Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2021 | Nov. 05, 2021 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-40574 | |
Entity Registrant Name | SYNCHRONOSS TECHNOLOGIES, INC | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 06-1594540 | |
Entity Address, Address Line One | 200 Crossing Boulevard | |
Entity Address, Address Line Two | 3rd Floor | |
Entity Address, City or Town | Bridgewater | |
Entity Address, State or Province | NJ | |
Entity Address, Postal Zip Code | 08807 | |
City Area Code | 866 | |
Local Phone Number | 620-3940 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding (in shares) | 88,340,870 | |
Entity Central Index Key | 0001131554 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q3 | |
Common Stock | ||
Document Information [Line Items] | ||
Title of 12(b) Security | Common Stock, $.0001 par value | |
Trading Symbol | SNCR | |
Security Exchange Name | NASDAQ | |
8.375% Senior Notes due 2026 | ||
Document Information [Line Items] | ||
Title of 12(b) Security | 8.375% Senior Notes due 2026 | |
Trading Symbol | SNCRL | |
Security Exchange Name | NASDAQ |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 24,141 | $ 33,671 |
Accounts receivable, net | 39,073 | 47,849 |
Prepaid & other current assets | 47,239 | 39,847 |
Total current assets | 110,453 | 121,367 |
Non-current assets: | ||
Property and equipment, net | 8,161 | 11,732 |
Operating lease right-of-use assets | 27,629 | 34,538 |
Goodwill | 226,840 | 232,771 |
Intangible assets, net | 63,464 | 69,593 |
Loan receivable | 4,834 | 4,834 |
Other assets, non-current | 6,994 | 7,420 |
Total non-current assets | 337,922 | 360,888 |
Total assets | 448,375 | 482,255 |
Current liabilities: | ||
Accounts payable | 6,795 | 12,749 |
Accrued expenses | 70,255 | 69,326 |
Deferred revenues, current | 31,506 | 33,045 |
Debt, current | 0 | 10,000 |
Total current liabilities | 108,556 | 125,120 |
Long-term debt, net of debt issuance costs | 117,494 | 0 |
Deferred tax liabilities | 790 | 1,875 |
Deferred revenues, non-current | 845 | 12,569 |
Leases, non-current | 38,013 | 44,273 |
Other non-current liabilities | 4,578 | 4,995 |
Redeemable noncontrolling interest | 12,500 | 12,500 |
Total liabilities | 282,776 | 201,332 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Common stock, $0.0001 par value; 100,000 shares authorized, 87,999 and 51,177 shares issued; 87,999 and 44,015 outstanding at September 30, 2021 and December 31, 2020, respectively | 9 | 5 |
Treasury stock, at cost (nil and 7,162 shares at September 30, 2021 and December 31, 2020, respectively) | 0 | (82,087) |
Additional paid-in capital | 492,376 | 499,348 |
Accumulated other comprehensive loss | (30,911) | (28,213) |
Accumulated deficit | (368,380) | (345,771) |
Total stockholders’ equity | 93,094 | 43,282 |
Total liabilities and stockholders’ equity | 448,375 | 482,255 |
Series A Preferred Stock | ||
Current liabilities: | ||
Preferred stock | 0 | 237,641 |
Series B Preferred Stock | ||
Current liabilities: | ||
Preferred stock | $ 72,505 | $ 0 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares | Sep. 30, 2021 | Dec. 31, 2020 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 87,999,000 | 51,177,000 |
Common stock, shares outstanding (in shares) | 87,999,000 | 44,015,000 |
Treasury stock, shares (in shares) | 0 | 7,162,000 |
Series A Preferred Stock | ||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 0 | 10,000,000 |
Preferred stock, shares issued (in shares) | 0 | 250,000 |
Preferred stock, shares outstanding (in shares) | 0 | 250,000 |
Series B Preferred Stock | ||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 150,000 | 0 |
Preferred stock, shares issued (in shares) | 75,000 | 0 |
Preferred stock, shares outstanding (in shares) | 75,000 | 0 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | ||
Income Statement [Abstract] | |||||
Net revenues | $ 69,753 | $ 68,636 | $ 206,784 | $ 222,293 | |
Costs and expenses: | |||||
Cost of revenues | [1] | 27,245 | 28,452 | 83,024 | 93,403 |
Research and development | 15,368 | 20,885 | 49,962 | 59,769 | |
Selling, general and administrative | 27,953 | 23,265 | 67,790 | 74,249 | |
Restructuring charges | 1,485 | 820 | 3,075 | 6,763 | |
Depreciation and amortization | 8,215 | 12,212 | 26,567 | 33,852 | |
Total costs and expenses | 80,266 | 85,634 | 230,418 | 268,036 | |
Loss from continuing operations | (10,513) | (16,998) | (23,634) | (45,743) | |
Interest income | 24 | 20 | 54 | 1,587 | |
Interest expense | (2,933) | (72) | (3,172) | (401) | |
Other Income (expense) | (1,669) | 2,684 | (3,489) | 5,743 | |
Loss from continuing operations, before taxes | (15,091) | (14,366) | (30,241) | (38,814) | |
Benefit for income taxes | 6,982 | 8,744 | 7,346 | 29,148 | |
Net loss from continuing operations | (8,109) | (5,622) | (22,895) | (9,666) | |
Net income (loss) attributable to redeemable noncontrolling interests | 0 | (60) | 286 | (242) | |
Preferred stock dividend | (1,722) | (9,685) | (33,728) | (27,882) | |
Net loss attributable to Synchronoss | $ (9,831) | $ (15,367) | $ (56,337) | $ (37,790) | |
Earnings (loss) per share | |||||
Basic (in dollars per share) | $ (0.11) | $ (0.36) | $ (0.98) | $ (0.90) | |
Diluted (in dollars per share) | $ (0.11) | $ (0.36) | $ (0.98) | $ (0.90) | |
Weighted-average common shares outstanding: | |||||
Basic (in shares) | 85,646 | 42,360 | 57,662 | 41,777 | |
Diluted (in shares) | 85,646 | 42,360 | 57,662 | 41,777 | |
[1] | Cost of revenues excludes depreciation and amortization which are shown separately. |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (8,109) | $ (5,622) | $ (22,895) | $ (9,666) |
Other comprehensive (loss) income, net of tax | ||||
Foreign currency translation adjustments | (1,827) | 1,343 | (3,595) | (726) |
Unrealized gain on available for sale securities | 0 | 0 | 0 | 751 |
Net income on inter-company foreign currency transactions | 358 | 864 | 897 | 1,046 |
Total other comprehensive (loss) income | (1,469) | 2,207 | (2,698) | 1,071 |
Comprehensive loss | (9,578) | (3,415) | (25,593) | (8,595) |
Comprehensive (loss) income attributable to redeemable noncontrolling interests | 0 | (60) | 286 | (242) |
Comprehensive loss attributable to Synchronoss | $ (9,578) | $ (3,475) | $ (25,307) | $ (8,837) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited) - USD ($) shares in Thousands, $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Common Stock | Treasury Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated deficit | Accumulated deficitCumulative Effect, Period of Adoption, Adjustment |
Beginning balance (in shares) at Dec. 31, 2019 | 51,704 | 7,162 | ||||||
Beginning balance at Dec. 31, 2019 | $ 76,077 | $ (750) | $ 5 | $ (82,087) | $ 525,739 | $ (33,261) | $ (334,319) | $ (750) |
Ending balance (in shares) at Jun. 30, 2020 | 51,619 | 7,162 | ||||||
Ending balance at Jun. 30, 2020 | $ 62,002 | 18 | $ 5 | $ (82,087) | 517,794 | (34,397) | (339,313) | 18 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Accounting Standards Update [Extensible List] | Accounting Standards Update 2016-13 [Member] | |||||||
Beginning balance (in shares) at Dec. 31, 2019 | 51,704 | 7,162 | ||||||
Beginning balance at Dec. 31, 2019 | $ 76,077 | (750) | $ 5 | $ (82,087) | 525,739 | (33,261) | (334,319) | (750) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Stock based compensation | 14,406 | 14,406 | ||||||
Issuance of restricted stock (in shares) | (188) | |||||||
Preferred stock dividend | (25,373) | (25,373) | ||||||
Amortization of preferred stock issuance costs | (2,510) | (2,510) | ||||||
Shares withheld for taxes in connection with issuance of restricted stock (in shares) | (2) | |||||||
Net income (loss) attributable to Synchronoss | (9,666) | (9,666) | ||||||
Non-controlling interest | 0 | 242 | (242) | |||||
Total other comprehensive income (loss) | 1,071 | 1,071 | ||||||
Ending balance (in shares) at Sep. 30, 2020 | 51,514 | 7,162 | ||||||
Ending balance at Sep. 30, 2020 | 53,255 | $ 5 | $ (82,087) | 512,504 | (32,190) | (344,977) | ||
Beginning balance (in shares) at Jun. 30, 2020 | 51,619 | 7,162 | ||||||
Beginning balance at Jun. 30, 2020 | 62,002 | $ 18 | $ 5 | $ (82,087) | 517,794 | (34,397) | (339,313) | $ 18 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Stock based compensation | 4,336 | 4,336 | ||||||
Issuance of restricted stock (in shares) | (105) | |||||||
Preferred stock dividend | (8,761) | (8,761) | ||||||
Amortization of preferred stock issuance costs | (925) | (925) | ||||||
Net income (loss) attributable to Synchronoss | (5,622) | (5,622) | ||||||
Non-controlling interest | 0 | 60 | (60) | |||||
Total other comprehensive income (loss) | 2,207 | 2,207 | ||||||
Ending balance (in shares) at Sep. 30, 2020 | 51,514 | 7,162 | ||||||
Ending balance at Sep. 30, 2020 | $ 53,255 | $ 5 | $ (82,087) | 512,504 | (32,190) | (344,977) | ||
Beginning balance (in shares) at Dec. 31, 2020 | 51,177 | 51,177 | 7,162 | |||||
Beginning balance at Dec. 31, 2020 | $ 43,282 | $ 5 | $ (82,087) | 499,348 | (28,213) | (345,771) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Stock based compensation | 7,472 | 7,472 | ||||||
Issuance of restricted stock (in shares) | 1,676 | |||||||
Issuance of restricted stock | 1 | 1 | ||||||
Preferred stock dividend | (20,937) | (20,937) | ||||||
Amortization of preferred stock issuance costs | (12,791) | (12,791) | ||||||
Common stock issuance - Public Offering (in shares) | 42,308 | |||||||
Common stock issuance - Public Offering | 110,000 | $ 4 | 109,996 | |||||
Treasury shares used in Public Offering (in shares) | (7,162) | 7,162 | ||||||
Treasury shares used in Public Offering | 0 | $ 82,087 | (82,087) | |||||
Common Stock - Issuance Costs | (8,340) | (8,340) | ||||||
Net income (loss) attributable to Synchronoss | (22,895) | (22,895) | ||||||
Non-controlling interest | 0 | (286) | 286 | |||||
Total other comprehensive income (loss) | $ (2,698) | (2,698) | ||||||
Ending balance (in shares) at Sep. 30, 2021 | 87,999 | 87,999 | 0 | |||||
Ending balance at Sep. 30, 2021 | $ 93,094 | $ 9 | $ 0 | 492,376 | (30,911) | (368,380) | ||
Beginning balance (in shares) at Jun. 30, 2021 | 88,121 | 0 | ||||||
Beginning balance at Jun. 30, 2021 | 101,956 | $ 9 | $ 0 | 491,660 | (29,442) | (360,271) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Stock based compensation | 2,438 | 2,438 | ||||||
Issuance of restricted stock (in shares) | (122) | |||||||
Preferred stock dividend | (1,722) | (1,722) | ||||||
Net income (loss) attributable to Synchronoss | (8,109) | (8,109) | ||||||
Total other comprehensive income (loss) | $ (1,469) | (1,469) | ||||||
Ending balance (in shares) at Sep. 30, 2021 | 87,999 | 87,999 | 0 | |||||
Ending balance at Sep. 30, 2021 | $ 93,094 | $ 9 | $ 0 | $ 492,376 | $ (30,911) | $ (368,380) |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | ||
Operating activities: | |||
Net loss continuing operations | $ (22,895) | $ (9,666) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Depreciation and amortization | 26,567 | 33,852 | |
Amortization of debt issuance costs | 305 | 0 | |
(Gain) loss on Disposals of fixed assets | 58 | 12 | |
(Gain) loss on Disposals of intangible assets | (550) | (2,164) | |
Deferred income taxes | (1,574) | 356 | |
Stock-based compensation | 7,230 | 14,547 | |
Operating lease impairment | 1,794 | 6,232 | |
Changes in operating assets and liabilities: | |||
Accounts receivable, net | 8,905 | 11,357 | |
Prepaid expenses and other current assets | (7,275) | (5,426) | |
Accounts payable | (6,441) | (8,400) | |
Accrued expenses | 8,237 | 10,063 | |
Deferred revenues | (13,338) | (36,924) | |
Other liabilities | 4,528 | (5,178) | |
Net cash provided by (used in) operating activities | 5,551 | 8,661 | |
Investing activities: | |||
Purchases of fixed assets | (1,386) | (571) | |
Additions to capitalized software | (17,004) | (12,610) | |
Acquisition of intangible assets | 0 | (400) | |
Proceeds from the sale of intangibles | 550 | 2,164 | |
Maturity of marketable securities available for sale | 0 | 11 | |
Net cash used in investing activities | (17,840) | (11,406) | |
Financing activities: | |||
Share-based compensation-related proceeds, net of taxes paid on withholding shares | (1) | 0 | |
Taxes paid on withholding shares | (1) | (9) | |
Debt issuance costs related to long term debt | (7,811) | 0 | |
Proceeds from issuance of long term debt | 125,000 | 0 | |
Borrowings on revolving line of credit | 0 | 10,000 | |
Repayment of revolving line of credit | (10,000) | 0 | |
Proceeds from issuance of common stock | 110,000 | 0 | |
Proceeds from issuance of preferred stock | 75,000 | 0 | |
Redemption of Series A Preferred stock | (278,665) | 0 | |
Net cash provided by financing activities | 2,687 | 9,991 | |
Effect of exchange rate changes on cash | 72 | 112 | |
Net (decrease) increase in cash and cash equivalents | (9,530) | 7,358 | |
Cash and cash equivalents, beginning of period | 33,671 | 39,001 | |
Cash and cash equivalents, end of period | 24,141 | 46,359 | |
Supplemental disclosures of non-cash investing and financing activities: | |||
Paid in kind dividends on Series A Convertible Participating Perpetual Preferred Stock | [1] | 31,277 | 26,995 |
Common Stock | |||
Financing activities: | |||
Stock issuance costs | (8,340) | 0 | |
Series B Preferred Stock | |||
Financing activities: | |||
Stock issuance costs | $ (2,495) | $ 0 | |
[1] | Current year amounts include amortization of preferred stock issuance costs accelerated due to Series A redemption. |
Description of Business
Description of Business | 9 Months Ended |
Sep. 30, 2021 | |
Description of Business | |
Description of Business | Description of Business General Synchronoss Technologies, Inc. (“Synchronoss” or the “Com pany”) Digital, Cloud, Messaging and Total Network Management platforms help the world’s leading companies, including operators, original equipment manufacturers (“OEMs”), and Media and Technology providers to deliver continuously transformative customer experiences that create high value engagement and new monetization opportunities. The Company currently operates in and markets solutions and services directly through the Company’s sales organizations in North America, Europe and Asia-Pacific. The Company’s platforms give customers new opportunities in the Telecommunications, Media and Technology (“TMT”) space, taking advantage of the rapidly converging services, connected devices, networks and applications. The Company delivers platforms, products and solutions including: • White Label Personal Cloud: Cloud sync, backup, storage, device set up, content transfer and content engagement for user generated content. • Messaging: White label consumer email solutions. Advanced, multi-channel messaging peer-to-peer (“P2P”) communications and application-to-person (“A2P”) commerce solutions. • Digital: Customer journey and workflow design, development, orchestration and experience management. • Total Network Management (“TNM”): integrated application suite that designs, procures, manages and optimizes telecom network infrastructure. The Synchronoss Personal Cloud™ platform is a secure and highly scalable white label platform designed to store and sync subscriber’s personally created content seamlessly to and from current and new devices. This allows a carrier’s customers to protect, engage with and manage their personal content and gives the Company’s Operator customers the ability to increase average revenue per user (“ARPU”) through a new monthly recurring charge (“MRC”) and opportunities to mine valuable data that will give subscribers access to new, beneficial services. Additionally, the Company’s Personal Cloud Platform performs an expanding set of value-add services including facilitating an Operator’s initial device setup and enhancing visibility and control across disparate devices within subscribers’ smart homes. The Synchronoss Messaging Platform powers hundreds of millions of subscribers’ mail boxes worldwide. The Company’s Advanced Messaging Product is a powerful, secure and intelligent white label messaging platform that expands capabilities for Operators and TMT companies to offer P2P messaging via Rich Communications Services (“RCS”). Add itionally, the Company’s Advanced Messaging Product powers commerce and a robust ecosystem for Operators, brands and advertisers to execute Application to Person (“A2P”) commerce and data-rich dialogue with subscribers. The Synchronoss Digital Platform is a suite of technology, tools and solutions that includes digital experience creation and management, automated provisioning, artificial intelligence and financial analytics that service a broad array of TMT markets. The products equip customers with a toolkit of capabilities where they can design, deploy and manage end user customer journeys and workflows easily and quickly from one central platform that also integrates across front end customer engagement channels as well as enterprise business systems (e.g. CRM, POS) allowing non-citizen developers to configure rather than code experiences. The platform sits between customer-facing touch points and a customer’s existing back-office systems to orchestrate data, workflows and processes into digital customer journeys that interface with end user channels creating user experiences that can be centrally managed and coordinated with less resources than is typical in a traditional IT environment. |
Basis of Presentation and Conso
Basis of Presentation and Consolidation | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation Basis of Presentation and Consolidation The accompanying interim unaudited condensed consolidated financial statements have been prepared by Synchronoss and in the opinion of management, include all adjustments necessary for a fair presentation of the Company’s financial position, results of operations and cash flows for the interim periods. They do not include all of the information and footnotes required by U.S. generally accepted accounting principles (“GAAP”) for complete financial statements and should be read in conjunction with the Company’s audited consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020. The results of operations for the three and nine months ended September 30, 2021 are not necessarily indicative of the results to be expected for the year ending December 31, 2021. The condensed consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries and variable interest entities (“VIE”) in which the Company is the primary beneficiary and entities in which the Company has a controlling interest. Investments in less than majority-owned companies in which the Company does not have a controlling interest, but does have significant influence, are accounted for as equity method investments. Investments in less than majority-owned companies in which the Company does not have the ability to exert significant influence over the operating and financial policies of the investee are accounted for using the cost method. All material intercompany transactions and accounts are eliminated in consolidation. For further information about the Company’s basis of presentation and consolidation or its significant accounting policies, refer to the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020. Risks and Uncertainties There continue to be uncertainties regarding the current coronavirus ("COVID-19") pandemic, and the Company is closely monitoring the impact of the pandemic on all aspects of its business, including how it will impact its customers, employees, suppliers, vendors, business partners and distribution channels. While the pandemic did not materially affect the Company’s financial results and business operations for the three and nine months ended September 30, 2021, the Company is unable to predict the impact that COVID-19 will have on its financial position and operating results due to numerous uncertainties. The Company will continue to assess the evolving impact of the COVID-19 pandemic and will make adjustments to its operations as necessary. Recently Issued Accounting Standards Recent accounting pronouncements adopted Standard Description Effect on the financial statements Update 2019-12 - Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes The ASU removes the exception to the general principles in ASC 740, Income Taxes, associated with the incremental approach for intra-period tax allocation, accounting for basis differences when there are ownership changes in foreign investments and interim-period income tax accounting for year-to-date losses that exceed anticipated losses. In addition, the ASU improves the application of income tax related guidance and simplifies U.S. GAAP when accounting for franchise taxes that are partially based on income, transactions with government resulting in a step-up in tax basis goodwill, separate financial statements of legal entities not subject to tax, and enacted changes in tax laws in interim periods. Different transition approaches, retrospective, modified retrospective, or prospective, will apply to each income tax simplification provision. The Company adopted the new standard as of January 1, 2021. The standard did not have a material impact on the Company’s consolidated financial position or results of operations upon adoption. Date of adoption: January 1, 2021. Standards issued not yet adopted Standard Description Effect on the financial statements Update 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity's Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity's Own Equity (ASU 2020-06) The ASU simplifies the accounting for convertible instruments by reducing the number of accounting models available for convertible debt instruments. This guidance also eliminates the treasury stock method to calculate diluted earnings per share for convertible instruments and requires the use of the if-converted method. This guidance will be effective for us in the first quarter of 2022 on a full or modified retrospective basis, with early adoption permitted. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements. Date of adoption: January 1, 2022. |
Revenue
Revenue | 9 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue Disaggregation of revenue The Company disaggregates revenue from contracts with customers into the nature of the products and services and geographical regions. The Company’s geographic regions are the Americas, Europe, the Middle East and Africa (“EMEA”), and Asia Pacific (“APAC”). The majority of the Company’s revenue is from the TMT sector. Three Months Ended September 30, 2021 Three Months Ended September 30, 2020 Cloud Digital Messaging Total Cloud Digital Messaging Total Geography Americas $ 41,090 $ 12,486 $ 2,426 $ 56,002 $ 37,806 $ 10,211 $ 4,249 $ 52,266 APAC 245 1,123 6,929 8,297 — 791 8,280 9,071 EMEA 1,789 756 2,909 5,454 1,678 1,633 3,988 7,299 Total $ 43,124 $ 14,365 $ 12,264 $ 69,753 $ 39,484 $ 12,635 $ 16,517 $ 68,636 Service Line Professional Services $ 3,542 $ 1,983 $ 3,709 $ 9,234 $ 5,253 $ 2,891 $ 3,262 $ 11,406 Transaction Services 1,237 1,113 2 2,352 1,345 1,715 — 3,060 Subscription Services 38,345 9,456 7,830 55,631 32,886 8,001 11,236 52,123 License — 1,813 723 2,536 — 28 2,019 2,047 Total $ 43,124 $ 14,365 $ 12,264 $ 69,753 $ 39,484 $ 12,635 $ 16,517 $ 68,636 Nine Months Ended September 30, 2021 Nine Months Ended September 30, 2020 Cloud Digital Messaging Total Cloud Digital Messaging Total Geography Americas $ 115,192 $ 34,329 $ 17,207 $ 166,728 $ 117,889 $ 33,785 $ 23,652 $ 175,326 APAC 245 3,166 19,878 23,289 — 2,368 24,163 26,531 EMEA 5,474 1,978 9,315 16,767 5,086 4,237 11,113 20,436 Total $ 120,911 $ 39,473 $ 46,400 $ 206,784 $ 122,975 $ 40,390 $ 58,928 $ 222,293 Service Line Professional Services $ 11,351 $ 6,212 $ 8,907 $ 26,470 $ 14,398 $ 10,163 $ 14,464 $ 39,025 Transaction Services 4,533 4,326 5 8,864 4,126 5,004 — 9,130 Subscription Services 105,027 26,435 36,365 167,827 104,451 24,254 32,965 161,670 License — 2,500 1,123 3,623 — 969 11,499 12,468 Total $ 120,911 $ 39,473 $ 46,400 $ 206,784 $ 122,975 $ 40,390 $ 58,928 $ 222,293 Trade Accounts Receivable and Contract balances The Company classifies its right to consideration in exchange for deliverables as either a receivable or a contract asset. A receivable is a right to consideration that is unconditional (i.e. only the passage of time is required before payment is due). For example, the Company recognizes a receivable for revenues related to its time and materials and transaction or volume-based contracts. The Company presents such receivables in Trade accounts receivable, net in its Condensed Consolidated Statements of Financial Position at their net estimated realizable value. The Company maintains an allowance for credit losses to provide for the estimated amount of receivables that may not be collected. The allowance is based upon an assessment of customer creditworthiness, historical payment experience, the age of outstanding receivables and other economic indicators. A contract asset is a right to consideration that is conditional upon factors other than the passage of time. For example, the Company would record a contract asset if it records revenue on a professional services engagement but are not entitled to bill until the Company achieves specified milestones. Contract assets balance at September 30, 2021 is $7.5 million. Amounts collected in advance of services being provided are accounted for as contract liabilities, which are presented as deferred revenue on the accompanying Condensed Consolidated Balance Sheets and are realized with the associated revenue recognized under the contract. Nearly all of the Company's contract liabilities balance is related to services revenue, primarily subscription services contracts. The Company’s contract assets and liabilities are reported in a net position on a customer basis at the end of each reporting period. Significant changes in the contract liabilities balance (current and non-current) during the period are as follows: Contract Liabilities 1 Balance - January 1, 2021 $ 45,614 Revenue recognized in the period (207,027) Amounts billed but not recognized as revenue 193,764 Balance - September 30, 2021 $ 32,351 ________________________________ 1 Comprised of Deferred Revenue Transaction price allocated to the remaining performance obligations Topic 606 requires that the Company disclose the aggregate amount of transaction price that is allocated to performance obligations that have not yet been satisfied as of September 30, 2021. The Company has elected not to disclose transaction price allocated to remaining performance obligations for: 1. Contracts with an original duration of one year or less, including contracts that can be terminated for convenience without a substantive penalty; 2. Contracts for which the Company recognizes revenues based on the right to invoice for services performed; 3. Variable consideration allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied promise to transfer a distinct good or service that forms part of a single performance obligation in accordance with Topic 606 Section 10-25-14(b), for which the criteria in Topic 606 Section 10-32-40 have been met. This applies to a limited number of situations where the Company is dependent upon data from a third party or where fees are highly variable. Many of the Company’s performance obligations meet one or more of these exemptions. Specifically, the Company has excluded the following from the Company’s remaining performance obligations, all of which will be resolved in the period in which amounts are known: • consideration for future transactions, above any contractual minimums • consideration for success-based transactions contingent on third party data • credits for failure to meet future service level requirements As of September 30, 2021, the aggregate amount of transaction price allocated to remaining performance obligations, other than those meeting the exclusion criteria above, was $240.4 million, of which approximately 85.5 percent is expected to be recognized as revenues within 2 years, and the remainder thereafter. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements In accordance with accounting principles generally accepted in the United States, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-level hierarchy prioritizes the inputs used to measure fair value as follows: • Level 1 - Observable inputs - quoted prices in active markets for identical assets and liabilities; • Level 2 - Observable inputs other than the quoted prices in active markets for identical assets and liabilities includes quoted prices for similar instruments, quoted prices for identical or similar instruments in inactive markets, and amounts derived from valuation models where all significant inputs are observable in active markets; and • Level 3 - Unobservable inputs - includes amounts derived from valuation models where one or more significant inputs are unobservable and require the Company to develop relevant assumptions. The following is a summary of assets, liabilities and redeemable noncontrolling interests and their related classifications under the fair value hierarchy: September 30, 2021 Total (Level 1) (Level 2) (Level 3) Assets Cash and cash equivalents 1 $ 24,141 $ 24,141 $ — $ — Total assets $ 24,141 $ 24,141 $ — $ — Temporary equity Redeemable noncontrolling interests 2 $ 12,500 $ — $ — $ 12,500 Total temporary equity $ 12,500 $ — $ — $ 12,500 December 31, 2020 Total (Level 1) (Level 2) (Level 3) Assets Cash and cash equivalents 1 $ 33,671 $ 33,671 $ — $ — Total assets $ 33,671 $ 33,671 $ — $ — Temporary Equity Redeemable noncontrolling interests 2 $ 12,500 $ — $ — $ 12,500 Total temporary equity $ 12,500 $ — $ — $ 12,500 ________________________________ 1 Cash equivalents includes money market funds. 2 Put arrangements held by the noncontrolling interests in certain of the Company’s joint ventures. Redeemable Noncontrolling Interests The redeemable noncontrolling interests recorded at fair value are put arrangements held by the noncontrolling interests in certain of the Company’s joint ventures. The Company recognizes changes in the redemption value immediately as they occur and adjusts the carrying value of the noncontrolling interest to the greater of the estimated redemption value, which approximates fair value, at the end of each reporting period or the initial carrying amount. The fair value of the redeemable noncontrolling interests was estimated by applying an income approach using a discounted cash flow analysis. This fair value measurement is based on significant inputs that are not observable in the market and thus represents a Level 3 measurement. Significant changes in the underlying assumptions used to value the redeemable noncontrolling interests could significantly increase or decrease the fair value estimates recorded in the Condensed Consolidated Balance Sheets. The changes in fair value of the Company’s Level 3 redeemable noncontrolling interests during the nine months ended September 30, 2021 were as follows: Balance at December 31, 2020 $ 12,500 Fair value adjustment 286 Net (income) loss attributable to redeemable noncontrolling interests (286) Balance at September 30, 2021 $ 12,500 |
Leases
Leases | 9 Months Ended |
Sep. 30, 2021 | |
Leases [Abstract] | |
Leases | Leases The Company has entered into contracts with third parties to lease a variety of assets, including certain real estate, equipment, automobiles and other assets. The Company’s leases frequently allow for lease payments that could vary based on factors such as inflation or the degree of utilization of the underlying asset. For example, certain of the Company’s real estate leases could require us to make payments that vary based on common area maintenance charges, insurance and other charges. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The Company is party to certain sublease arrangements, primarily related to the Company’s real estate leases, where it acts as the lessee and intermediate lessor. The Company reflects finance leases as a component of Leases, non-current on the Condensed Consolidated Balance Sheet. The finance leases were not material for the period ended September 30, 2021. The following table presents information about the Company's Right of Use (ROU) assets and lease liabilities at September 30, 2021: ROU assets: Non-current operating lease ROU assets $ 27,629 Operating lease liabilities: Current operating lease liabilities 1 $ 8,037 Non-current operating lease liabilities 37,572 Total operating lease liabilities $ 45,609 ________________________________ 1 Amounts are included in Accrued Expenses on the Condensed Consolidated Balance Sheet. The following table presents information about lease expense and sublease income for the three and nine months ended September 30, 2021: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2021 Operating lease cost 1 $ 2,235 $ 7,268 Other lease costs and income: Variable lease costs 1 85 501 Operating lease impairments 1, 2 642 1,794 Sublease income 1 (693) (2,471) Total net lease cost $ 2,269 $ 7,092 ________________________________ 1 Amounts are included in Cost of revenues, Selling, general and administrative and/or Research and development based on the function that the underlying leased asset supports which are reflected in the Condensed Consolidated Statements of Operations. 2 As part of the Company’s continued cost savings initiatives, the Company closed certain office spaces and terminated various lease agreements. These actions resulted in a ROU asset impairment charge for the period, which was determined by the present value of the forecasted future cash flows for the remaining lease term. The following table provides the undiscounted amount of future cash flows included in our lease liabilities at September 30, 2021 for each of the five years subsequent to December 31, 2020 and thereafter, as well as a reconciliation of such undiscounted cash flows to our lease liabilities at September 30, 2021: Operating Leases Remaining 2021 $ 2,975 2022 10,870 2023 8,552 2024 8,308 2025 8,193 Thereafter 18,562 Total future lease payments 57,460 Less: amount representing interest (11,851) Present value of future lease payments (lease liability) $ 45,609 The following table provides the weighted-average remaining lease term and weighted-average discount rates for our leases as of September 30, 2021: Operating Leases: Weighted-average remaining lease term (years), weighted based on lease liability balances 6.06 Weighted-average discount rate (percentages), weighted based on the remaining balance of lease payments 8.1% The following table provides certain cash flow and supplemental noncash information related to our lease liabilities for the nine months ended September 30, 2021: Operating Leases: Cash paid for amounts included in the measurement of lease liabilities $ 10,437 |
Investments in Affiliates and R
Investments in Affiliates and Related Transactions | 9 Months Ended |
Sep. 30, 2021 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investments in Affiliates and Related Transactions | Investments in Affiliates and Related Transactions Sequential Technology International, LLC In connection with the divestiture of the exception handling business of the Company in 2017, Synchronoss entered into a three-year Cloud Telephony and Support services agreement (“CTS Agreement”) to grant Sequential Technology International, LLC (“STIN”) access to certain Synchronoss software and private branch exchange systems to facilitate exception handling operations required to support STIN customers. The CTS agreement expired in the first quarter of 2020. At the time of the expiration, the Company entered into an Asset Purchase Agreement with STIN. As part of the agreement, the Company received $1.6 million in exchange for certain hardware and system assets for the cloud telephony and remaining support service business. During the second quarter of 2020, the Company entered into an agreement with STIN and AP Capital Holdings II, LLC (“APC”) to divest its remaining equity interest in STIN as well as settle its paid-in-kind purchase money note (“PIK note”) and certain amounts due as of December 31, 2019 in consideration for a $9.0 million secured promissory note (the “Note”), which includes contingent consideration of up to $16.0 million. The Note has an 8% interest rate and a 3-year stated term. As part of the arrangement, APC acquired a majority stake of STIN. Additionally, in the event of a sale of STIN by APC and STIN at a future date, the Company shall receive 5% of such sale proceeds, after reducing the sale proceeds by any outstanding amounts of the above Note, including any earned contingent consideration. The Company determined the fair value of the Note as of the transaction date to be approximately $4.8 million. The Company determined the fair value of the Note using a discounted cash flow analysis, which discounts the expected future cash flows of the asset to determine its fair value. The fair value measurement is based on significant inputs not observable in the market and thus represents a Level 3 measurement. No gain or loss was recognized as a result of the transaction. As of September 30, 2021 , |
Debt
Debt | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Debt | Debt Offering of Senior Notes On June 30, 2021, the Company closed its underwritten public offering of $120.0 million aggregate principal amount of 8.375% senior notes due 2026 at a par value of $25.00 per senior note (the “Senior Notes”). The offering was conducted pursuant to an underwriting agreement (the “Notes Underwriting Agreement”) dated June 25, 2021, by and among the Company and B. Riley Securities, Inc., as representative of the several underwriters (the “Notes Underwriters”). At the closing, the Company issued $125.0 million aggregate principal amount of Senior Notes, inclusive of $5.0 million aggregate principal amount of Senior Notes issued pursuant to the full exercise of the Notes Underwriters’ option to purchase additional Senior Notes. The Notes Underwriting Agreement contains customary representations, warranties and covenants of the Company, customary conditions to closing, indemnification obligations of the Company and the Notes Underwriters, including for liabilities under the Securities Act, other obligations of the parties and termination provisions. On June 30, 2021, the Company entered into an indenture (the “Base Indenture”) and a supplemental indenture (the “First Supplemental Indenture” and, together with the Base Indenture, the “Indenture”) with The Bank of New York Mellon Trust Company National Association, as trustee (the “Trustee”), between the Company and the Trustee. The Indenture establishes the form and provides for the issuance of the Senior Notes. The Senior Notes are senior unsecured obligations of the Company and rank equally in right of payment with all of the Company’s existing and future senior unsecured and unsubordinated indebtedness. The Senior Notes are effectively subordinated in right of payment to all of the Company’s existing and future secured indebtedness to the extent of the value of the assets securing such indebtedness and structurally subordinated to all existing and future indebtedness of the Company’s subsidiaries, including trade payables. The Senior Notes bear interest at the rate of 8.375% per annum. Interest on the Senior Notes is payable quarterly in arrears on January 31, April 30, July 31 and October 31 of each year, commencing on July 31, 2021. The Senior Notes will mature on June 30, 2026, unless redeemed prior to maturity. The Company may, at its option, at any time and from time to time, redeem the Senior Notes for cash in whole or in part (i) on or after June 30, 2022 and prior to June 30, 2023, at a price equal to $25.75 per Senior Note, plus accrued and unpaid interest to, but excluding, the date of redemption, (ii) on or after June 30, 2023 and prior to June 30, 2024, at a price equal to $25.50 per Senior Note, plus accrued and unpaid interest to, but excluding, the date of redemption, (iii) on or after June 30, 2024 and prior to June 30, 2025, at a price equal to $25.25 per Senior Note, plus accrued and unpaid interest to, but excluding, the date of redemption, and (iv) on or after June 30, 2025 and prior to maturity, at a price equal to 100% of their principal amount, plus accrued and unpaid interest to, but excluding, the date of redemption. On and after any redemption date, interest will cease to accrue on the redeemed Senior Notes. The Indenture contains customary events of default and cure provisions. If an uncured default occurs and is continuing, the Trustee or the holders of at least 25% of the principal amount of the Senior Notes may declare the entire amount of the Senior Notes, together with accrued and unpaid interest, if any, to be immediately due and payable. In the case of an event of default involving the Company’s bankruptcy, insolvency or reorganization, the principal of, and accrued and unpaid interest on, the principal amount of the Senior Notes, together with accrued and unpaid interest, if any, will automatically, and without any declaration or other action on the part of the Trustee or the holders of the Senior Notes, become due and payable. The carrying amounts of the Company’s borrowings were as follows: Senior Notes September 30, 2021 December 31, 2020 8.375% Senior Notes due 2026 $ 125,000 $ — Unamortized discount and debt issuance cost 1 (7,506) — Carrying value of Senior Notes $ 117,494 $ — ________________________________ 1 Debt issuance are deferred and amortized into interest expense using the effective interest method. The total fair value of the outstanding Senior Notes was $124.1 million as of September 30, 2021. T he Company is in compliance with its debt covenants as of September 30, 2021. On October 25, 2021, the Company entered into an At Market Issuance Sales Agreement (the “Sales Agreement”) between the Company and B. Riley Securities, Inc. (the “Agent”), a related party, pursuant to which the Company may offer and sell, from time to time, up to $18.0 million of the Company’s 8.375% Senior Notes due 2026. Sales of the additional Senior Notes pursuant to the Sales Agreement, if any, may be made in transactions that are deemed to be “at the market offerings” as defined in Rule 415 under the Securities Act of 1933, as amended (the “Securities Act”). The Agent is not required to sell any specific number of the additional Senior Notes, but the Agent will make all sales using commercially reasonable efforts consistent with its normal trading and sales practices on mutually agreed terms between the Agent and the Company. Under the Sales Agreement, the Agent will be entitled to compensation of 2.0% of the gross proceeds of all notes sold through it as the Company’s agent. The additional Senior Notes sold pursuant to the Sales Agreement will be issued pursuant to a prospectus dated August 28, 2020, as supplemented by a prospectus supplement dated October 25, 2021, in each case filed with the Securities and Exchange Commission (the “Commission”) pursuant to the Company’s effective Registration Statement on Form S-3 (File No. 333-248133), which was declared effective by the Commission on August 28, 2020, and the Registration Statement on Form S-3 (File No. 333-260482), filed with the Commission pursuant to Rule 462(b) under the Securities Act on October 25, 2021. The additional Senior Notes will be issued pursuant to the Indenture, dated June 30, 2021 (the “Base Indenture”), as supplemented by the First Supplemental Indenture, dated June 30, 2021 (the “First Supplemental Indenture” and, together with the Base Indenture, the “Indenture”) between The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”), and the Company. The up to $18.0 million in aggregate principal amount of the additional Senior Notes that the Company may offer and sell under the prospectus supplement and the accompanying prospectus constitutes a further issuance of and are fungible with the $125.0 million in aggregate principal amount of the Senior Notes that the Company has issued to date, and form a single series of debt securities. The additional Senior Notes issued will have terms identical to the initial Senior Notes and will have the same CUSIP number as, and will be fungible and vote together with, the initial Senior Notes immediately upon issuance. The additional Senior Notes (when issued) and initial Senior Notes are listed and trade on The Nasdaq Global Market under the symbol “SNCRL.” 2019 Revolving Credit Facility On October 4, 2019, the Company entered into a Credit Agreement with Citizens Bank, N.A., for a $10.0 million Revolving Credit Facility. Borrowings under the Revolving Credit Facility bore interest at a rate equal to, at the Company’s option, either (1) the arithmetic average of the LIBOR rate determined by reference to the costs of funds for U.S. dollar deposits for the interest period (one, three or six months (or 12 months if agreed to by all applicable Lenders)) as selected by the Company relevant to such borrowing plus the applicable margin, or (2) a base rate determined by reference to the greatest of the federal funds rate plus 0.5%, the prime commercial lending rate as determined by the Agent, and the daily LIBOR rate plus 1.0%, in each case plus an applicable margin and subject to a floor of 0.5%. On June 30, 2021, the Company paid off the outstanding balance and closed the Revolving Credit Facility. Interest expense The following table summarizes the Company’s interest expense: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 2021 Senior Notes due 2026 Amortization of debt issuance costs $ 306 $ — $ 306 $ — Interest on borrowings 2,617 — 2,617 — 2019 Revolving Credit Facility Amortization of debt issuance costs — 12 84 40 Commitment fee — — — 4 Interest on borrowings — 59 126 141 Other 1 10 1 39 216 Total $ 2,933 $ 72 $ 3,172 $ 401 ________________________________ 1 Mainly finance leases’ related interest expense |
Accumulated Other Comprehensive
Accumulated Other Comprehensive (Loss) / Income | 9 Months Ended |
Sep. 30, 2021 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive (Loss) / Income | Accumulated Other Comprehensive (Loss) / Income The changes in accumulated other comprehensive (loss) income during the nine months ended September 30, 2021 were as follows: Balance at December 31, 2020 Other comprehensive (loss) income Tax effect Balance at September 30, 2021 Foreign currency $ (26,076) $ (3,595) $ — $ (29,671) Unrealized loss on intra-entity foreign currency transactions (2,137) 1,361 (464) (1,240) Total $ (28,213) $ (2,234) $ (464) $ (30,911) |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2021 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Common Stock Each holder of common stock is entitled to vote on all matters and is entitled to one vote for each share held. Dividends on common stock will be paid when, and if, declared by the Company’s Board of Directors. No dividends have ever been declared or paid by the Company. Common Stock Offering On June 29, 2021, the Company closed its underwritten public offering of common stock, par value $0.0001 per share. The offering was conducted pursuant to an underwriting agreement (the “Underwriting Agreement”) dated June 24, 2021, by and between the Company and B. Riley Securities, Inc., as representative of the several underwriters (the “Underwriters”) for net proceeds of $102.3 million. At the closing, the Company issued 42,307,692 shares of common stock, inclusive of 3,846,154 shares of common stock issued pursuant to the full exercise of the Underwriters’ option to purchase additional shares of common stock. The Company used the net proceeds for the redemption of the Series A Convertible Preferred Stock. Preferred Stock The Company’s Board of Directors (the “Board”) is authorized to issue preferred shares and has the discretion to determine the rights, preferences, privileges and restrictions, including voting rights, dividend rights, conversion rights, redemption privileges and liquidation preferences of preferred stock. Series B Non-Convertible Preferred Stock On June 30, 2021, the Company closed a private placement of 75,000 shares of its Series B Perpetual Non-Convertible Preferred Stock, par value $0.0001 per share, with an initial liquidation preference of $1,000 per share (the “Series B Preferred Stock”), for net proceeds of $72.5 million (the “Series B Transaction”). The sale of the Series B Preferred Stock was pursuant to the Series B Preferred Stock Purchase Agreement, dated as of June 24, 2021 (the “Series B Purchase Agreement”), between the Company and B. Riley Principal Investments, LLC (“BRPI”). In connection with the closing of the Series B Transaction, the Company (i) filed a Certificate of Designation with the State of Delaware setting forth the rights, preferences, privileges, qualifications, restrictions and limitations on the Series B Preferred Stock (the “Series B Certificate”) and (ii) entered into an Investor Rights Agreement with B. Riley Financial, Inc. (“B. Riley Financial”) and BRPI setting forth certain governance and registration rights of B. Riley Financial with respect to the Company. Certificate of Designation of the Series B Preferred Stock The rights, preferences, privileges, qualifications, restrictions and limitations of the shares of Series B Preferred Stock are set forth in the Series B Certificate. Under the Series B Certificate, the holders of the Series B Preferred Stock are entitled to receive, on each share of Series B Preferred Stock on a quarterly basis, an amount equal to the dividend rate, as described in the following sentence, divided by four and multiplied by the then-applicable Liquidation Preference per share of Series B Preferred Stock (collectively, the “Preferred Dividends”). The dividend rate is (1) 9.5% per annum for the period commencing on June 30, 2021 and ending on and including December 31, 2021, (2) 13% per annum for the year commencing on January 1, 2022 and ending on and including December 31, 2022; and (3) 14% per annum for the year commencing on January 1, 2023 and thereafter. The Preferred Dividends will be due in cash on January 1, April 1, July 1 and October 1 of each year (each, a “Series B Dividend Payment Date”). The Company may choose to pay the Series B Preferred Dividends in cash or in additional shares of Series B Preferred Stock. In the event the Company does not declare and pay a dividend in cash on any Series B Dividend Payment Date, the unpaid amount of the Preferred Dividend will be added to the Liquidation Preference. As of September 30, 2021, the Liquidation Value and Redemption Value of the Series B Preferred Shares was $76.8 million. On and after the fifth anniversary of the date of issuance, holders of shares of Series B Preferred Stock will have the right to cause the Company to redeem each share of Series B Preferred Stock for cash in an amount equal to the sum of the current liquidation preference and any accrued dividends. Each share of Series B Preferred Stock will also be redeemable at the option of the holder upon the occurrence of a “Fundamental Change” at (i) par in the case of a payment in cash or (ii) 1.5 times par in the case of payment in shares of Common Stock (such shares being, “Registrable Securities”), subject to certain limitations on the amount of stock that could be issued to the holders of Series B Stock. In addition, the Company will be permitted to redeem outstanding shares of the Series B Preferred Stock at any time for the sum of the then-applicable Liquidation Preference and the accrued but unpaid dividends. Pursuant to the Series B Certificate, the Company will be required to use (i) the first $50.0 million of proceeds from certain transactions (i.e., disposition, sale of assets, tax refunds) received by the Company to redeem for cash, shares of the Series B Preferred Stock, on a pro rata basis among each holder of Series B Preferred Stock and (ii) the next $25.0 million of proceeds from certain transactions received by the Company may be used by the Company to buy back shares of Common Stock and to the extent, not used for such purpose by the Company, to redeem, for cash, shares of the Series B Preferred Stock, on a pro rata basis among each holder of the Series B Preferred Stock. The Company shall be required to obtain the prior written consent of the holders holding at least a majority of the outstanding shares of the Series B Preferred Stock before taking certain actions, including: (i) certain dividends, repayments and redemptions; (ii) any amendment to the Company’s certificate of incorporation that adversely affects the rights, preferences, privileges or voting powers of the Series B Preferred Stock; and (iii) issuances of stock ranking senior or equivalent to shares of the Series B Preferred Stock (including additional shares of the Series B Preferred Stock) in the priority of payment of dividends or in the distribution of assets upon any liquidation, dissolution or winding up of the Company. Other than with respect to the foregoing consent rights, the Series B Preferred Stock is non-voting stock. Investor Rights Agreement On June 30, 2021, the Company, B. Riley Financial and BRPI entered into an Investor Rights Agreement (the “Investor Rights Agreement”). Pursuant to the Investor Rights Agreement, for so long as affiliates of B. Riley Financial beneficially own at least 10% of the outstanding shares of common stock (unless such equity threshold percentage is not met due to dilution from equity issuances), B. Riley Financial is entitled to nominate one Class II director (the “B. Riley Nominee”) to the Company’s board of directors (the “Board”), who shall be an employee of B. Riley Financial or its affiliates and is approved by the Board, such approval not to be unreasonably withheld. For so long as affiliates of B. Riley Financial beneficially own 5% or more but less than 10% of the outstanding shares of common stock (unless such equity threshold percentage is not met due to dilution from equity issuances), B. Riley Financial is entitled to certain board observer rights. A summary of the Company’s Series B Perpetual Non-Convertible Preferred Stock balance at September 30, 2021 and changes during the nine months ended September 30, 2021, are presented below: Series B Preferred Stock Shares Amount Balance at December 31, 2020 — $ — Issuance of Series B preferred stock 75 75,000 Issuance costs related to preferred stock — (2,495) Balance at September 30, 2021 75 $ 72,505 On October 1, 2021 the Company paid the accrued Series B Perpetual Non-Convertible Preferred Stock dividend of $1.8 million. Series A Convertible Preferred Stock In accordance with the terms of the Share Purchase Agreement dated as of October 17, 2017 (the “PIPE Purchase Agreement”), with Silver Private Holdings I, LLC, an affiliate of Siris (“Silver”), on February 15, 2018, the Company issued to Silver 185,000 shares of its newly issued Series A Convertible Participating Perpetual Preferred Stock (the “Series A Preferred Stock”), par value $0.0001 per share, with an initial liquidation preference of $1,000 per share, in exchange for $97.7 million in cash and the transfer from Silver to the Company of the 5,994,667 shares of the Company’s common stock held by Silver (the “Preferred Transaction”). Redemption of Series A Preferred Stock The net proceeds from the common stock public offering, Senior Note offering and the Series B transaction was used in part to fully redeem all outstanding shares of the Company’s Series A Preferred Stock on June 30, 2021 (the “Redemption”). The Company redeemed in full all of the 268,917 outstanding shares of the Series A Preferred Stock for an aggregate Redemption Price of $278.7 million and all rights under the Investor Rights Agreement relating to the Series A Preferred Stock were terminated effective with the Redemption. No Series A Preferred Stock remain outstanding or authorized as of September 30, 2021. A summary of the Company’s Series A Convertible Participating Perpetual Preferred Stock balance at September 30, 2021 and changes during the nine months ended September 30, 2021, are presented below: Series A Preferred Stock Shares Amount Balance at December 31, 2020 250 $ 237,641 Amortization of preferred stock issuance costs — 12,791 Issuance of preferred PIK dividend 19 18,485 Payment of preferred dividend — 9,748 Redemption of Series A preferred shares (269) (278,665) Balance at September 30, 2021 — $ — The Company and Siris Capital Group, LLC (“Siris”) entered into an Advisory Services Agreement dated as of May 18, 2020 under which Siris may provide consulting and advisory services to the Company on operational, business, financial and strategic matters. All obligations related to this Advisory Services Agreement were paid by the Company and the Advisory Services Agreement was terminated as of June 30, 2021. Registration Rights The Investor Rights Agreement entered into on June 30, 2021 provides that in the event Synchronoss issues Registrable Securities to the holders of Series B Preferred Stock, such holders will have certain demand and piggy-back registration rights with respect to such Registrable Securities. In addition, on June 30, 2021, in connection with the redemption of the Series A Preferred Stock, the Investor Rights Agreement between the Company and Silver terminated. Stock Plans On June 10, 2021, the Company’s stockholders approved the amendment and restatement of the Company’s 2015 Equity Incentive Plan to increase the number of shares issuable thereunder by 3.0 million shares. There were no significant changes to Synchronoss Technologies, Inc. 2017 New Hire Equity Incentive Plan (the “Incentive Plan”) during the three and nine months ended September 30, 2021. As of September 30, 2021, there were 1.2 million shares available for the grant or award under the Company’s 2015 Equity Incentive Plan and 0.4 million shares available for the grant or award under the Company’s 2017 New Hire Equity Incentive Plan. On November 1, 2021 the Incentive Plan was amended to increase the maximum number of shares of Common Stock authorized for issuance under the Incentive Plan by 566,711 shares from 1,500,000 shares to a new aggregate total of 2,066,711 shares. The Company’s performance cash awards granted to executives under the Long Term Incentive (“LTI”) Pla ns have been accounted for as liability awards, due to the Company’s intent and the ability to settle such awards in cash upon vesting and the Company has reflected such awards in accrued expenses. As of September 30, 2021, the liability for such awards is approximately $0.2 million. Stock-Based Compensation The following table summarizes stock-based compensation expense related to all of the Company’s stock awards included by operating expense categories, as follows: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Cost of revenues $ 432 $ 505 $ 1,289 $ 1,899 Research and development 725 890 2,276 3,392 Selling, general and administrative 1,132 2,996 3,790 9,256 Total stock-based compensation expense $ 2,289 $ 4,391 $ 7,355 $ 14,547 The following table summarizes stock-based compensation expense related to all of the Company’s stock awards included by award type, as follows: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Stock options $ 1,064 $ 1,701 $ 2,912 $ 5,289 Restricted stock awards 1,373 2,626 4,412 8,922 Performance Based Cash Units (148) 64 31 336 Total stock-based compensation before taxes $ 2,289 $ 4,391 $ 7,355 $ 14,547 Tax benefit $ 420 $ 604 $ 1,357 $ 2,192 The total stock-based compensation cost related to unvested equity awards as of September 30, 2021 was approximately $10.9 million. The expense is expected to be recognized over a weighted-average period of approximately 1.3 years. The total stock-based compensation cost related to unvested performance based cash units as of September 30, 2021 was approximately $0.5 million. The expense is expected to be recognized over a weighted-average period of approximately 2.2 years. Stock Options The Company uses the Black-Scholes option pricing model for determining the estimated fair value for stock options. The weighted-average assumptions used in the Black-Scholes option pricing model are as follows: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Expected stock price volatility 78.5 % 78.3 % 82.9 % 74.5 % Risk-free interest rate 0.6 % 0.2 % 0.6 % 1.0 % Expected life of options (in years) 4.20 4.52 4.24 4.47 Expected dividend yield 0.0 % 0.0 % 0.0 % 0.0 % Weighted-average fair value (PSV) of the options $ 1.72 $ 2.23 $ 1.88 $ 2.80 The following table summarizes information about stock options outstanding as of September 30, 2021: Options Number of Weighted-Average Weighted-Average Aggregate Outstanding at December 31, 2020 4,423 $ 9.60 Options Granted 1,966 3.08 Options Exercised — — Options Cancelled (1,395) 9.81 Outstanding at September 30, 2021 4,994 $ 6.97 5.07 $ — Vested and exercisable at September 30, 2021 1,696 $ 12.76 3.14 $ — The total intrinsic value of stock options exercisable at September 30, 2021 and 2020 was nil and nil, respectively. The total intrinsic value of stock options exercised during the nine months ended September 30, 2021 and 2020 was nil and nil, respectively. Awards of Restricted Stock and Performance Stock A summary of the Company’s unvested restricted stock at September 30, 2021, and changes during the nine months ended September 30, 2021, is presented below: Unvested Restricted Stock Number of Weighted- Average Unvested at December 31, 2020 1,510 $ 7.05 Granted 2,000 3.11 Vested (837) 7.56 Forfeited (354) 4.38 Unvested at September 30, 2021 2,319 $ 3.84 Restricted stock awards are granted subject to other service conditions or service and performance conditions (“Performance-Based Awards”). Restricted stock and Performance-Based Awards are measured at the closing stock price at the date of grant and are recognized straight line over the requisite service period. Performance Based Cash Units Performance based cash units vest at the end of a three-year period based on service and achievement of certain performance objectives determined by the Company’s Board of Directors. A summary of the Company’s unvested performance-based cash units at September 30, 2021 and changes during the nine months ended September 30, 2021, is presented below: Unvested Cash Units Number of Period End Fair Value Unvested at December 31, 2020 907 $ 4.70 Granted 1,556 — Granted adjustment 1 (307) Vested (30) — Forfeited (564) — Unvested at September 30, 2021 1,562 $ 2.40 ___________________________ 1 Includes changes in the unvested units due to performance adjustments Performance based cash units are measured at the closing stock price at the reporting period end date and are recognized straight line over the requisite service period. The expense for the period will increase or decrease based on updated fair values of these awards at each reporting da te. Unvested units fluctuations are shown as adjustments to units granted in the table above. These fluctuations are based on the percentage achievement of the performance metrics at the end of each reporting period. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company recognized an income tax benefit of approximately $7.3 million and $29.1 million during the nine months ended September 30, 2021 and 2020, respectively. The effective tax rate was approximately 24.3% for the nine months ended September 30, 2021, which was higher than the U.S. federal statutory rate primarily due to discrete income tax benefit recorded in the current quarter associated with the finalization of the Company’s U.S. federal income tax return, which reflected a net operating loss that was carried back to prior tax years. Based on the final carryback claim, the Company recorded a discrete income tax benefit of $7.4 million and discrete income tax expense related to a liability for unrecognized tax benefits in the amount of $2.1 million, all of which, if recognized, would impact the Company’s effective tax rate. This increase was partially offset by pre-tax losses in jurisdictions where full valuation allowances have been recorded, pre-tax losses in jurisdictions which have a zero tax rate, and certain foreign jurisdictions projecting current income tax expense. The Company’s effective tax rate was approximately 75.3% for the nine months ended September 30, 2020, which was higher than the U.S. federal statutory rate primarily due to the Company’s ability to recognize certain loss carrybacks as a result of the enactment of the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) in the first quarter of 2020, the impact of the redemption of the Company’s interest in STIN and valuation allowances recorded in domestic and foreign jurisdictions, partially offset by the impact of permanent book-tax differences. The Company continues to consider all available evidence, including historical profitability and projections of future taxable income together with new evidence, both positive and negative, that could affect the view of the future realization of deferred tax assets. As a result of the assessment, no change was recorded by the Company to the valuation allowance during the nine months ended September 30, 2021. On March 11, 2021 the American Rescue Plan Act ("ARPA") was signed into law which is aimed at addressing the continuing economic and health impacts of the COVID-19 pandemic. This legislation relief, along with the previous governmental relief packages provide for numerous changes to current tax law. The Company does not anticipate that ARPA will have a material impact on its financial statements in the period ending September 30, 2021. During the quarter, the Internal Revenue Service commenced an audit of certain of the Company’s prior year U.S. federal income tax filings, including the 2015 through 2020 tax years. The Company does not believe that the results of this audit will have a material effect on its financial position or results of operations. |
Restructuring
Restructuring | 9 Months Ended |
Sep. 30, 2021 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | Restructuring The Company continues to execute certain restructurings to identify workforce optimization opportunities to better align the Company’s resources with its key strategic priorities. A summary of the Company’s restructuring accrual at September 30, 2021 and changes during the nine months ended September 30, 2021, are presented below: Balance at December 31, 2020 Charges Payments Other Adjustments Balance at September 30, 2021 Employment termination costs $ 1,580 $ 3,075 $ (2,130) $ — $ 2,525 |
Earnings per Common Share (EPS)
Earnings per Common Share (EPS) | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Earnings per Common Share (EPS) | Earnings per Common Share (“EPS”) Basic EPS is computed based upon the weighted average number of common shares outstanding for the year. Diluted EPS is computed based upon the weighted average number of common shares outstanding for the year plus the dilutive effect of common stock equivalents using the treasury stock method and the average market price of the Company’s common stock for the year. The Company includes participating securities (Redeemable Convertible Preferred Stock - Participation with Dividends on Common Stock that contain preferred dividend) in the computation of EPS pursuant to the two-class method. The two-class method of computing earnings per share is an allocation method that calculates earnings per share for common stock and participating securities. During periods of net loss, no effect is given to the participating securities because they do not share in the losses of the Company. The following table provides a reconciliation of the numerator and denominator used in computing basic and diluted net income attributable to common stockholders per common share from continued and discontinued operations. Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Numerator - Basic: Net loss from continuing operations $ (8,109) $ (5,622) $ (22,895) $ (9,666) Net income (loss) attributable to redeemable noncontrolling interests — (60) 286 (242) Preferred stock dividend 1 (1,722) (9,685) (33,728) (27,882) Net loss attributable to Synchronoss $ (9,831) $ (15,367) $ (56,337) $ (37,790) Numerator - Diluted: Net loss from continuing operations attributable to Synchronoss $ (9,831) $ (15,367) $ (56,337) $ (37,790) Denominator: Weighted average common shares outstanding — basic 85,646 42,360 57,662 41,777 Dilutive effect of: Shares from assumed conversion of preferred stock 2 — — — — Shares from assumed conversion of Performance Based Cash Units 3 — — — — Weighted average common shares outstanding — diluted 85,646 42,360 57,662 41,777 Basic EPS Earnings per share: Basic $ (0.11) $ (0.36) $ (0.98) $ (0.90) Diluted $ (0.11) $ (0.36) $ (0.98) $ (0.90) Anti-dilutive stock options excluded — — — — Unvested shares of restricted stock awards 2,319 1,952 2,319 1,952 ________________________________ 1 Current year amounts include amortization of preferred stock issuance costs accelerated due to Series A redemption during the second quarter. 2 The calculation does not include the effect of assumed conversion of preferred stock of nil and 13,426,155 shares for the three months ended September 30, 2021 and 2020, respectively; and 14,767,557 and 12,963,664 shares for the nine months ended September 30, 2021 and 2020, respectively; which is based on 55.5556 shares per $1,000 principal amount of the preferred stock, because the effect would have been anti–dilutive. 3 The calculation does not include the effect of assumed conversion of Performance Based Cash Units of 1,559,130 and nil shares for the three months ended September 30, 2021 and 2020, respectively; and 776,303 and nil shares for the nine months ended September 30, 2021 and 2020, respectively; which is based on 1 share per 1 Performance Based Cash Unit, because the effect would have been anti–dilutive. |
Commitments, Contingencies and
Commitments, Contingencies and Other | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments, Contingencies and Other | Commitments, Contingencies and Other Purchase Obligations Aggregate annual future minimum payments under non-cancelable agreements are as follows: Year Non-cancelable agreements 2021 $ 4,788 2022 21,696 2023 14,541 2024 and thereafter 21,995 Total $ 63,020 Legal Matters In the ordinary course of business, the Company is regularly subject to various claims, suits, regulatory inquiries and investigations. The Company records a liability for specific legal matters when it determines that the likelihood of an unfavorable outcome is probable, and the loss can be reasonably estimated. Management has also identified certain other legal matters where they believe an unfavorable outcome is not probable and, therefore, no reserve is established. Although management currently believes that resolving claims against the Company, including claims where an unfavorable outcome is reasonably possible, will not have a material impact on the Company’s business, financial position, results of operations, or cash flows, these matters are subject to inherent uncertainties and management’s view of these matters may change in the future. The Company also evaluates other contingent matters, including income and non-income tax contingencies, to assess the likelihood of an unfavorable outcome and estimated extent of potential loss. It is possible that an unfavorable outcome of one or more of these lawsuits or other contingencies could have a material impact on the liquidity, results of operations, or financial condition of the Company. On May 1, 2017, May 2, 2017, June 8, 2017 and June 14, 2017, four putative class actions were filed against the Company and certain of its current and former officers and directors in the United States District Court for the District of New Jersey (the “Securities Law Action”). After these cases were consolidated, the court appointed as lead plaintiff Employees’ Retirement System of the State of Hawaii, which filed, on November 20, 2017, a consolidated complaint purportedly on behalf of purchasers of the Company’s common stock between February 3, 2016 and June 13, 2017. On February 2, 2018, the defendants moved to dismiss the consolidated complaint in its entirety, with prejudice. Before that motion was decided, on August 24, 2018, lead plaintiff filed a consolidated amended complaint purportedly on behalf of purchasers of the Company’s common stock between October 28, 2014 and June 13, 2017. On June 28, 2019, the Court granted defendants’ motion to dismiss the consolidated amended complaint in its entirety, without prejudice, allowing lead plaintiff leave to amend its complaint. On August 14, 2019, lead plaintiff filed a second amended complaint. The second amended complaint asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended, and it alleges, among other things, that the defendants made false and misleading statements of material information concerning the Company’s financial results, business operations, and prospects. The plaintiff seeks unspecified damages, fees, interest, and costs. On October 4, 2019, the defendants moved to dismiss the second amended complaint in its entirety. On May 29, 2020, the Court granted in part and denied in part defendants’ motion to dismiss the second amended complaint, without prejudice. Plaintiff filed its motion for class certification on October 30, 2020. On September 15, 2017, October 24, 2017, October 27, 2017 and October 30, 2017, Company shareholders filed derivative lawsuits against certain of the Company’s current and former officers and directors and the Company (as nominal defendant) in the United States District Court for the District of New Jersey (the “Derivative Suits”). On May 24, 2018, the Court consolidated the Derivative Suits and appointed Lisa LeBoeuf as lead plaintiff. The lead plaintiff designated as the Operative Complaint the complaint she previously had filed on October 27, 2017. On March 11, 2019, the defendants filed a motion to dismiss the Operative Complaint, which the Court granted in substantial part on November 26, 2019. On December 10, 2019, the defendants filed a motion for reconsideration respecting the only claim to survive the motion to dismiss. On June 12, 2020, the Court granted the defendants’ motion for reconsideration and dismissed the remaining claim without prejudice, allowing lead plaintiff leave to amend her complaint. On July 13, 2020, lead plaintiff filed an amended complaint. The amended complaint alleges claims related to breaches of fiduciary duties and unjust enrichment. The amended complaint’s allegations relate to substantially the same facts as those underlying the Securities Law Action described above. On April 30, 2021, the Court dismissed Plaintiff’s amended complaint in its entirety. Plaintiff filed a notice of appeal on May 28, 2021. On March 7, 2019, Synchronoss shareholders, Beth Daniel and Juan Solis, filed a separate derivative lawsuit against certain of the Company’s current and former officers and directors and the Company (as nominal defendant) in the Court of Chancery of the State of Delaware, asserting substantially the same allegations as those underlying the Derivative Suits and the Securities Law Action described above (the “Delaware Litigation”). Plaintiffs seek unspecified damages and for the Company to take steps to improve its corporate governance and internal procedures. On May 20, 2019, the parties stipulated to a stay of the action pending a ruling on the pending motion to dismiss in the Derivative Suits. On June 11, 2020 and June 12, 2020, Company shareholders filed derivative lawsuits against certain of the Company’s current and former officers and directors and the Company (as nominal defendant) in the United States District Court for the District of New Jersey (the “Demand Refused Derivative Complaints” and together with the Delaware Litigation and the Derivative Suits, the “Derivative Actions”). The Demand Refused Derivative Complaints allege claims related to breaches of fiduciary duty, unjust enrichment, and alleged violations of securities laws. The complainants’ allegations relate substantially to the same facts as those underlying the Securities Law Action described above. The Demand Refused Derivative Complaints further allege that each plaintiff made a demand upon the Company’s Board of Directors to investigate the alleged misconduct and that such demand was wrongfully refused. Plaintiffs seek unspecified damages and for the Company to take steps to improve its corporate governance and internal procedures. On October 20, 2020, the Court consolidated the actions and appointed co-lead plaintiffs. On December 4, 2020, co-lead plaintiffs filed a consolidated amended complaint. On February 3, 2021, the defendants filed motions to dismiss the amended complaint. On May 7, 2021, a mediation took place concerning the Securities Law Action and the Derivative Actions. On August 19, 2021, the parties to the Securities Law Action entered into a stipulation of settlement. The Court preliminarily approved the proposed settlement in the Securities Law Action on August 25, 2021, and a settlement hearing is scheduled for December 8, 2021. On September 9, 2021, the parties to the Derivative Actions entered into a stipulation of settlement. The Court preliminarily approved the proposed settlement in the Derivative Actions on September 14, 2021, and a settlement hearing is scheduled for November 30, 2021. Due to the inherent uncertainties of litigation, the Company cannot predict the outcomes of the settlement hearings and gives no assurance that the asserted claims in the Securities Law Action or the Derivative Actions will not have a material adverse effect on the Company’s financial position, prospects, or results of operations. In the third quarter of 2017, the SEC and Department of Justice initiated investigations in connection with the June 2017 Announcement and certain transactions that the Company restated in the third quarter of 2018. The Company has received subpoenas, produced documents, and provided additional information to the government in connection with those investigations. On June 22, 2021, the Securities and Exchange Commission (“SEC”) staff verbally notified the Company that the staff has made a preliminary determination to recommend that the SEC initiate an enforcement action against the Company. This is in connection with certain financial transactions that the Company effected in 2015 and 2016 and its disclosure of and accounting for such transactions, which the Company restated in the third quarter of 2018 in its restated annual and quarterly financial statements for 2015 and 2016. That restatement followed the Company’s announcement, on June 13, 2017 (the “June 2017 Announcement”), that certain of its prior financial statements would need to be restated. Certain individuals, including certain former members of Synchronoss’ management team, received similar notifications. The Company remains in discussions with the SEC staff regarding the prospect of resolving this matter through settlement. If the Company is unable to resolve this matter through settlement then it would expect to receive a “Wells notice” from the SEC staff in connection with this matter. Although a Wells notice is neither a formal charge of wrongdoing nor a final determination that the recipient has violated any law, it is a formal notice that the SEC intends to bring an enforcement action against the recipient. Upon receipt of a Wells notice, the recipient has the opportunity to respond to the SEC staff’s position before any formal enforcement action is taken. Due to the inherent uncertainties of government investigations, the Company cannot predict the outcome of these Except as set forth above, the Company is not currently subject to any other legal proceedings that could have a material adverse effect on its operations; however, the Company may from time to time become a party to various legal proceedings arising in the ordinary course of our business. The Company is currently the plaintiff in several patent infringement cases. The defendants in several of these cases have filed counterclaims. Although the Company cannot predict the outcome of the cases at this time due to the inherent uncertainties of litigation, the Company continues to pursue its claims and believes that the counterclaims are without merit, and the Company intends to defend all such counterclaims. |
Additional Financial Informatio
Additional Financial Information | 9 Months Ended |
Sep. 30, 2021 | |
Other Income and Expenses [Abstract] | |
Additional Financial Information | Additional Financial Information Other Income, net The following table sets forth the components of included in the Other Income, net included in the Condensed Consolidated Statements of Operations: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 FX gains (losses) 1 $ (1,752) $ 2,228 $ (4,055) $ 2,330 Government refunds 195 322 199 874 Income from sale of intangible assets 2 — — 550 2,164 Other 3 (112) 134 (183) 375 Total $ (1,669) $ 2,684 $ (3,489) $ 5,743 ________________________________ 1 Fair value of foreign exchange gains and losses 2 Represents gain on sale of certain of the Company’s IP addresses and Patents 3 Represents an aggregate of individually immaterial transactions |
Basis of Presentation and Con_2
Basis of Presentation and Consolidation (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation The accompanying interim unaudited condensed consolidated financial statements have been prepared by Synchronoss and in the opinion of management, include all adjustments necessary for a fair presentation of the Company’s financial position, results of operations and cash flows for the interim periods. They do not include all of the information and footnotes required by U.S. generally accepted accounting principles (“GAAP”) for complete financial statements and should be read in conjunction with the Company’s audited consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020. The results of operations for the three and nine months ended September 30, 2021 are not necessarily indicative of the results to be expected for the year ending December 31, 2021. |
Risks and Uncertainties | Risks and UncertaintiesThere continue to be uncertainties regarding the current coronavirus ("COVID-19") pandemic, and the Company is closely monitoring the impact of the pandemic on all aspects of its business, including how it will impact its customers, employees, suppliers, vendors, business partners and distribution channels. While the pandemic did not materially affect the Company’s financial results and business operations for the three and nine months ended September 30, 2021, the Company is unable to predict the impact that COVID-19 will have on its financial position and operating results due to numerous uncertainties. The Company will continue to assess the evolving impact of the COVID-19 pandemic and will make adjustments to its operations as necessary. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards Recent accounting pronouncements adopted Standard Description Effect on the financial statements Update 2019-12 - Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes The ASU removes the exception to the general principles in ASC 740, Income Taxes, associated with the incremental approach for intra-period tax allocation, accounting for basis differences when there are ownership changes in foreign investments and interim-period income tax accounting for year-to-date losses that exceed anticipated losses. In addition, the ASU improves the application of income tax related guidance and simplifies U.S. GAAP when accounting for franchise taxes that are partially based on income, transactions with government resulting in a step-up in tax basis goodwill, separate financial statements of legal entities not subject to tax, and enacted changes in tax laws in interim periods. Different transition approaches, retrospective, modified retrospective, or prospective, will apply to each income tax simplification provision. The Company adopted the new standard as of January 1, 2021. The standard did not have a material impact on the Company’s consolidated financial position or results of operations upon adoption. Date of adoption: January 1, 2021. Standards issued not yet adopted Standard Description Effect on the financial statements Update 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity's Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity's Own Equity (ASU 2020-06) The ASU simplifies the accounting for convertible instruments by reducing the number of accounting models available for convertible debt instruments. This guidance also eliminates the treasury stock method to calculate diluted earnings per share for convertible instruments and requires the use of the if-converted method. This guidance will be effective for us in the first quarter of 2022 on a full or modified retrospective basis, with early adoption permitted. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements. Date of adoption: January 1, 2022. |
Fair Value Measurements | In accordance with accounting principles generally accepted in the United States, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-level hierarchy prioritizes the inputs used to measure fair value as follows: • Level 1 - Observable inputs - quoted prices in active markets for identical assets and liabilities; • Level 2 - Observable inputs other than the quoted prices in active markets for identical assets and liabilities includes quoted prices for similar instruments, quoted prices for identical or similar instruments in inactive markets, and amounts derived from valuation models where all significant inputs are observable in active markets; and • Level 3 - Unobservable inputs - includes amounts derived from valuation models where one or more significant inputs are unobservable and require the Company to develop relevant assumptions. |
Basis of Presentation and Con_3
Basis of Presentation and Consolidation (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Recently Issued Accounting Standards | Recent accounting pronouncements adopted Standard Description Effect on the financial statements Update 2019-12 - Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes The ASU removes the exception to the general principles in ASC 740, Income Taxes, associated with the incremental approach for intra-period tax allocation, accounting for basis differences when there are ownership changes in foreign investments and interim-period income tax accounting for year-to-date losses that exceed anticipated losses. In addition, the ASU improves the application of income tax related guidance and simplifies U.S. GAAP when accounting for franchise taxes that are partially based on income, transactions with government resulting in a step-up in tax basis goodwill, separate financial statements of legal entities not subject to tax, and enacted changes in tax laws in interim periods. Different transition approaches, retrospective, modified retrospective, or prospective, will apply to each income tax simplification provision. The Company adopted the new standard as of January 1, 2021. The standard did not have a material impact on the Company’s consolidated financial position or results of operations upon adoption. Date of adoption: January 1, 2021. Standards issued not yet adopted Standard Description Effect on the financial statements Update 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity's Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity's Own Equity (ASU 2020-06) The ASU simplifies the accounting for convertible instruments by reducing the number of accounting models available for convertible debt instruments. This guidance also eliminates the treasury stock method to calculate diluted earnings per share for convertible instruments and requires the use of the if-converted method. This guidance will be effective for us in the first quarter of 2022 on a full or modified retrospective basis, with early adoption permitted. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements. Date of adoption: January 1, 2022. |
Revenue (Tables)
Revenue (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | Three Months Ended September 30, 2021 Three Months Ended September 30, 2020 Cloud Digital Messaging Total Cloud Digital Messaging Total Geography Americas $ 41,090 $ 12,486 $ 2,426 $ 56,002 $ 37,806 $ 10,211 $ 4,249 $ 52,266 APAC 245 1,123 6,929 8,297 — 791 8,280 9,071 EMEA 1,789 756 2,909 5,454 1,678 1,633 3,988 7,299 Total $ 43,124 $ 14,365 $ 12,264 $ 69,753 $ 39,484 $ 12,635 $ 16,517 $ 68,636 Service Line Professional Services $ 3,542 $ 1,983 $ 3,709 $ 9,234 $ 5,253 $ 2,891 $ 3,262 $ 11,406 Transaction Services 1,237 1,113 2 2,352 1,345 1,715 — 3,060 Subscription Services 38,345 9,456 7,830 55,631 32,886 8,001 11,236 52,123 License — 1,813 723 2,536 — 28 2,019 2,047 Total $ 43,124 $ 14,365 $ 12,264 $ 69,753 $ 39,484 $ 12,635 $ 16,517 $ 68,636 Nine Months Ended September 30, 2021 Nine Months Ended September 30, 2020 Cloud Digital Messaging Total Cloud Digital Messaging Total Geography Americas $ 115,192 $ 34,329 $ 17,207 $ 166,728 $ 117,889 $ 33,785 $ 23,652 $ 175,326 APAC 245 3,166 19,878 23,289 — 2,368 24,163 26,531 EMEA 5,474 1,978 9,315 16,767 5,086 4,237 11,113 20,436 Total $ 120,911 $ 39,473 $ 46,400 $ 206,784 $ 122,975 $ 40,390 $ 58,928 $ 222,293 Service Line Professional Services $ 11,351 $ 6,212 $ 8,907 $ 26,470 $ 14,398 $ 10,163 $ 14,464 $ 39,025 Transaction Services 4,533 4,326 5 8,864 4,126 5,004 — 9,130 Subscription Services 105,027 26,435 36,365 167,827 104,451 24,254 32,965 161,670 License — 2,500 1,123 3,623 — 969 11,499 12,468 Total $ 120,911 $ 39,473 $ 46,400 $ 206,784 $ 122,975 $ 40,390 $ 58,928 $ 222,293 |
Schedule of Significant Changes in the Contract Liabilities Balance | Significant changes in the contract liabilities balance (current and non-current) during the period are as follows: Contract Liabilities 1 Balance - January 1, 2021 $ 45,614 Revenue recognized in the period (207,027) Amounts billed but not recognized as revenue 193,764 Balance - September 30, 2021 $ 32,351 ________________________________ 1 Comprised of Deferred Revenue |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of Assets and Liabilities Held and their Related Classifications Under the Fair Value Hierarchy | The following is a summary of assets, liabilities and redeemable noncontrolling interests and their related classifications under the fair value hierarchy: September 30, 2021 Total (Level 1) (Level 2) (Level 3) Assets Cash and cash equivalents 1 $ 24,141 $ 24,141 $ — $ — Total assets $ 24,141 $ 24,141 $ — $ — Temporary equity Redeemable noncontrolling interests 2 $ 12,500 $ — $ — $ 12,500 Total temporary equity $ 12,500 $ — $ — $ 12,500 December 31, 2020 Total (Level 1) (Level 2) (Level 3) Assets Cash and cash equivalents 1 $ 33,671 $ 33,671 $ — $ — Total assets $ 33,671 $ 33,671 $ — $ — Temporary Equity Redeemable noncontrolling interests 2 $ 12,500 $ — $ — $ 12,500 Total temporary equity $ 12,500 $ — $ — $ 12,500 ________________________________ 1 Cash equivalents includes money market funds. 2 Put arrangements held by the noncontrolling interests in certain of the Company’s joint ventures. |
Schedule of Changes in Fair Value of Level 3 | The changes in fair value of the Company’s Level 3 redeemable noncontrolling interests during the nine months ended September 30, 2021 were as follows: Balance at December 31, 2020 $ 12,500 Fair value adjustment 286 Net (income) loss attributable to redeemable noncontrolling interests (286) Balance at September 30, 2021 $ 12,500 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Leases [Abstract] | |
Schedule of Operating Assets and Liabilities | The following table presents information about the Company's Right of Use (ROU) assets and lease liabilities at September 30, 2021: ROU assets: Non-current operating lease ROU assets $ 27,629 Operating lease liabilities: Current operating lease liabilities 1 $ 8,037 Non-current operating lease liabilities 37,572 Total operating lease liabilities $ 45,609 ________________________________ 1 Amounts are included in Accrued Expenses on the Condensed Consolidated Balance Sheet. |
Schedule of Components of Lease Expense and Weighted Average Lease Term and Rates | The following table presents information about lease expense and sublease income for the three and nine months ended September 30, 2021: Three Months Ended Nine Months Ended September 30, 2021 September 30, 2021 Operating lease cost 1 $ 2,235 $ 7,268 Other lease costs and income: Variable lease costs 1 85 501 Operating lease impairments 1, 2 642 1,794 Sublease income 1 (693) (2,471) Total net lease cost $ 2,269 $ 7,092 ________________________________ 1 Amounts are included in Cost of revenues, Selling, general and administrative and/or Research and development based on the function that the underlying leased asset supports which are reflected in the Condensed Consolidated Statements of Operations. 2 As part of the Company’s continued cost savings initiatives, the Company closed certain office spaces and terminated various lease agreements. These actions resulted in a ROU asset impairment charge for the period, which was determined by the present value of the forecasted future cash flows for the remaining lease term. The following table provides the weighted-average remaining lease term and weighted-average discount rates for our leases as of September 30, 2021: Operating Leases: Weighted-average remaining lease term (years), weighted based on lease liability balances 6.06 Weighted-average discount rate (percentages), weighted based on the remaining balance of lease payments 8.1% The following table provides certain cash flow and supplemental noncash information related to our lease liabilities for the nine months ended September 30, 2021: Operating Leases: Cash paid for amounts included in the measurement of lease liabilities $ 10,437 |
Schedule of Maturities of Operating Lease Liabilities | The following table provides the undiscounted amount of future cash flows included in our lease liabilities at September 30, 2021 for each of the five years subsequent to December 31, 2020 and thereafter, as well as a reconciliation of such undiscounted cash flows to our lease liabilities at September 30, 2021: Operating Leases Remaining 2021 $ 2,975 2022 10,870 2023 8,552 2024 8,308 2025 8,193 Thereafter 18,562 Total future lease payments 57,460 Less: amount representing interest (11,851) Present value of future lease payments (lease liability) $ 45,609 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Carrying Amounts | The carrying amounts of the Company’s borrowings were as follows: Senior Notes September 30, 2021 December 31, 2020 8.375% Senior Notes due 2026 $ 125,000 $ — Unamortized discount and debt issuance cost 1 (7,506) — Carrying value of Senior Notes $ 117,494 $ — ________________________________ 1 Debt issuance are deferred and amortized into interest expense using the effective interest method. |
Schedule of Interest Expense | The following table summarizes the Company’s interest expense: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 2021 Senior Notes due 2026 Amortization of debt issuance costs $ 306 $ — $ 306 $ — Interest on borrowings 2,617 — 2,617 — 2019 Revolving Credit Facility Amortization of debt issuance costs — 12 84 40 Commitment fee — — — 4 Interest on borrowings — 59 126 141 Other 1 10 1 39 216 Total $ 2,933 $ 72 $ 3,172 $ 401 ________________________________ 1 Mainly finance leases’ related interest expense |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive (Loss) / Income (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of Changes in Accumulated Other Comprehensive Income (Loss) | The changes in accumulated other comprehensive (loss) income during the nine months ended September 30, 2021 were as follows: Balance at December 31, 2020 Other comprehensive (loss) income Tax effect Balance at September 30, 2021 Foreign currency $ (26,076) $ (3,595) $ — $ (29,671) Unrealized loss on intra-entity foreign currency transactions (2,137) 1,361 (464) (1,240) Total $ (28,213) $ (2,234) $ (464) $ (30,911) |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Stockholder's Equity | |
Schedule of Series A Preferred Stock | A summary of the Company’s Series B Perpetual Non-Convertible Preferred Stock balance at September 30, 2021 and changes during the nine months ended September 30, 2021, are presented below: Series B Preferred Stock Shares Amount Balance at December 31, 2020 — $ — Issuance of Series B preferred stock 75 75,000 Issuance costs related to preferred stock — (2,495) Balance at September 30, 2021 75 $ 72,505 A summary of the Company’s Series A Convertible Participating Perpetual Preferred Stock balance at September 30, 2021 and changes during the nine months ended September 30, 2021, are presented below: Series A Preferred Stock Shares Amount Balance at December 31, 2020 250 $ 237,641 Amortization of preferred stock issuance costs — 12,791 Issuance of preferred PIK dividend 19 18,485 Payment of preferred dividend — 9,748 Redemption of Series A preferred shares (269) (278,665) Balance at September 30, 2021 — $ — |
Schedule of Stock-based Compensation | The following table summarizes stock-based compensation expense related to all of the Company’s stock awards included by operating expense categories, as follows: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Cost of revenues $ 432 $ 505 $ 1,289 $ 1,899 Research and development 725 890 2,276 3,392 Selling, general and administrative 1,132 2,996 3,790 9,256 Total stock-based compensation expense $ 2,289 $ 4,391 $ 7,355 $ 14,547 The following table summarizes stock-based compensation expense related to all of the Company’s stock awards included by award type, as follows: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Stock options $ 1,064 $ 1,701 $ 2,912 $ 5,289 Restricted stock awards 1,373 2,626 4,412 8,922 Performance Based Cash Units (148) 64 31 336 Total stock-based compensation before taxes $ 2,289 $ 4,391 $ 7,355 $ 14,547 Tax benefit $ 420 $ 604 $ 1,357 $ 2,192 |
Schedule of Fair Value Assumptions | The weighted-average assumptions used in the Black-Scholes option pricing model are as follows: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Expected stock price volatility 78.5 % 78.3 % 82.9 % 74.5 % Risk-free interest rate 0.6 % 0.2 % 0.6 % 1.0 % Expected life of options (in years) 4.20 4.52 4.24 4.47 Expected dividend yield 0.0 % 0.0 % 0.0 % 0.0 % Weighted-average fair value (PSV) of the options $ 1.72 $ 2.23 $ 1.88 $ 2.80 |
Schedule of Information About Stock Options Outstanding | The following table summarizes information about stock options outstanding as of September 30, 2021: Options Number of Weighted-Average Weighted-Average Aggregate Outstanding at December 31, 2020 4,423 $ 9.60 Options Granted 1,966 3.08 Options Exercised — — Options Cancelled (1,395) 9.81 Outstanding at September 30, 2021 4,994 $ 6.97 5.07 $ — Vested and exercisable at September 30, 2021 1,696 $ 12.76 3.14 $ — |
Restricted stock awards | |
Stockholder's Equity | |
Summary of Unvested Restricted Stock and Performance Shares Activity | A summary of the Company’s unvested restricted stock at September 30, 2021, and changes during the nine months ended September 30, 2021, is presented below: Unvested Restricted Stock Number of Weighted- Average Unvested at December 31, 2020 1,510 $ 7.05 Granted 2,000 3.11 Vested (837) 7.56 Forfeited (354) 4.38 Unvested at September 30, 2021 2,319 $ 3.84 |
Performance based cash units | |
Stockholder's Equity | |
Summary of Unvested Restricted Stock and Performance Shares Activity | A summary of the Company’s unvested performance-based cash units at September 30, 2021 and changes during the nine months ended September 30, 2021, is presented below: Unvested Cash Units Number of Period End Fair Value Unvested at December 31, 2020 907 $ 4.70 Granted 1,556 — Granted adjustment 1 (307) Vested (30) — Forfeited (564) — Unvested at September 30, 2021 1,562 $ 2.40 ___________________________ 1 Includes changes in the unvested units due to performance adjustments |
Restructuring (Tables)
Restructuring (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Restructuring and Related Activities [Abstract] | |
Schedule of the Restructuring Accrual and Changes | A summary of the Company’s restructuring accrual at September 30, 2021 and changes during the nine months ended September 30, 2021, are presented below: Balance at December 31, 2020 Charges Payments Other Adjustments Balance at September 30, 2021 Employment termination costs $ 1,580 $ 3,075 $ (2,130) $ — $ 2,525 |
Earnings per Common Share (EP_2
Earnings per Common Share (EPS) (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Reconciliation of the Numerator and Denominator Used in Computing Basic and Diluted Net Income Attributable to Common Stockholders Per Common Share | The following table provides a reconciliation of the numerator and denominator used in computing basic and diluted net income attributable to common stockholders per common share from continued and discontinued operations. Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Numerator - Basic: Net loss from continuing operations $ (8,109) $ (5,622) $ (22,895) $ (9,666) Net income (loss) attributable to redeemable noncontrolling interests — (60) 286 (242) Preferred stock dividend 1 (1,722) (9,685) (33,728) (27,882) Net loss attributable to Synchronoss $ (9,831) $ (15,367) $ (56,337) $ (37,790) Numerator - Diluted: Net loss from continuing operations attributable to Synchronoss $ (9,831) $ (15,367) $ (56,337) $ (37,790) Denominator: Weighted average common shares outstanding — basic 85,646 42,360 57,662 41,777 Dilutive effect of: Shares from assumed conversion of preferred stock 2 — — — — Shares from assumed conversion of Performance Based Cash Units 3 — — — — Weighted average common shares outstanding — diluted 85,646 42,360 57,662 41,777 Basic EPS Earnings per share: Basic $ (0.11) $ (0.36) $ (0.98) $ (0.90) Diluted $ (0.11) $ (0.36) $ (0.98) $ (0.90) Anti-dilutive stock options excluded — — — — Unvested shares of restricted stock awards 2,319 1,952 2,319 1,952 ________________________________ 1 Current year amounts include amortization of preferred stock issuance costs accelerated due to Series A redemption during the second quarter. 2 The calculation does not include the effect of assumed conversion of preferred stock of nil and 13,426,155 shares for the three months ended September 30, 2021 and 2020, respectively; and 14,767,557 and 12,963,664 shares for the nine months ended September 30, 2021 and 2020, respectively; which is based on 55.5556 shares per $1,000 principal amount of the preferred stock, because the effect would have been anti–dilutive. 3 The calculation does not include the effect of assumed conversion of Performance Based Cash Units of 1,559,130 and nil shares for the three months ended September 30, 2021 and 2020, respectively; and 776,303 and nil shares for the nine months ended September 30, 2021 and 2020, respectively; which is based on 1 share per 1 Performance Based Cash Unit, because the effect would have been anti–dilutive. |
Commitments, Contingencies an_2
Commitments, Contingencies and Other (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Aggregate Annual Future Minimum Lease Payments Under Non-Cancelable Leases | Aggregate annual future minimum payments under non-cancelable agreements are as follows: Year Non-cancelable agreements 2021 $ 4,788 2022 21,696 2023 14,541 2024 and thereafter 21,995 Total $ 63,020 |
Additional Financial Informat_2
Additional Financial Information (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Other Income and Expenses [Abstract] | |
Schedule of Components of Other Income, Net | The following table sets forth the components of included in the Other Income, net included in the Condensed Consolidated Statements of Operations: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 FX gains (losses) 1 $ (1,752) $ 2,228 $ (4,055) $ 2,330 Government refunds 195 322 199 874 Income from sale of intangible assets 2 — — 550 2,164 Other 3 (112) 134 (183) 375 Total $ (1,669) $ 2,684 $ (3,489) $ 5,743 ________________________________ 1 Fair value of foreign exchange gains and losses 2 Represents gain on sale of certain of the Company’s IP addresses and Patents 3 Represents an aggregate of individually immaterial transactions |
Revenue - Disaggregation of Rev
Revenue - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Disaggregation of Revenue [Line Items] | ||||
Net revenues | $ 69,753 | $ 68,636 | $ 206,784 | $ 222,293 |
Professional Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 9,234 | 11,406 | 26,470 | 39,025 |
Transaction Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 2,352 | 3,060 | 8,864 | 9,130 |
Subscription Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 55,631 | 52,123 | 167,827 | 161,670 |
License | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 2,536 | 2,047 | 3,623 | 12,468 |
Americas | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 56,002 | 52,266 | 166,728 | 175,326 |
APAC | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 8,297 | 9,071 | 23,289 | 26,531 |
EMEA | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 5,454 | 7,299 | 16,767 | 20,436 |
Cloud | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 43,124 | 39,484 | 120,911 | 122,975 |
Cloud | Professional Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 3,542 | 5,253 | 11,351 | 14,398 |
Cloud | Transaction Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 1,237 | 1,345 | 4,533 | 4,126 |
Cloud | Subscription Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 38,345 | 32,886 | 105,027 | 104,451 |
Cloud | License | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 0 | 0 | 0 | 0 |
Cloud | Americas | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 41,090 | 37,806 | 115,192 | 117,889 |
Cloud | APAC | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 245 | 0 | 245 | 0 |
Cloud | EMEA | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 1,789 | 1,678 | 5,474 | 5,086 |
Digital | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 14,365 | 12,635 | 39,473 | 40,390 |
Digital | Professional Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 1,983 | 2,891 | 6,212 | 10,163 |
Digital | Transaction Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 1,113 | 1,715 | 4,326 | 5,004 |
Digital | Subscription Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 9,456 | 8,001 | 26,435 | 24,254 |
Digital | License | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 1,813 | 28 | 2,500 | 969 |
Digital | Americas | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 12,486 | 10,211 | 34,329 | 33,785 |
Digital | APAC | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 1,123 | 791 | 3,166 | 2,368 |
Digital | EMEA | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 756 | 1,633 | 1,978 | 4,237 |
Messaging | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 12,264 | 16,517 | 46,400 | 58,928 |
Messaging | Professional Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 3,709 | 3,262 | 8,907 | 14,464 |
Messaging | Transaction Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 2 | 0 | 5 | 0 |
Messaging | Subscription Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 7,830 | 11,236 | 36,365 | 32,965 |
Messaging | License | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 723 | 2,019 | 1,123 | 11,499 |
Messaging | Americas | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 2,426 | 4,249 | 17,207 | 23,652 |
Messaging | APAC | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 6,929 | 8,280 | 19,878 | 24,163 |
Messaging | EMEA | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | $ 2,909 | $ 3,988 | $ 9,315 | $ 11,113 |
Revenue - Contract Assets and L
Revenue - Contract Assets and Liabilities (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2021USD ($) | |
Revenue from Contract with Customer [Abstract] | |
Contract asset, balance | $ 7,500 |
Changes In Contract Liabilities [Roll Forward] | |
Balance - January 1, 2021 | 45,614 |
Revenue recognized in the period | (207,027) |
Amounts billed but not recognized as revenue | 193,764 |
Balance - September 30, 2021 | $ 32,351 |
Revenue - Remaining Performance
Revenue - Remaining Performance Obligations (Details) $ in Millions | Sep. 30, 2021USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 240.4 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-10-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, percent | 85.50% |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 2 years |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Held and their Related Classifications Under the Fair Value Hierarchy (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Assets | ||
Cash and cash equivalents | $ 24,141 | $ 33,671 |
Total assets | 24,141 | 33,671 |
Temporary Equity | ||
Redeemable noncontrolling interests | 12,500 | 12,500 |
Total temporary equity | 12,500 | 12,500 |
(Level 1) | ||
Assets | ||
Cash and cash equivalents | 24,141 | 33,671 |
Total assets | 24,141 | 33,671 |
Temporary Equity | ||
Redeemable noncontrolling interests | 0 | 0 |
Total temporary equity | 0 | 0 |
(Level 2) | ||
Assets | ||
Cash and cash equivalents | 0 | 0 |
Total assets | 0 | 0 |
Temporary Equity | ||
Redeemable noncontrolling interests | 0 | 0 |
Total temporary equity | 0 | 0 |
(Level 3) | ||
Assets | ||
Cash and cash equivalents | 0 | 0 |
Total assets | 0 | 0 |
Temporary Equity | ||
Redeemable noncontrolling interests | 12,500 | 12,500 |
Total temporary equity | $ 12,500 | $ 12,500 |
Fair Value Measurements - Level
Fair Value Measurements - Level 3 Redeemable Noncontrolling Interests (Details) - Redeemable Noncontrolling Interests $ in Thousands | 9 Months Ended |
Sep. 30, 2021USD ($) | |
Changes in fair value of the Company’s Level 3 redeemable noncontrolling interests | |
Balance at December 31, 2020 | $ 12,500 |
Fair value adjustment | 286 |
Net (income) loss attributable to redeemable noncontrolling interests | (286) |
Balance at September 30, 2021 | $ 12,500 |
Leases - ROU Assets and Lease L
Leases - ROU Assets and Lease Liabilities - Operating Assets and Liabilities (Details) $ in Thousands | Sep. 30, 2021USD ($) |
ROU assets: | |
Non-current operating lease ROU assets | $ 27,629 |
Operating lease liabilities: | |
Current operating lease liabilities | 8,037 |
Non-current operating lease liabilities | 37,572 |
Total operating lease liabilities | $ 45,609 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Accrued expenses |
Leases - Components of Lease Ex
Leases - Components of Lease Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2021 | Sep. 30, 2021 | |
Leases [Abstract] | ||
Operating lease cost | $ 2,235 | $ 7,268 |
Other lease costs and income: | ||
Variable lease costs | 85 | 501 |
Operating lease impairments/remeasurements | 642 | 1,794 |
Sublease income | (693) | (2,471) |
Total net lease cost | $ 2,269 | $ 7,092 |
Leases - Maturities of Operatin
Leases - Maturities of Operating Lease Liabilities (Details) $ in Thousands | Sep. 30, 2021USD ($) |
Leases [Abstract] | |
Remaining 2021 | $ 2,975 |
2022 | 10,870 |
2023 | 8,552 |
2024 | 8,308 |
2025 | 8,193 |
Thereafter | 18,562 |
Total future lease payments | 57,460 |
Less: amount representing interest | (11,851) |
Present value of future lease payments (lease liability) | $ 45,609 |
Leases - Weighted Average Lease
Leases - Weighted Average Lease Term and Rates (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2021USD ($) | |
Leases [Abstract] | |
Weighted-average remaining lease term (years), weighted based on lease liability balances | 6 years 21 days |
Weighted-average discount rate (percentages), weighted based on the remaining balance of lease payments | 8.10% |
Cash paid for amounts included in the measurement of lease liabilities | $ 10,437 |
Investments in Affiliates and_2
Investments in Affiliates and Related Transactions (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2017 | |
Sequential Technology International, LLC and AP Capital Holdings II, LLC | Loans Payable | |||
Schedule of Equity Method Investments [Line Items] | |||
Principal amount | $ 9,000,000 | ||
Contingent consideration, liability | $ 16,000,000 | ||
Interest rate, as a percent | 8.00% | ||
Stated term | 3 years | ||
Proceeds from sale, percentage | 5.00% | ||
Other assets fair value disclosure | $ 4,800,000 | ||
Sequential Technology International, LLC | |||
Schedule of Equity Method Investments [Line Items] | |||
Duration of services agreement | 3 years | ||
Consideration received | $ 1,600,000 |
Debt - Offering of Senior Notes
Debt - Offering of Senior Notes (Details) - Senior Notes - Senior Notes Due June 30, 2026 | Oct. 25, 2021USD ($) | Jun. 30, 2021USD ($)senior_note$ / shares | Sep. 30, 2021USD ($) |
Debt Instrument [Line Items] | |||
Principal amount | $ 120,000,000 | ||
Interest rate, as a percent | 8.375% | ||
Par value (in dollars per share) | $ / shares | $ 25 | ||
Amount issued inclusive of underwriters' option to purchase | $ 125,000,000 | ||
Amount issued to underwriters | $ 5,000,000 | ||
Principal amount redeemed | 100.00% | ||
Percentage of debt holders demand full repayment on debt default amount | 25.00% | ||
Long-term debt fair value | $ 124,100,000 | ||
Subsequent Event | |||
Debt Instrument [Line Items] | |||
Principal amount | $ 18,000,000 | ||
Interest rate, as a percent | 8.375% | ||
Sales agent compensation, percentage | 2.00% | ||
On or after June 30, 2022 and prior to June 30, 2023 | |||
Debt Instrument [Line Items] | |||
Debt instrument, redemption price (in dollars per share) | senior_note | 25.75 | ||
On or after June 30, 2023 and prior to June 30, 2024 | |||
Debt Instrument [Line Items] | |||
Debt instrument, redemption price (in dollars per share) | 25.50 | ||
On or after June 30, 2024 and prior to June 30, 2025 | |||
Debt Instrument [Line Items] | |||
Debt instrument, redemption price (in dollars per share) | 25.25 |
Debt - Carrying Amounts (Detail
Debt - Carrying Amounts (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Jun. 30, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | |||
Unamortized discount and debt issuance cost | $ (7,506) | $ 0 | |
Carrying value of Senior Notes | 117,494 | 0 | |
Senior Notes Due June 30, 2026 | Senior Notes | |||
Debt Instrument [Line Items] | |||
Interest rate, as a percent | 8.375% | ||
8.375% Senior Notes due 2026 | $ 125,000 | $ 0 |
Debt - 2019 Revolving Credit Fa
Debt - 2019 Revolving Credit Facility (Details) - Revolving Facility | Oct. 04, 2019USD ($) |
Line of Credit Facility [Line Items] | |
Borrowing capacity | $ 10,000,000 |
Debt, floor interest rate | 0.50% |
Federal Funds Rate | |
Line of Credit Facility [Line Items] | |
Basis spread on variable rate | 0.50% |
LIBOR | |
Line of Credit Facility [Line Items] | |
Basis spread on variable rate | 1.00% |
Debt - Interest Expense (Detail
Debt - Interest Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Debt Instrument [Line Items] | ||||
Amortization of debt issuance costs | $ 305 | $ 0 | ||
Other | $ 10 | $ 1 | 39 | 216 |
Total | 2,933 | 72 | 3,172 | 401 |
Senior Notes | Senior Notes Due June 30, 2026 | ||||
Debt Instrument [Line Items] | ||||
Amortization of debt issuance costs | 306 | 0 | 306 | 0 |
Interest on borrowings | 2,617 | 0 | 2,617 | 0 |
Line of Credit | Revolving Facility | ||||
Debt Instrument [Line Items] | ||||
Amortization of debt issuance costs | 0 | 12 | 84 | 40 |
Commitment fee | 0 | 0 | 0 | 4 |
Interest on borrowings | $ 0 | $ 59 | $ 126 | $ 141 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive (Loss) / Income - Changes in Accumulated Other Comprehensive Income (Loss) (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2021USD ($) | |
Changes in accumulated other comprehensive income (loss) | |
Beginning balance | $ 43,282 |
Other comprehensive (loss) income | (2,234) |
Tax effect | (464) |
Ending balance | 93,094 |
Accumulated Other Comprehensive Income (Loss) | |
Changes in accumulated other comprehensive income (loss) | |
Beginning balance | (28,213) |
Ending balance | (30,911) |
Foreign currency | |
Changes in accumulated other comprehensive income (loss) | |
Beginning balance | (26,076) |
Other comprehensive (loss) income | (3,595) |
Tax effect | 0 |
Ending balance | (29,671) |
Unrealized loss on intra-entity foreign currency transactions | |
Changes in accumulated other comprehensive income (loss) | |
Beginning balance | (2,137) |
Other comprehensive (loss) income | 1,361 |
Tax effect | (464) |
Ending balance | $ (1,240) |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Details) | Nov. 01, 2021shares | Oct. 01, 2021USD ($) | Jun. 30, 2021USD ($)$ / sharesshares | Jun. 29, 2021USD ($)$ / sharesshares | Feb. 15, 2018USD ($)$ / sharesshares | Sep. 30, 2021USD ($)vote$ / sharesshares | Oct. 31, 2021shares | Jun. 10, 2021shares | Dec. 31, 2020$ / sharesshares |
Class of Stock [Line Items] | |||||||||
Dividends | $ | $ 0 | ||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||
2015 Plan | |||||||||
Class of Stock [Line Items] | |||||||||
Number of shares authorized (in shares) | 3,000,000 | ||||||||
Number of shares available for grant (in shares) | 1,200,000 | ||||||||
Liability, accrued expenses, non-vested | $ | $ 200,000 | ||||||||
2015 Plan | Subsequent Event | Common Stock | |||||||||
Class of Stock [Line Items] | |||||||||
Number of shares authorized (in shares) | 2,066,711 | ||||||||
2017 New Hire Plan | |||||||||
Class of Stock [Line Items] | |||||||||
Number of shares available for grant (in shares) | 400,000 | ||||||||
Silver Private Holdings I, LLC | |||||||||
Class of Stock [Line Items] | |||||||||
Consideration received on transaction | $ | $ 97,700,000 | ||||||||
Preferred stock, shares issued (in shares) | 185,000 | ||||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.0001 | ||||||||
Preferred stock, liquidation preference (in dollars per share) | $ / shares | $ 1,000 | ||||||||
Number of shares repurchased under program (in shares) | 5,994,667 | ||||||||
Minimum | |||||||||
Class of Stock [Line Items] | |||||||||
Preferred stock, ownership percentage | 5.00% | ||||||||
Maximum | |||||||||
Class of Stock [Line Items] | |||||||||
Preferred stock, ownership percentage | 10.00% | ||||||||
Public Stock Offering | |||||||||
Class of Stock [Line Items] | |||||||||
Consideration received on transaction | $ | $ 102,300,000 | ||||||||
Number of shares issued in transaction (in shares) | 42,307,692 | ||||||||
Over-Allotment Option | |||||||||
Class of Stock [Line Items] | |||||||||
Number of shares issued in transaction (in shares) | 3,846,154 | ||||||||
Common Stock | |||||||||
Class of Stock [Line Items] | |||||||||
Number of votes per share (vote) | vote | 1 | ||||||||
Common Stock | 2015 Plan | Subsequent Event | |||||||||
Class of Stock [Line Items] | |||||||||
Number of shares authorized (in shares) | 1,500,000 | ||||||||
Number of additional shares authorized (in shares) | 566,711 | ||||||||
Series B Preferred Stock | |||||||||
Class of Stock [Line Items] | |||||||||
Preferred stock, shares issued (in shares) | 75,000 | 0 | |||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||
Preferred stock, liquidation preference (in dollars per share) | $ / shares | $ 1,000 | ||||||||
Preferred stock, dividend rate, percentage one | 9.50% | ||||||||
Preferred stock, dividend rate, percentage two | 13.00% | ||||||||
Preferred stock, dividend rate, percentage three | 14.00% | ||||||||
Liquidation and redemption value | $ | $ 76,800,000 | ||||||||
Proceeds from sale of stock transactions used for redemption of shares | $ | $ 50,000,000 | ||||||||
Proceeds from sale of stock transactions, used for redemption of shares and buy back of shares | $ | 25,000,000 | ||||||||
Series B Preferred Stock | Subsequent Event | |||||||||
Class of Stock [Line Items] | |||||||||
Preferred stock dividend | $ | $ 1,800,000 | ||||||||
Series B Preferred Stock | Private Placement | |||||||||
Class of Stock [Line Items] | |||||||||
Consideration received on transaction | $ | $ 72,500,000 | ||||||||
Number of shares issued in transaction (in shares) | 75,000 | ||||||||
Series A Preferred Stock | |||||||||
Class of Stock [Line Items] | |||||||||
Preferred stock, shares issued (in shares) | 0 | 250,000 | |||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | |||||||
Redemption of Series A preferred shares (in shares) | (269,000) | ||||||||
Shares redeemed (in shares) | 268,917 | ||||||||
Value of shares redeemed | $ | $ 278,700,000 | ||||||||
Redemption of Series A preferred shares | $ | $ 278,665,000 |
Stockholders' Equity - Preferre
Stockholders' Equity - Preferred Stock (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2021USD ($)shares | |
Series B Preferred Stock | |
Increase (Decrease) in Temporary Equity [Roll Forward] | |
Beginning balance (in shares) | shares | 0 |
Issuance of preferred stock (in shares) | shares | 75,000 |
Amortization of preferred stock issuance costs (in shares) | shares | 0 |
Ending balance (in shares) | shares | 75,000 |
Beginning balance | $ | $ 0 |
Issuance of preferred stock | $ | 75,000 |
Amortization of preferred stock issuance costs | $ | (2,495) |
Ending balance | $ | $ 72,505 |
Series A Preferred Stock | |
Increase (Decrease) in Temporary Equity [Roll Forward] | |
Beginning balance (in shares) | shares | 250,000 |
Amortization of preferred stock issuance costs (in shares) | shares | 0 |
Issuance of preferred PIK dividend (in shares) | shares | 19,000 |
Payment of preferred dividend (in shares) | shares | 0 |
Redemption of Series A preferred shares (in shares) | shares | (269,000) |
Ending balance (in shares) | shares | 0 |
Beginning balance | $ | $ 237,641 |
Amortization of preferred stock issuance costs | $ | (12,791) |
Issuance of preferred PIK dividend | $ | 18,485 |
Payment of preferred dividend | $ | 9,748 |
Redemption of Series A preferred shares | $ | (278,665) |
Ending balance | $ | $ 0 |
Stockholders' Equity - Stock-ba
Stockholders' Equity - Stock-based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Employee Service Share-based Compensation, Aggregate Disclosures [Abstract] | ||||
Total stock-based compensation expense | $ 2,289 | $ 4,391 | $ 7,355 | $ 14,547 |
Tax benefit | 420 | 604 | 1,357 | 2,192 |
Stock-based compensation cost related to non-vested equity awards not yet recognized as an expense | 10,900 | $ 10,900 | ||
Weighted-average period over which stock-based compensation cost related to non-vested equity awards is expected to be recognized | 1 year 3 months 18 days | |||
Stock options | ||||
Employee Service Share-based Compensation, Aggregate Disclosures [Abstract] | ||||
Total stock-based compensation expense | 1,064 | 1,701 | $ 2,912 | 5,289 |
Restricted stock awards | ||||
Employee Service Share-based Compensation, Aggregate Disclosures [Abstract] | ||||
Total stock-based compensation expense | 1,373 | 2,626 | 4,412 | 8,922 |
Performance Based Cash Units | ||||
Employee Service Share-based Compensation, Aggregate Disclosures [Abstract] | ||||
Total stock-based compensation expense | (148) | 64 | 31 | 336 |
Stock-based compensation cost related to non-vested equity awards not yet recognized as an expense | 500 | $ 500 | ||
Weighted-average period over which stock-based compensation cost related to non-vested equity awards is expected to be recognized | 2 years 2 months 12 days | |||
Cost of revenues | ||||
Employee Service Share-based Compensation, Aggregate Disclosures [Abstract] | ||||
Total stock-based compensation expense | 432 | 505 | $ 1,289 | 1,899 |
Research and development | ||||
Employee Service Share-based Compensation, Aggregate Disclosures [Abstract] | ||||
Total stock-based compensation expense | 725 | 890 | 2,276 | 3,392 |
Selling, general and administrative | ||||
Employee Service Share-based Compensation, Aggregate Disclosures [Abstract] | ||||
Total stock-based compensation expense | $ 1,132 | $ 2,996 | $ 3,790 | $ 9,256 |
Stockholders' Equity - Black-Sc
Stockholders' Equity - Black-Scholes Assumptions (Details) - Stock options - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Weighted-average assumptions | ||||
Expected stock price volatility | 78.50% | 78.30% | 82.90% | 74.50% |
Risk-free interest rate | 0.60% | 0.20% | 0.60% | 1.00% |
Expected life of options (in years) | 4 years 2 months 12 days | 4 years 6 months 7 days | 4 years 2 months 26 days | 4 years 5 months 19 days |
Expected dividend yield | 0.00% | 0.00% | 0.00% | 0.00% |
Weighted-average fair value (PSV) of the options (usd per share) | $ 1.72 | $ 2.23 | $ 1.88 | $ 2.80 |
Stockholders' Equity - Stock Op
Stockholders' Equity - Stock Options (Details) - USD ($) $ / shares in Units, shares in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Number of Options | ||
Options outstanding at the beginning of the period (in shares) | 4,423 | |
Options Granted (in shares) | 1,966 | |
Options Exercised (in shares) | 0 | |
Options Cancelled (in shares) | (1,395) | |
Options outstanding at the end of the period (in shares) | 4,994 | |
Vested and exercisable (in shares) | 1,696 | |
Weighted-Average Exercise Price | ||
Balance at the beginning of the period (in dollars per share) | $ 9.60 | |
Options Granted (in dollars per share) | 3.08 | |
Options Exercised (in dollars per share) | 0 | |
Options Cancelled (in dollars per share) | 9.81 | |
Balance at the end of the period (in dollars per share) | 6.97 | |
Vested and exercisable (in dollars per share) | $ 12.76 | |
Weighted-Average Remaining Contractual Term (Years) | ||
Outstanding | 5 years 25 days | |
Vested and exercisable | 3 years 1 month 20 days | |
Aggregate Intrinsic Value | ||
Outstanding | $ 0 | |
Vested and exercisable | 0 | |
Additional disclosures related to stock options | ||
Total intrinsic value for stock options exercisable | 0 | $ 0 |
Total intrinsic value for stock options exercised | $ 0 | $ 0 |
Stockholders' Equity - Restrict
Stockholders' Equity - Restricted Stock and Performance Stock (Details) shares in Thousands | 9 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Restricted stock awards | |
Number of Awards | |
Non-vested at the beginning of the period (in shares) | shares | 1,510 |
Granted (in shares) | shares | 2,000 |
Vested (in shares) | shares | (837) |
Forfeited (in shares) | shares | (354) |
Non-vested at the end of the period (in shares) | shares | 2,319 |
Weighted- Average Grant Date Fair Value | |
Non-vested at the beginning of the period (in dollars per share) | $ / shares | $ 7.05 |
Granted (in dollars per share) | $ / shares | 3.11 |
Vested (in dollars per share) | $ / shares | 7.56 |
Forfeited (in dollars per share) | $ / shares | 4.38 |
Non-vested at the end of the period (in dollars per share) | $ / shares | $ 3.84 |
Performance based cash units | |
Number of Awards | |
Non-vested at the beginning of the period (in shares) | shares | 907 |
Granted (in shares) | shares | 1,556 |
Granted adjustment (in shares) | shares | (307) |
Vested (in shares) | shares | (30) |
Forfeited (in shares) | shares | (564) |
Non-vested at the end of the period (in shares) | shares | 1,562 |
Weighted- Average Grant Date Fair Value | |
Non-vested at the beginning of the period (in dollars per share) | $ / shares | $ 4.70 |
Granted (in dollars per share) | $ / shares | 0 |
Granted adjustment (in dollars per share) | $ / shares | |
Vested (in dollars per share) | $ / shares | 0 |
Forfeited (in dollars per share) | $ / shares | 0 |
Non-vested at the end of the period (in dollars per share) | $ / shares | $ 2.40 |
Performance based cash units | 2015 Plan | |
Weighted- Average Grant Date Fair Value | |
Vesting period (in years) | 3 years |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | ||||
Benefit for income taxes | $ 6,982 | $ 8,744 | $ 7,346 | $ 29,148 |
Effective income tax rate | 24.30% | 75.30% | ||
Discrete tax benefit related to unrecognized tax benefits | 7,400 | $ 7,400 | ||
Discrete tax expense related to unrecognized tax benefits | $ 2,100 | $ 2,100 |
Restructuring - Restructuring A
Restructuring - Restructuring Accrual and Changes (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Restructuring accrual and changes | ||||
Charges | $ 1,485 | $ 820 | $ 3,075 | $ 6,763 |
Employment termination costs | ||||
Restructuring accrual and changes | ||||
Balance at December 31, 2020 | 1,580 | |||
Charges | 3,075 | |||
Payments | (2,130) | |||
Other Adjustments | 0 | |||
Balance at September 30, 2021 | $ 2,525 | $ 2,525 |
Earnings per Common Share (EP_3
Earnings per Common Share (EPS) - Reconciliation of the Numerator and Denominator Used in Computing Basic and Diluted Net Income Attributable to Common Stockholders Per Common Share (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021USD ($)$ / sharesshares | Sep. 30, 2020USD ($)$ / sharesshares | Sep. 30, 2021USD ($)$ / sharesshares | Sep. 30, 2020USD ($)$ / sharesshares | |
Earnings Per Share Reconciliation [Abstract] | ||||
Net loss from continuing operations | $ | $ (8,109) | $ (5,622) | $ (22,895) | $ (9,666) |
Net income (loss) attributable to redeemable noncontrolling interests | $ | 0 | (60) | 286 | (242) |
Preferred stock dividend 1 | $ | (1,722) | (9,685) | (33,728) | (27,882) |
Net loss attributable to Synchronoss | $ | (9,831) | (15,367) | (56,337) | (37,790) |
Net loss from continuing operations attributable to Synchronoss | $ | $ (9,831) | $ (15,367) | $ (56,337) | $ (37,790) |
Denominator: | ||||
Weighted average common shares outstanding - basic (in shares) | 85,646,000 | 42,360,000 | 57,662,000 | 41,777,000 |
Dilutive effect of: | ||||
Shares from assumed conversion of preferred stock (in shares) | 0 | 0 | 0 | 0 |
Shares from assumed conversion of Performance Based Cash Units (in shares) | 0 | 0 | 0 | 0 |
Weighted average common shares outstanding - diluted (in shares) | 85,646,000 | 42,360,000 | 57,662,000 | 41,777,000 |
Earnings per share: | ||||
Basic (in dollars per share) | $ / shares | $ (0.11) | $ (0.36) | $ (0.98) | $ (0.90) |
Diluted (in dollars per share) | $ / shares | $ (0.11) | $ (0.36) | $ (0.98) | $ (0.90) |
Stock Options | ||||
Earnings per share: | ||||
Anti-dilutive stock options excluded (in shares) | 0 | 0 | 0 | 0 |
Restricted Stock Awards | ||||
Earnings per share: | ||||
Anti-dilutive stock options excluded (in shares) | 2,319,000 | 1,952,000 | 2,319,000 | 1,952,000 |
Preferred Stock | ||||
Earnings per share: | ||||
Anti-dilutive stock options excluded (in shares) | 0 | 13,426,155 | 14,767,557 | 12,963,664 |
Preferred stock, conversion ratio | 0.0555556 | 0.0555556 | ||
Performance Based Cash Units | ||||
Earnings per share: | ||||
Anti-dilutive stock options excluded (in shares) | 1,559,130 | 0 | 776,303 | 0 |
Performance based cash units, conversion ratio | 1 | 1 |
Commitments, Contingencies an_3
Commitments, Contingencies and Other - Aggregate Annual Future Minimum Lease Payments Under Non-Cancelable Leases (Details) $ in Thousands | Sep. 30, 2021USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2021 | $ 4,788 |
2022 | 21,696 |
2023 | 14,541 |
2024 and thereafter | 21,995 |
Total | $ 63,020 |
Commitments, Contingencies an_4
Commitments, Contingencies and Other - Additional Information (Details) | 1 Months Ended |
Jun. 14, 2017complaint | |
The Securities Law Actions | Pending Litigation | |
Loss Contingencies [Line Items] | |
Number of complaints filed | 4 |
Additional Financial Informat_3
Additional Financial Information - Components of Other Income, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Other Income and Expenses [Abstract] | ||||
FX gains (losses) | $ (1,752) | $ 2,228 | $ (4,055) | $ 2,330 |
Government refunds | 195 | 322 | 199 | 874 |
Income from sale of intangible assets | 0 | 0 | 550 | 2,164 |
Other | (112) | 134 | (183) | 375 |
Total | $ (1,669) | $ 2,684 | $ (3,489) | $ 5,743 |
Uncategorized Items - sncr-2021
Label | Element | Value |
Accounting Standards Update [Extensible Enumeration] | us-gaap_AccountingStandardsUpdateExtensibleList | Accounting Standards Update 2016-13 [Member] |