Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2022 | May 02, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2022 | |
Document Transition Report | false | |
Entity File Number | 000-50744 | |
Entity Registrant Name | NUVASIVE, INC | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 33-0768598 | |
Entity Address, Address Line One | 12101 Airport Way | |
Entity Address, City or Town | Broomfield | |
Entity Address, State or Province | CO | |
Entity Address, Postal Zip Code | 80021 | |
City Area Code | (800) | |
Local Phone Number | 455-1476 | |
Title of 12(b) Security | Common Stock, par value $0.001 per share | |
Trading Symbol | NUVA | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 52,041,030 | |
Entity Central Index Key | 0001142596 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 205,312 | $ 246,091 |
Accounts receivable, net of allowances of $20,707 and $21,064, respectively | 231,425 | 214,398 |
Inventory, net | 324,403 | 315,845 |
Prepaid income taxes | 5,536 | 5,425 |
Prepaid expenses and other current assets | 25,538 | 20,665 |
Total current assets | 792,214 | 802,424 |
Property and equipment, net | 313,689 | 303,664 |
Intangible assets, net | 233,301 | 242,675 |
Goodwill | 636,703 | 633,467 |
Operating lease right-of-use assets | 100,656 | 102,987 |
Deferred tax assets | 61,294 | 48,003 |
Restricted cash and investments | 1,494 | 1,494 |
Other assets | 21,150 | 19,361 |
Total assets | 2,160,501 | 2,154,075 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 115,674 | 115,614 |
Contingent consideration liabilities | 66,054 | 7,986 |
Accrued payroll and related expenses | 55,848 | 66,596 |
Operating lease liabilities | 10,043 | 9,867 |
Income tax liabilities | 1,110 | 828 |
Total current liabilities | 248,729 | 200,891 |
Long-term senior convertible notes | 886,793 | 884,984 |
Deferred tax liabilities | 12,807 | 3,049 |
Operating lease liabilities | 109,093 | 111,592 |
Contingent consideration liabilities | 73,762 | 139,824 |
Other long-term liabilities | 17,396 | 18,528 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Preferred stock, $0.001 par value; 5,000 shares authorized, none outstanding | 0 | 0 |
Common stock, $0.001 par value; 150,000 shares authorized at March 31, 2022 and December 31, 2021; 58,747 shares issued and 51,949 outstanding at March 31, 2022; 58,469 shares issued and 51,769 outstanding at December 31, 2021 | 63 | 63 |
Additional paid-in capital | 1,441,783 | 1,434,976 |
Accumulated other comprehensive loss | (11,741) | (7,792) |
Retained earnings | 64,909 | 45,708 |
Treasury stock at cost; 6,798 shares and 6,700 shares at March 31, 2022 and December 31, 2021, respectively | (683,093) | (677,748) |
Total equity | 811,921 | 795,207 |
Total liabilities and equity | $ 2,160,501 | $ 2,154,075 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowances | $ 20,707 | $ 21,064 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 150,000,000 | 150,000,000 |
Common stock, shares issued (in shares) | 58,747,000 | 58,469,000 |
Common stock, shares outstanding (in shares) | 51,949,000 | 51,769,000 |
Treasury stock at cost, shares (in shares) | 6,798,000 | 6,700,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Net sales: | ||
Net sales | $ 290,762 | $ 271,249 |
Cost of sales (excluding below amortization of intangible assets): | ||
Cost of sales | 79,097 | 71,811 |
Gross profit | 211,665 | 199,438 |
Operating expenses: | ||
Selling, general and administrative | 160,281 | 145,954 |
Research and development | 23,358 | 22,224 |
Amortization of intangible assets | 13,032 | 13,337 |
Business transition costs | 3,060 | 5,584 |
Total operating expenses | 199,731 | 187,099 |
Interest and other income (expense), net: | ||
Interest income | 43 | 87 |
Interest expense | (4,379) | (8,030) |
Other income (expense), net | 16,244 | (12,526) |
Total interest and other income (expense), net | 11,908 | (20,469) |
Income (loss) before income taxes | 23,842 | (8,130) |
Income tax (expense) benefit | (4,641) | 620 |
Consolidated net income (loss) | $ 19,201 | $ (7,510) |
Net income (loss) per share: | ||
Basic (in dollars per share) | $ 0.37 | $ (0.15) |
Diluted (in dollars per share) | $ 0.35 | $ (0.15) |
Weighted average shares outstanding: | ||
Basic (in shares) | 51,829 | 51,379 |
Diluted (in shares) | 62,579 | 51,379 |
Product [Member] | ||
Net sales: | ||
Net sales | $ 265,973 | $ 245,451 |
Cost of sales (excluding below amortization of intangible assets): | ||
Cost of sales | 57,183 | 53,302 |
Service [Member] | ||
Net sales: | ||
Net sales | 24,789 | 25,798 |
Cost of sales (excluding below amortization of intangible assets): | ||
Cost of sales | $ 21,914 | $ 18,509 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Statement of Comprehensive Income [Abstract] | ||
Consolidated net income (loss) | $ 19,201 | $ (7,510) |
Other comprehensive loss: | ||
Unrealized loss on marketable securities, net of tax | 0 | (13) |
Translation adjustments, net of tax | (3,949) | (1,541) |
Other comprehensive loss | (3,949) | (1,554) |
Total consolidated comprehensive income (loss) | $ 15,252 | $ (9,064) |
Consolidated Statements of Equi
Consolidated Statements of Equity - USD ($) shares in Thousands, $ in Thousands | Total | Adjustment For Modified Retrospective Adoption Of Accounting Standard [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Additional Paid-in Capital [Member]Adjustment For Modified Retrospective Adoption Of Accounting Standard [Member] | Accumulated Other Comprehensive Loss [Member] | Retained Earnings [Member] | Retained Earnings [Member]Adjustment For Modified Retrospective Adoption Of Accounting Standard [Member] | Treasury Stock [Member] |
Beginning Balance (in shares) at Dec. 31, 2020 | 57,945 | 6,569 | |||||||
Beginning Balance at Dec. 31, 2020 | $ 918,918 | $ (82,689) | $ 62 | $ 1,550,001 | $ (147,161) | $ (7,585) | $ 45,322 | $ 64,472 | $ (668,882) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Issuance of common stock under employee and director equity option and purchase plans (in shares) | 4 | 1 | |||||||
Issuance of common stock under employee and director equity option and purchase plans | (61) | (6) | $ (55) | ||||||
Stock-based compensation expense | 7,709 | 7,709 | |||||||
Settlement of convertible note hedge (in shares) | (1) | ||||||||
Settlement of convertible note hedge | 0 | 53 | $ (53) | ||||||
Equity component of convertible note settlement (in share) | 1 | ||||||||
Equity component of convertible note settlement | 574 | 574 | |||||||
Consolidated net income (loss) | (7,510) | (7,510) | |||||||
Other comprehensive income (loss) | (1,554) | (1,554) | |||||||
Ending Balance (in shares) at Mar. 31, 2021 | 57,949 | 6,570 | |||||||
Ending Balance at Mar. 31, 2021 | 835,387 | $ 62 | 1,411,170 | (9,139) | 102,284 | $ (668,990) | |||
Beginning Balance (in shares) at Dec. 31, 2021 | 58,469 | 6,700 | |||||||
Beginning Balance at Dec. 31, 2021 | 795,207 | $ 63 | 1,434,976 | (7,792) | 45,708 | $ (677,748) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Issuance of common stock under employee and director equity option and purchase plans (in shares) | 278 | 98 | |||||||
Issuance of common stock under employee and director equity option and purchase plans | (5,345) | $ (5,345) | |||||||
Stock-based compensation expense | 6,807 | 6,807 | |||||||
Consolidated net income (loss) | 19,201 | 19,201 | |||||||
Other comprehensive income (loss) | (3,949) | (3,949) | |||||||
Ending Balance (in shares) at Mar. 31, 2022 | 58,747 | 6,798 | |||||||
Ending Balance at Mar. 31, 2022 | $ 811,921 | $ 63 | $ 1,441,783 | $ (11,741) | $ 64,909 | $ (683,093) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Operating activities: | ||
Consolidated net income (loss) | $ 19,201 | $ (7,510) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Depreciation and amortization | 36,801 | 36,432 |
Deferred income taxes | (3,891) | (3,535) |
Amortization of non-cash interest | 1,963 | 2,660 |
Stock-based compensation | 6,807 | 7,709 |
Net (gain) loss from foreign currency adjustments | (15,988) | 12,547 |
Reserves on current assets | (1,864) | 4,002 |
Other non-cash adjustments | 1,365 | 6,397 |
Changes in operating assets and liabilities, net of effects from acquisitions: | ||
Accounts receivable | (17,216) | (1,544) |
Inventory | (3,215) | (12,464) |
Prepaid expenses and other current assets | 805 | (2,057) |
Accounts payable and accrued liabilities | (7,956) | (5,663) |
Accrued payroll and related expenses | (10,491) | (4,271) |
Income taxes | 218 | (1,064) |
Net cash provided by operating activities | 6,539 | 31,639 |
Investing activities: | ||
Acquisition of Simplify Medical, net of cash acquired | 0 | (149,408) |
Purchases of intangible assets | 0 | (1,200) |
Purchases of property and equipment | (33,223) | (25,070) |
Proceeds from sales of marketable securities | 0 | 127,023 |
Proceeds from maturities of marketable securities | 0 | 46,000 |
Other investing activities | (947) | 0 |
Net cash used in investing activities | (34,170) | (2,655) |
Financing activities: | ||
Payment of contingent consideration | (6,839) | (3) |
Purchases of treasury stock | (5,345) | (55) |
Payments upon settlement of senior convertible notes | 0 | (649,426) |
Other financing activities | (521) | (341) |
Net cash used in financing activities | (12,705) | (649,825) |
Effect of exchange rate changes on cash | (443) | (2,171) |
Decrease in cash, cash equivalents and restricted cash | (40,779) | (623,012) |
Cash, cash equivalents and restricted cash at beginning of period | 247,585 | 858,363 |
Cash, cash equivalents and restricted cash at end of period | $ 206,806 | $ 235,351 |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2022 | Mar. 31, 2021 |
Statement of Cash Flows [Abstract] | ||
Cash and cash equivalents | $ 205,312 | $ 233,857 |
Restricted cash | 1,494 | 1,494 |
Total cash, cash equivalents and restricted cash shown in the Unaudited Consolidated Statements of Cash Flows | $ 206,806 | $ 235,351 |
Description of Business and Bas
Description of Business and Basis of Presentation | 3 Months Ended |
Mar. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business and Basis of Presentation | Description of Business and Basis of Presentation Description of Business NuVasive, Inc., or the Company, or NuVasive, was incorporated in Delaware on July 21, 1997, and began commercializing its products in 2001. Since its incorporation in 1997, the Company has grown from a small developer of specialty spinal implants into a global medical technology company delivering procedurally integrated solutions for spine surgery. Underlying the Company’s procedurally integrated solutions for spine surgery are technologies designed to enable better clinical, financial, and operational outcomes, including: • its surgical access instruments, including its integrated split-blade retractor system, designed to enable less-invasive surgical techniques by minimizing soft tissue disruption during spine surgery; • its Advanced Materials Science portfolio of specialized spinal implants, designed to advance spinal fusion by enhancing the osseointegration and biomechanical properties of implant materials, including porous titanium and porous polyetheretherketone; • its fixation systems, designed to facilitate the preservation and restoration of patient alignment, while addressing a vast array of spinal pathologies from an open or less-invasive approach across all spinal procedures; • its cervical total disc replacement technology, which complements the Company’s portfolio of products and services for cervical spinal fusion surgery and is designed to offer surgeons capabilities across key performance functions—anatomic, physiologic motion, and radiologic design; • its neuromonitoring systems, which use proprietary software-driven nerve detection and avoidance technology, and the Company’s intraoperative neuromonitoring, or IONM, services and support; and • its Pulse platform, a software ecosystem that integrates multiple hardware technologies into a single, condensed footprint in the operating room, including: radiation reduction, imaging enhancement, rod bending, navigation, IONM, and spinal alignment tools. In addition, the Company also designs and sells expandable growing rod implant systems for the treatment of early-onset scoliosis that can be non-invasively lengthened following implantation with precise, incremental adjustments via an external remote controller using magnetic technology called MAGnetic External Control, or MAGEC. This technology is also the basis for the Company’s Precice line of products which is designed to support complex orthopedic reconstruction, such as trauma and limb length discrepancy. Precice is an intramedullary device that, once implanted, utilizes the MAGEC technology to non-invasively lengthen the femur and tibia. The COVID-19 pandemic significantly impacted the Company’s business and results of operations during the years ended December 31, 2020 and 2021, as well as the three months ended March 31, 2022. Many government agencies, in conjunction with hospitals and healthcare systems have, to varying degrees, deferred, reduced, or suspended elective surgical procedures due to the COVID-19 pandemic. While certain spine surgeries are deemed essential and certain surgeries, like in cases of trauma, cannot be delayed, the Company has seen and may continue to see a significant reduction in procedural volumes as hospital systems and/or patients elect to defer spine surgery procedures. During the three months ended March 31, 2022, procedural volume rates for elective surgeries steadily recovered in the U.S. and certain international regions as government restrictions eased and hospital systems resumed more elective surgical procedures. The COVID-19 pandemic continues to evolve and its impact on the Company’s business will depend on several factors that are highly uncertain and unpredictable, including, the efficacy and adoption of vaccines, future resurgences of the virus and its variants, the imposition of governmental lockdowns, quarantine and physical distancing requirements, patient capacity at hospitals and healthcare systems, the duration and severity of healthcare worker shortages, and the willingness and ability of patients to seek care and treatment due to safety concerns or financial hardship. Basis of Presentation and Principles of Consolidation The accompanying Unaudited Consolidated Financial Statements include the accounts of the Company and its majority-owned or controlled subsidiaries, collectively referred to as either NuVasive or the Company. The Company translates the financial statements of its foreign subsidiaries using end-of-period exchange rates for assets and liabilities and average exchange rates during each reporting period for results of operations. When there is a portion of equity in an acquired subsidiary not attributable, directly or indirectly, to the respective parent entity, the Company records the fair value of the non-controlling interest at the acquisition date and classifies the amounts attributable to the non-controlling interest separately in equity in the Company's Consolidated Financial Statements. Any subsequent changes in a parent's ownership interest while the parent retains its controlling financial interest in its subsidiary are accounted for as equity transactions. All significant intercompany balances and transactions have been eliminated in consolidation. The accompanying Unaudited Consolidated Financial Statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission, or the SEC. Pursuant to these rules and regulations, the Company has condensed or omitted certain information and footnote disclosures it normally includes in its annual Consolidated Financial Statements prepared in accordance with generally accepted accounting principles in the United States, or U.S. GAAP. Operating results for the three months ended March 31, 2022 are not necessarily indicative of the results that may be expected for any other interim period or for the full year. These Unaudited Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and notes thereto for the year ended December 31, 2021 included in the Company’s Annual Report on Form 10-K filed with the SEC. In the opinion of management, the Unaudited Consolidated Financial Statements and notes thereto include all adjustments that are of a normal and recurring nature that are necessary for the fair presentation of the Company’s financial position and of the results of operations and cash flows for the periods presented. Use of Estimates To prepare financial statements in conformity with U.S. GAAP, management must make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. These estimates and assumptions involve judgments with respect to numerous factors that are difficult to predict. As a result, actual amounts could be materially different from these estimates. Recent Accounting Pronouncements Not Yet Adopted In October 2021, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update No. 2021-08, Business Combinations (Topic 805), Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, which requires an entity (acquirer) to recognize and measure contract assets and liabilities acquired in a business combination in accordance with Topic 606, Revenue from Contracts with Customers. This update is effective for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years, with early adoption permitted. The amendments should be applied prospectively to business combinations occurring on or after the effective date of the amendments. The Company is currently evaluating the impact the standard will have on our Consolidated Financial Statements. Revenue Recognition In accordance with Accounting Standards Codification 606 Revenue from Contracts with Customers, or ASC 606, the Company recognizes revenue upon the transfer of goods or services to a customer at an amount that reflects the expected consideration to be received in exchange for those goods or services. The principles in ASC 606 are applied using the following five steps: (i) identify the contract with a customer; (ii) identify the performance obligation(s) in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligation(s) in the contract; and (v) recognize revenue when (or as) the Company satisfies its performance obligation(s). Specifically, revenue from the sale of implants, fixation products and disposables is generally recognized at an amount that reflects the expected consideration upon notice that the Company’s products have been used in a surgical procedure or upon shipment to a third-party customer assuming control of the products. Revenue from IONM services is recognized in the period the service is performed for the amount of consideration expected to be received. Revenue from the sale of surgical instrument sets is generally recognized upon receipt of a purchase order and the subsequent shipment to a customer who assumes control. In certain cases, the Company does offer the ability for customers to lease surgical instrumentation primarily on a non-sales type basis. Revenue from the sale or lease of capital equipment is recognized when the Company transfers control to the customer, which is generally at the point when acceptance occurs that indicates customer acknowledgment of delivery or installation, depending on the terms of the arrangement. Selling and leasing of surgical instrument sets and capital equipment represents an immaterial amount of the Company’s total net sales in all periods presented. Revenue associated with products holding rights of return or trade-in are recognized when the Company concludes there is not a risk of significant revenue reversal in future periods for the expected consideration in the transaction. Costs incurred by the Company associated with sales contracts with customers are deferred over the performance obligation period and recognized in the same period as the related revenue, with the exception of contracts that complete within one year or less, in which case the associated costs are expensed as incurred. Accounts Receivable and Related Valuation Accounts Accounts receivable in the accompanying Unaudited Consolidated Balance Sheets are presented net of allowances for credit losses. The Company maintains an allowance for credit losses resulting from the inability of its customers, including hospitals, ambulatory surgery centers, and distributors, to make required payments. The allowance for credit losses is calculated quarterly, and is estimated on a region-by-region basis considering a number of factors including age of account balances, collection history, historical account write-offs, third party credit reports, identified trends, current economic conditions, and supportable forecasted economic expectations. The allowance is adjusted on a specific identification basis for certain accounts as well as pooling of accounts with similar characteristics. An increase in the provision for credit losses may be required when the financial condition of the Company’s customers or its collection experience deteriorates. An increase to the allowance for credit losses results in a corresponding charge to selling, general and administrative expenses. The Company has a diverse customer base and no single customer represented greater than ten percent of net sales or accounts receivable. Historically, the Company’s reserves have been adequate to cover credit losses. The Company's exposure to credit losses may increase if its customers are adversely affected by changes in healthcare laws, coverage and reimbursement, economic pressures or uncertainty associated with local or global economic recessions, disruption associated with the current COVID-19 pandemic, or other customer-specific factors. It is possible that there could be a significant adverse impact from potential adjustments to the carrying amount of trade receivables as customers’ cash flows are impacted by their response to the COVID-19 pandemic and the deferral of elective surgical procedures. The following table summarizes the changes in the allowance for credit losses: (in thousands) March 31, 2022 December 31, 2021 Allowance for credit losses at January 1 $ 10,928 $ 9,646 Current-period provision for expected losses 337 2,165 Write-offs charged against the allowance (102) (743) Recoveries of amounts previously written off 3 42 Changes resulting from foreign currency fluctuations (6) (182) Allowance for credit losses at end of period $ 11,160 $ 10,928 Inventory, Net Net inventory as of March 31, 2022 consisted of $307.6 million of finished goods, $10.6 million of work in progress and $6.2 million of raw materials. Net inventory as of December 31, 2021 consisted of $301.3 million of finished goods, $8.1 million of work in progress and $6.4 million of raw materials. Finished goods primarily consists of specialized implants, fixation products and disposables and are stated at the lower of cost or net realizable value determined by utilizing a standard cost method, which includes capitalized variances, which approximates the weighted average cost. Work in progress and raw materials represent the underlying material, and labor for work in progress, that ultimately yield finished goods upon completion and are recorded at the lower of cost or net realizable value. The Company reviews the components of its inventory on a periodic basis for excess and obsolescence and adjusts inventory to its net realizable value as necessary. The Company records an inventory reserve for estimated excess and obsolete inventory based upon historical turnover and assumptions about future demand for its products and market conditions, such as product life cycles and timing of the introduction and development of new or enhanced products. The Company’s allograft products have shelf lives ranging from two years to five years and are subject to demand fluctuations based on the availability and demand for alternative products. The Company’s inventory, which consists primarily of disposables, specialized implants and fixation products, is at risk of obsolescence following the introduction and development of new or enhanced products. One of the Company’s strategic objectives is to continue to rapidly develop and commercialize new products and product enhancements which increases the risk that products will become obsolete prior to the end of their anticipated useful life. The Company’s estimates and assumptions for excess and obsolete inventory are reviewed and updated on a quarterly basis. The estimates the Company uses for demand are also used for near-term capacity planning and inventory purchasing and are consistent with its net sales forecasts. Increases in the reserve for excess and obsolete inventory result in a corresponding charge to cost of sales. Derivative Financial Instruments The Company recognizes all derivative instruments as assets or liabilities in its Unaudited Consolidated Balance Sheets and measures these instruments at fair value by revaluing these assets and liabilities at the end of each reporting period. Gains and losses are recorded as a component of other income (expense), net in the Unaudited Consolidated Statements of Operations. Comprehensive Income (Loss) Comprehensive income (loss) is defined as the change in equity during a period from transactions and other events and circumstances from non-owner sources. Comprehensive income (loss) includes net of tax, unrealized gains or losses on the Company’s marketable debt securities and foreign currency translation adjustments. The cumulative translation adjustments included in accumulated other comprehensive loss were $11.7 million and $7.8 million for March 31, 2022 and December 31, 2021, respectively. Product Shipment Costs Product shipment costs, included in selling, general and administrative expense in the accompanying Unaudited Consolidated Statements of Operations, were $8.1 million and $7.1 million for the three months ended March 31, 2022 and March 31, 2021, respectively. The majority of the Company’s shipping costs are associated with providing instrument sets to hospitals for use in individual surgical procedures. Amounts billed to customers for shipping and handling of products are reflected in net sales and are not material for any period presented. Business Transition Costs The Company incurs certain costs related to acquisition, integration and business transition activities, which include severance, relocation, consulting, leasehold exit costs, third-party merger and acquisition costs, contingent consideration fair value adjustments and other costs directly associated with such activities. Contingent consideration is accrued based on the fair value of the expected payment, and such accruals are subject to increase or decrease based on the assessment of the likelihood that the contingent milestones will be achieved resulting in payment. If an accrual for contingent consideration decreases during a particular period, it results in a reduction of costs during such period. During the three months ended March 31, 2022, the Company recorded $3.1 million of costs related to acquisition, integration and business transition activities, which included de minimis fair value adjustments on contingent consideration liabilities associated with the Company’s 2021, 2017 and 2016 acquisitions. During the three months ended March 31, 2021, the Company recorded $5.6 million of costs related to acquisition, integration and business transition activities, which included $0.9 million of fair value adjustments on contingent consideration liabilities associated with the Company’s 2017 and 2016 acquisitions and $3.9 million of costs associated with the 2021 acquisition of Simplify Medical Pty Limited, or Simplify Medical. |
Net Income (Loss) Per Share
Net Income (Loss) Per Share | 3 Months Ended |
Mar. 31, 2022 | |
Earnings Per Share [Abstract] | |
Net Income (Loss) Per Share | Net Income (Loss) Per Share The following table sets forth the computation of basic and diluted consolidated net income (loss) per share: Three Months Ended March 31, (in thousands, except per share data) 2022 2021 Numerator: Net income (loss) for basic $ 19,201 $ (7,510) Dilutive potential net income (loss): Interest and debt issuance costs on the 1.00% Senior Convertible Notes due 2023, net of tax $ 1,705 $ — Interest and debt issuance costs on the 0.375% Senior Convertible Notes due 2025, net of tax 821 — Net income (loss) for diluted $ 21,727 $ (7,510) Denominator for basic and diluted net income (loss) per share: Weighted average common shares outstanding for basic 51,829 51,379 Dilutive potential common stock outstanding: Employee stock purchase plan (ESPP) 3 — Restricted stock units (RSUs) and performance restricted stock units (PRSUs) 578 — 1.00% Senior Convertible Notes due 2023 5,345 — 0.375% Senior Convertible Notes due 2025 4,824 — Weighted average common shares outstanding for diluted 62,579 51,379 Basic net income (loss) per share $ 0.37 $ (0.15) Diluted net income (loss) per share $ 0.35 $ (0.15) In accordance with ASU No. 2020-06, Debt with Conversion and Other Options (Subtopic 470-20), or ASU 2020-06, the Company applies the if-converted method in computing the effect of the Company's senior convertible notes on diluted net income (loss) per share. The numerator of the diluted net income (loss) per share computation is adjusted for interest expense and amortization of debt issuance costs, net of tax, and the denominator is adjusted for the weighted average number of shares into which each of the Company’s senior convertible notes could be converted. The effect is only included in the calculation of diluted net income (loss) per share for those senior convertible notes which reduce net income (loss) per share. The following weighted average outstanding common stock equivalents were not included in the calculation of net income (loss) per diluted share because their effects were anti-dilutive: Three Months Ended March 31, ( in thousands ) 2022 2021 ESPP, RSUs and PRSUs 239 1,355 Warrants 10,169 21,034 Senior convertible notes — 10,169 Total 10,408 32,558 |
Business Combinations
Business Combinations | 3 Months Ended |
Mar. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Business Combinations | Business Combinations The Company recognizes the assets acquired, liabilities assumed, and any non-controlling interest at fair value at the date of acquisition. Certain acquisitions contain contingent consideration arrangements that require the Company to assess the acquisition date fair value of the contingent consideration liabilities. Such liabilities are recorded as part of the purchase price allocation of the acquisition, with subsequent fair value adjustments to the contingent consideration recorded in the Unaudited Consolidated Statements of Operations. See Note 4, Financial Instruments and Fair Value Measurements, in the Notes to Unaudited Consolidated Financial Statements included in this Quarterly Report for further discussion on contingent consideration liabilities. Acquisition of Simplify Medical Pty Limited On February 24, 2021, the Company, through its indirect wholly-owned subsidiary, NuVasive (AUST/NZ) Pty Limited, acquired all of the stock interest in Simplify Medical, a developer of cervical disc technology for cervical total disc replacement procedures. Simplify Medical now operates as a wholly-owned subsidiary of the Company. The Company agreed to make an upfront payment of $150.0 million, subject to customary purchase price adjustments, plus additional future payments contingent upon milestones related to regulatory approval and net sales from products incorporating the Simplify Medical cervical disc technology. In April 2021, the Simplify Cervical Disc received approval from the U.S. Food and Drug Administration, or FDA, for two-level cervical total disc replacement, resulting in the Company’s payment of $45.8 million for the achievement of the regulatory milestone . Additional milestone payments, which are uncapped and contingent upon net sales from products incorporating the Simplify Medical cervical disc technology, will become payable in calendar years 2023, 2024 and 2025. In connection with the closing, the Company paid $151.0 million, which included additional amounts for customary purchase price adjustments, using available cash on hand. The allocation of the purchase price to the assets acquired and liabilities assumed based on their fair values is as follows: (in thousands) Cash paid for purchase $ 151,026 Cash 1,563 Accounts receivable 203 Inventory 6,710 Other current assets 568 Property, plant and equipment, net 381 Definite-lived intangible assets: Developed technology 141,700 Patents 19,000 Trade names 3,500 Goodwill 81,125 Other assets 7 Contingent consideration liabilities (103,400) Accounts payable, accrued expenses and other (331) $ 151,026 Goodwill recognized in this transaction is not deductible for tax purposes. Goodwill largely consists of expected net sales synergies resulting from the combination of product portfolios, use of the Company’s existing commercial infrastructure to expand sales of Simplify Medical’s products, and the assembled workforce. The intangible assets acquired are being amortized on a straight-line basis over useful lives of seventeen years, ten years, and fifteen years for developed technology-based intangible assets, patent-related intangible assets, and trade name related intangible assets, respectively. The estimated fair values of the intangible assets acquired were primarily determined using the income approach based on significant inputs that were not observable. In connection with the acquisition, contingent consideration liabilities of $103.4 million were recorded for the potential regulatory and net sales-based milestone payments. The fair value of the contingent liability related to the regulatory milestone payment was determined using the probability approach based on the probability of the approval being achieved as of various periods. The fair value of the contingent liability relating to the net sales-based milestone payments was determined using a Monte Carlo simulation model based on forecast net sales, volatility factors associated with those forecast net sales and discount rates. The Company’s results of operations for the three months ended March 31, 2021 include the operating results of Simplify Medical since the date of acquisition. Acquisition costs of $3.9 million were included in the Unaudited Consolidated Statements of Operations as business transition costs for the three months ended March 31, 2021. Variable Interest Entities The Company provides IONM services through various subsidiaries, which conduct business as NuVasive Clinical Services. In providing IONM services to surgeons and healthcare facilities across the United States, the Company maintains contractual relationships with several physician practices, or PCs. In accordance with authoritative guidance, the Company has determined that the PCs are variable interest entities and therefore, the accompanying Unaudited Consolidated Financial Statements include the accounts of the PCs from the date of acquisition. During the periods presented, the results of the PCs were immaterial to the Company’s financial statements. The creditors of the PCs have claims only to the assets of the PCs, which are not material, and the assets of the PCs are not available to the Company. |
Financial Instruments and Fair
Financial Instruments and Fair Value Measurements | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Financial Instruments and Fair Value Measurements | Financial Instruments and Fair Value Measurements Foreign Currency and Derivative Financial Instruments The Company translates the financial statements of its foreign subsidiaries using end-of-period exchange rates for assets and liabilities, and average exchange rates during each reporting period for results of operations. Some of the Company’s reporting entities conduct a portion of their business in currencies other than the entity’s functional currency. These transactions give rise to receivables and payables that are denominated in currencies other than the entity’s functional currency. The value of these receivables and payables is subject to changes in currency exchange rates from the point at which the transactions are originated until the settlement in cash. Both realized and unrealized gains and losses in the value of these receivables and payables are included in the determination of net income or loss. Net currency exchange gains (losses), which include gains and losses from derivative instruments, were $16.0 million and $(2.7) million for the three months ended March 31, 2022 and March 31, 2021, respectively, and are included in other income (expense), net in the Unaudited Consolidated Statements of Operations. To manage foreign currency exposure risks, the Company uses derivatives for activities in entities that have short-term intercompany receivables and payables denominated in a currency other than the entity’s functional currency. The fair value is based on a quoted market price (Level 1). A s of March 31, 2022 and December 31, 2021, a notional principal amount of $17.6 million and $12.2 million, respectively, was outstanding to hedge currency risk relative to the Company’s foreign currency-denominated receivables and payables . Derivative instrument net gains on the Company’s forward exchange contracts were $0.8 million and $1.3 million for the three months ended March 31, 2022 and March 31, 2021, respectively, and are included in other income (expense), net in the Unaudited Consolidated Statements of Operations. The fair value of the forward contract exchange derivative instrument asset (liability) was de minimis as of March 31, 2022 and December 31, 2021. The derivative instruments are recorded in other current assets or other current liabilities in the Unaudited Consolidated Balance Sheets commensurate with the nature of the instrument at period end. Fair Value Measurements The Company measures certain assets and liabilities in accordance with authoritative guidance, which requires fair value measurements be classified and disclosed in one of the following three categories: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. Level 2: Observable prices that are based on inputs not quoted on active markets, but corroborated by market data. Level 3: Unobservable inputs are used when little or no market data is available. Assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurements. The Company reviews the fair value hierarchy classification on a quarterly basis. Changes in the ability to observe valuation inputs may result in a reclassification of levels for certain assets or liabilities within the fair value hierarchy. The Company did not have any transfers of assets and liabilities between the levels of the fair value measurement hierarchy during the periods presented. The fair values of the Company’s assets and liabilities, including cash equivalents, marketable debt securities, restricted investments, derivatives, and contingent consideration are measured at fair value on a recurring basis. As of March 31, 2022 and December 31, 2021, the Company held investments in securities classified as cash equivalents. During the periods presented, the Company did not hold any such investments that were in a significant unrealized loss position and no impairment charges were recorded on such investments. Realized gains and losses and interest income related to marketable securities were immaterial during all periods presented. The Company’s assets that are measured at fair value were based on the following fair value categories: (in thousands) Total Quoted Price in Active Market (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) March 31, 2022: Cash equivalents: Money market funds $ 130,651 $ 130,651 $ — $ — Total cash equivalents $ 130,651 $ 130,651 $ — $ — December 31, 2021: Cash equivalents: Money market funds $ 179,451 $ 179,451 $ — $ — Total cash equivalents 179,451 179,451 — — The carrying amounts of certain financial instruments such as cash and cash equivalents, accounts receivable, prepaid expenses, other current assets, accounts payable, accrued expenses, and other current liabilities as of March 31, 2022 and December 31, 2021 approximate their related fair values due to the short-term maturities of these instruments. The fair value of certain financial instruments was measured and classified within Level 1 of the fair value hierarchy based on quoted prices. Fair Value of Senior Convertible Notes The fair value, based on a quoted market price (Level 1), of the Company’s outstanding $450.0 million principal amount of Senior Convertible Notes due 2023 at March 31, 2022 and December 31, 2021 was approximately $447.2 million and $450.6 million, respectively. The fair value, based on a quoted market price (Level 1), of the Company’s outstanding $450.0 million principal amount of Senior Convertible Notes due 2025 at March 31, 2022 and December 31, 2021 was approximately $425.0 million and $433.5 million, respectively. See Note 6, Indebtedness, in the Notes to Unaudited Consolidated Financial Statements included in this Quarterly Report for further discussion on the carrying value of the Company’s outstanding senior convertible notes. Contingent Consideration Liabilities The fair value of contingent consideration liabilities assumed in business combinations is recorded as part of the purchase price consideration of the acquisition, and is determined using a discounted cash flow 2022 Valuation Technique Discounted cash flow, Monte Carlo Discount Rate Range 4.0% - 5.9% Weighted Average Discount Rate 4.5% Expected Years 2023 - 2027 Contingent consideration liabilities at March 31, 2022 and December 31, 2021 were $139.8 million and $147.8 million, respectively, and were recorded in the Unaudited Consolidated Balance Sheets commensurate with the respective payment terms. The following table sets forth the changes in the estimated fair value of the Company's contingent consideration liabilities measured on a recurring basis using significant unobservable inputs (Level 3): Three Months Ended March 31, ( in thousands ) 2022 2021 Beginning balance at January 1 $ 147,810 $ 37,041 Contingent consideration liability recorded upon acquisition — 103,400 Change in fair value measurement 39 881 Contingent consideration paid or settled (8,037) (156) Changes resulting from foreign currency fluctuations 4 — Balance at end of period $ 139,816 $ 141,166 During the first quarter of 2021, the Company recorded $103.4 million in contingent consideration liabilities as part of the Simplify Medical acquisition, of which $42.8 million and $60.6 million relate to the regulatory approval and net sales milestones, respectively. In the second quarter of 2021, the Simplify Cervical Disc received approval from the FDA for two-level cervical total disc replacement which resulted in the payment of $45.8 million for the achievement of the regulatory milestone. As a result of the milestone achievement, the Company recorded a $3.0 million increase in the fair value of the contingent consideration liability, which has been recorded within Business Transition Costs in the Company’s Consolidated Statements of Operations in the year ended December 31, 2021. For the quarter ended March 31, 2022 and year ended December 31, 2021, the Company increased the contingent consideration liabilities related to the net sales milestones by $0.1 million and $47.9 million, respectively, which resulted from updates to the Company’s forecasted net sales assumptions. The remaining contingent consideration liabilities for the Simplify Medical acquisition totaled $108.6 million and $108.5 million as of March 31, 2022 and December 31, 2021, respectively. Changes in fair value measurement of the contingent consideration liabilities are recorded in the Consolidated Statements of Operations within the Business Transition Costs line item. Non-financial assets and liabilities measured on a nonrecurring basis Certain non-financial assets and liabilities are measured at fair value, usually with Level 3 inputs including the discounted cash flow method or cost method, on a nonrecurring basis in accordance with authoritative guidance. These include items such as non-financial assets and liabilities initially measured at fair value in a business combination and non-financial long-lived assets measured at fair value for an impairment assessment. In general, non-financial assets, including goodwill, intangible assets and property and equipment, are measured at fair value when there is an indication of impairment and are recorded at fair value only when any impairment is recognized. The carrying values of the Company’s financing lease obligations approximated their estimated fair value as of March 31, 2022 and December 31, 2021. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 3 Months Ended |
Mar. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill and intangible assets consisted of the following: (in thousands, except years) Weighted- Gross Accumulated Intangible March 31, 2022: Intangible assets subject to amortization: Developed technology 11 $ 378,541 $ (217,914) $ 160,627 Patents 10 58,330 (33,436) 24,894 Manufacturing know-how and trade secrets 12 21,394 (21,394) — Trade name and trademarks 9 25,264 (20,260) 5,004 Customer relationships 9 156,743 (113,967) 42,776 Total intangible assets subject to amortization 10 $ 640,272 $ (406,971) $ 233,301 Intangible assets not subject to amortization: Goodwill $ 636,703 Total goodwill and intangible assets, net $ 870,004 (in thousands, except years) Weighted- Average Amortization Period (in years) Gross Amount Accumulated Amortization Intangible Assets, net December 31, 2021: Intangible assets subject to amortization: Developed technology 11 $ 374,457 $ (209,283) $ 165,174 Patents 10 57,783 (31,903) 25,880 Manufacturing know-how and trade secrets 12 21,412 (21,387) 25 Trade name and trademarks 9 25,163 (19,621) 5,542 Customer relationships 9 156,208 (110,154) 46,054 Total intangible assets subject to amortization 10 $ 635,023 $ (392,348) $ 242,675 Intangible assets not subject to amortization: Goodwill $ 633,467 Total goodwill and intangible assets, net $ 876,142 The changes to goodwill are comprised of the following: ( in thousands ) December 31, 2021 Gross goodwill $ 641,767 Accumulated impairment loss (8,300) 633,467 Changes to gross goodwill Changes resulting from foreign currency fluctuations 3,236 March 31, 2022 Gross goodwill 645,003 Accumulated impairment loss (8,300) $ 636,703 Total expense related to the amortization of intangible assets, which is recorded in both cost of sales and operating expenses in the Unaudited Consolidated Statements of Operations depending on the functional nature of the intangible asset, was $13.9 million and $14.2 million for the three months ended March 31, 2022 and March 31, 2021, respectively. Total future amortization expense related to intangible assets subject to amortization at March 31, 2022 is set forth in the table below: (in thousands) Remaining 2022 $ 39,169 2023 27,441 2024 21,628 2025 20,782 2026 15,984 Thereafter through 2038 108,297 Total future amortization expense $ 233,301 |
Indebtedness
Indebtedness | 3 Months Ended |
Mar. 31, 2022 | |
Debt Disclosure [Abstract] | |
Indebtedness | Indebtedness The carrying values of the Company’s Senior Convertible Notes are as follows: (in thousands) March 31, 2022 December 31, 2021 1.00% Senior Convertible Notes due 2023: Principal amount $ 450,000 $ 450,000 Unamortized debt issuance costs (5,402) (6,543) 444,598 443,457 0.375% Senior Convertible Notes due 2025: Principal amount 450,000 450,000 Unamortized debt issuance costs (7,805) (8,473) 442,195 441,527 Total Senior Convertible Notes $ 886,793 $ 884,984 Three Months Ended March 31, (in thousands) 2022 2021 Interest expense: Contractual coupon interest $ 1,547 $ 4,594 Amortization of debt issuance costs 1,810 2,507 Total interest expense recognized on Senior Convertible Notes $ 3,357 $ 7,101 Effective interest rates: Senior Convertible Notes due 2021 (1) — % 2.9 % Senior Convertible Notes due 2023 (2) 2.0 % 2.0 % Senior Convertible Notes due 2025 (2) 1.0 % 1.0 % ( 1) Senior Convertible Notes due 2021 settled in full on March 15, 2021. (2 ) Interest on Senior Convertible Notes due 2023 and 2025 began accruing upon issuance and is payable semi-annually. 1.00% Senior Convertible Notes due 2023 In June 2020, the Company issued $450.0 million principal amount of unsecured Senior Convertible Notes with a stated interest rate of 1.00% and a maturity date of June 1, 2023, or the 2023 Notes. The net proceeds from the offering of the 2023 Notes, after deducting initial purchasers’ discounts and costs directly related to the offering, were approximately $436.7 million. The 2023 Notes were initially required to be settled in cash as the Company did not have sufficient reserved shares. On September 10, 2020, the Company held a Special Meeting of Stockholders and received stockholder approval to amend the Company’s Restated Certificate of Incorporation to increase the number of shares of its common stock authorized for issuance from 120,000,000 shares to 150,000,000 shares. As a result of the increase in the number of shares of the Company’s common stock authorized for issuance, as of September 10, 2020 and as of December 31, 2020 and December 31, 2021, the Company had sufficient reserved shares and therefore may settle conversions of the 2023 Notes in cash, stock, or a combination thereof, solely at the Company’s discretion. It is the Company’s current intent and policy to settle all conversions through combination settlement, which involves satisfying the principal amount outstanding with cash and any note conversion value over the principal amount in shares of the Company’s common stock. The initial conversion rate of the 2023 Notes is 11.8778 shares per $1,000 principal amount, which is equivalent to a conversion price of approximately $84.19 per share, subject to adjustments. In addition, following certain corporate events that occur prior to the maturity date, the Company will increase the conversion rate for a holder who elects to convert its 2023 Notes in connection with such a corporate event in certain circumstances. As of December 31, 2020, the Company uses the treasury share method for assumed conversion of the 2023 Notes to compute the weighted average shares of common stock outstanding for diluted earnings per share. The Company also entered into transactions for a convertible notes hedge and warrants concurrently with the issuance of the 2023 Notes. At the time of issuance, the cash conversion feature of the 2023 Notes required bifurcation from the 2023 Notes and was initially accounted for as a derivative liability (the "Embedded Conversion Derivative"), which was included in long-term liabilities in the Company’s Unaudited Consolidated Balance Sheets. The fair value of the 2023 Notes Embedded Conversion Derivative was $57.2 million, and was recorded as the original debt discount for purposes of accounting for the debt component of the 2023 Notes. On September 10, 2020, as a result of the increase in the number of shares of the Company’s common stock authorized for issuance, the Company had sufficient reserved shares to settle conversions of the 2023 Notes in cash, stock, or a combination thereof, and in accordance with authoritative literature, the Embedded Conversion Derivative was marked to fair value and reclassified to stockholders’ equity, which resulted in recognizing $37.3 million in additional paid-in-capital during 2020. The original issue discount was recognized as interest expense using the effective interest method. As of January 1, 2021, the Company early adopted ASU 2020-06, which removed the requirement of separating the embedded conversion feature classified within stockholders’ equity from the 2023 Notes. Accordingly, the Company reclassified the unamortized debt discount from its additional paid-in capital to its senior convertible notes within long-term liabilities in the Unaudited Consolidated Balance Sheets. The impact of the adoption of ASU 2020-06 as of January 1, 2021 resulted in an increase in senior convertible notes and retained earnings of $46.8 million and $7.9 million, respectively, and a decrease in deferred tax liabilities and additional paid-in capital by $11.2 million and $43.5 million, respectively. Prior to February 1, 2023, holders may convert their 2023 Notes only under the following conditions: (a) during any calendar quarter commencing after the calendar quarter ending on September 30, 2020 (and only during such calendar quarter), if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; (b) during the five business day period after any five consecutive trading day period, or the measurement period, in which the trading price of the 2023 Notes per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the Company’s common stock and the conversion rate on such trading day; or (c) upon the occurrence of specified corporate events, as defined in the 2023 Notes. On or after February 1, 2023, until the close of business on the second scheduled trading day immediately preceding June 1, 2023, holders may convert their 2023 Notes at any time, regardless of the foregoing conditions. The Company may not redeem the 2023 Notes prior to the maturity date and no principal payments are due on the 2023 Notes prior to maturity. Other than restrictions relating to certain fundamental changes and consolidations, mergers or asset sales and customary anti-dilution adjustments, the 2023 Notes do not contain any financial covenants and do not restrict the Company from conducting significant restructurings, paying dividends or issuing or repurchasing any of its other securities. As of March 31, 2022, the Company is unaware of any current events or market conditions that would allow holders to convert the 2023 Notes. 2023 Hedge In connection with the sale of the 2023 Notes, the Company entered into privately negotiated call option transactions with certain dealers, which included affiliates of certain of the initial purchasers of the 2023 Notes and other financial institutions, or the 2023 Counterparties, entitling the Company to purchase up to 5,345,010 shares of the Company’s common stock at an initial stock price of $84.19 per share, each of which is subject to adjustment. The 2023 Hedge was initially required to be settled in cash as the Company did not have sufficient reserved shares with respect to the 2023 Notes. As a result, the 2023 Hedge was accounted for as a derivative asset, which was included in long-term assets in the Company’s Unaudited Consolidated Balance Sheets. The cost of the 2023 Hedge was $69.5 million. On September 10, 2020, as a result of the increase in the number of shares of the Company’s common stock authorized for issuance, the Company had sufficient reserved shares to settle the 2023 Notes, which therefore allows for the 2023 Hedge to be settled in cash, stock, or a combination thereof. In accordance with authoritative literature, the Convertible Note Hedge Derivative was marked to fair value and reclassified to stockholders’ equity, which resulted in recognizing a reduction of $37.3 million in additional paid-in-capital during 2020. The 2023 Hedge will expire on the second scheduled trading day immediately preceding June 1, 2023. The 2023 Hedge is expected to reduce the potential equity dilution upon conversion of the 2023 Notes if the daily volume-weighted average price per share of the Company’s common stock exceeds the strike price of the 2023 Hedge. An assumed exercise of the 2023 Hedge by the Company is considered anti-dilutive since the effect of the inclusion would always be anti-dilutive with respect to the calculation of diluted earnings per share. 2023 Warrants In connection with the sale of the 2023 Notes, the Company sold warrants to the 2023 Counterparties, or the 2023 Warrants, to acquire up to 5,345,010 shares of the Company’s common stock. The 2023 Warrants initially limited the amount of shares the Company was required to reserve for issuance under the 2023 Warrants to an aggregate of 3,093,500 shares of the Company’s common stock, subject to adjustment upon the Company having a sufficient amount of authorized and unissued shares which are not reserved for other transactions. As a result of the Company receiving stockholder approval to increase the number of shares of the Company’s common stock authorized for issuance on September 10, 2020, the Company subsequently entered into amendment agreements with each of the 2023 Counterparties to increase the number of authorized shares of the Company’s common stock required to be reserved under the 2023 Warrants to the aggregate amount of 6,948,512 shares. The 2023 Warrants will expire on various dates from September 2023 through November 2023 and may be settled in net shares or cash, subject to certain conditions. It is the Company’s current intent and policy to settle all conversions in shares of the Company’s common stock. The Company received $46.8 million in cash proceeds from the sale of the 2023 Warrants, which was recorded in additional paid-in-capital. The 2023 Warrants could have a dilutive effect on the Company’s earnings per share to the extent that the price of the Company's common stock during a given measurement period exceeds the strike price of the 2023 Warrants, which is $104.84 per share. The Company uses the treasury share method for assumed conversion of its 2023 Warrants to compute the weighted average common shares outstanding for diluted earnings per share. 0.375% Senior Convertible Notes due 2025 In March 2020, the Company issued $450.0 million principal amount of unsecured Senior Convertible Notes with a stated interest rate of 0.375% and a maturity date of March 15, 2025, or the 2025 Notes. The net proceeds from the offering of the 2025 Notes, after deducting initial purchasers’ discounts and costs directly related to the offering, were approximately $437.0 million. The 2025 Notes may be settled in cash, stock, or a combination thereof, solely at the Company’s discretion. It is the Company's current intent and policy to settle all conversions through combination settlement, which involves satisfying the principal amount outstanding with cash and any note conversion value over the principal amount in shares of the Company’s common stock. The initial conversion rate of the 2025 Notes is 10.7198 shares per $1,000 principal amount, which is equivalent to a conversion price of approximately $93.29 per share, subject to adjustments. In addition, following certain corporate events that occur prior to the maturity date or if the Company issues a notice of redemption, the Company will increase the conversion rate for a holder who elects to convert its 2025 Notes in connection with such a corporate event or in connection with such redemption in certain circumstances. For the year ended December 31, 2020, the Company used the treasury share method for assumed conversion of the 2025 Notes to compute the weighted average shares of common stock outstanding for diluted earnings per share. The Company also entered into transactions for a convertible notes hedge, or the 2025 Hedge, and warrants, or the 2025 Warrants, concurrently with the issuance of the 2025 Notes. At the time of issuance and in accordance with Accounting Standards Codification Topic 470, the embedded conversion feature of the 2025 Notes required bifurcation from the notes and was initially accounted for as an equity instrument classified to stockholders’ equity, which resulted in recognizing $78.3 million in additional paid-in-capital during 2020. As of January 1, 2021, the Company early adopted ASU 2020-06, which removed the requirement of separating the embedded conversion feature classified within stockholders’ equity from the 2025 Notes. Accordingly, the Company reclassified the unamortized debt discount and corresponding debt issuance costs from its additional paid-in capital to its senior convertible notes within long-term liabilities in the Unaudited Consolidated Balance Sheets. The impact of the adoption of ASU 2020-06 as of January 1, 2021 resulted in an increase in senior convertible notes and retained earnings of $64.7 million and $8.8 million, respectively, and a decrease in deferred tax liabilities and additional paid-in capital by $15.9 million and $57.6 million, respectively. Prior to September 15, 2024, holders may convert their 2025 Notes only under the following conditions: (a) during any calendar quarter commencing after the calendar quarter ending on June 30, 2020 (and only during such calendar quarter), if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; (b) during the five business day period after any five consecutive trading day period, or the measurement period, in which the trading price of the 2025 Notes per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the Company’s common stock and the conversion rate on such trading day; (c) if the Company calls any or all of the 2025 Notes for redemption, at any time prior to the close of business on the second scheduled trading day preceding the redemption date; or (d) upon the occurrence of specified corporate events, as defined in the 2025 Notes. On or after September 15, 2024, until the close of business on the second scheduled trading day immediately preceding March 15, 2025, holders may convert their 2025 Notes at any time, regardless of the foregoing conditions. The Company may not redeem the 2025 Notes prior to March 20, 2023. The Company may redeem the 2025 Notes, at its option, in whole or in part, on or after March 20, 2023 until the close of business on the business day immediately preceding September 15, 2024, if the last reported sale price of the Company’s common stock has been at least 130% of the conversion price then in effect for at least 20 trading days during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company delivers written notice of a redemption. The redemption price will be equal to 100% of the principal amount of such 2025 Notes to be redeemed plus accrued and unpaid interest to, but excluding, the redemption date . No principal payments are due on the 2025 Notes prior to maturity. Other than restrictions relating to certain fundamental changes and consolidations, mergers or asset sales and customary anti-dilution adjustments, the 2025 Notes do not contain any financial covenants and do not restrict the Company from conducting significant restructurings, paying dividends or issuing or repurchasing any of its other securities. As of March 31, 2022, the Company is unaware of any current events or market conditions that would allow holders to convert the 2025 Notes. 2025 Hedge In connection with the sale of the 2025 Notes, the Company entered into privately negotiated call option transactions with certain dealers, which included affiliates of certain of the initial purchasers of the 2025 Notes and other financial institutions, or the 2025 Counterparties, entitling the Company to purchase up to 4,823,910 shares of the Company’s common stock at an initial stock price of $93.29 per share, each of which is subject to adjustment. The cost of the 2025 Hedge was $78.3 million and accounted for as an equity instrument by recognizing $78.3 million in additional paid-in-capital during 2020. The 2025 Hedge will expire on the second scheduled trading day immediately preceding March 15, 2025. The 2025 Hedge is expected to reduce the potential equity dilution upon conversion of the 2025 Notes if the daily volume-weighted average price per share of the Company’s common stock exceeds the strike price of the 2025 Hedge. An assumed exercise of the 2025 Hedge by the Company is considered anti-dilutive since the effect of the inclusion would always be anti-dilutive with respect to the calculation of diluted earnings per share. 2025 Warrants The Company sold warrants to the 2025 Counterparties to acquire up to 4,823,910 shares of the Company’s common stock. The 2025 Warrants will expire on various dates from June 2025 through October 2025 and may be settled in net shares or cash, subject to certain conditions. It is the Company’s current intent and policy to settle all conversions in shares of the Company’s common stock. The Company received $47.1 million in cash proceeds from the sale of the 2025 Warrants, which was recorded in additional paid-in-capital. The 2025 Warrants could have a dilutive effect on the Company’s earnings per share to the extent that the price of the Company's common stock during a given measurement period exceeds the strike price of the 2025 Warrants, which is $127.84 per share. The Company uses the treasury share method for assumed conversion of its 2025 Warrants to compute the weighted average common shares outstanding for diluted earnings per share. 2.25% Senior Convertible Notes due 2021 In March 2016, the Company issued $650.0 million principal amount of unsecured Senior Convertible Notes with a stated interest rate of 2.25% and a maturity date of March 15, 2021, or the 2021 Notes. Interest on the 2021 Notes began accruing upon issuance and was payable semi-annually. On March 15, 2021 the Company settled in full the 2021 Notes at their scheduled maturity as further discussed below. The net proceeds from the offering of the 2021 Notes, after deducting initial purchasers' discounts and costs directly related to the offering, were approximately $634.1 million. Prior to September 14, 2020, the 2021 Notes provided for settlement in cash, stock, or a combination thereof, solely at the Company’s discretion. As of September 14, 2020, combination settlement was deemed to have been elected by the Company. The initial conversion rate of the 2021 Notes was 16.7158 shares per $1,000 principal amount, which was equivalent to a conversion price of approximately $59.82 per share, subject to adjustments. For the year ended December 31, 2020, the Company used the treasury share method for assumed conversion of the 2021 Notes to compute the weighted average shares of common stock outstanding for diluted earnings per share. The Company also entered into transactions for a convertible notes hedge, or the 2021 Hedge, and warrants, or the 2021 Warrants, concurrently with the issuance of the 2021 Notes. At the time of issuance and in accordance with Accounting Standards Codification Topic 470, the embedded conversion feature of the 2021 Notes required bifurcation from the notes and was accounted for as an equity instrument classified to stockholders’ equity, which resulted in recognizing $84.8 million in additional paid-in-capital during 2016. As of January 1, 2021, the Company early adopted ASU 2020-06, which removed the requirement of separating the embedded conversion feature classified within stockholders’ equity from the 2021 Notes. Accordingly, the Company reclassified the unamortized debt discount and corresponding debt issuance costs from its additional paid-in capital to its senior convertible notes within current liabilities in the Consolidated Balance Sheets. The impact of the adoption of ASU 2020-06 as of January 1, 2021, resulted in an increase in senior convertible notes and retained earnings of $3.9 million and $47.8 million, respectively, and a decrease in deferred tax liabilities and additional paid-in capital by $0.9 million and $46.1 million, respectively. Prior to September 15, 2020, holders could have converted their 2021 Notes only under the following conditions: (a) during any calendar quarter beginning June 30, 2016, if the reported sale price of the Company's common stock for at least 20 days out of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter was greater than 130% of the conversion price on each applicable trading day; (b) during the five business day period in which the trading price of the 2021 Notes fell below 98% of the product of (i) the last reported sale price of the Company's common stock and (ii) the conversion rate on that date; and (c) upon the occurrence of specified corporate events, as defined in the 2021 Notes. From September 15, 2020 and until the close of business on the second scheduled trading day immediately preceding March 15, 2021, holders could have converted their 2021 Notes at any time (regardless of the foregoing circumstances). The Company had the ability to redeem the 2021 Notes, at its option, in whole or in part beginning on March 20, 2019 until the close of business on the business day immediately preceding September 15, 2020 if the last reported sale price of the Company’s common stock had been at least 130% of the conversion price then in effect for at least 20 trading days during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company delivers written notice of a redemption. No principal payments were due on the 2021 Notes prior to maturity. Other than restrictions relating to certain fundamental changes and consolidations, mergers or asset sales and customary anti-dilution adjustments, the 2021 Notes did not contain any financial covenants and did not restrict the Company from paying dividends or issuing or repurchasing any of its other securities. As of September 15, 2020, holders could have converted their 2021 Notes at any time prior to the close of business on the second scheduled trading day immediately preceding the maturity date. As a result, the 2021 Notes were considered redeemable as of December 31, 2020. A portion of the equity component that was recorded upon the issuance of the 2021 Notes was reclassified to temporary equity in the Consolidated Balance Sheets as of December 31, 2020. Such amount was determined based on the cash consideration to be paid upon conversion and the carrying amount of the debt. The reclassification into temporary equity as of December 31, 2020 was $4.7 million based on the 2021 Notes principal of $650.0 million and the carrying value of $645.3 million. 2021 Hedge In connection with the offering of the 2021 Notes, the Company entered into the hedge transaction with the initial purchasers of the 2021 Notes and/or their affiliates, or the 2021 Counterparties, entitling the Company to purchase up to 10,865,270 shares of the Company's common stock at an initial stock price of $59.82 per share, each of which was subject to adjustment. The cost of the 2021 Hedge was $111.2 million and accounted for as an equity instrument by recognizing $111.2 million in additional paid-in-capital during 2016. The 2021 Hedge expired on March 15, 2021 and was put in place to reduce the potential equity dilution upon conversion of the 2021 Notes if the daily volume-weighted average price per share of the Company's common stock exceeded the strike price of the 2021 Hedge. Prior to its expiration, an assumed exercise of the 2021 Hedge by the Company was considered anti-dilutive since the effect of the inclusion would always be anti-dilutive with respect to the calculation of diluted earnings per share. 2021 Warrants The Company sold warrants to the 2021 Counterparties to acquire up to 10,865,270 shares of the Company’s common stock. The 2021 Warrants expired on various dates from June 2021 through December 2021 and could have only be settled in cash or net shares. As of December 31, 2021, all of the warrants expired unexercised. The Company received $44.9 million in cash proceeds from the sale of the 2021 Warrants, which was recorded in additional paid-in-capital. Prior to their expiration and termination, the 2021 Warrants could have had a dilutive effect on the Company's earnings per share to the extent that the price of the Company's common stock during a given measurement period exceeded the strike price of the 2021 Warrants, which was$80.00 per share. The Company used the treasury share method for assumed conversion of the 2021 Warrants to compute the weighted average common shares outstanding for diluted earnings per share. Settlement of the 2021 Notes and 2021 Hedge On March 15, 2021, the 2021 Notes reached maturity and the Company settled in full the 2021 Notes. The Company received conversion notices from the holders of 1.4% of the 2021 Notes, representing $9.1 million outstanding principal amount thereof, or the Conversions. The Company paid an aggregate of $649.4 million in cash for the settlement of the 2021 Notes, which included $640.9 million in satisfaction of the outstanding principal of the 2021 Notes and $8.5 million in cash in connection with the settlement of the Conversions. Additionally, in satisfaction of the Conversions, and pursuant to combination settlement, the Company issued 837 shares of common stock in the aggregate to the holders who elected to convert their outstanding notes. The Company funded the repayment of the outstanding principal amount of the 2021 Notes, accrued interest thereon, and the cash component of the Conversions using available cash on hand. In connection with the settlement of the 2021 Notes, the Company exercised its rights under the convertible note hedge transactions with the 2021 Counterparties on March 15, 2021 and received 842 shares of its own common stock. Revolving Senior Credit Facility In February 2020, the Company entered into a Second Amended and Restated Credit Agreement, or the 2020 Credit Agreement, for a revolving senior credit facility, or the 2020 Facility, which replaced the previous Amended and Restated Credit Agreement the Company had entered into in April 2017. The 2020 Credit Agreement was further amended in May 2020 to, among other things, provide additional flexibility in determining the financial covenant leverage ratios for the second and third fiscal quarters of 2020 and to adjust certain margin and benchmark rates used to determine interest under the 2020 Facility. The 2020 Credit Agreement provides for secured revolving loans, multicurrency loan options and letters of credit in an aggregate amount of up to $550.0 million. The 2020 Credit Agreement also contains an expansion feature, which allows the Company to increase the aggregate principal amount of the 2020 Facility provided the Company remains in compliance with the underlying financial covenants on a pro forma basis, including but not limited to, compliance with the consolidated interest coverage ratio and certain consolidated leverage ratios. The 2020 Facility matures in February 2025 (subject to an earlier springing maturity date), and includes a sublimit of $50.0 million for standby letters of credit, a sublimit of $250.0 million for multicurrency borrowings, and a sublimit of $5.0 million for swingline loans. All assets of the Company and its material domestic subsidiaries continue to be pledged as collateral under the 2020 Facility (subject to customary exceptions) pursuant to the terms set forth in the Second Amended and Restated Security and Pledge Agreement executed in favor of the administrative agent by the Company. Each of the Company’s material domestic subsidiaries guarantee the 2020 Facility. In connection with the 2020 Facility, the Company incurred issuance costs which will be amortized over the term of the 2020 Facility. The Company did not carry any outstanding revolving loans under the 2020 Facility as of March 31, 2022 and December 31, 2021. Any borrowings under the 2020 Facility are intended to be used by the Company to provide financing for working capital and other general corporate purposes, including potential mergers and acquisitions and to refinance indebtedness. Borrowings under the 2020 Facility bear interest, at the Company’s option, at a rate equal to an applicable margin plus: (a) the applicable Eurocurrency Rate (as defined in the 2020 Credit Agreement), or (b) a base rate determined by reference to the highest of (1) the federal funds effective rate plus 0.50%, (2) the Bank of America prime rate, and (3) the Eurocurrency Rate for an interest period of one month plus 1.00%. The margin for the 2020 Facility ranges, based on the Company’s consolidated total net leverage ratio, from 0.50% to 1.25% in the case of base rate loans and from 1.50% to 2.25% in the case of Eurocurrency Rate loans. The 2020 Facility includes an unused line fee ranging, based on the Company’s consolidated total net leverage ratio, from 0.35% to 0.50% per annum on the revolving commitment. The 2020 Credit Agreement contains affirmative, negative, permitted acquisition and financial covenants, and events of default customary for financings of this type. The financial covenants require the Company to maintain a consolidated interest coverage ratio and certain consolidated leverage ratios, which are measured on a quarterly basis. The 2020 Facility grants the lenders preferred first priority liens and security interests in capital stock, intercompany debt and all of the present and future property and assets of the Company and each guarantor. The Company is currently in compliance with the 2020 Credit Agreement covenants. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2022 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders’ EquityIn October 2017, the Company announced that the Board of Directors approved a share repurchase program authorizing the repurchase of up to $100 million of the Company’s common stock over a three-year period. In February 2020, the Company announced that the Board of Directors approved an increase in the share repurchase authorization from $100 million to $150 million of the Company’s common stock and extended the authorization through December 31, 2021. In March 2020, in connection with the issuance of the 2025 Notes, the Company repurchased approximately 1,085,000 shares of its common stock for $75 million. On November 3, 2021, the Board of Directors approved an increase in the share repurchase authorization by $25 million and extended the authorization through December 31, 2022. Accordingly, as of March 31, 2022, the Company is authorized to repurchase up to $100 million of common stock under the share repurchase program. Under this program, the Company is authorized to repurchase its shares in open market purchases, privately negotiated purchases or other transactions. The Company did not repurchase any shares of common stock under the repurchase program during the three months ended March 31, 2022. |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2022 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation The compensation cost that has been included in the Unaudited Consolidated Statements of Operations for the Company’s stock-based compensation plans was as follows: Three Months Ended March 31, (in thousands) 2022 2021 Selling, general and administrative expense $ 6,442 $ 5,975 Research and development expense 329 1,651 Cost of sales 36 83 Stock-based compensation expense before taxes 6,807 7,709 Related income tax benefit (988) (1,409) Stock-based compensation expense, net of taxes $ 5,819 $ 6,300 As of March 31, 2022, there was $68.8 million of unrecognized compensation expense for restricted stock units, or RSUs, and performance-based restricted stock units, or PRSUs, to be recognized over a weighted average period of 2.6 years. Restricted Stock Units and Performance-Based Restricted Stock Units The Company issued approximately 216,000 and 63,000 shares of common stock, before net share settlement, upon vesting of RSUs and PRSUs during the three months ended March 31, 2022, respectively, and issued approximately 371,000 shares of common stock, before net share settlement, upon vesting of RSUs and PRSUs during the year ended December 31, 2021. Employee Stock Purchase Plan The weighted average assumptions used to estimate the fair value of stock purchase rights under the employee stock purchase plan, or ESPP, are as follows: Three Months Ended March 31, 2022 2021 ESPP Volatility 27 % 49 % Expected term (years) 0.5 0.5 Risk free interest rate 0.1 % 0.1 % Expected dividend yield — % — % Under the terms of the ESPP, employees can elect to have up to 15% of their annual compensation, up to a maximum of $21,250 per year, withheld to purchase shares of Company common stock for a purchase price equal to 85% of the lower of the fair market value per share (at closing) of Company common stock on (i) the commencement date of the six-month offering period, or (ii) the respective purchase date. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Income taxes are determined using an estimated annual effective tax rate applied against income, and then adjusted for the tax impacts of certain significant and discrete items. For the three months ended March 31, 2022, the Company treated the tax impact of the following as discrete events for which the tax effect was recognized separately from the application of the annual effective tax rate: state tax credit benefits, tax expense related to share-based compensation and uncertain tax reserves. The Company’s effective tax rate recorded for the three months ended March 31, 2022 was 20%. In accordance with the disclosure requirements as described in ASC 740, the Company has classified unrecognized tax benefits as non-current income tax liabilities, or a reduction in deferred tax assets, unless expected to be paid within one year. The Company’s continuing practice is to recognize interest and/or penalties related to income tax matters in income tax expense. The Company had an increase in gross unrecognized tax benefits of approximately $2.2 million during the three months ended March 31, 2022, primarily related to research and development credits. The Company believes it is reasonably possible that approximately $0.1 million of its remaining unrecognized tax positions may be recognized within the next twelve months as certain statute of limitations expire, the amount of which is primarily attributable to tax positions involving the valuation of intercompany transactions. |
Business Segment, Product, and
Business Segment, Product, and Geographic Information | 3 Months Ended |
Mar. 31, 2022 | |
Segment Reporting [Abstract] | |
Business Segment, Product and Geographic Information | Business Segment, Product and Geographic Information The Company operates in one segment based upon the Company’s organizational structure, the way in which the operations and investments are managed and evaluated by the chief operating decision maker, or the CODM, as well as the lack of availability of discrete financial information at a lower level. The Company’s CODM reviews net sales at the product line offering level, and manufacturing, operating income and expenses, and net income at the Company wide level to allocate resources and assess the Company’s overall performance. The Company shares common, centralized support functions, including finance, human resources, legal, information technology, and corporate marketing, all of which report directly to the CODM. Accordingly, decision-making regarding the Company’s overall operating performance and allocation of Company resources is assessed on a consolidated basis. The Company has disclosed the net sales for each of its product line offerings to provide the reader of the financial statements transparency into the operations of the Company. The Company reports under two distinct product lines; spinal hardware and surgical support. The Company’s spinal hardware product line offerings include implants and fixation products. The Company’s surgical support product offerings include IONM services, disposables and biologics, and capital equipment, all of which are used to aid spinal surgery. Net sales by product line was as follows: Three Months Ended March 31, (in thousands) 2022 2021 Spinal hardware $ 220,796 $ 204,558 Surgical support 69,966 66,691 Total net sales $ 290,762 $ 271,249 Net sales and property and equipment, net, by geographic area were as follows: Net Sales Property and Equipment, Net Three Months Ended March 31, December 31, (in thousands) 2022 2021 United States $ 220,829 $ 208,098 $ 266,309 $ 256,688 International (excludes Puerto Rico) 69,933 63,151 47,380 46,976 Total $ 290,762 $ 271,249 $ 313,689 $ 303,664 |
Commitments
Commitments | 3 Months Ended |
Mar. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments | Commitments Leases At the inception of a contractual arrangement, the Company determines whether the contract contains a lease by assessing whether there is an identified asset and whether the contract conveys the right to control the use of the identified asset in exchange for consideration over a period of time. If both criteria are met, the Company records the associated lease liability and corresponding right-of-use asset upon commencement of the lease using a discount rate based on a credit-adjusted secured borrowing rate commensurate with the term of the lease. The Company records lease liabilities within current liabilities or long-term liabilities based upon the length of time associated with the lease payments. The Company records its operating lease right-of-use assets as long-term assets. Right-of-use assets for financing leases are recorded within property and equipment, net The Company leases office and storage facilities and equipment under various operating and financing lease agreements. The initial terms of these leases range from 1 to 17 years and generally provide for periodic rent increases, and renewal and termination options. The Company’s lease agreements do not contain any material variable lease payments, residual value guarantees or material restrictive covenants. Certain leases require the Company to pay taxes, insurance, and maintenance. Payments for the transfer of goods or services such as common area maintenance and utilities represent non-lease components. The Company elected the package of practical expedients and therefore does not separate non-lease components from lease components. The table below summarizes the Company’s right-of-use assets and lease liabilities as of March 31, 2022 and December 31, 2021: (in thousands, except years and rates) March 31, 2022 December 31, 2021 Assets Operating $ 100,656 $ 102,987 Financing 2,414 2,276 Total leased assets $ 103,070 $ 105,263 Liabilities Current: Operating $ 10,043 $ 9,867 Financing 1,750 1,546 Long-term: Operating 109,093 111,592 Financing 800 885 Total lease liabilities $ 121,686 $ 123,890 Supplemental non-cash information: Weighted-average remaining lease term (years) - operating leases 11.4 11.6 Weighted-average remaining lease term (years) - finance leases 2.5 2.1 Weighted-average discount rate - operating leases 5.3 % 5.3 % Weighted-average discount rate - finance leases 3.5 % 4.7 % The table below summarizes the Company’s lease costs, cash payments, and operating lease liabilities arising from obtaining right-of-use assets under its operating and financing lease obligations: Three Months Ended March 31, (in thousands) 2022 2021 Lease expense: Operating lease expense $ 4,107 $ 3,911 Finance lease expense: Depreciation of right-of-use assets 397 327 Interest expense on lease liabilities 30 32 Total lease expense $ 4,534 $ 4,270 Consolidated Statements of Cash Flows information: Operating cash flows used for operating leases $ 4,153 $ 3,619 Operating cash flows used for financing leases 30 32 Financing cash flows used for financing leases 521 334 Total cash paid for amounts included in the measurement of lease liabilities $ 4,704 $ 3,985 Supplemental non-cash information: Operating lease liabilities arising from obtaining right-of-use assets $ 498 $ 2,231 The Company’s future minimum annual lease payments under operating and financing leases at March 31, 2022 are as follows: (in thousands) Financing Operating Remaining 2022 $ 1,329 $ 12,095 2023 870 15,159 2024 329 13,911 2025 80 12,529 2026 26 12,306 Thereafter — 96,568 Total minimum lease payments $ 2,634 $ 162,568 Less: amount representing interest (84) (43,432) Present value of obligations under leases 2,550 119,136 Less: current portion (1,750) (10,043) Long-term lease obligations $ 800 $ 109,093 Executive Severance Plans The Company has employment contracts with key executives and maintains severance plans that provide for the payment of severance and other benefits if such executives are terminated for reasons other than cause, as defined in those agreements and plans. Certain agreements call for payments that are based on historical compensation, and accordingly, the amount of the contractual commitment will change over time commensurate with the executive’s applicable earnings. At March 31, 2022, future commitments for such key executives were approximately $14.8 million. In certain circumstances, the agreements call for the acceleration of equity vesting. Those figures are not reflected in the above information. |
Contingencies
Contingencies | 3 Months Ended |
Mar. 31, 2022 | |
Contingencies [Abstract] | |
Contingencies | Contingencies The Company is subject to potential liabilities under government regulations and various claims and legal actions that are pending or may be asserted from time-to-time. These matters arise in the ordinary course and conduct of the Company’s business and include, for example, commercial, intellectual property, environmental, securities and employment matters. The Company intends to continue to defend itself vigorously in such matters and when warranted, take legal action against others. Furthermore, the Company regularly assesses contingencies to determine the degree of probability and range of possible loss for potential accrual in its financial statements. An estimated loss contingency is accrued in the Company’s financial statements if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Based on the Company’s assessment, it has adequately accrued an amount for contingent liabilities currently in existence. The Company does not accrue amounts for liabilities that it does not believe are probable. Litigation is inherently unpredictable, and unfavorable resolutions could occur. As a result, assessing contingencies is highly subjective and requires judgment about future events. The amount of ultimate loss may exceed the Company’s current accruals, and it is possible that its cash flows or results of operations could be materially affected in any particular period by the unfavorable resolution of one or more of these contingencies. |
Description of Business and B_2
Description of Business and Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | Description of Business NuVasive, Inc., or the Company, or NuVasive, was incorporated in Delaware on July 21, 1997, and began commercializing its products in 2001. Since its incorporation in 1997, the Company has grown from a small developer of specialty spinal implants into a global medical technology company delivering procedurally integrated solutions for spine surgery. Underlying the Company’s procedurally integrated solutions for spine surgery are technologies designed to enable better clinical, financial, and operational outcomes, including: • its surgical access instruments, including its integrated split-blade retractor system, designed to enable less-invasive surgical techniques by minimizing soft tissue disruption during spine surgery; • its Advanced Materials Science portfolio of specialized spinal implants, designed to advance spinal fusion by enhancing the osseointegration and biomechanical properties of implant materials, including porous titanium and porous polyetheretherketone; • its fixation systems, designed to facilitate the preservation and restoration of patient alignment, while addressing a vast array of spinal pathologies from an open or less-invasive approach across all spinal procedures; • its cervical total disc replacement technology, which complements the Company’s portfolio of products and services for cervical spinal fusion surgery and is designed to offer surgeons capabilities across key performance functions—anatomic, physiologic motion, and radiologic design; • its neuromonitoring systems, which use proprietary software-driven nerve detection and avoidance technology, and the Company’s intraoperative neuromonitoring, or IONM, services and support; and • its Pulse platform, a software ecosystem that integrates multiple hardware technologies into a single, condensed footprint in the operating room, including: radiation reduction, imaging enhancement, rod bending, navigation, IONM, and spinal alignment tools. In addition, the Company also designs and sells expandable growing rod implant systems for the treatment of early-onset scoliosis that can be non-invasively lengthened following implantation with precise, incremental adjustments via an external remote controller using magnetic technology called MAGnetic External Control, or MAGEC. This technology is also the basis for the Company’s Precice line of products which is designed to support complex orthopedic reconstruction, such as trauma and limb length discrepancy. Precice is an intramedullary device that, once implanted, utilizes the MAGEC technology to non-invasively lengthen the femur and tibia. The COVID-19 pandemic significantly impacted the Company’s business and results of operations during the years ended December 31, 2020 and 2021, as well as the three months ended March 31, 2022. Many government agencies, in conjunction with hospitals and healthcare systems have, to varying degrees, deferred, reduced, or suspended elective surgical procedures due to the COVID-19 pandemic. While certain spine surgeries are deemed essential and certain surgeries, like in cases of trauma, cannot be delayed, the Company has seen and may continue to see a significant reduction in procedural volumes as hospital systems and/or patients elect to defer spine surgery procedures. During the three months ended March 31, 2022, procedural volume rates for elective surgeries steadily recovered in the U.S. and certain international regions as government restrictions eased and hospital systems resumed more elective surgical procedures. The COVID-19 pandemic continues to evolve and its impact on the Company’s business will depend on several factors that are highly uncertain and unpredictable, including, the efficacy and adoption of vaccines, future resurgences of the virus and its variants, the imposition of governmental lockdowns, quarantine and physical distancing requirements, patient capacity at hospitals and healthcare systems, the duration and severity of healthcare worker shortages, and the willingness and ability of patients to seek care and treatment due to safety concerns or financial hardship. |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The accompanying Unaudited Consolidated Financial Statements include the accounts of the Company and its majority-owned or controlled subsidiaries, collectively referred to as either NuVasive or the Company. The Company translates the financial statements of its foreign subsidiaries using end-of-period exchange rates for assets and liabilities and average exchange rates during each reporting period for results of operations. When there is a portion of equity in an acquired subsidiary not attributable, directly or indirectly, to the respective parent entity, the Company records the fair value of the non-controlling interest at the acquisition date and classifies the amounts attributable to the non-controlling interest separately in equity in the Company's Consolidated Financial Statements. Any subsequent changes in a parent's ownership interest while the parent retains its controlling financial interest in its subsidiary are accounted for as equity transactions. All significant intercompany balances and transactions have been eliminated in consolidation. The accompanying Unaudited Consolidated Financial Statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission, or the SEC. Pursuant to these rules and regulations, the Company has condensed or omitted certain information and footnote disclosures it normally includes in its annual Consolidated Financial Statements prepared in accordance with generally accepted accounting principles in the United States, or U.S. GAAP. Operating results for the three months ended March 31, 2022 are not necessarily indicative of the results that may be expected for any other interim period or for the full year. These Unaudited Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and notes thereto for the year ended December 31, 2021 included in the Company’s Annual Report on Form 10-K filed with the SEC. In the opinion of management, the Unaudited Consolidated Financial Statements and notes thereto include all adjustments that are of a normal and recurring nature that are necessary for the fair presentation of the Company’s financial position and of the results of operations and cash flows for the periods presented. |
Use of Estimates | Use of Estimates To prepare financial statements in conformity with U.S. GAAP, management must make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. These estimates and assumptions involve judgments with respect to numerous factors that are difficult to predict. As a result, actual amounts could be materially different from these estimates. |
Recent Accounting Pronouncements Not Yet Adopted | Recent Accounting Pronouncements Not Yet Adopted In October 2021, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update No. 2021-08, Business Combinations (Topic 805), Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, which requires an entity (acquirer) to recognize and measure contract assets and liabilities acquired in a business combination in accordance with Topic 606, Revenue from Contracts with Customers. This update is effective for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years, with early adoption permitted. The amendments should be applied prospectively to business combinations occurring on or after the effective date of the amendments. The Company is currently evaluating the impact the standard will have on our Consolidated Financial Statements. |
Revenue Recognition | Revenue Recognition In accordance with Accounting Standards Codification 606 Revenue from Contracts with Customers, or ASC 606, the Company recognizes revenue upon the transfer of goods or services to a customer at an amount that reflects the expected consideration to be received in exchange for those goods or services. The principles in ASC 606 are applied using the following five steps: (i) identify the contract with a customer; (ii) identify the performance obligation(s) in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligation(s) in the contract; and (v) recognize revenue when (or as) the Company satisfies its performance obligation(s). Specifically, revenue from the sale of implants, fixation products and disposables is generally recognized at an amount that reflects the expected consideration upon notice that the Company’s products have been used in a surgical procedure or upon shipment to a third-party customer assuming control of the products. Revenue from IONM services is recognized in the period the service is performed for the amount of consideration expected to be received. Revenue from the sale of surgical instrument sets is generally recognized upon receipt of a purchase order and the subsequent shipment to a customer who assumes control. In certain cases, the Company does offer the ability for customers to lease surgical instrumentation primarily on a non-sales type basis. Revenue from the sale or lease of capital equipment is recognized when the Company transfers control to the customer, which is generally at the point when acceptance occurs that indicates customer acknowledgment of delivery or installation, depending on the terms of the arrangement. Selling and leasing of surgical instrument sets and capital equipment represents an immaterial amount of the Company’s total net sales in all periods presented. Revenue associated with products holding rights of return or trade-in are recognized when the Company concludes there is not a risk of significant revenue reversal in future periods for the expected consideration in the transaction. Costs incurred by the Company associated with sales contracts with customers are deferred over the performance obligation period and recognized in the same period as the related revenue, with the exception of contracts that complete within one year or less, in which case the associated costs are expensed as incurred. |
Accounts Receivable and Related Valuation Accounts | Accounts Receivable and Related Valuation Accounts Accounts receivable in the accompanying Unaudited Consolidated Balance Sheets are presented net of allowances for credit losses. The Company maintains an allowance for credit losses resulting from the inability of its customers, including hospitals, ambulatory surgery centers, and distributors, to make required payments. The allowance for credit losses is calculated quarterly, and is estimated on a region-by-region basis considering a number of factors including age of account balances, collection history, historical account write-offs, third party credit reports, identified trends, current economic conditions, and supportable forecasted economic expectations. The allowance is adjusted on a specific identification basis for certain accounts as well as pooling of accounts with similar characteristics. An increase in the provision for credit losses may be required when the financial condition of the Company’s customers or its collection experience deteriorates. An increase to the allowance for credit losses results in a corresponding charge to selling, general and administrative expenses. The Company has a diverse customer base and no single customer represented greater than ten percent of net sales or accounts receivable. Historically, the Company’s reserves have been adequate to cover credit losses. The Company's exposure to credit losses may increase if its customers are adversely affected by changes in healthcare laws, coverage and reimbursement, economic pressures or uncertainty associated with local or global economic recessions, disruption associated with the current COVID-19 pandemic, or other customer-specific factors. It is possible that there could be a significant adverse impact from potential adjustments to the carrying amount of trade receivables as customers’ cash flows are impacted by their response to the COVID-19 pandemic and the deferral of elective surgical procedures. |
Inventory, Net | Inventory, Net Net inventory as of March 31, 2022 consisted of $307.6 million of finished goods, $10.6 million of work in progress and $6.2 million of raw materials. Net inventory as of December 31, 2021 consisted of $301.3 million of finished goods, $8.1 million of work in progress and $6.4 million of raw materials. |
Derivative Financial Instruments | Derivative Financial Instruments The Company recognizes all derivative instruments as assets or liabilities in its Unaudited Consolidated Balance Sheets and measures these instruments at fair value by revaluing these assets and liabilities at the end of each reporting period. Gains and losses are recorded as a component of other income (expense), net in the Unaudited Consolidated Statements of Operations. |
Comprehensive Income (Loss) | Comprehensive Income (Loss)Comprehensive income (loss) is defined as the change in equity during a period from transactions and other events and circumstances from non-owner sources. Comprehensive income (loss) includes net of tax, unrealized gains or losses on the Company’s marketable debt securities and foreign currency translation adjustments. |
Product Shipment Costs | Product Shipment Costs Product shipment costs, included in selling, general and administrative expense in the accompanying Unaudited Consolidated Statements of Operations, were $8.1 million and $7.1 million for the three months ended March 31, 2022 and March 31, 2021, respectively. The majority of the Company’s shipping costs are associated with providing instrument sets to hospitals for use in individual surgical procedures. Amounts billed to customers for shipping and handling of products are reflected in net sales and are not material for any period presented. |
Business Transition Costs | Business Transition Costs The Company incurs certain costs related to acquisition, integration and business transition activities, which include severance, relocation, consulting, leasehold exit costs, third-party merger and acquisition costs, contingent consideration fair value adjustments and other costs directly associated with such activities. Contingent consideration is accrued based on the fair value of the expected payment, and such accruals are subject to increase or decrease based on the assessment of the likelihood that the contingent milestones will be achieved resulting in payment. If an accrual for contingent consideration decreases during a particular period, it results in a reduction of costs during such period. |
Description of Business and B_3
Description of Business and Basis of Presentation (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Changes in Allowance for Credit Losses | The following table summarizes the changes in the allowance for credit losses: (in thousands) March 31, 2022 December 31, 2021 Allowance for credit losses at January 1 $ 10,928 $ 9,646 Current-period provision for expected losses 337 2,165 Write-offs charged against the allowance (102) (743) Recoveries of amounts previously written off 3 42 Changes resulting from foreign currency fluctuations (6) (182) Allowance for credit losses at end of period $ 11,160 $ 10,928 |
Net Income (Loss) Per Share (Ta
Net Income (Loss) Per Share (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Consolidated Net Income (Loss) Per Share | The following table sets forth the computation of basic and diluted consolidated net income (loss) per share: Three Months Ended March 31, (in thousands, except per share data) 2022 2021 Numerator: Net income (loss) for basic $ 19,201 $ (7,510) Dilutive potential net income (loss): Interest and debt issuance costs on the 1.00% Senior Convertible Notes due 2023, net of tax $ 1,705 $ — Interest and debt issuance costs on the 0.375% Senior Convertible Notes due 2025, net of tax 821 — Net income (loss) for diluted $ 21,727 $ (7,510) Denominator for basic and diluted net income (loss) per share: Weighted average common shares outstanding for basic 51,829 51,379 Dilutive potential common stock outstanding: Employee stock purchase plan (ESPP) 3 — Restricted stock units (RSUs) and performance restricted stock units (PRSUs) 578 — 1.00% Senior Convertible Notes due 2023 5,345 — 0.375% Senior Convertible Notes due 2025 4,824 — Weighted average common shares outstanding for diluted 62,579 51,379 Basic net income (loss) per share $ 0.37 $ (0.15) Diluted net income (loss) per share $ 0.35 $ (0.15) |
Anti-dilutive Common Stock Equivalents Not Included in Calculation of Net Income (Loss) Per Diluted Share | The following weighted average outstanding common stock equivalents were not included in the calculation of net income (loss) per diluted share because their effects were anti-dilutive: Three Months Ended March 31, ( in thousands ) 2022 2021 ESPP, RSUs and PRSUs 239 1,355 Warrants 10,169 21,034 Senior convertible notes — 10,169 Total 10,408 32,558 |
Business Combinations (Tables)
Business Combinations (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Summary of Preliminary Allocation of Purchase Price to Assets Acquired and Liabilities Assumed | The allocation of the purchase price to the assets acquired and liabilities assumed based on their fair values is as follows: (in thousands) Cash paid for purchase $ 151,026 Cash 1,563 Accounts receivable 203 Inventory 6,710 Other current assets 568 Property, plant and equipment, net 381 Definite-lived intangible assets: Developed technology 141,700 Patents 19,000 Trade names 3,500 Goodwill 81,125 Other assets 7 Contingent consideration liabilities (103,400) Accounts payable, accrued expenses and other (331) $ 151,026 |
Financial Instruments and Fai_2
Financial Instruments and Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value of Assets and Liabilities Measured on Recurring Basis | The Company’s assets that are measured at fair value were based on the following fair value categories: (in thousands) Total Quoted Price in Active Market (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) March 31, 2022: Cash equivalents: Money market funds $ 130,651 $ 130,651 $ — $ — Total cash equivalents $ 130,651 $ 130,651 $ — $ — December 31, 2021: Cash equivalents: Money market funds $ 179,451 $ 179,451 $ — $ — Total cash equivalents 179,451 179,451 — — |
Schedule of Inputs and Valuation Techniques Used in Recurring Level 3 Fair Value Measurements | The recurring Level 3 fair value measurements of contingent consideration liabilities associated with commercial sales milestones include the following significant unobservable inputs as of March 31, 2022: 2022 Valuation Technique Discounted cash flow, Monte Carlo Discount Rate Range 4.0% - 5.9% Weighted Average Discount Rate 4.5% Expected Years 2023 - 2027 |
Schedule of Fair Value of Liabilities Measured on Recurring Basis Using Unobservable Inputs | The following table sets forth the changes in the estimated fair value of the Company's contingent consideration liabilities measured on a recurring basis using significant unobservable inputs (Level 3): Three Months Ended March 31, ( in thousands ) 2022 2021 Beginning balance at January 1 $ 147,810 $ 37,041 Contingent consideration liability recorded upon acquisition — 103,400 Change in fair value measurement 39 881 Contingent consideration paid or settled (8,037) (156) Changes resulting from foreign currency fluctuations 4 — Balance at end of period $ 139,816 $ 141,166 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill and Intangible Assets | Goodwill and intangible assets consisted of the following: (in thousands, except years) Weighted- Gross Accumulated Intangible March 31, 2022: Intangible assets subject to amortization: Developed technology 11 $ 378,541 $ (217,914) $ 160,627 Patents 10 58,330 (33,436) 24,894 Manufacturing know-how and trade secrets 12 21,394 (21,394) — Trade name and trademarks 9 25,264 (20,260) 5,004 Customer relationships 9 156,743 (113,967) 42,776 Total intangible assets subject to amortization 10 $ 640,272 $ (406,971) $ 233,301 Intangible assets not subject to amortization: Goodwill $ 636,703 Total goodwill and intangible assets, net $ 870,004 (in thousands, except years) Weighted- Average Amortization Period (in years) Gross Amount Accumulated Amortization Intangible Assets, net December 31, 2021: Intangible assets subject to amortization: Developed technology 11 $ 374,457 $ (209,283) $ 165,174 Patents 10 57,783 (31,903) 25,880 Manufacturing know-how and trade secrets 12 21,412 (21,387) 25 Trade name and trademarks 9 25,163 (19,621) 5,542 Customer relationships 9 156,208 (110,154) 46,054 Total intangible assets subject to amortization 10 $ 635,023 $ (392,348) $ 242,675 Intangible assets not subject to amortization: Goodwill $ 633,467 Total goodwill and intangible assets, net $ 876,142 |
Schedule of Changes to Goodwill | The changes to goodwill are comprised of the following: ( in thousands ) December 31, 2021 Gross goodwill $ 641,767 Accumulated impairment loss (8,300) 633,467 Changes to gross goodwill Changes resulting from foreign currency fluctuations 3,236 March 31, 2022 Gross goodwill 645,003 Accumulated impairment loss (8,300) $ 636,703 |
Future Amortization Expense Related to Intangible Assets | Total future amortization expense related to intangible assets subject to amortization at March 31, 2022 is set forth in the table below: (in thousands) Remaining 2022 $ 39,169 2023 27,441 2024 21,628 2025 20,782 2026 15,984 Thereafter through 2038 108,297 Total future amortization expense $ 233,301 |
Indebtedness (Tables)
Indebtedness (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Senior Convertible Notes | The carrying values of the Company’s Senior Convertible Notes are as follows: (in thousands) March 31, 2022 December 31, 2021 1.00% Senior Convertible Notes due 2023: Principal amount $ 450,000 $ 450,000 Unamortized debt issuance costs (5,402) (6,543) 444,598 443,457 0.375% Senior Convertible Notes due 2025: Principal amount 450,000 450,000 Unamortized debt issuance costs (7,805) (8,473) 442,195 441,527 Total Senior Convertible Notes $ 886,793 $ 884,984 Three Months Ended March 31, (in thousands) 2022 2021 Interest expense: Contractual coupon interest $ 1,547 $ 4,594 Amortization of debt issuance costs 1,810 2,507 Total interest expense recognized on Senior Convertible Notes $ 3,357 $ 7,101 Effective interest rates: Senior Convertible Notes due 2021 (1) — % 2.9 % Senior Convertible Notes due 2023 (2) 2.0 % 2.0 % Senior Convertible Notes due 2025 (2) 1.0 % 1.0 % ( 1) Senior Convertible Notes due 2021 settled in full on March 15, 2021. (2 ) Interest on Senior Convertible Notes due 2023 and 2025 began accruing upon issuance and is payable semi-annually. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Share-based Payment Arrangement [Abstract] | |
Compensation Cost Included in Unaudited Consolidated Statement of Operations for All Stock-based Compensation Arrangements | The compensation cost that has been included in the Unaudited Consolidated Statements of Operations for the Company’s stock-based compensation plans was as follows: Three Months Ended March 31, (in thousands) 2022 2021 Selling, general and administrative expense $ 6,442 $ 5,975 Research and development expense 329 1,651 Cost of sales 36 83 Stock-based compensation expense before taxes 6,807 7,709 Related income tax benefit (988) (1,409) Stock-based compensation expense, net of taxes $ 5,819 $ 6,300 |
Weighted Average Assumptions Used to Estimate Fair Value of Stock Purchase Rights under ESPP | The weighted average assumptions used to estimate the fair value of stock purchase rights under the employee stock purchase plan, or ESPP, are as follows: Three Months Ended March 31, 2022 2021 ESPP Volatility 27 % 49 % Expected term (years) 0.5 0.5 Risk free interest rate 0.1 % 0.1 % Expected dividend yield — % — % |
Business Segment, Product and G
Business Segment, Product and Geographic Information (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Segment Reporting [Abstract] | |
Schedule of Net Sales by Product Line | Net sales by product line was as follows: Three Months Ended March 31, (in thousands) 2022 2021 Spinal hardware $ 220,796 $ 204,558 Surgical support 69,966 66,691 Total net sales $ 290,762 $ 271,249 |
Schedule of Net Sales and Net Property and Equipment by Geographical Area | Net sales and property and equipment, net, by geographic area were as follows: Net Sales Property and Equipment, Net Three Months Ended March 31, December 31, (in thousands) 2022 2021 United States $ 220,829 $ 208,098 $ 266,309 $ 256,688 International (excludes Puerto Rico) 69,933 63,151 47,380 46,976 Total $ 290,762 $ 271,249 $ 313,689 $ 303,664 |
Commitments (Tables)
Commitments (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Right-of-use Assets and Lease Liabilities | The table below summarizes the Company’s right-of-use assets and lease liabilities as of March 31, 2022 and December 31, 2021: (in thousands, except years and rates) March 31, 2022 December 31, 2021 Assets Operating $ 100,656 $ 102,987 Financing 2,414 2,276 Total leased assets $ 103,070 $ 105,263 Liabilities Current: Operating $ 10,043 $ 9,867 Financing 1,750 1,546 Long-term: Operating 109,093 111,592 Financing 800 885 Total lease liabilities $ 121,686 $ 123,890 Supplemental non-cash information: Weighted-average remaining lease term (years) - operating leases 11.4 11.6 Weighted-average remaining lease term (years) - finance leases 2.5 2.1 Weighted-average discount rate - operating leases 5.3 % 5.3 % Weighted-average discount rate - finance leases 3.5 % 4.7 % |
Lease Costs, Cash Payments and Operating Lease Liabilities Arising From Obtaining Right-of-use Assets under Operating and Financing Lease Obligations | The table below summarizes the Company’s lease costs, cash payments, and operating lease liabilities arising from obtaining right-of-use assets under its operating and financing lease obligations: Three Months Ended March 31, (in thousands) 2022 2021 Lease expense: Operating lease expense $ 4,107 $ 3,911 Finance lease expense: Depreciation of right-of-use assets 397 327 Interest expense on lease liabilities 30 32 Total lease expense $ 4,534 $ 4,270 Consolidated Statements of Cash Flows information: Operating cash flows used for operating leases $ 4,153 $ 3,619 Operating cash flows used for financing leases 30 32 Financing cash flows used for financing leases 521 334 Total cash paid for amounts included in the measurement of lease liabilities $ 4,704 $ 3,985 Supplemental non-cash information: Operating lease liabilities arising from obtaining right-of-use assets $ 498 $ 2,231 |
Future Minimum Annual Lease Payments under Operating and Financing Leases | The Company’s future minimum annual lease payments under operating and financing leases at March 31, 2022 are as follows: (in thousands) Financing Operating Remaining 2022 $ 1,329 $ 12,095 2023 870 15,159 2024 329 13,911 2025 80 12,529 2026 26 12,306 Thereafter — 96,568 Total minimum lease payments $ 2,634 $ 162,568 Less: amount representing interest (84) (43,432) Present value of obligations under leases 2,550 119,136 Less: current portion (1,750) (10,043) Long-term lease obligations $ 800 $ 109,093 |
Description of Business and B_4
Description of Business and Basis of Presentation - Summary of Changes in Allowance for Credit Losses (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2022 | Dec. 31, 2021 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Allowance for credit losses at January 1 | $ 10,928 | $ 9,646 |
Current-period provision for expected losses | 337 | 2,165 |
Write-offs charged against the allowance | (102) | (743) |
Recoveries of amounts previously written off | 3 | 42 |
Changes resulting from foreign currency fluctuations | (6) | (182) |
Allowance for credit losses at end of period | $ 11,160 | $ 10,928 |
Description of Business and B_5
Description of Business and Basis of Presentation (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Schedule Of Description Of Business And Basis Of Presentation [Line Items] | |||
Inventory, finished goods | $ 307,600 | $ 301,300 | |
Inventory, work in progress | 10,600 | 8,100 | |
Inventory, raw materials | 6,200 | 6,400 | |
Cumulative translation adjustments included in accumulated other comprehensive loss | 11,700 | $ 7,800 | |
Product shipment costs | 79,097 | $ 71,811 | |
Business transition costs | 3,060 | 5,584 | |
2021, 2017 and 2016 Acquisitions [Member] | |||
Schedule Of Description Of Business And Basis Of Presentation [Line Items] | |||
Business transition costs | $ 0 | 900 | |
Simplify Medical [Member] | |||
Schedule Of Description Of Business And Basis Of Presentation [Line Items] | |||
Acquisition costs | 3,900 | ||
Allograft Products [Member] | Minimum [Member] | |||
Schedule Of Description Of Business And Basis Of Presentation [Line Items] | |||
Inventory, shelf life | 2 years | ||
Allograft Products [Member] | Maximum [Member] | |||
Schedule Of Description Of Business And Basis Of Presentation [Line Items] | |||
Inventory, shelf life | 5 years | ||
Product Shipment Costs [Member] | |||
Schedule Of Description Of Business And Basis Of Presentation [Line Items] | |||
Product shipment costs | $ 8,100 | $ 7,100 |
Net Income (Loss) Per Share - C
Net Income (Loss) Per Share - Computation of Basic and Diluted Consolidated Net Income (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | ||||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | Jun. 30, 2020 | Mar. 31, 2020 | |
Numerator: | |||||
Net income (loss) for basic | $ 19,201 | $ (7,510) | |||
Dilutive potential net income (loss): | |||||
Net income (loss) for diluted | $ 21,727 | $ (7,510) | |||
Denominator for basic and diluted net income (loss) per share: | |||||
Weighted average common shares outstanding for basic (in shares) | 51,829 | 51,379 | |||
Dilutive potential common stock outstanding: | |||||
Weighted average common shares outstanding for diluted (in shares) | 62,579 | 51,379 | |||
Basic net income (loss) per share (in dollars per share) | $ 0.37 | $ (0.15) | |||
Diluted net income (loss) per share (in dollars per share) | $ 0.35 | $ (0.15) | |||
Employee stock purchase plan (ESPP) [Member] | |||||
Dilutive potential common stock outstanding: | |||||
Incremental common shares from share-based payments (in shares) | 3 | 0 | |||
Restricted Stock Units (RSUs) and Performance Restricted Stock Units (PRSUs) [Member] | |||||
Dilutive potential common stock outstanding: | |||||
Incremental common shares from share-based payments (in shares) | 578 | 0 | |||
1.00% Senior Convertible Notes due 2023 [Member] | |||||
Earning Per Share [Line Items] | |||||
Interest rate on convertible notes | 1.00% | 1.00% | 1.00% | ||
Dilutive potential net income (loss): | |||||
Interest and debt issuance costs | $ 1,705 | $ 0 | |||
Dilutive potential common stock outstanding: | |||||
Incremental common shares from senior convertible notes (in shares) | 5,345 | 0 | |||
0.375% Senior Convertible Notes due 2025 [Member] | |||||
Earning Per Share [Line Items] | |||||
Interest rate on convertible notes | 0.375% | 0.375% | 0.375% | ||
Dilutive potential net income (loss): | |||||
Interest and debt issuance costs | $ 821 | $ 0 | |||
Dilutive potential common stock outstanding: | |||||
Incremental common shares from senior convertible notes (in shares) | 4,824 | 0 |
Net Income (Loss) Per Share - A
Net Income (Loss) Per Share - Anti-dilutive Common Stock Equivalents Not Included in Calculation of Net Income (Loss) Per Diluted Share (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from computation of earnings per share | 10,408 | 32,558 |
ESPP, RSUs and PRSUs [Member] | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from computation of earnings per share | 239 | 1,355 |
Warrants [Member] | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from computation of earnings per share | 10,169 | 21,034 |
Senior Convertible Notes [Member] | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from computation of earnings per share | 0 | 10,169 |
Business Combinations (Details
Business Combinations (Details Textual) - Simplify Medical [Member] - USD ($) $ in Thousands | Feb. 24, 2021 | Apr. 30, 2021 | Mar. 31, 2021 |
Business Acquisition [Line Items] | |||
Upfront payment | $ 150,000 | ||
Regulatory milestone, payment | $ 45,800 | ||
Cash paid for purchase | 151,026 | ||
Contingent consideration liabilities | $ 103,400 | ||
Acquisition costs | $ 3,900 | ||
Developed Technology [Member] | |||
Business Acquisition [Line Items] | |||
Intangible assets useful life | 17 years | ||
Patents [Member] | |||
Business Acquisition [Line Items] | |||
Intangible assets useful life | 10 years | ||
Trade Names [Member] | |||
Business Acquisition [Line Items] | |||
Intangible assets useful life | 15 years |
Business Combinations - Summary
Business Combinations - Summary of Preliminary Allocation of Purchase Price to Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Feb. 24, 2021 | Mar. 31, 2022 | Dec. 31, 2021 |
Definite-lived intangible assets: | |||
Goodwill | $ 636,703 | $ 633,467 | |
Simplify Medical [Member] | |||
Business Acquisition [Line Items] | |||
Cash paid for purchase | $ 151,026 | ||
Cash | 1,563 | ||
Accounts receivable | 203 | ||
Inventory | 6,710 | ||
Other current assets | 568 | ||
Property, plant and equipment, net | 381 | ||
Definite-lived intangible assets: | |||
Goodwill | 81,125 | ||
Other assets | 7 | ||
Contingent consideration liabilities | (103,400) | ||
Accounts payable, accrued expenses and other | (331) | ||
Purchase price | 151,026 | ||
Simplify Medical [Member] | Developed Technology [Member] | |||
Definite-lived intangible assets: | |||
Definite-lived intangible assets | 141,700 | ||
Simplify Medical [Member] | Patents [Member] | |||
Definite-lived intangible assets: | |||
Definite-lived intangible assets | 19,000 | ||
Simplify Medical [Member] | Trade Names [Member] | |||
Definite-lived intangible assets: | |||
Definite-lived intangible assets | $ 3,500 |
Financial Instruments and Fai_3
Financial Instruments and Fair Value Measurements (Details Textual) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Apr. 30, 2021USD ($) | Mar. 31, 2022USD ($)investment | Jun. 30, 2021USD ($) | Mar. 31, 2021USD ($) | Dec. 31, 2021USD ($)investment | Feb. 24, 2021USD ($) | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||||
Net currency exchange gains (losses) from derivatives instruments | $ 16,000,000 | $ (2,700,000) | ||||
Number of unrealized loss positions | investment | 0 | 0 | ||||
Impairment charges recorded on investments | $ 0 | 0 | ||||
Simplify Medical [Member] | ||||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||||
Contingent consideration liabilities | $ 103,400,000 | |||||
Regulatory milestone, payment | $ 45,800,000 | |||||
Contingent Consideration Liabilities [Member] | ||||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||||
Contingent consideration liabilities | 139,800,000 | $ 147,800,000 | ||||
Contingent consideration liability recorded upon acquisition | 0 | 103,400,000 | ||||
Increase in contingent consideration liabilities related to the net sales milestone | 100,000 | 47,900,000 | ||||
Contingent Consideration Liabilities [Member] | Simplify Medical Acquisition [Member] | ||||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||||
Contingent consideration liabilities | 108,600,000 | 108,500,000 | ||||
Contingent consideration liability recorded upon acquisition | 103,400,000 | |||||
Contingent consideration liabilities regulatory milestone | 42,800,000 | |||||
Increase in contingent consideration liabilities related to the net sales milestone | 60,600,000 | |||||
Contingent Consideration Liabilities [Member] | Simplify Medical [Member] | ||||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||||
Regulatory milestone, payment | $ 45,800,000 | |||||
Increase in fair value of contingent consideration liability | 3,000,000 | |||||
Quoted Price in Active Market (Level 1) [Member] | 1.00% Senior Convertible Notes due 2023 [Member] | ||||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||||
Notional principal amount | 450,000,000 | 450,000,000 | ||||
Convertible debt fair value | 447,200,000 | 450,600,000 | ||||
Quoted Price in Active Market (Level 1) [Member] | 0.375% Senior Convertible Notes due 2025 [Member] | ||||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||||
Notional principal amount | 450,000,000 | 450,000,000 | ||||
Convertible debt fair value | 425,000,000 | 433,500,000 | ||||
Foreign Exchange Forward [Member] | ||||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||||
Notional principal amount | 17,600,000 | $ 12,200,000 | ||||
Foreign Exchange Forward [Member] | Other (Expense) Income [Member] | ||||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||||
Derivative instrument net gains | $ 800,000 | $ 1,300,000 |
Financial Instruments and Fai_4
Financial Instruments and Fair Value Measurements - Schedule of Fair Value of Assets and Liabilities Measured on Recurring Basis (Details) - Fair Value, Recurring [Member] - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Cash equivalents: | ||
Total cash equivalents | $ 130,651 | $ 179,451 |
Money Market Funds [Member] | ||
Cash equivalents: | ||
Total cash equivalents | 130,651 | 179,451 |
Quoted Price in Active Market (Level 1) [Member] | ||
Cash equivalents: | ||
Total cash equivalents | 130,651 | 179,451 |
Quoted Price in Active Market (Level 1) [Member] | Money Market Funds [Member] | ||
Cash equivalents: | ||
Total cash equivalents | $ 130,651 | $ 179,451 |
Financial Instruments and Fai_5
Financial Instruments and Fair Value Measurements - Schedule Inputs and Valuation Techniques Used in Recurring Level 3 Fair Value Measurements (Details) - Level 3 [Member] - Commercial Sale Milestone [Member] - Fair Value, Recurring [Member] | Mar. 31, 2022 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |
Business Combination, Contingent Consideration, Liability, Valuation Technique [Extensible List] | Valuation Technique, Discounted Cash Flow [Member] |
Discount Rate [Member] | Minimum [Member] | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |
Contingent consideration liability measurement input | 0.040 |
Discount Rate [Member] | Maximum [Member] | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |
Contingent consideration liability measurement input | 0.059 |
Discount Rate [Member] | Weighted Average [Member] | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |
Contingent consideration liability measurement input | 0.045 |
Financial Instruments and Fai_6
Financial Instruments and Fair Value Measurements - Schedule of Fair Value of Liabilities Measured on Recurring Basis Using Unobservable Inputs (Details) - Contingent Consideration Liabilities [Member] - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning balance at January 1 | $ 147,810 | $ 37,041 |
Contingent consideration liability recorded upon acquisition | 0 | 103,400 |
Change in fair value measurement | 39 | 881 |
Contingent consideration paid or settled | (8,037) | (156) |
Changes resulting from foreign currency fluctuations | 4 | 0 |
Balance at end of period | $ 139,816 | $ 141,166 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2022 | Dec. 31, 2021 | |
Intangible assets subject to amortization: | ||
Weighted- Average Amortization Period (in years) | 10 years | 10 years |
Gross Amount | $ 640,272 | $ 635,023 |
Accumulated Amortization | (406,971) | (392,348) |
Total intangible assets subject to amortization | 233,301 | 242,675 |
Intangible assets not subject to amortization: | ||
Goodwill | 636,703 | 633,467 |
Total goodwill and intangible assets, net | $ 870,004 | $ 876,142 |
Developed Technology [Member] | ||
Intangible assets subject to amortization: | ||
Weighted- Average Amortization Period (in years) | 11 years | 11 years |
Gross Amount | $ 378,541 | $ 374,457 |
Accumulated Amortization | (217,914) | (209,283) |
Total intangible assets subject to amortization | $ 160,627 | $ 165,174 |
Patents [Member] | ||
Intangible assets subject to amortization: | ||
Weighted- Average Amortization Period (in years) | 10 years | 10 years |
Gross Amount | $ 58,330 | $ 57,783 |
Accumulated Amortization | (33,436) | (31,903) |
Total intangible assets subject to amortization | $ 24,894 | $ 25,880 |
Manufacturing know-how and trade secrets [Member] | ||
Intangible assets subject to amortization: | ||
Weighted- Average Amortization Period (in years) | 12 years | 12 years |
Gross Amount | $ 21,394 | $ 21,412 |
Accumulated Amortization | (21,394) | (21,387) |
Total intangible assets subject to amortization | $ 0 | $ 25 |
Trade name and trademarks [Member] | ||
Intangible assets subject to amortization: | ||
Weighted- Average Amortization Period (in years) | 9 years | 9 years |
Gross Amount | $ 25,264 | $ 25,163 |
Accumulated Amortization | (20,260) | (19,621) |
Total intangible assets subject to amortization | $ 5,004 | $ 5,542 |
Customer relationships [Member] | ||
Intangible assets subject to amortization: | ||
Weighted- Average Amortization Period (in years) | 9 years | 9 years |
Gross Amount | $ 156,743 | $ 156,208 |
Accumulated Amortization | (113,967) | (110,154) |
Total intangible assets subject to amortization | $ 42,776 | $ 46,054 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets (Details Textual) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expense related to intangible assets | $ 13.9 | $ 14.2 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Schedule of Changes to Goodwill (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Goodwill [Roll Forward] | |
Gross Goodwill at beginning of period | $ 641,767 |
Accumulated impairment loss at beginning of period | (8,300) |
Goodwill at beginning of period | 633,467 |
Changes to gross goodwill | |
Changes resulting from foreign currency fluctuations | 3,236 |
Gross Goodwill at end of period | 645,003 |
Accumulated impairment loss at end of period | (8,300) |
Goodwill at end of period | $ 636,703 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Future Amortization Expense Related to Intangible Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Future amortization expense related to intangible assets | ||
Remaining 2022 | $ 39,169 | |
2023 | 27,441 | |
2024 | 21,628 | |
2025 | 20,782 | |
2026 | 15,984 | |
Thereafter through 2038 | 108,297 | |
Total intangible assets subject to amortization | $ 233,301 | $ 242,675 |
Indebtedness - Carrying Value o
Indebtedness - Carrying Value of Senior Convertible Notes (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 | Jun. 30, 2020 | Mar. 31, 2020 |
Debt Instrument [Line Items] | ||||
Total Senior Convertible Notes | $ 886,793,000 | $ 884,984,000 | ||
1.00% Senior Convertible Notes due 2023 [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate on convertible notes | 1.00% | 1.00% | 1.00% | |
Principal amount | $ 450,000,000 | $ 450,000,000 | $ 450,000,000 | |
Unamortized debt issuance costs | (5,402,000) | (6,543,000) | ||
Total Senior Convertible Notes | $ 444,598,000 | $ 443,457,000 | ||
0.375% Senior Convertible Notes due 2025 [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate on convertible notes | 0.375% | 0.375% | 0.375% | |
Principal amount | $ 450,000,000 | $ 450,000,000 | $ 450,000,000 | |
Unamortized debt issuance costs | (7,805,000) | (8,473,000) | ||
Total Senior Convertible Notes | $ 442,195,000 | $ 441,527,000 |
Indebtedness - Interest and Eff
Indebtedness - Interest and Effective Interest Rates (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Interest expense: | ||
Total interest expense recognized on Senior Convertible Notes | $ 4,379 | $ 8,030 |
Senior Convertible Notes [Member] | ||
Interest expense: | ||
Contractual coupon interest | 1,547 | 4,594 |
Amortization of debt issuance costs | 1,810 | 2,507 |
Total interest expense recognized on Senior Convertible Notes | $ 3,357 | $ 7,101 |
Senior Convertible Notes due 2021 [Member] | Senior Convertible Notes [Member] | ||
Effective interest rates: | ||
Effective interest rates | 0.00% | 2.90% |
Senior Convertible Notes due 2023 [Member] | Senior Convertible Notes [Member] | ||
Effective interest rates: | ||
Effective interest rates | 2.00% | 2.00% |
Senior Convertible Notes due 2025 [Member] | Senior Convertible Notes [Member] | ||
Effective interest rates: | ||
Effective interest rates | 1.00% | 1.00% |
Indebtedness (Details Textual)
Indebtedness (Details Textual) | Mar. 15, 2021USD ($)shares | Jun. 30, 2020USD ($)d$ / sharesshares | Mar. 31, 2020USD ($)d$ / sharesshares | Feb. 29, 2020USD ($) | Mar. 31, 2016USD ($)d$ / sharesshares | Dec. 31, 2020USD ($) | Dec. 31, 2016USD ($) | Mar. 31, 2022USD ($)shares | Dec. 31, 2021USD ($)shares | Jan. 01, 2021USD ($) | Sep. 10, 2020shares | Sep. 09, 2020shares |
Debt Instrument [Line Items] | ||||||||||||
Common stock, shares authorized (in shares) | shares | 150,000,000 | 150,000,000 | 150,000,000 | 120,000,000 | ||||||||
Retained earnings | $ 64,909,000 | $ 45,708,000 | ||||||||||
Deferred tax liabilities | 12,807,000 | 3,049,000 | ||||||||||
Carrying value | 886,793,000 | 884,984,000 | ||||||||||
Revolving Senior Credit Facility [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Credit facility, maximum borrowing capacity | $ 550,000,000 | |||||||||||
Loan outstanding | $ 0 | $ 0 | ||||||||||
Revolving Senior Credit Facility [Member] | Federal Funds Effective Rate [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Credit facility bear interest rate | 0.50% | |||||||||||
Revolving Senior Credit Facility [Member] | Eurocurrency Rate [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Credit facility bear interest rate | 1.00% | |||||||||||
Multicurrency Borrowings [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Credit facility, maximum borrowing capacity | $ 250,000,000 | |||||||||||
Standby Letters of Credit [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Credit facility, maximum borrowing capacity | 50,000,000 | |||||||||||
Swing Line Loans [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Credit facility, maximum borrowing capacity | $ 5,000,000 | |||||||||||
2023 Warrants [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Cash proceeds from the sale of warrants | $ 46,800,000 | |||||||||||
Warrant strike price (in dollars per share) | $ / shares | $ 104.84 | |||||||||||
2025 Warrants [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Cash proceeds from the sale of warrants | $ 47,100,000 | |||||||||||
Warrant strike price (in dollars per share) | $ / shares | $ 127.84 | |||||||||||
2021 Warrants [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Cash proceeds from the sale of warrants | $ 44,900,000 | |||||||||||
Warrant strike price (in dollars per share) | $ / shares | $ 80 | |||||||||||
2023 Hedge [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Amount reclassified to stockholders' equity | $ 37,300,000 | |||||||||||
Common stock to be purchased (in shares) | shares | 5,345,010 | |||||||||||
Stock price (in dollars per share) | $ / shares | $ 84.19 | |||||||||||
Cost of hedge transaction | $ 69,500,000 | |||||||||||
2025 Hedge [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Common stock to be purchased (in shares) | shares | 4,823,910 | |||||||||||
Stock price (in dollars per share) | $ / shares | $ 93.29 | |||||||||||
Cost of hedge transaction | $ 78,300,000 | |||||||||||
2021 Hedge [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Common stock to be purchased (in shares) | shares | 10,865,270 | |||||||||||
Stock price (in dollars per share) | $ / shares | $ 59.82 | |||||||||||
Cost of hedge transaction | $ 111,200,000 | |||||||||||
Number of common shares received in settlement of convertible note hedge transaction | shares | 842 | |||||||||||
Minimum [Member] | Revolving Senior Credit Facility [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Unused line fee | 0.35% | |||||||||||
Minimum [Member] | Revolving Senior Credit Facility [Member] | Eurocurrency Rate [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Credit facility bear interest rate | 1.50% | |||||||||||
Minimum [Member] | Revolving Senior Credit Facility [Member] | Base Rate [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Credit facility bear interest rate | 0.50% | |||||||||||
Maximum [Member] | Revolving Senior Credit Facility [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Unused line fee | 0.50% | |||||||||||
Maximum [Member] | Revolving Senior Credit Facility [Member] | Eurocurrency Rate [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Credit facility bear interest rate | 2.25% | |||||||||||
Maximum [Member] | Revolving Senior Credit Facility [Member] | Base Rate [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Credit facility bear interest rate | 1.25% | |||||||||||
Additional Paid-in Capital [Member] | 2025 Hedge [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Cost of hedge transaction | $ 78,300,000 | |||||||||||
Additional Paid-in Capital [Member] | 2021 Hedge [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Cost of hedge transaction | $ 111,200,000 | |||||||||||
Common Stock [Member] | 2023 Warrants [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Preferred or common stock into which the warrants is converted (in shares) | shares | 3,093,500 | |||||||||||
Common Stock [Member] | 2023 Warrants [Member] | 2023 Counterparties [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Preferred or common stock into which the warrants is converted (in shares) | shares | 6,948,512 | |||||||||||
Common Stock [Member] | Maximum [Member] | 2023 Warrants [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Preferred or common stock into which the warrants is converted (in shares) | shares | 5,345,010 | |||||||||||
Common Stock [Member] | Maximum [Member] | 2025 Warrants [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Preferred or common stock into which the warrants is converted (in shares) | shares | 4,823,910 | |||||||||||
Common Stock [Member] | Maximum [Member] | 2021 Warrants [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Preferred or common stock into which the warrants is converted (in shares) | shares | 10,865,270 | |||||||||||
1.00% Senior Convertible Notes due 2023 [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest rate on convertible notes | 1.00% | 1.00% | 1.00% | |||||||||
Principal amount | $ 450,000,000 | $ 450,000,000 | $ 450,000,000 | |||||||||
Proceeds from issuance of convertible debt, net of issuance costs | $ 436,700,000 | |||||||||||
Initial conversion rate adjustment, shares | 11.8778 | |||||||||||
Principal amount of debt considered for conversion rate | $ 1,000 | |||||||||||
Initial conversion price of convertible notes (in dollars per share) | $ / shares | $ 84.19 | |||||||||||
Fair value of embedded conversion derivative | $ 57,200,000 | |||||||||||
Carrying value | $ 444,598,000 | $ 443,457,000 | ||||||||||
1.00% Senior Convertible Notes due 2023 [Member] | Conversion Option Two [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount of debt considered for conversion rate | $ 1,000 | |||||||||||
Consecutive trading days considered for debt conversion | d | 5 | |||||||||||
1.00% Senior Convertible Notes due 2023 [Member] | Minimum [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Percentage of conversion price | 130.00% | |||||||||||
1.00% Senior Convertible Notes due 2023 [Member] | Minimum [Member] | Conversion Option One [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Consecutive trading days considered for debt conversion | d | 20 | |||||||||||
1.00% Senior Convertible Notes due 2023 [Member] | Maximum [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Percentage of conversion price | 98.00% | |||||||||||
1.00% Senior Convertible Notes due 2023 [Member] | Maximum [Member] | Conversion Option One [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Consecutive trading days considered for debt conversion | d | 30 | |||||||||||
1.00% Senior Convertible Notes due 2023 [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member] | ASU 2020-06 [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Convertible debt liabilities | $ 46,800,000 | |||||||||||
Retained earnings | 7,900,000 | |||||||||||
Deferred tax liabilities | (11,200,000) | |||||||||||
Additional paid-in capital | (43,500,000) | |||||||||||
1.00% Senior Convertible Notes due 2023 [Member] | Additional Paid-in Capital [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Amount reclassified to stockholders' equity | 37,300,000 | |||||||||||
0.375% Senior Convertible Notes due 2025 [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest rate on convertible notes | 0.375% | 0.375% | 0.375% | |||||||||
Principal amount | $ 450,000,000 | $ 450,000,000 | $ 450,000,000 | |||||||||
Proceeds from issuance of convertible debt, net of issuance costs | $ 437,000,000 | |||||||||||
Initial conversion rate adjustment, shares | 10.7198 | |||||||||||
Principal amount of debt considered for conversion rate | $ 1,000 | |||||||||||
Initial conversion price of convertible notes (in dollars per share) | $ / shares | $ 93.29 | |||||||||||
Percentage of conversion price | 130.00% | |||||||||||
Debt redemption price percentage | 100.00% | |||||||||||
Carrying value | $ 442,195,000 | $ 441,527,000 | ||||||||||
0.375% Senior Convertible Notes due 2025 [Member] | Conversion Option Two [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount of debt considered for conversion rate | $ 1,000 | |||||||||||
Consecutive trading days considered for debt conversion | d | 5 | |||||||||||
0.375% Senior Convertible Notes due 2025 [Member] | Minimum [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Consecutive trading days considered for debt conversion | d | 20 | |||||||||||
Percentage of conversion price | 130.00% | |||||||||||
0.375% Senior Convertible Notes due 2025 [Member] | Minimum [Member] | Conversion Option One [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Consecutive trading days considered for debt conversion | d | 20 | |||||||||||
0.375% Senior Convertible Notes due 2025 [Member] | Maximum [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Consecutive trading days considered for debt conversion | d | 30 | |||||||||||
Percentage of conversion price | 98.00% | |||||||||||
0.375% Senior Convertible Notes due 2025 [Member] | Maximum [Member] | Conversion Option One [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Consecutive trading days considered for debt conversion | d | 30 | |||||||||||
0.375% Senior Convertible Notes due 2025 [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member] | ASU 2020-06 [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Convertible debt liabilities | 64,700,000 | |||||||||||
Retained earnings | 8,800,000 | |||||||||||
Deferred tax liabilities | (15,900,000) | |||||||||||
Additional paid-in capital | (57,600,000) | |||||||||||
0.375% Senior Convertible Notes due 2025 [Member] | Additional Paid-in Capital [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Amount reclassified to stockholders' equity | 78,300,000 | |||||||||||
2.25% Senior Convertible Notes due 2021 [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest rate on convertible notes | 2.25% | |||||||||||
Principal amount | $ 650,000,000 | 650,000,000 | ||||||||||
Proceeds from issuance of convertible debt, net of issuance costs | $ 634,100,000 | |||||||||||
Initial conversion rate adjustment, shares | 16.7158 | |||||||||||
Principal amount of debt considered for conversion rate | $ 1,000 | |||||||||||
Initial conversion price of convertible notes (in dollars per share) | $ / shares | $ 59.82 | |||||||||||
Reclassification into temporary equity | 4,700,000 | |||||||||||
Carrying value | $ 645,300,000 | |||||||||||
Percentage of conversion notices from notes holders | 1.40% | |||||||||||
Outstanding amount for which conversion notices received | $ 9,100,000 | |||||||||||
Aggregate cash payments for settlement of convertible notes | 649,400,000 | |||||||||||
Cash payments for outstanding principal amount | 640,900,000 | |||||||||||
Cash payments for settlement of conversions | $ 8,500,000 | |||||||||||
2.25% Senior Convertible Notes due 2021 [Member] | Conversion Option Two [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Consecutive trading days considered for debt conversion | d | 5 | |||||||||||
2.25% Senior Convertible Notes due 2021 [Member] | Minimum [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Consecutive trading days considered for debt conversion | d | 20 | |||||||||||
Percentage of conversion price | 130.00% | |||||||||||
2.25% Senior Convertible Notes due 2021 [Member] | Minimum [Member] | Conversion Option One [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Consecutive trading days considered for debt conversion | d | 20 | |||||||||||
2.25% Senior Convertible Notes due 2021 [Member] | Maximum [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Consecutive trading days considered for debt conversion | d | 30 | |||||||||||
Percentage of conversion price | 98.00% | |||||||||||
2.25% Senior Convertible Notes due 2021 [Member] | Maximum [Member] | Conversion Option One [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Consecutive trading days considered for debt conversion | d | 30 | |||||||||||
2.25% Senior Convertible Notes due 2021 [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member] | ASU 2020-06 [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Convertible debt liabilities | 3,900,000 | |||||||||||
Retained earnings | 47,800,000 | |||||||||||
Deferred tax liabilities | (900,000) | |||||||||||
Additional paid-in capital | $ (46,100,000) | |||||||||||
2.25% Senior Convertible Notes due 2021 [Member] | Additional Paid-in Capital [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Amount reclassified to stockholders' equity | $ 84,800,000 | |||||||||||
2.25% Senior Convertible Notes due 2021 [Member] | Common Stock [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Convertible note hedge transactions purchase of common stock (in shares) | shares | 837 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - Common Stock [Member] - USD ($) | Nov. 03, 2021 | Mar. 31, 2020 | Oct. 31, 2017 | Mar. 31, 2022 | Feb. 29, 2020 |
Equity Class Of Treasury Stock [Line Items] | |||||
Share repurchase program, authorized amount | $ 150,000,000 | ||||
Share repurchase program, period in force | 3 years | ||||
Shares repurchased during period (in shares) | 0 | ||||
Shares repurchased during period, value | $ 0 | ||||
Share repurchase program, authorized amount increased | $ 25,000,000 | ||||
0.375% Senior Convertible Notes due 2025 [Member] | |||||
Equity Class Of Treasury Stock [Line Items] | |||||
Shares repurchased during period (in shares) | 1,085,000 | ||||
Shares repurchased during period, value | $ 75,000,000 | ||||
Maximum [Member] | |||||
Equity Class Of Treasury Stock [Line Items] | |||||
Share repurchase program, authorized amount | $ 100,000,000 | $ 100,000,000 |
Stock-Based Compensation - Comp
Stock-Based Compensation - Compensation Cost Included in Unaudited Consolidated Statement of Operations for All Stock-based Compensation Arrangements (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense before taxes | $ 6,807 | $ 7,709 |
Related income tax benefit | (988) | (1,409) |
Stock-based compensation expense, net of taxes | 5,819 | 6,300 |
Selling, General And Administrative Expense [Member] | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense before taxes | 6,442 | 5,975 |
Research and Development Expense [Member] | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense before taxes | 329 | 1,651 |
Cost of Sales [Member] | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense before taxes | $ 36 | $ 83 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details Textual) - USD ($) shares in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2022 | Dec. 31, 2021 | |
ESPP [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Maximum percentage of annual compensation | 15.00% | |
Maximum amount withheld to purchase shares of the company | $ 21,250 | |
Percentage of issuance price of stock under the stock issuance program | 85.00% | |
ESPP offering period | 6 months | |
Restricted Stock Units (RSUs) and Performance-Based Restricted Stock Units (PRSUs) [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Unamortized cost related to share-based compensation | $ 68,800,000 | |
Weighted average period for recognition of unamortized cost | 2 years 7 months 6 days | |
Shares of common stock issued upon vesting (in shares) | 371 | |
Restricted Stock Units (RSUs) [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Shares of common stock issued upon vesting (in shares) | 216 | |
Performance Based Restricted Stock Units (PRSUs) [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Shares of common stock issued upon vesting (in shares) | 63 |
Stock-Based Compensation - Weig
Stock-Based Compensation - Weighted Average Assumptions Used to Estimate Fair Value of Stock Purchase Rights under ESPP (Details) - ESPP [Member] | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Weighted average assumptions used to estimate fair value of stock options granted and stock purchase rights under ESPP | ||
Volatility | 27.00% | 49.00% |
Expected term (years) | 6 months | 6 months |
Risk free interest rate | 0.10% | 0.10% |
Expected dividend yield | 0.00% | 0.00% |
Income Taxes (Details)
Income Taxes (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Income Tax Disclosure [Abstract] | |
Effective income tax rate | 20.00% |
Increase in gross unrecognized tax benefits | $ 2.2 |
Remaining unrecognized tax positions | $ 0.1 |
Business Segment, Product and_2
Business Segment, Product and Geographic Information (Details Textual) | 3 Months Ended |
Mar. 31, 2022segmentproduct_line | |
Segment Reporting [Abstract] | |
Number of operating segments | segment | 1 |
Number of product lines | product_line | 2 |
Business Segment, Product and_3
Business Segment, Product and Geographic Information - Schedule of Net Sales by Product Line (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Entity Wide Information Revenue From External Customer [Line Items] | ||
Net sales | $ 290,762 | $ 271,249 |
Spinal Hardware [Member] | ||
Entity Wide Information Revenue From External Customer [Line Items] | ||
Net sales | 220,796 | 204,558 |
Surgical Support [Member] | ||
Entity Wide Information Revenue From External Customer [Line Items] | ||
Net sales | $ 69,966 | $ 66,691 |
Business Segment, Product and_4
Business Segment, Product and Geographic Information - Schedule of Net Sales and Net Property and Equipment by Geographical Area (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Revenues and Net Property and Equipment by Geographical Areas [Line Items] | |||
Net Sales | $ 290,762 | $ 271,249 | |
Property and equipment, net | 313,689 | $ 303,664 | |
United States | |||
Revenues and Net Property and Equipment by Geographical Areas [Line Items] | |||
Net Sales | 220,829 | 208,098 | |
Property and equipment, net | 266,309 | 256,688 | |
International (excludes Puerto Rico) [Member] | |||
Revenues and Net Property and Equipment by Geographical Areas [Line Items] | |||
Net Sales | 69,933 | $ 63,151 | |
Property and equipment, net | $ 47,380 | $ 46,976 |
Commitments (Details Textual)
Commitments (Details Textual) - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Commitments And Contingencies Disclosure [Line Items] | ||
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Property and equipment, net | Property and equipment, net |
Restricted cash for security deposit | $ 1.5 | $ 1.5 |
Executive Severance Plans [Member] | ||
Commitments And Contingencies Disclosure [Line Items] | ||
Other commitments | $ 14.8 | |
Minimum [Member] | ||
Commitments And Contingencies Disclosure [Line Items] | ||
Initial terms of lease | 1 year | |
Maximum [Member] | ||
Commitments And Contingencies Disclosure [Line Items] | ||
Initial terms of lease | 17 years |
Commitments - Right-of-use Asse
Commitments - Right-of-use Assets and Lease Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Assets | ||
Operating | $ 100,656 | $ 102,987 |
Financing | 2,414 | 2,276 |
Total leased assets | 103,070 | 105,263 |
Current: | ||
Operating | 10,043 | 9,867 |
Financing | 1,750 | 1,546 |
Long-term: | ||
Operating | 109,093 | 111,592 |
Financing | 800 | 885 |
Total lease liabilities | $ 121,686 | $ 123,890 |
Supplemental non-cash information: | ||
Weighted-average remaining lease term (years) - operating leases | 11 years 4 months 24 days | 11 years 7 months 6 days |
Weighted-average remaining lease term (years) - finance leases | 2 years 6 months | 2 years 1 month 6 days |
Weighted-average discount rate - operating leases | 5.30% | 5.30% |
Weighted-average discount rate - finance leases | 3.50% | 4.70% |
Commitments - Lease Costs, Cash
Commitments - Lease Costs, Cash Payments and Operating Lease Liabilities Arising From Obtaining Right-of-use Assets under Operating and Financing Lease Obligations (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Lease expense: | ||
Operating lease expense | $ 4,107 | $ 3,911 |
Finance lease expense: | ||
Depreciation of right-of-use assets | 397 | 327 |
Interest expense on lease liabilities | 30 | 32 |
Total lease expense | 4,534 | 4,270 |
Consolidated Statements of Cash Flows information: | ||
Operating cash flows used for operating leases | 4,153 | 3,619 |
Operating cash flows used for financing leases | 30 | 32 |
Financing cash flows used for financing leases | 521 | 334 |
Total cash paid for amounts included in the measurement of lease liabilities | 4,704 | 3,985 |
Supplemental non-cash information: | ||
Operating lease liabilities arising from obtaining right-of-use assets | $ 498 | $ 2,231 |
Commitments - Future Minimum An
Commitments - Future Minimum Annual Lease Payments under Operating and Financing Leases (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Financing Leases | ||
Remaining 2022 | $ 1,329 | |
2023 | 870 | |
2024 | 329 | |
2025 | 80 | |
2026 | 26 | |
Thereafter | 0 | |
Total minimum lease payments | 2,634 | |
Less: amount representing interest | (84) | |
Present value of obligations under leases | 2,550 | |
Less: current portion | (1,750) | $ (1,546) |
Long-term lease obligations | 800 | 885 |
Operating Leases | ||
Remaining 2022 | 12,095 | |
2023 | 15,159 | |
2024 | 13,911 | |
2025 | 12,529 | |
2026 | 12,306 | |
Thereafter | 96,568 | |
Total minimum lease payments | 162,568 | |
Less: amount representing interest | (43,432) | |
Present value of obligations under leases | 119,136 | |
Less: current portion | (10,043) | (9,867) |
Long-term lease obligations | $ 109,093 | $ 111,592 |