting Standards Update 606 [Member] | |||
Assets: | |||
Trade receivables, net | (153) | ||
Other long-term assets | 10,171 | ||
Deferred tax asset, net | (2,516) | ||
As adjusted [Member] | |||
Assets: | |||
Trade receivables, net | 15,997 | ||
Other long-term assets | 18,304 | ||
Deferred tax asset, net | $ 4,935 |
SIGNIFICANT ACCOUNTING POLICI_8
SIGNIFICANT ACCOUNTING POLICIES (Schedule of Weighted Average Assumptions Used to Calculate Fair Value of Company's Stock Options) (Details) - Employee Stock Option [Member] | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk free interest rate | 1.86% | 2.78% | 1.66% |
Dividend yields | 0.00% | 0.00% | 0.00% |
Expected volatility | 26.00% | 30.00% | 32.00% |
Weighted average expected term from grant date (in years) | 3 years 9 months 29 days | 3 years 9 months 10 days | 3 years 9 months 18 days |
ACQUISITIONS (Narrative) (Detai
ACQUISITIONS (Narrative) (Details) - USD ($) $ in Thousands | Mar. 12, 2019 | Jan. 30, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Business Acquisition [Line Items] | |||||
General and administrative | $ (18,584) | $ (16,145) | $ (17,577) | ||
Seculert Ltd [Member] | |||||
Business Acquisition [Line Items] | |||||
Percentage of outstanding shares acquired | 100.00% | ||||
Cash consideration | $ 10,000 | ||||
Contingent payment | $ 10,000 | ||||
General and administrative | $ (240) | ||||
Kaalbi Technologies Private Ltd. (ShieldSquare) [Member] | |||||
Business Acquisition [Line Items] | |||||
Deferred consideration | $ 2,080 | $ 2,035 | |||
Total consideration | 14,319 | ||||
Cash consideration including working capital adjustments | 12,239 | ||||
Kaalbi Technologies Private Ltd. (ShieldSquare) [Member] | After Working Capital Adjustment (ShieldSquare) [Member] | |||||
Business Acquisition [Line Items] | |||||
Cash consideration | 12,239 | ||||
Kaalbi Technologies Private Ltd. (ShieldSquare) [Member] | Before Working Capital Adjustment (ShieldSquare) [Member] | |||||
Business Acquisition [Line Items] | |||||
Cash consideration | 12,558 | ||||
Kaalbi Technologies Private Ltd. (ShieldSquare) [Member] | Bot mitigation and Bot management solutions [Member] | |||||
Business Acquisition [Line Items] | |||||
Total consideration | $ 14,203 | ||||
Kaalbi Technologies Private Ltd. (ShieldSquare) [Member] | Technology [Member] | |||||
Business Acquisition [Line Items] | |||||
Useful life | 9 years |
ACQUISITIONS (Schedule of Alloc
ACQUISITIONS (Schedule of Allocation of Purchase Price) (Details) - USD ($) $ in Thousands | Mar. 12, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Consideration: | ||||
Deferred consideration | $ 2,080 | |||
Identifiable assets acquired, and liabilities assumed: | ||||
Goodwill | $ 41,144 | $ 32,174 | $ 32,174 | |
Kaalbi Technologies Private Ltd. (ShieldSquare) [Member] | ||||
Consideration: | ||||
Cash consideration paid on closing date, including working capital adjustments | $ 12,239 | |||
Deferred consideration | 2,080 | |||
Total purchase price | 14,319 | |||
Identifiable assets acquired, and liabilities assumed: | ||||
Technology | 7,385 | |||
Goodwill | 8,970 | |||
Other current assets | 271 | |||
Deferred tax liability | (2,307) | |||
Total identifiable assets acquired, and liabilities assumed | $ 14,319 |
MARKETABLE SECURITIES (Narrativ
MARKETABLE SECURITIES (Narrative) (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Marketable Securities [Abstract] | |
Carrying value of equity securities and our marketable securities | $ 2,570 |
MARKETABLE SECURITIES (Schedule
MARKETABLE SECURITIES (Schedule of Marketable Securities With Contractual Maturities) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Debt Securities, Available-for-sale [Line Items] | ||
Adjusted cost, less than one year | $ 34,114 | $ 15,780 |
Gross unrealized losses, less than one year | (38) | |
Gross unrealized gains, less than one year | 240 | |
Market Value, less than one year | 34,354 | 15,742 |
Adjusted cost, over one year through three years | 108,620 | 63,147 |
Gross unrealized losses, over one year through three years | (19) | (696) |
Gross unrealized gains, over one through three years | 1,188 | 11 |
Market Value, over one year through three years | 109,789 | 62,462 |
Adjusted cost, greater than three years | 2,829 | 22,924 |
Gross unrealized losses, greater than three years | (717) | |
Gross unrealized gains, greater than three years | 78 | |
Market value, greater than three years | 2,907 | 22,207 |
Foreign banks and government debentures [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Adjusted cost, less than one year | 18,193 | 6,759 |
Gross unrealized losses, less than one year | (11) | |
Gross unrealized gains, less than one year | 96 | |
Market Value, less than one year | 18,289 | 6,748 |
Adjusted cost, over one year through three years | 56,201 | 43,266 |
Gross unrealized losses, over one year through three years | (358) | |
Gross unrealized gains, over one through three years | 721 | 6 |
Market Value, over one year through three years | 56,922 | 42,914 |
Adjusted cost, greater than three years | 1,062 | 11,926 |
Gross unrealized losses, greater than three years | (357) | |
Gross unrealized gains, greater than three years | 19 | |
Market value, greater than three years | 1,081 | 11,569 |
Corporate debentures [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Adjusted cost, less than one year | 15,921 | 9,021 |
Gross unrealized losses, less than one year | (27) | |
Gross unrealized gains, less than one year | 144 | |
Market Value, less than one year | 16,065 | 8,994 |
Adjusted cost, over one year through three years | 52,419 | 19,881 |
Gross unrealized losses, over one year through three years | (19) | (338) |
Gross unrealized gains, over one through three years | 467 | 5 |
Market Value, over one year through three years | 52,867 | 19,548 |
Adjusted cost, greater than three years | 1,767 | 10,998 |
Gross unrealized losses, greater than three years | (360) | |
Gross unrealized gains, greater than three years | 59 | |
Market value, greater than three years | $ 1,826 | $ 10,638 |
MARKETABLE SECURITIES (Summary
MARKETABLE SECURITIES (Summary of Investments With Continuous Unrealized Losses and Related Fair Values) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Debt Securities, Available-for-sale [Line Items] | ||
Investments with continuous unrealized losses for less than 12 months, Fair value | $ 3,852 | $ 38,807 |
Investments with continuous unrealized losses for less than 12 months, Unrealized losses | (13) | (299) |
Investments with continuous unrealized losses for 12 months or greater, Fair value | 2,631 | 48,571 |
Investments with continuous unrealized losses for 12 months or greater, unrealized losses | (6) | (1,154) |
Total investments with continuous unrealized losses, Fair value | 6,483 | 87,378 |
Total investments with continuous unrealized losses, unrealized losses | (19) | (1,453) |
Interest receivable | 1,183 | 898 |
Foreign banks and government debentures [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Investments with continuous unrealized losses for less than 12 months, Fair value | 26,860 | |
Investments with continuous unrealized losses for less than 12 months, Unrealized losses | (177) | |
Investments with continuous unrealized losses for 12 months or greater, Fair value | 24,966 | |
Investments with continuous unrealized losses for 12 months or greater, unrealized losses | (550) | |
Total investments with continuous unrealized losses, Fair value | 51,826 | |
Total investments with continuous unrealized losses, unrealized losses | (727) | |
Corporate debentures [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Investments with continuous unrealized losses for less than 12 months, Fair value | 3,852 | 11,947 |
Investments with continuous unrealized losses for less than 12 months, Unrealized losses | (13) | (122) |
Investments with continuous unrealized losses for 12 months or greater, Fair value | 2,631 | 23,605 |
Investments with continuous unrealized losses for 12 months or greater, unrealized losses | (6) | (604) |
Total investments with continuous unrealized losses, Fair value | 6,483 | 35,552 |
Total investments with continuous unrealized losses, unrealized losses | $ (19) | $ (726) |
FAIR VALUE MEASUREMENTS (Financ
FAIR VALUE MEASUREMENTS (Financial Assets and Liabilities Measured at Fair Value on Recurring Basis) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total financial assets | $ 150,403 | $ 110,367 |
Total liabilities | 2,035 | |
Foreign banks and government debentures [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 76,293 | 61,231 |
Corporate debentures [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 70,757 | 39,180 |
Equity Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 2,570 | |
Deferred Consideration [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities | 2,035 | |
Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total financial assets | 3,353 | 4,970 |
Total liabilities | ||
Level 1 [Member] | Foreign banks and government debentures [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | ||
Level 1 [Member] | Corporate debentures [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | ||
Level 1 [Member] | Equity Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 2,570 | |
Level 1 [Member] | Deferred Consideration [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities | ||
Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total financial assets | 147,050 | 105,397 |
Total liabilities | ||
Level 2 [Member] | Foreign banks and government debentures [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 76,293 | 61,231 |
Level 2 [Member] | Corporate debentures [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 70,757 | 39,180 |
Level 2 [Member] | Equity Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | ||
Level 2 [Member] | Deferred Consideration [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities | ||
Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total financial assets | ||
Total liabilities | 2,035 | |
Level 3 [Member] | Foreign banks and government debentures [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | ||
Level 3 [Member] | Corporate debentures [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | ||
Level 3 [Member] | Equity Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | ||
Level 3 [Member] | Deferred Consideration [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities | 2,035 | |
Money Market Funds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 783 | 4,970 |
Money Market Funds [Member] | Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 783 | 4,970 |
Money Market Funds [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | ||
Money Market Funds [Member] | Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | ||
Government debentures [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 4,986 | |
Government debentures [Member] | Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | ||
Government debentures [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 4,986 | |
Government debentures [Member] | Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Raw materials and components | $ 1,881 | $ 2,140 |
Work-in-progress | 1,306 | 1,894 |
Finished products | 10,753 | 14,367 |
Inventory, Total | $ 13,940 | $ 18,401 |
PROPERTY AND EQUIPMENT, NET (De
PROPERTY AND EQUIPMENT, NET (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | $ 114,540 | $ 107,363 | |
Accumulated depreciation | 91,569 | 83,686 | |
Property and equipment, net | 22,971 | 23,677 | |
Depreciation expenses | 8,912 | 8,834 | $ 10,001 |
Computer, peripheral equipment and software [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 95,930 | 90,054 | |
Accumulated depreciation | 78,711 | 72,236 | |
Office furniture and equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 11,989 | 11,121 | |
Accumulated depreciation | 8,677 | 7,710 | |
Leasehold improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 6,621 | 6,188 | |
Accumulated depreciation | $ 4,181 | $ 3,740 |
INTANGIBLE ASSETS, NET (Narrati
INTANGIBLE ASSETS, NET (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Amortization expenses | $ 2,371 | $ 948 | $ 1,231 |
INTANGIBLE ASSETS, NET (Schedul
INTANGIBLE ASSETS, NET (Schedule of Intangible Assets, Net) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Finite-Lived Intangible Assets [Line Items] | ||
Cost of intangible assets | $ 42,763 | $ 35,378 |
Accumulated amortization | 28,282 | 25,911 |
Intangible assets, net | 14,481 | 9,467 |
Acquired Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost of intangible assets | 32,946 | 25,561 |
Accumulated amortization | $ 18,465 | 16,139 |
Weighted average amortization period (years) | 8 years 6 months | |
Customers relationships and brand name [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost of intangible assets | $ 9,817 | 9,817 |
Accumulated amortization | $ 9,817 | $ 9,772 |
Weighted average amortization period (years) | 5 years 9 months 18 days |
INTANGIBLE ASSETS, NET (Future
INTANGIBLE ASSETS, NET (Future Estimated Amortization Expenses) (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2020 | $ 1,891 |
2021 | 1,858 |
2022 | 1,858 |
2023 | 1,858 |
2024 and thereafter | 7,016 |
Total | $ 14,481 |
INTANGIBLE ASSETS, NET (Sched_2
INTANGIBLE ASSETS, NET (Schedule of Changes in Goodwill) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Balance as of January 1 | $ 32,174 | $ 32,174 |
Acquisitions | 8,970 | |
Balance as of December 31 | $ 41,144 | $ 32,174 |
LEASES (Narrative) (Details)
LEASES (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Lessee, Lease, Description [Line Items] | |||
Operating right-of-use assets | $ 18,144 | ||
Short term operating lease liabilities | 5,193 | ||
Long-term operating lease liabilities | 13,914 | ||
Total rent expenses | 5,578 | $ 6,047 | $ 6,161 |
Adoption Date Impact [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Operating right-of-use assets | 21,048 | ||
Short term operating lease liabilities | 5,040 | ||
Long-term operating lease liabilities | $ 16,008 | ||
Maximum [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Lease expired | Dec. 31, 2027 |
LEASES (Schedule of Aggregate L
LEASES (Schedule of Aggregate Lease Payments for Right of Use Assets Remaining Lease Period) (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Accounting Policies [Abstract] | |
2020 | $ 5,677 |
2021 | 4,437 |
2022 | 3,427 |
2023 | 2,622 |
2024 | 2,480 |
2025 and thereafter | 1,668 |
Total undiscounted lease payments | 20,311 |
Less: adjustment to discounted lease payments | (1,204) |
Total discounted lease payments | $ 19,107 |
LEASES (Schedule of Weighted Av
LEASES (Schedule of Weighted Average Remaining Lease Terms and Discount Rates) (Details) | Dec. 31, 2019 |
Accounting Policies [Abstract] | |
Weighted average remaining lease term (years) | 4 years 8 months 19 days |
Weighted average discount rate | 2.60% |
OTHER PAYABLES AND ACCRUED EX_3
OTHER PAYABLES AND ACCRUED EXPENSES (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Other Liabilities Disclosure [Abstract] | ||
Accrued expenses and other | $ 10,357 | $ 7,068 |
Subcontractors accrual | 1,627 | 1,160 |
Accrued taxes | 1,738 | 3,863 |
Deferred consideration | 2,035 | |
Total other payables and accrued expenses | $ 15,757 | $ 12,091 |
COMMITMENTS AND CONTINGENT LI_2
COMMITMENTS AND CONTINGENT LIABILITIES (Details) - USD ($) $ in Thousands | May 09, 2016 | Jan. 16, 2018 | Aug. 29, 2013 |
Commitments and Contingencies Disclosure [Abstract] | |||
Amount awarded in litigation matter | $ 6,900 | $ 6,800 | |
Claims | $ 40 |
SHAREHOLDERS' EQUITY (Narrative
SHAREHOLDERS' EQUITY (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | May 31, 2019 | May 31, 2018 | Apr. 30, 2017 | |
Treasury stock, at cost [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Repurchase of shares, authorized amount | $ 40,000 | $ 40,000 | $ 40,000 | |||
Stock Options [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 4 years | |||||
Stock Option Plans [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Ordinary shares reserved for future issuance | 33,312,967 | |||||
In-the-money options outstanding | 3,579,879 | 3,983,216 | ||||
Intrinsic value of options exercised | $ 1,125,612 | $ 1,112,589 | $ 2,068,522 | |||
Out-of-the-money options outstanding | 718,400 | 871,987 | ||||
Weighted-average grant-date fair value of options granted | $ 5.54 | $ 6.67 | $ 4.31 | |||
Total unrecognized compensation costs | $ 7,614 | |||||
Unrecognized compensation costs, period of recognition | 1 year 6 months 14 days | |||||
Restricted Stock Units (RSUs) [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 4 years | |||||
Total unrecognized compensation costs | $ 16,008 | |||||
Unrecognized compensation costs, period of recognition | 1 year 7 months 13 days | |||||
Weighted average fair value at grant date of non-vested shares | $ 23.41 | $ 23.82 | $ 16.24 |
SHAREHOLDERS' EQUITY (Summary o
SHAREHOLDERS' EQUITY (Summary of Stock Option Activity) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Number of options | ||
Outstanding at December 31, 2019 | 28,286,653 | |
Stock Options [Member] | ||
Number of options | ||
Outstanding at January 1, 2019 | 4,855,203 | |
Granted | 1,207,866 | |
Exercised | (1,250,680) | |
Expired | (2,875) | |
Forfeited | (511,235) | |
Outstanding at December 31, 2019 | 4,298,279 | 4,855,203 |
Exercisable at December 31, 2019 | 1,185,612 | |
Vested and expected to vest at December 31, 2019 | 3,980,155 | |
Weighted-average exercise price | ||
Outstanding at January 1, 2019 | $ 16.96 | |
Granted | 24.05 | |
Exercised | 14.43 | |
Expired | 16.43 | |
Forfeited | 18.24 | |
Outstanding at December 31, 2019 | 19.54 | $ 16.96 |
Exercisable at December 31, 2019 | 15.42 | |
Vested and expected to vest at December 31, 2019 | $ 19.27 | |
Weighted- average remaining contractual term (in years) | ||
Outstanding | 3 years 1 month 13 days | 3 years 3 months 18 days |
Exercisable at December 31, 2019 | 1 year 10 months 28 days | |
Vested and expected to vest at December 31, 2019 | 3 years 14 days | |
Aggregate intrinsic value | ||
Outstanding at January 1, 2019 | $ 29,774 | |
Outstanding at December 31, 2019 | 27,514 | $ 29,774 |
Exercisable at December 31, 2019 | 12,361 | |
Vested and expected to vest at December 31, 2019 | $ 26,549 |
SHAREHOLDERS' EQUITY (Summary_2
SHAREHOLDERS' EQUITY (Summary of Stock Options Outstanding By Exercise Price Range) (Details) | 12 Months Ended |
Dec. 31, 2019$ / sharesshares | |
Outstanding | |
Number of options | shares | 4,298,279 |
Exercisable | |
Number of options | shares | 1,185,612 |
Exercise Price Range One [Member] | |
Outstanding | |
Ranges of exercise price, Lower limit | $ 10.04 |
Ranges of exercise price, Upper limit | $ 14.74 |
Number of options | shares | 1,291,709 |
Weighted average remaining contractual life (years) | 1 year 8 months 23 days |
Weighted average exercise price | $ 13.40 |
Exercisable | |
Number of options | shares | 620,850 |
Weighted average exercise price | $ 13.31 |
Exercise Price Range Two [Member] | |
Outstanding | |
Ranges of exercise price, Lower limit | 15.09 |
Ranges of exercise price, Upper limit | $ 19.30 |
Number of options | shares | 905,825 |
Weighted average remaining contractual life (years) | 2 years 5 months 4 days |
Weighted average exercise price | $ 16.78 |
Exercisable | |
Number of options | shares | 490,075 |
Weighted average exercise price | $ 16.44 |
Exercise Price Range Three [Member] | |
Outstanding | |
Ranges of exercise price, Lower limit | 20.62 |
Ranges of exercise price, Upper limit | $ 27.15 |
Number of options | shares | 2,100,745 |
Weighted average remaining contractual life (years) | 4 years 3 months 10 days |
Weighted average exercise price | $ 24.51 |
Exercisable | |
Number of options | shares | 74,687 |
Weighted average exercise price | $ 26.29 |
SHAREHOLDERS' EQUITY (Summary_3
SHAREHOLDERS' EQUITY (Summary of RSU Activity) (Details) - Restricted Stock Units (RSUs) [Member] | 12 Months Ended |
Dec. 31, 2019shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Outstanding at January 1, 2019 | 1,077,909 |
Granted | 802,513 |
Vested | (388,073) |
Forfeited | (125,436) |
Outstanding as of December 31, 2019 | 1,366,913 |
SHAREHOLDERS' EQUITY (Summary_4
SHAREHOLDERS' EQUITY (Summary of Stock-Based Compensation Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Stock-based compensation expense | $ 13,064 | $ 12,503 | $ 13,031 |
Cost of revenues [Member] | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Stock-based compensation expense | 224 | 221 | 241 |
Research and development [Member] | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Stock-based compensation expense | 2,855 | 3,123 | 3,867 |
Selling and marketing [Member] | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Stock-based compensation expense | 6,953 | 7,072 | 6,894 |
General and administrative [Member] | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Stock-based compensation expense | $ 3,032 | $ 2,087 | $ 2,029 |
SHAREHOLDERS' EQUITY (Schedule
SHAREHOLDERS' EQUITY (Schedule of Number of Reserved and Authorized Shares In Equity Incentive Plans) (Details) | Dec. 31, 2019shares |
Stockholders' Equity Note [Abstract] | |
Stock options exercised and outstanding | 28,286,653 |
RSUs vested and outstanding | 2,741,853 |
Ordinary shares available for issuance under the Equity Incentive Plans | 2,284,461 |
Total Reserved and Authorized Shares as of December 31, 2019 | 33,312,967 |
EARNINGS (LOSS) PER SHARE (Deta
EARNINGS (LOSS) PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Numerator for basic and diluted net earnings (loss) per share: | |||
Net income (loss) | $ 22,566 | $ 11,735 | $ (7,493) |
Weighted average shares outstanding, net of treasury stock: | |||
Denominator for basic net earnings (loss) per share | 46,816,899 | 45,289,296 | 43,475,844 |
Effect of dilutive securities: | |||
Employee stock options and RSUs | 1,706,221 | 2,402,572 | |
Denominator for diluted net earnings (loss) per share | 48,523,120 | 47,691,868 | 43,475,844 |
Basic net earnings (loss) per share | $ 0.48 | $ 0.26 | $ (0.17) |
Diluted net earnings (loss) per share | $ 0.47 | $ 0.25 | $ (0.17) |
TAXES ON INCOME (Narrative) (De
TAXES ON INCOME (Narrative) (Details) ₪ in Thousands, $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Dec. 22, 2017 | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2017ILS (₪) | |
Income Taxes [Line Items] | |||||
Amount added (deducted) to unrecognized tax benefits derived from interest and exchange | $ 484 | $ (88) | $ 290 | ||
Accrued interest liability on uncertain tax positions | $ 460 | $ 214 | |||
Tax rate | 23.00% | 23.00% | 24.00% | 24.00% | |
Tax exempt undistributed retained earnings | $ 128,751 | ||||
Income tax liability, contingent upon distribution of previously tax exempt earnings | $ 29,613 | ||||
Litigation settlement amount | $ 10,728 | ||||
Amount of provision | 10,950 | ||||
Additional tax benefit | 200 | ||||
Tax expense recorded related to the re-measurement of the deferred tax balance | $ 3,247 | ||||
Preferred Enterprise Regime [Member] | |||||
Income Taxes [Line Items] | |||||
Tax rate | 16.00% | ||||
Technological Preferred Enterprise [Member] | |||||
Income Taxes [Line Items] | |||||
Tax rate | 12.00% | ||||
Preferred Enterprise Status [Member] | |||||
Income Taxes [Line Items] | |||||
Tax rate | 23.00% | 23.00% | 24.00% | 24.00% | |
ILS [Member] | |||||
Income Taxes [Line Items] | |||||
Litigation settlement amount | ₪ | ₪ 37,727 | ||||
Minimum [Member] | |||||
Income Taxes [Line Items] | |||||
Tax rate | 35.00% | ||||
Minimum [Member] | Preferred Enterprise Regime [Member] | |||||
Income Taxes [Line Items] | |||||
Withholding tax | 15.00% | ||||
Maximum [Member] | |||||
Income Taxes [Line Items] | |||||
Tax rate | 21.00% | ||||
Maximum [Member] | Preferred Enterprise Regime [Member] | |||||
Income Taxes [Line Items] | |||||
Withholding tax | 20.00% | ||||
Foreign [Member] | United States Subsidiary [Member] | |||||
Income Taxes [Line Items] | |||||
Operating loss carry forward amount | $ 7,250 | ||||
Operating loss carryforward limitations of use | can be carried forward and offset against taxable income up to 20 years | ||||
Foreign [Member] | United States Subsidiary [Member] | Earliest Tax Year [Member] | |||||
Income Taxes [Line Items] | |||||
Operating loss carry forward expiration date | Dec. 31, 2023 | ||||
Foreign [Member] | United States Subsidiary [Member] | Latest Tax Year [Member] | |||||
Income Taxes [Line Items] | |||||
Operating loss carry forward expiration date | Dec. 31, 2038 |
TAXES ON INCOME (Reconciliation
TAXES ON INCOME (Reconciliation of Unrecognized Tax Benefits) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | ||
Beginning balance | $ 3,214 | $ 1,534 |
Additions for prior year tax positions | 484 | 221 |
Reclassified from current tax payable | 574 | |
Decrease for prior year tax positions | (88) | |
Additions for current year tax positions | 1,899 | 973 |
Ending balance | $ 5,597 | $ 3,214 |
TAXES ON INCOME (Summary of Tax
TAXES ON INCOME (Summary of Taxes On Income Summary) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Current taxes | $ 4,678 | $ 5,371 | $ 5,561 |
Deferred taxes | (1,535) | (2,308) | 91 |
Taxes on income | 3,143 | 3,063 | 5,652 |
Domestic | 1,833 | 2,049 | 238 |
Foreign | 1,310 | 1,014 | 5,414 |
Taxes on income | $ 3,143 | $ 3,063 | $ 5,652 |
TAXES ON INCOME (Summary of T_2
TAXES ON INCOME (Summary of Taxes On Income By Jurisdiction) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Domestic taxes: Current taxes | $ 3,670 | $ 2,206 | $ 238 |
Domestic taxes: Deferred taxes | (1,837) | (157) | |
Domestic | 1,833 | 2,049 | 238 |
Foreign taxes: Current taxes | 1,008 | 3,165 | 5,323 |
Foreign taxes: Deferred taxes | 302 | (2,151) | 91 |
Foreign | 1,310 | 1,014 | 5,414 |
Taxes on income | $ 3,143 | $ 3,063 | $ 5,652 |
TAXES ON INCOME (Significant Co
TAXES ON INCOME (Significant Components of Deferred Tax Liabilities and Assets) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Income Tax Disclosure [Abstract] | ||
Carryforward losses and tax credit | $ 7,175 | $ 4,743 |
Deferred revenues | 4,967 | 6,350 |
Temporary differences | 4,484 | 5,093 |
Unrealized losses on marketable securities | 331 | |
Deferred tax assets before valuation allowance | 16,626 | 16,517 |
Valuation allowance | (1,477) | (3,247) |
Net deferred tax assets | 15,149 | 13,270 |
Intangible assets, including goodwill | (5,140) | (4,047) |
Depreciable assets | (1,497) | (1,780) |
Unrealized gains on marketable securities | (388) | |
Deferred tax liability | (7,025) | (5,827) |
Net deferred tax assets | $ 8,124 | $ 7,443 |
TAXES ON INCOME (Reconciliati_2
TAXES ON INCOME (Reconciliation Between Theoretical and Actual Tax Expense) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Income Tax Disclosure [Abstract] | ||||
Income (loss) before taxes, as reported in the consolidated statements of income (loss) | $ 25,709 | $ 14,798 | $ (1,841) | |
Statutory tax rate | 23.00% | 23.00% | 24.00% | |
Theoretical tax expense (benefit) on the above amount at the Israeli statutory tax rate | $ 5,913 | $ 3,404 | $ (442) | |
Tax adjustment in respect of different tax rate of foreign subsidiary | 65 | 334 | ||
Non-deductible expenses and other permanent differences | 188 | (340) | 375 | |
Deferred taxes on losses for which valuation allowance was provided, net | 592 | 743 | 1,288 | |
Utilization of tax losses and deferred taxes for which valuation allowance was provided, net | (2,175) | (2,259) | (709) | |
Stock compensation relating to stock options per ASC No. 718 | 821 | 1,073 | 1,976 | |
Income taxes in respect of prior years | 330 | 273 | (1,038) | |
Change of tax rate | 696 | 3,249 | ||
Approved, Privileged and Preferred enterprise loss (benefits) | [1] | (2,783) | (684) | 347 |
Other | 257 | 92 | 272 | |
Taxes on income | $ 3,143 | $ 3,063 | $ 5,652 | |
Basic earnings per share amounts of the benefit resulting from the "Approved, Privileged and Preferred Enterprise" status | $ 0.06 | $ 0 | $ 0 | |
Diluted earnings per share amounts of the benefit resulting from the "Approved, Privileged and Preferred Enterprise" status | $ 0.06 | $ 0 | $ 0 | |
[1] | Basic earnings per share amounts of the benefit resulting from the "Approved, Privileged and Preferred Enterprise" status |
TAXES ON INCOME (Schedule of In
TAXES ON INCOME (Schedule of Income (Loss) Before Taxes on Income) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Domestic | $ 19,185 | $ 9,009 | $ (5,918) |
Foreign | 6,524 | 5,789 | 4,077 |
Income (loss) before taxes on income | $ 25,709 | $ 14,798 | $ (1,841) |
GEOGRAPHIC INFORMATION (Schedul
GEOGRAPHIC INFORMATION (Schedule of Total Revenues by Geograpical Areas) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | $ 252,072 | $ 234,404 | $ 211,369 | |
The United States [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | 85,447 | 82,990 | 78,464 | |
America - other [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | 20,982 | 19,501 | 19,437 | |
EMEA [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | [1] | 75,275 | 75,751 | 56,589 |
Germany [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | 23,863 | |||
Asia Pacific [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | $ 70,368 | $ 56,162 | $ 56,879 | |
[1] | Europe, the Middle East and Africa. For the year ended December 31, 2018, revenues from sales to customers located in Germany amounted to $ 23,863. |
GEOGRAPHIC INFORMATION (Sched_2
GEOGRAPHIC INFORMATION (Schedule of Long-Lived Assets by Geograpical Areas) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | $ 22,971 | $ 23,677 |
America (principally the United States) [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | 1,401 | 1,736 |
Israel [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | 20,411 | 20,856 |
EMEA - other [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | 246 | 253 |
Asia Pacific [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | $ 913 | $ 832 |
SELECTED STATEMENTS OF INCOME_3
SELECTED STATEMENTS OF INCOME DATA (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Financial income, net: | |||
Interest on bank deposits and other | $ 7,016 | $ 5,279 | $ 3,528 |
Amortization of premiums, accretion of discounts and interest on debt marketable securities, net | 3,639 | 2,304 | 2,008 |
Other gain | 537 | ||
Gain from sale of available-for-sale marketable securities | 18 | ||
Bank charges | (124) | (113) | (89) |
Foreign currency translation differences, net | (2,276) | (196) | (635) |
Financial income and expenses, net | $ 8,792 | $ 7,274 | $ 4,830 |
BALANCES AND TRANSACTIONS WIT_3
BALANCES AND TRANSACTIONS WITH RELATED PARTIES (Schedule of Related Party Balances Per the Balance Sheet) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Related Party Transactions [Abstract] | ||
Trade receivables and prepaid expenses | $ 3,982 | $ 1,676 |
Trade payables and accrued expenses | $ 1,419 | $ 604 |
BALANCES AND TRANSACTIONS WIT_4
BALANCES AND TRANSACTIONS WITH RELATED PARTIES (Schedule of Related Party Balances Per the Income Statement) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Related Party Transactions [Abstract] | ||||
Revenues | [1] | $ 4,476 | $ 2,491 | $ 2,547 |
Cost of revenues | [2] | 7,061 | 6,956 | 4,280 |
Operating expenses, net - primarily lease, sub-contractors and communications | [3] | 4,888 | 4,757 | 4,853 |
Purchase of property and equipment | $ 1,944 | $ 2,761 | $ 1,663 | |
[1] | Distribution of the Company's products on a non-exclusive basis. | |||
[2] | Related to cost of product purchased from one of the related companies. The Company depends on a sole | |||
[3] | The Company leases office space and purchases other miscellaneous services from certain companies, which |