Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | Apr. 25, 2019 | |
Document Documentand Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | PODD | |
Entity Registrant Name | INSULET CORPORATION | |
Entity Central Index Key | 0001145197 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Entity Common Stock, Shares Outstanding (in shares) | 59,675,242 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Current Assets | ||
Cash and cash equivalents | $ 129,254 | $ 113,906 |
Short-term investments | 187,120 | 175,040 |
Accounts receivable, net | 68,655 | 63,294 |
Unbilled receivable | 9,503 | 13,378 |
Inventories | 73,822 | 71,414 |
Prepaid expenses and other current assets | 28,028 | 24,254 |
Total current assets | 496,382 | 461,286 |
Long-term investments | 76,789 | 140,784 |
Property and equipment, net | 299,605 | 258,379 |
Other intangible assets, net | 11,484 | 10,383 |
Goodwill | 39,694 | 39,646 |
Other assets | 28,658 | 18,266 |
Total assets | 952,612 | 928,744 |
Current Liabilities | ||
Accounts payable | 26,833 | 25,500 |
Accrued expenses and other current liabilities | 85,945 | 88,973 |
Deferred revenue | 1,195 | 1,184 |
Total current liabilities | 113,973 | 115,657 |
Convertible debt, net of current portion | 599,601 | 591,978 |
Other long-term liabilities | 15,408 | 9,010 |
Total liabilities | 728,982 | 716,645 |
Stockholders’ Equity | ||
Authorized: 5,000,000 shares at March 31, 2019 and December 31, 2018. Issued and outstanding: zero shares at March 31, 2019 and December 31, 2018. | 0 | 0 |
Authorized: 100,000,000 at March 31, 2019 and December 31, 2018. Issued and outstanding: 59,638,439 and 59,188,758 at March 31, 2019 and December 31, 2018, respectively. | 60 | 59 |
Additional paid-in capital | 905,891 | 898,559 |
Accumulated other comprehensive loss | (3,085) | (2,905) |
Accumulated deficit | (679,236) | (683,614) |
Total stockholders’ equity | 223,630 | 212,099 |
Total liabilities and stockholders’ equity | $ 952,612 | $ 928,744 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, issued (in shares) | 59,638,439 | 59,188,758 |
Common stock, outstanding (in shares) | 59,638,439 | 59,188,758 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Income Statement [Abstract] | ||
Revenue | $ 159,555 | $ 123,578 |
Cost of revenue | 52,859 | 47,763 |
Gross profit | 106,696 | 75,815 |
Operating expenses: | ||
Research and development | 31,954 | 20,267 |
Sales and marketing | 41,616 | 33,049 |
General and administrative | 25,861 | 22,499 |
Total operating expenses | 99,431 | 75,815 |
Operating income | 7,265 | 0 |
Interest expense | 6,615 | 7,918 |
Other income, net | 4,054 | 1,682 |
Interest expense and other income, net | 2,561 | 6,236 |
Income (loss) before income taxes | 4,704 | (6,236) |
Income tax expense | 326 | 333 |
Net income (loss) | $ 4,378 | $ (6,569) |
Net income (loss) per share: | ||
Net income (loss) per share: basic (in dollars per share) | $ 0.07 | $ (0.11) |
Net income (loss) per shares: diluted (in dollars per share) | $ 0.07 | $ 0 |
Weighted average number of shares outstanding, basic (in shares) | 59,355,031 | 58,482,786 |
Weighted average number of shares outstanding, diluted (in shares) | 61,148,428 | 58,482,786 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | ||
Net income (loss) | $ 4,378 | $ (6,569) |
Other comprehensive loss, net of tax | ||
Foreign currency translation adjustment, net of tax | (815) | (318) |
Unrealized gain (loss) on available-for-sale debt securities, net of tax | 635 | (725) |
Total other comprehensive loss, net of tax | (180) | (1,043) |
Total comprehensive income (loss) | $ 4,198 | $ (7,612) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss |
Beginning balance (in shares) at Dec. 31, 2017 | 58,319,348 | ||||
Beginning balance at Dec. 31, 2017 | $ 158,516 | $ 58 | $ 866,206 | $ (707,255) | $ (493) |
Exercise of options to purchase common stock, net of shares withheld and retired to satisfy cashless exercises (in shares) | 114,042 | ||||
Exercise of options to purchase common stock, net of shares withheld and retired to satisfy cashless exercises | 2,961 | 2,961 | |||
Stock-based compensation expense | 8,181 | 8,181 | |||
Restricted stock units vested, net of shares withheld for taxes (in shares) | 289,852 | ||||
Restricted stock units vested, net of shares withheld for taxes | (11,815) | $ 1 | (11,816) | ||
Debt retirement | (12) | (12) | |||
Net income (loss) | (6,569) | (6,569) | |||
Other comprehensive loss | (1,043) | (1,043) | |||
Ending balance (in shares) at Mar. 31, 2018 | 58,723,242 | ||||
Ending balance at Mar. 31, 2018 | $ 170,568 | $ 59 | 865,520 | (693,475) | (1,536) |
Beginning balance (in shares) at Dec. 31, 2018 | 59,188,758 | 59,188,758 | |||
Beginning balance at Dec. 31, 2018 | $ 212,099 | $ 59 | 898,559 | (683,614) | (2,905) |
Exercise of options to purchase common stock, net of shares withheld and retired to satisfy cashless exercises (in shares) | 273,082 | 269,473 | |||
Exercise of options to purchase common stock, net of shares withheld and retired to satisfy cashless exercises | $ 9,061 | $ 1 | 9,060 | ||
Stock-based compensation expense | 5,784 | 5,784 | |||
Restricted stock units vested, net of shares withheld for taxes (in shares) | 180,208 | ||||
Restricted stock units vested, net of shares withheld for taxes | (7,512) | (7,512) | |||
Net income (loss) | 4,378 | 4,378 | |||
Other comprehensive loss | $ (180) | (180) | |||
Ending balance (in shares) at Mar. 31, 2019 | 59,638,439 | 59,638,439 | |||
Ending balance at Mar. 31, 2019 | $ 223,630 | $ 60 | $ 905,891 | $ (679,236) | $ (3,085) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | ||
Cash flows from operating activities | |||
Net income (loss) | $ 4,378 | $ (6,569) | |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities | |||
Depreciation and amortization | 5,135 | 3,522 | |
Non-cash interest expense | 7,623 | 7,163 | |
Stock-based compensation expense | 5,784 | 8,181 | |
Provision for bad debts | 807 | 697 | |
Other | (326) | 46 | |
Changes in operating assets and liabilities: | |||
Accounts receivable and unbilled receivable | (2,796) | 1,800 | |
Inventories | (2,690) | 6,706 | |
Prepaid expenses and other assets | (5,563) | (3,324) | |
Accounts payable, accrued expenses and other current liabilities | (5,256) | (20,950) | |
Deferred revenue | 11 | (2,165) | |
Other long-term liabilities | (740) | 627 | |
Net cash provided by (used in) operating activities | 6,367 | (4,266) | |
Cash flows from investing activities | |||
Purchases of property, equipment and software | [1] | (45,255) | (35,374) |
Purchases of investments | (2,156) | (60,880) | |
Receipts from the maturity or sale of investments | 55,031 | 40,266 | |
Net cash provided by (used in) investing activities | 7,620 | (55,988) | |
Cash flows from financing activities | |||
Repayment of convertible debt | 0 | (15) | |
Proceeds from exercise of stock options | [2] | 9,061 | 2,961 |
Payment of withholding taxes in connection with vesting of restricted stock units | (7,512) | (11,816) | |
Net cash provided by (used in) financing activities | 1,549 | (8,870) | |
Effect of exchange rate changes on cash | (188) | (307) | |
Net increase (decrease) in cash, cash equivalents and restricted cash | 15,348 | (69,431) | |
Cash, cash equivalents and restricted cash, beginning of period | 113,906 | 272,577 | |
Cash, cash equivalents and restricted cash, end of period | 129,254 | 203,146 | |
Cash outflows from property, equipment and intangible assets | 11,500 | 4,000 | |
Purchases of property, equipment and software, previously recorded in accounts payable | $ 12,700 | $ 17,500 | |
Number of shares acquired (in shares) | 3,609 | 8,243 | |
Payments for repurchase of common stock | $ 300 | $ 700 | |
[1] | Cash outflows from purchases of property, equipment and intangible assets for the three months ended March 31, 2019 and 2018 include $11.5 million and $4.0 million, respectively, of purchases made in prior periods that were included in accounts payable and accrued expenses as of December 31, 2018 and 2017, respectively, and exclude $12.7 million and $17.5 million of purchases made during the three months ended March 31, 2019 and 2018, respectively, that were included in accounts payable and accrued expenses as of March 31, 2019 | ||
[2] | During the period of three months ended March 31, 2019 and 2018, the Company acquired 3,609 and 8,243 shares of its common stock, respectively, with a value of $0.3 million and $0.7 million, respectively, in return for the exercise of stock options. The acquired shares were subsequently retired. |
Nature of the Business
Nature of the Business | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of the Business | Nature of the Business Insulet Corporation (the "Company") is primarily engaged in the development, manufacturing and sale of its proprietary Omnipod® System, an innovative, discreet and easy-to-use continuous insulin delivery system for people with insulin-dependent diabetes. The Omnipod System consists of two product lines: the Omnipod Insulin Management System (“Omnipod”), which the Company has been selling since 2005, and its next generation Omnipod DASH TM Insulin Management System ("Omnipod DASH" or "DASH"), which began a U.S. limited market release in 2018. Collectively, we refer to these products as the "Omnipod System". In addition to using the Omnipod System for insulin delivery, the Company also partners with global pharmaceutical and biotechnology companies to tailor the Omnipod System technology platform for the delivery of their drugs across other therapeutic areas. The majority of the Company's drug delivery revenue currently consists of sales to Amgen supplying the Neulasta Onpro kit, an innovative delivery system for Amgen’s white blood cell booster to help reduce the risk of infection during intense chemotherapy. |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | Basis of Presentation and Summary of Significant Accounting Policies Basis of Presentation The unaudited consolidated financial statements in this Quarterly Report on Form 10-Q have been prepared in accordance with generally accepted accounting principles (“U.S. GAAP” or "GAAP") for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, these unaudited consolidated financial statements do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2019 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2019 , or for any other subsequent interim period. The unaudited consolidated financial statements in this Quarterly Report on Form 10-Q should be read in conjunction with the Company’s consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 . Use of Estimates in Preparation of Financial Statements The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions in the application of certain of its significant accounting policies that may materially affect the reported amounts of assets, liabilities, equity, revenue and expenses. Actual results may differ from those estimates. Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Summary of Significant Accounting Policies The Company's significant accounting policies are described in Note 2, "Summary of Significant Accounting Policies", in the Company's Annual Report on Form 10-K for fiscal year 2018. Segment Reporting Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated on a regular basis by the chief operating decision-maker ("CODM") in deciding how to allocate resources to an individual segment and in assessing performance of the segment. The Company has concluded its Chief Executive Officer ("CEO") is the CODM as the CEO is the ultimate decision maker for key operating decisions, determining the allocation of resources and assessing the financial performance of the Company. These decisions, allocations and assessments are performed by the CODM using consolidated financial information. The Company’s products are relatively consistent and manufacturing is centralized and consistent across product offerings. Based on these factors, key operating decisions and resource allocations are made by the CODM using consolidated financial data and as such the Company has concluded that it operates as one segment. Shipping and Handling Costs The Company does not typically charge its customers for shipping and handling costs associated with shipping its product to its customers unless non-standard shipping and handling services are requested. These shipping and handling costs are included in general and administrative expenses and were $2.6 million and $1.0 million for the three months ended March 31, 2019 and 2018 , respectively. Reclassification of Prior Period Amounts Certain reclassifications have been made to prior period amounts to conform to the current period financial statement presentation. Software license costs have been reallocated from general and administrative expenses to research and development and sales and marketing expenses based on license usage. These reclassifications have no effect on previously reported net income. Recently Adopted Accounting Standards Effective January 1, 2019, the Company adopted ASU No. 2016-02, Leases (Topic 842) ("ASU 2016-02"). ASU 2016-02 and its related amendments (collectively referred to as ASC 842) amends the guidance in former ASC Topic 840, Leases. The new standard increases transparency and comparability most significantly by requiring the recognition by lessees of right-of-use (“ROU”) assets and lease liabilities on the balance sheet for those leases classified as operating leases. The Company adopted ASC 842 on January 1, 2019 using the modified retrospective method, whereby the new guidance is applied prospectively as of the date of adoption and prior periods are not to be restated. The Company elected the package of practical expedients which permits the Company to not reassess (1) whether any expired or existing contracts are or contain leases, (2) the lease classification for any expired or existing leases, and (3) any initial direct costs for any existing leases as of the effective date. The Company also excludes leases with an expected term of less than one year from the application of ASC 842. The adoption of the lease standard did not change the Company's previously reported consolidated statements of operations and did not result in a cumulative catch-up adjustment to opening equity. Adoption of the lease standard had a material impact on its consolidated balance sheet (Note 13). Effective January 1, 2019, the Company adopted ASU 2017-12, Targeted Improvements to Accounting for Hedging Activities ("ASU 2017-12"). ASU 2017-12 updates the current hedge accounting guidance with the objective of improving the financial reporting of hedging activities by better portraying the economic results of an entity's risk management activities in its financial statements. As the Company currently does not use derivative financial instruments, this guidance did not have any impact on the Company's financial statements upon adoption. Effective January 1, 2019, the Company early adopted ASU 2018-15, Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract ("ASU 2018-15"). ASU 2018-15 requires that entities capitalize certain costs to implement a cloud computing arrangement that is a service contract consistent with the rules applicable to internal use software capitalization projects. The Company adopted this new guidance effective January 1, 2019, prospectively. Upon adoption, the Company defers eligible costs related to the implementation of cloud computing arrangements within other current and non-current assets and amortizes these costs over the expected term if the hosting arrangement to the same income statement line as the associated cloud operating expenses. Adoption of this standard resulted in the Company capitalizing $1.3 million of cloud computing implementation costs to the consolidated balance sheet for the period ending March 31, 2019. Accounting Standards Issued and Not Yet Adopted In January 2017, the Financial Accounting Standards Board ("FASB") issued ASU 2017-04, Simplifying the Test for Goodwill Impairment ("ASU 2017-04"). ASU 2017-04 simplifies the accounting for goodwill impairments by eliminating "Step 2" from the goodwill impairment test, which requires an entity to calculate the implied fair value of goodwill to measure a goodwill impairment charge, and alternatively, requires an entity to measure the impairment of goodwill assigned to a reporting unit as the amount by which the carrying value of the assets and liabilities of the reporting unit, including goodwill, exceeds the reporting unit's fair value. The guidance is effective for annual reporting periods beginning after December 15, 2019, and interim periods within those years. Early adoption is permitted for all entities. The Company is currently evaluating the impact of ASU 2017-04 but does not expect it to be material to the consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Changes to the Disclosure Requirements for Fair Value Measurement ("ASU 2018-13"). ASU 2018-13 modifies certain disclosure requirements related to fair value measurements primarily associated with Level 3 investments. The guidance is effective no later than January 1, 2020 for the Company and can be early-adopted prospectively in any interim period for certain disclosure requirements or retrospectively for others. The Company does not expect the adoption of this guidance to have a material impact on its fair value disclosures. In June 2016, the FASB issued ASU 2016-13, Credit Losses (Topic 326) ("ASU 2016-13"). ASU 2016-13 requires that financial assets measured at amortized cost, such as trade receivables and contract assets, be presented net of expected credit losses, which may be estimated based on relevant information such as historical experience, current conditions, and future expectation for each pool of similar financial asset. The new guidance requires enhanced disclosures related to trade receivables and associated credit losses. The guidance is effective beginning January 1, 2020. The adoption of this guidance is expected to increase the level of disclosures related to the Company's trade receivables and is not expected to have a material impact on its consolidated financial statements. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 3 Months Ended |
Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contract with Customers | Revenue from Contracts with Customers The following table summarizes revenue from contracts with customers for the three months ended March 31, 2019 and 2018: Three months Ended March 31, (in thousands) 2019 2018 U.S. Omnipod $ 86,103 $ 70,272 International Omnipod 56,888 38,404 Total Diabetes Revenue: 142,991 108,676 Drug Delivery 16,564 14,902 Total $ 159,555 $ 123,578 Revenue for customers comprising more than 10% of total revenue were as follows: Three Months Ended March 31, 2019 2018 Amgen, Inc. 10% 12% Ypsomed * 27% Cardinal Health Inc. and affiliates 10% 10% * Represents less than 10% of consolidated revenue. The aggregate amount of deferred revenue recorded on the balance sheet for unsatisfied performance obligations was $2.2 million and $2.1 million as of March 31, 2019 and December 31, 2018, respectively. As of March 31, 2019 and December 31, 2018, respectively, $1.0 million and $0.9 million of deferred revenue is included within other long-term liabilities on the balance sheet and is expected to be satisfied over a course of less than five years. Revenue recognized during the three months ended March 31, 2019 and March 31, 2018 from amounts included in deferred revenue at the beginning of the period was approximately $0.9 million and $2.1 million respectively. No revenue was recognized during the three months ended March 31, 2019 and March 31, 2018 from performance obligations satisfied or partially satisfied in previous periods. |
Investments and Fair Value
Investments and Fair Value | 3 Months Ended |
Mar. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Investment and Fair Value | Investments and Fair Value Cash and Cash Equivalents: For the purpose of financial statement classification, the Company considers all highly-liquid investment instruments with original maturities of 90 days or less, when purchased, to be cash equivalents. Cash equivalents generally include money market mutual funds, U.S. government and agency bonds, and are carried at cost which approximates their fair value. Included in the Company's cash and cash equivalents are restricted cash amounts set aside for collateral on outstanding letters of credit totaling $2.7 million as of March 31, 2019 and $2.7 million as of December 31, 2018 . Marketable Securities: The Company's short-term and long-term investments in debt securities have maturity dates that range from 1 days to 23 months as of March 31, 2019 . The Company’s investment portfolio included approximately 74 available-for-sale debt securities that had insignificant unrealized loss positions as of March 31, 2019. The Company has the intent and ability to hold these investments until maturity whereby these unrealized losses are expected to be recovered. There were no charges recorded in the period for other-than-temporary declines in the fair value of available-for-sale debt securities. The Company's investments had insignificant realized gains or losses for the three months ended March 31, 2019 . To measure fair value of assets and liabilities required to be measured or disclosed at fair value, the Company uses the following fair value hierarchy based on three levels of inputs of which the first two are considered observable and the last unobservable: Level 1 — quoted prices in active markets for identical assets or liabilities; Level 2 — observable inputs other than quoted prices in active markets for identical assets or liabilities; Level 3 — unobservable inputs in which there is little or no market data available, which require the reporting entity to develop its own assumptions. The Company had no Level 3 assets or liabilities as of March 31, 2019 . The following table provides amortized cost, gross unrealized gains and losses, fair value and the level in the fair value hierarchy within which those measurements fall: (in thousands) Amortized cost Gross Unrealized Gains Gross Unrealized Gains (Losses) Fair Value Level 1 Level 2 March 31, 2019 Money market mutual funds $ 26,644 $ — $ — $ 26,644 $ 26,644 $ — Total cash equivalents $ 26,644 $ — $ — $ 26,644 $ 26,644 $ — U.S. government and agency bonds $ 104,649 $ — $ (280 ) $ 104,369 $ 59,671 $ 44,698 Corporate bonds 75,598 37 (113 ) 75,522 — 75,522 Certificates of deposit 7,242 — (13 ) 7,229 — 7,229 Total short-term investments $ 187,489 $ 37 $ (406 ) $ 187,120 $ 59,671 $ 127,449 U.S. government and agency bonds $ 59,877 $ 164 $ (11 ) $ 60,030 $ 49,517 $ 10,513 Corporate bonds 13,265 63 — 13,328 — 13,328 Certificates of deposit 3,420 11 — 3,431 — 3,431 Total long-term investments $ 76,562 $ 238 $ (11 ) $ 76,789 $ 49,517 $ 27,272 December 31, 2018 Money market mutual funds $ 47,199 $ — $ — $ 47,199 $ 47,199 $ — Total cash equivalents $ 47,199 $ — $ — $ 47,199 $ 47,199 $ — U.S. government and agency bonds $ 112,995 $ — $ (486 ) $ 112,509 $ 69,605 $ 42,904 Corporate bonds 56,235 — (210 ) 56,025 — 56,025 Certificates of deposit 6,506 — — 6,506 — 6,506 Total short-term investments $ 175,736 $ — $ (696 ) $ 175,040 $ 69,605 $ 105,435 U.S. government and agency bonds $ 90,458 $ 99 $ (155 ) $ 90,402 $ 64,086 $ 26,316 Corporate bonds 46,743 43 (68 ) 46,718 — 46,718 Certificates of deposit 3,664 — — 3,664 — 3,664 Total long-term investments $ 140,865 $ 142 $ (223 ) $ 140,784 $ 64,086 $ 76,698 |
Convertible Debt, Net
Convertible Debt, Net | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Convertible Debt, Net | Convertible Debt, Net The Company had outstanding convertible debt and related debt issuance costs on its consolidated balance sheet as follows: As of (in thousands) March 31, 2019 December 31, 2018 Principal amount of 1.25% Convertible Senior Notes, due September 2021 $ 344,992 $ 344,992 Principal amount of 1.375% Convertible Senior Notes, due November 2024 402,500 402,500 Unamortized debt discount (136,673 ) (143,616 ) Debt issuance costs (11,218 ) (11,898 ) Total convertible debt, net $ 599,601 $ 591,978 Interest expense related to the convertible debt was as follows: Three Months Ended March 31, (in thousands) 2019 2018 Contractual coupon interest $ 2,462 $ 2,480 Accretion of debt discount 6,943 6,522 Amortization of debt issuance costs 680 641 Total interest expense related to convertible debt $ 10,085 $ 9,643 Interest expense related to convertible debt for the three months ended March 31, 2019 is as follows: Three Months Ended March 31, 2019 (in thousands) 1.375% 1.25% Total Contractual coupon interest $ 1,384 $ 1,078 $ 2,462 Amortization of debt discount and issuance costs 3,879 3,744 7,623 Total interest expense related to convertible debt $ 5,263 $ 4,822 $ 10,085 Total interest expense for the three months ended March 31, 2019 was $6.6 million , which includes the interest expense related to convertible debt of $10.1 million , net of capitalized interest expense of $3.5 million . Total interest expense for the three months ended March 31, 2018 was $7.9 million , which includes the interest expense related to convertible debt of $9.6 million , net of capitalized interest expense of $1.7 million . Interest expense related to convertible debt for the three months ended March 31, 2018 is as follows: Three Months Ended March 31, 2018 (in thousands) 1.375% 1.25% 2.0% Total Contractual coupon interest $ 1,384 $ 1,078 $ 18 $ 2,480 Amortization of debt discount and issuance costs 3,611 3,513 39 7,163 Total interest expense related to convertible debt $ 4,995 $ 4,591 $ 57 $ 9,643 The carrying amount and the estimated fair value of the Company's convertible debt, which is based on the Level 2 quoted market prices as of March 31, 2019 and December 31, 2018 are as follows: As of March 31, 2019 December 31, 2018 (in thousands) Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value 1.375% Convertible Senior Notes, due November 2024 $ 294,851 $ 485,737 $ 290,972 $ 426,026 1.25% Convertible Senior Notes, due September 2021 304,750 558,887 301,006 483,851 Total $ 599,601 $ 1,044,624 $ 591,978 $ 909,877 1.375% Convertible Senior Notes In November 2017, the Company issued and sold $402.5 million in aggregate principal amount of 1.375% Convertible Senior Notes, due November 15, 2024 (the " 1.375% Notes"). The interest rate on the notes is 1.375% per annum, payable semi-annually in arrears in cash on May 15 and November 15 of each year. Interest began accruing on November 10, 2017 and the first interest payment was made on May 15, 2018. The 1.375% Notes are convertible into the Company’s common stock at an initial conversion rate of 10.7315 shares of common stock per $1,000 principal amount of the 1.375% Notes, which is equivalent to a conversion price of approximately $93.18 per share, subject to adjustment under certain circumstances. The 1.375% Notes will be convertible prior to the close of business on the business day immediately preceding August 15, 2024 only under certain circumstances and during certain periods, and will be convertible on or after August 15, 2024 until the close of business on the second scheduled trading day immediately preceding November 15, 2024, regardless of those circumstances. The Company recorded a debt discount of $120.7 million related to the 1.375% Notes resulting from the allocation of a portion of the proceeds to the fair value of the conversion feature reflecting a nonconvertible debt borrowing rate of 6.8% per annum. The debt discount was recorded as additional paid-in capital and is being amortized as non-cash interest expense over the seven year term of the 1.375% Notes. The Company also incurred debt issuance costs and other expenses related to the 1.375% Notes of approximately $10.9 million , of which $3.3 million was reclassified as a reduction to the value of the conversion feature allocated to equity. The remaining $7.6 million of debt issuance costs is presented as a reduction of debt in the consolidated balance sheet and is being amortized using the effective interest method as non-cash interest expense over the seven year term of the 1.375% Notes. As of March 31, 2019 , the Company included $294.9 million on its balance sheet in long-term debt related to the 1.375% Notes. 1.25% Convertible Senior Notes In September 2016, the Company issued and sold $345.0 million in principal amount of 1.25% Convertible Senior Notes, due September 15, 2021 (the " 1.25% Notes"). The interest rate on the notes is 1.25% per annum, payable semi-annually in arrears in cash on March 15 and September 15 of each year. The 1.25% Notes are convertible into the Company’s common stock at an initial conversion rate of 17.1332 shares of common stock per $1,000 principal amount of the 1.25% Notes, which is equivalent to a conversion price of approximately $58.37 per share, subject to adjustment under certain circumstances. The 1.25% Notes will be convertible prior to the close of business on the business day immediately preceding June 15, 2021 only under certain circumstances and during certain periods, and will be convertible on or after June 15, 2021 until the close of business on the second scheduled trading day immediately preceding September 15, 2021, regardless of those circumstances. The Company recorded a debt discount of $ 66.7 million related to the 1.25% Notes resulting from allocating a portion of the proceeds to the fair value of the conversion feature reflecting a nonconvertible debt borrowing rate of 5.8% per annum. The debt discount is being amortized as non-cash interest expense over the five year term of the 1.25% Notes. The Company incurred debt issuance costs and other expenses related to this offering of approximately $11.3 million , of which $2.2 million was reclassified as a reduction to the value of the amount allocated to equity. The remainder is presented as a reduction of debt in the consolidated balance sheet and is being amortized using the effective interest method as non-cash interest expense over the five year term of the 1.25% Notes. As of March 31, 2019 , the Company has $304.8 million , net of discounts and issuance costs, on its balance sheet in long-term debt related to the 1.25% Notes. 2% Convertible Senior Notes In June 2014, the Company issued and sold $201.3 million in principal amount of 2% Convertible Senior Notes due June 15, 2019 (the " 2% Notes"). The 2% Notes were convertible into the Company’s common stock at an initial conversion rate of 21.5019 shares of common stock per $1,000 principal amount of the 2% Notes, which is equivalent to a conversion price of approximately $46.51 per share. In separately negotiated transactions, the Company repurchased $134.2 million in principal of the notes in September 2016 and $63.4 million in principal of the notes in November 2017. The Company elected to call the remaining notes in March 2018 and settled the outstanding principal and conversion feature of the notes for $6.7 million in cash in the second quarter of 2018. The Company allocated approximately $3.2 million of the settlement to the fair value of the equity component and $3.5 million to the debt component, which was consistent with the carrying value of the notes as of the settlement date, resulting in no gain or loss on extinguishment. |
Accounts Receivable, Net
Accounts Receivable, Net | 3 Months Ended |
Mar. 31, 2019 | |
Receivables [Abstract] | |
Accounts Receivable, Net | Accounts Receivable, Net Accounts receivable consist of amounts due from third-party payors, patients and third-party intermediaries. The Company records an allowance for doubtful accounts at the time potential collection risk is identified. The Company estimates its allowance based on historical experience, assessment of specific risk, and discussions with individual customers. The Company believes the reserve is adequate to mitigate current collection risk. There were no customers that represented greater than 10% of gross accounts receivable as of March 31, 2019 and December 31, 2018, respectively. The components of accounts receivable are as follows: As of (in thousands) March 31, 2019 December 31, 2018 Trade receivables $ 72,513 $ 66,904 Allowance for doubtful accounts (3,858 ) (3,610 ) Total accounts receivable, net $ 68,655 $ 63,294 |
Net Income (Loss) Per Share
Net Income (Loss) Per Share | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure Potential Common Shares Excluded From Computation Of Diluted Net Loss Per Share [Abstract] | |
Net Income (Loss) Per Share | Net Income (Loss) Per Share Basic net income (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding for the period, excluding unvested restricted common shares. Diluted net income (loss) per share is computed using the weighted average number of common shares outstanding and, when dilutive, potential common share equivalents from outstanding stock options and restricted stock units (using the treasury-stock method), and potential common shares from the Company's convertible debt (using the if-converted method). The following table sets forth the components used in the computation of basic and diluted net income (loss) per share for the three months ended March 31, 2019. Because the Company reported a net loss for the three months ended March 31, 2018, all potential dilutive common shares have been excluded from the computation of the diluted net loss per share for the three months ended March 31, 2018, as the effect would have been anti-dilutive. (in thousands, except share and per share data) Three months ended March 31, 2019 Numerator: Net income $ 4,378 Denominator: Weighted average common shares outstanding 59,355,031 Effective of dilutive potential common share equivalents Stock options 1,524,315 Restricted stock units 269,082 Convertible debt — Shares used for diluted net income per share 61,148,428 Net income per share: Basic $ 0.07 Diluted $ 0.07 For the three months ended March 31, 2019, certain potential outstanding shares from stock options, restricted stock units and convertible debt were excluded from the computation of diluted net income per share because the effect of including these items was anti-dilutive. Additionally, certain performance-based restricted stock units were excluded from the computation of diluted net income per share because the underlying performance conditions for such restricted stock units had not been met as of these dates. The number of potential common share equivalents excluded from the computation of diluted net income (loss) per share for the three months ended March 31, 2019 and 2018 are as follows: Three Months Ended March 31, 2019 2018 1.375% Convertible Senior Notes 4,319,429 4,319,429 2.00% Convertible Senior Notes — 78,589 1.25% Convertible Senior Notes 5,910,954 5,910,954 Unvested restricted stock units 360,278 970,802 Stock options 280,887 3,433,110 Total potential common share equivalents excluded from computation of diluted net income (loss) per share 10,871,548 14,712,884 |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories are carried at the lower of cost or market, determined under the first-in, first-out method, and include the costs of material, labor and overhead. Inventory has been recorded at cost, or net realizable value as appropriate, as of March 31, 2019 and December 31, 2018 . The Company reviews inventories for net realizable value based on quantities on hand and expectations of future use. Work in process is calculated based upon a buildup in the stage of completion using estimated labor inputs for each stage in production. The components of inventories are as follows: As of (in thousands) March 31, 2019 December 31, 2018 Raw materials $ 12,246 $ 10,347 Work-in-process 30,922 30,222 Finished goods 30,654 30,845 Total inventories $ 73,822 $ 71,414 |
Prepaid Expenses and Other Asse
Prepaid Expenses and Other Assets | 3 Months Ended |
Mar. 31, 2019 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Prepaid Expenses and Other Assets | Prepaid Expenses and Other Assets The components of prepaid expenses and other current assets are as follows: As of (in thousands) March 31, 2019 December 31, 2018 Prepaid expenses and other current assets $ 20,122 $ 16,977 Capitalized contract acquisition costs, current portion 7,906 7,277 Total prepaid expenses and other current assets $ 28,028 $ 24,254 The components of other assets are as follows: As of (in thousands) March 31, 2019 December 31, 2018 Other assets $ 3,161 $ 2,278 Capitalized contract acquisition costs, net of current portion 17,211 15,988 Right of use asset - lease (Note 13) 8,286 — Total other assets $ 28,658 $ 18,266 The Company capitalizes commission costs that are related to new patient starts. These costs are deferred in other assets, net of the short term portion included in prepaid and other current assets. Costs to obtain a contract are amortized as sales and marketing expense on a straight line basis over the expected period of benefit, which considers future product upgrades for which a commission would be paid. These capitalized costs are periodically reviewed for impairment. As of March 31, 2019, capitalized contract acquisition costs were $25.1 million , including a current balance of $7.9 million and a non-current balance of $17.2 million . The Company recognized $2.0 million of amortization of capitalized commission costs during the three months ended March 31, 2019. There were no impairments to capitalized costs to obtain a contract recorded during the period. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets, Net | 3 Months Ended |
Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Other Intangible Assets, Net | Goodwill and Other Intangible Assets, Net Goodwill The Company has $39.7 million of goodwill on its balance sheet from prior business acquisitions. The Company performs an assessment of its goodwill for impairment on at least an annual basis or whenever events or changes in circumstances indicate there might be an impairment. The Company's annual impairment test date is October 1st. There was no impairment of goodwill during the three months ended March 31, 2019 . Intangible Assets, Net The Company’s finite-lived intangible assets are stated at cost less accumulated amortization and include customer relationships acquired in prior business acquisitions and from the Company's former European Distributor. See Note 12 for a discussion of the Company's accounting for estimated fees owed to its former European Distributor following the expiration of its distribution agreement on June 30, 2018. The components of other intangible assets are as follows: As of March 31, 2019 December 31, 2018 (in thousands) Gross Carrying Amount Accumulated Amortization Net Book Value Gross Carrying Amount Accumulated Amortization Net Book Value Customer and contractual relationships $ 8,423 $ (2,087 ) $ 6,336 $ 6,109 $ (1,880 ) $ 4,229 Internal-use software 10,702 (5,554 ) 5,148 11,262 (5,108 ) 6,154 Total intangible assets $ 19,125 $ (7,641 ) $ 11,484 $ 17,371 $ (6,988 ) $ 10,383 Amortization expense for intangible assets was approximately $0.6 million and $0.4 million for the three months ended March 31, 2019 and 2018 , respectively. Amortization expense is recorded in general and administrative expenses in the consolidated statements of operations. Amortization expense expected for the next five years and thereafter is as follows: (in thousands) Years Ending December 31, Customer and Contractual Relationships Internal-Use Software Total 2019 (remaining) $ 598 $ 1,312 $ 1,910 2020 732 1,593 2,325 2021 668 1,154 1,822 2022 668 565 1,233 2023 668 178 846 Thereafter 3,002 346 3,348 Total $ 6,336 $ 5,148 $ 11,484 As of March 31, 2019 , the weighted average amortization period of the Company’s customer and contractual relationships intangible assets and internal-use software intangible assets are approximately 9.1 years and 3.6 years , respectively. |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 3 Months Ended |
Mar. 31, 2019 | |
Payables and Accruals [Abstract] | |
Accrued Expenses and Other Current Liabilities | Accrued Expenses and Other Current Liabilities The components of accrued expenses and other current liabilities are as follows: As of (in thousands) March 31, 2019 December 31, 2018 Employee compensation and related costs $ 31,184 $ 37,822 Professional and consulting services 15,405 14,925 Supplier charges 7,496 7,742 Value added taxes payable 7,898 8,463 Warranty 2,665 2,701 Other 21,297 17,320 Total accrued expenses and other current liabilities $ 85,945 $ 88,973 Product Warranty Costs The Company generally provides a four -year warranty on its PDMs sold in the United States and Europe and a five -year warranty on its PDMs sold in Canada and may replace any Omnipod that does not function in accordance with product specifications. The Company estimates its warranty at the time the product is shipped based on historical experience and the estimated cost to service the claims. Warranty expense is recorded in cost of goods sold on the consolidated statement of operations. Cost to service the claims reflects the current product cost. As these estimates are based on historical experience, and the Company continues to introduce new products and versions, the Company also considers the anticipated performance of the product over its warranty period in estimating warranty reserves. A reconciliation of the changes in the Company’s product warranty liability is as follows: Three Months Ended March 31, (in thousands) 2019 2018 Product warranty liability at the beginning of the period $ 6,379 $ 5,337 Warranty expense 2,219 1,972 Warranty claims settled (2,315 ) (1,923 ) Product warranty liability at the end of the period $ 6,283 $ 5,386 Composition of balance: As of (in thousands) March 31, 2019 December 31, 2018 Short-term $ 2,665 $ 2,701 Long-term 3,618 3,678 Total warranty liability: $ 6,283 $ 6,379 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Legal Proceedings Between May 5, 2015 and June 16, 2015, three class action lawsuits were filed by shareholders in the U.S. District Court, for the District of Massachusetts, against the Company and certain individual current and former executives of the Company. Two suits subsequently were voluntarily dismissed. Arkansas Teacher Retirement System v. Insulet, et al., 1:15-cv-12345, (“ATRS”) alleged that the Company (and certain executives) committed violations of Sections 10(b) and 20(a) and Rule 10b-5 of the Securities Exchange Act of 1934 by making allegedly false and misleading statements about the Company’s business, operations, and prospects. On February 8, 2018, the parties executed a binding stipulation of settlement, under which all claims were released and a payment was made to the plaintiffs and the class they purport to represent. On August 6, 2018, the Court issued an order approving the settlement. The Company had previously accrued fees and expenses in connection with this matter for the amount of the final settlement liability that was not covered by insurance, which amount was not material to the Company's consolidated financial statements. In addition, on April 26, 2017, a derivative action (Walker v. DeSisto, et al., 1:17-cv-10738) (“Walker”) was filed, and on October 13, 2017, a second derivative action (Carnazza v. DeSisto, et al., 1:17-cv-11977) (“Carnazza”) was filed, both on behalf of the Company, each by a shareholder in the U.S. District Court for the District of Massachusetts against the Company (as a nominal defendant) and certain individual current and former officers and directors of the Company. The allegations in the actions are substantially similar to those alleged in the securities class action. The actions seek, among other things, damages, disgorgement of certain types of compensation or profits, and attorneys’ fees and costs. On July 11, 2018, the parties executed a binding stipulation of settlement, under which all claims were released and a payment of attorneys’ fees and reimbursement of expenses will be paid to plaintiffs’ counsel, subject to the Court’s approval. On July 13, 2018, the plaintiffs filed a motion for preliminary approval of the settlement, which is pending. The Company expects that such fees and expenses payable to plaintiff's counsel will be covered by the Company's insurance. The Company is, from time to time, involved in the normal course of business in various legal proceedings, including intellectual property, contract, employment and product liability suits. Although the Company is unable to quantify the exact financial impact of any of these matters, the Company believes that none of these currently pending matters will have an outcome material to its financial condition or business. Fees To Former European Distributor Following the expiration of its distribution agreement on June 30, 2018, the Company is required to pay to its former European Distributor a quarterly per-unit fee for Omnipod sales by the Company between July 1, 2018 and June 30, 2019 to certain customers of the former European Distributor. The Company is recognizing a liability and an associated intangible asset for this fee as qualifying sales occur. The actual total fee could vary significantly depending on the number of customers who count for purposes of calculating the fee under the terms of the distribution agreement, and the methodology applicable for determining this number under the agreement is subject to an active arbitration proceeding between the parties in Switzerland. The Company estimates that the final aggregate fee for the applicable twelve-month period could be in the range of approximately $10 million to $55 million . As of March 31, 2019, the Company has recognized approximately $6.4 million for fees related to Omnipod devices sold to qualifying customers during the period from July 1, 2018 through March 31, 2019. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Leases | Leases In February 2016, the FASB issued guidance codified in ASC Topic 842, Leases, which amends the guidance in former ASC Topic 840, Leases. The new standard increases transparency and comparability most significantly by requiring the recognition by lessees of right-of-use assets and lease liabilities on the balance sheet for those leases classified as operating leases. The Company adopted ASC 842 on January 1, 2019. In accordance with the new lease standard, the Company determines if an arrangement is a lease at inception. Operating leases are included in other assets, other current liabilities, and other long-term liabilities on our consolidated balance sheets. The Company does not have any significant finance leases. On January 1, 2019, upon the adoption of ASC 842, the Company recorded right-of-use assets of $8.8 million and an operating lease liability of $10.8 million on its consolidated balance sheet. The difference between the approximate value of the right-of-use assets and the approximate value of the lease obligations is attributable to a cease-use liability and deferred rent. Operating lease right-of-use assets (ROU) and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most of the Company's leases do not provide an implicit rate, the Company uses its incremental borrowing rate in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. The Company's lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. As of March 31, 2019, the Company's right-of-use assets obtained in exchange for lease obligations are $8.3 million included in other assets and total operating lease liabilities of $10.2 million included in other current liabilities and other long-term liabilities on the consolidated balance sheet. The Company has an operating lease of approximately 100,000 square feet of laboratory and office space in Billerica, Massachusetts. The lease expires in November 2022 and contains escalating payments over its life. Additionally, the Company leases approximately 29,000 square feet of warehousing space in Billerica, Massachusetts under a lease expiring in September 2019. The Company also leases international and certain other U.S. facilities. These operating leases expire at various dates through 2026, some of which may include options to extend the leases for up to 5 years , and some of which may include options to terminate the leases at certain times within the lease term. In the normal course of business, it is expected that these leases will be renewed. The Company's total operating lease cost was approximately $0.9 million and $0.8 million for the three months ended March 31, 2019 and March 31, 2018, respectively. Operating lease cost is recorded in general and administrative expenses in the consolidated statements of operations. There have been no material changes to the Company's lease obligation in the three months ended March 31, 2019. The future minimum undiscounted lease payments under operating leases as of March 31, 2019 are as follows: Years Ending December 31, (in thousands) 2019 (remaining) $ 2,484 2020 2,954 2021 2,899 2022 2,575 2023 269 Thereafter 561 Total future minimum lease payments 11,742 Less: imputed interest (1,548 ) Total future minimum lease payments $ 10,194 Amounts recognized in consolidated balance sheet as of March 31, 2019 Other current liabilities $ 2,315 Other long-term liabilities 7,879 Total operating lease liabilities $ 10,194 The Company's operating cash outflows from operating leases for the three months ended March 31, 2019 and March 31, 2018 were $0.8 million and $0.6 million , respectively. As of March 31, 2019, the weighted average remaining lease term for operating leases is approximately 3.9 years. As of March 31, 2019, the weighted-average discount rate used to determine the operating lease liability is 6.7% . As of March 31, 2019, the Company has no additional operating leases that have not yet commenced. |
Stock-Based Compensation and St
Stock-Based Compensation and Stockholder' Equity | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation and Stockholder' Equity | Stock-Based Compensation and Stockholder' Equity The Company grants stock options, and both time-based and performance-based restricted stock units under its 2017 Stock Option and Incentive Plan and offers employees the opportunity to purchase its common stock through an Employee Stock Purchase Plan. The following table reflects the Company's stock-based compensation expense related to share-based awards recognized in the three months ended March 31, 2019 and 2018 : Three Months Ended March 31, Unamortized Expense Weighted Average Remaining Expense Period (Years) ($ in thousands) 2019 2018 At March 31, 2019 Stock options $ 1,640 $ 2,359 $ 13,562 2.6 Restricted stock units 3,744 5,528 38,641 2.2 Employee stock purchase plan 400 294 267 0.2 Total $ 5,784 $ 8,181 $ 52,470 The following summarizes stock option activity during the three months ended March 31, 2019 : Number of Options (#) Weighted Average Exercise Price ($) Aggregate Intrinsic Value ($ in thousands) Weighted Average Remaining Contractual Term (Years) Outstanding at December 31, 2018 3,077,624 $ 39.16 Granted 114,040 92.16 Exercised (273,082 ) 34.45 $ 15,810 Cancelled (35,965 ) 38.32 Outstanding at March 31, 2019 2,882,617 $ 41.71 $ 153,897 5.5 Vested, March 31, 2019 2,191,005 $ 36.21 $ 129,008 4.6 Vested or expected to vest, March 31, 2019 (1) 2,743,607 $ 149,128 (1) Represents total outstanding stock options as of March 31, 2019 , adjusted for estimated forfeitures. The following table summarizes the status of the Company’s restricted stock units during the three months ended March 31, 2019 : Number of Shares (#) Weighted Average Fair Value ($) Outstanding at December 31, 2018 752,207 $ 55.02 Granted 261,650 91.64 Vested (266,448 ) 42.70 Forfeited (13,163 ) 64.61 Outstanding at March 31, 2019 734,246 $ 72.37 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company accounts for income taxes in accordance with ASC 740-10, Income Taxes (“ASC 740-10”). The Tax Cuts and Jobs Act ("Tax Reform Act") was enacted into law in December 2017. Among other changes, the Tax Reform Act subjects the Company to current tax on global intangible low-taxed income ("GILTI") earned by certain of its foreign subsidiaries. The Company has elected to recognize the income tax related to GILTI as a period expense in the period the tax is incurred or expected to occur. The inclusion of GILTI had no impact on the Company's income tax expense or effective tax rate in the period due to the full valuation allowance applied to the U.S. entity. The Company files federal, state and foreign tax returns. These returns are generally open to examination by the relevant tax authorities from three to four years from the date they are filed, although there is variation by jurisdiction. The tax filings relating to the Company's US federal and state tax returns are currently open to examination for tax years 2015 through 2017 and 2014 through 2017, respectively. In addition, the Company has generated tax losses since its inception in 2000 until 2018, and beginning in 2018 forward, the Company expects to generate taxable income. The years in which losses were generated may be subject to examination if the losses are carried forward and utilized in future years. As of March 31, 2019 and December 31, 2018 , the Company has provided a full valuation allowance against its domestic US federal and state net deferred tax asset because it is not more likely than not that the future tax benefit will be realized. In addition, the Company has a net deferred tax asset in foreign jurisdictions where no valuation allowance is recorded as it is more likely than not that the future tax benefit will be realized. As of March 31, 2019, the Company had no uncertain tax positions. Income tax expense was $0.3 million and $0.3 million for the three months ended March 31, 2019 and 2018. Income tax expense for both was primarily driven by state taxes in the United States and taxable income generated in foreign jurisdictions, mainly the United Kingdom and Canada. |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The unaudited consolidated financial statements in this Quarterly Report on Form 10-Q have been prepared in accordance with generally accepted accounting principles (“U.S. GAAP” or "GAAP") for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, these unaudited consolidated financial statements do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2019 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2019 , or for any other subsequent interim period. The unaudited consolidated financial statements in this Quarterly Report on Form 10-Q should be read in conjunction with the Company’s consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 . |
Use of Estimates in Preparation of Financial Statements | Use of Estimates in Preparation of Financial Statements The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions in the application of certain of its significant accounting policies that may materially affect the reported amounts of assets, liabilities, equity, revenue and expenses. Actual results may differ from those estimates. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. |
Segment Reporting | Segment Reporting Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated on a regular basis by the chief operating decision-maker ("CODM") in deciding how to allocate resources to an individual segment and in assessing performance of the segment. The Company has concluded its Chief Executive Officer ("CEO") is the CODM as the CEO is the ultimate decision maker for key operating decisions, determining the allocation of resources and assessing the financial performance of the Company. These decisions, allocations and assessments are performed by the CODM using consolidated financial information. The Company’s products are relatively consistent and manufacturing is centralized and consistent across product offerings. Based on these factors, key operating decisions and resource allocations are made by the CODM using consolidated financial data and as such the Company has concluded that it operates as one segment. |
Shipping and Handling Costs | Shipping and Handling Costs The Company does not typically charge its customers for shipping and handling costs associated with shipping its product to its customers unless non-standard shipping and handling services are requested. |
Reclassification of Prior Period Amounts | Reclassification of Prior Period Amounts Certain reclassifications have been made to prior period amounts to conform to the current period financial statement presentation. Software license costs have been reallocated from general and administrative expenses to research and development and sales and marketing expenses based on license usage. |
Recently Adopted and Not Yet Adopted Accounting Pronouncements | Recently Adopted Accounting Standards Effective January 1, 2019, the Company adopted ASU No. 2016-02, Leases (Topic 842) ("ASU 2016-02"). ASU 2016-02 and its related amendments (collectively referred to as ASC 842) amends the guidance in former ASC Topic 840, Leases. The new standard increases transparency and comparability most significantly by requiring the recognition by lessees of right-of-use (“ROU”) assets and lease liabilities on the balance sheet for those leases classified as operating leases. The Company adopted ASC 842 on January 1, 2019 using the modified retrospective method, whereby the new guidance is applied prospectively as of the date of adoption and prior periods are not to be restated. The Company elected the package of practical expedients which permits the Company to not reassess (1) whether any expired or existing contracts are or contain leases, (2) the lease classification for any expired or existing leases, and (3) any initial direct costs for any existing leases as of the effective date. The Company also excludes leases with an expected term of less than one year from the application of ASC 842. The adoption of the lease standard did not change the Company's previously reported consolidated statements of operations and did not result in a cumulative catch-up adjustment to opening equity. Adoption of the lease standard had a material impact on its consolidated balance sheet (Note 13). Effective January 1, 2019, the Company adopted ASU 2017-12, Targeted Improvements to Accounting for Hedging Activities ("ASU 2017-12"). ASU 2017-12 updates the current hedge accounting guidance with the objective of improving the financial reporting of hedging activities by better portraying the economic results of an entity's risk management activities in its financial statements. As the Company currently does not use derivative financial instruments, this guidance did not have any impact on the Company's financial statements upon adoption. Effective January 1, 2019, the Company early adopted ASU 2018-15, Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract ("ASU 2018-15"). ASU 2018-15 requires that entities capitalize certain costs to implement a cloud computing arrangement that is a service contract consistent with the rules applicable to internal use software capitalization projects. The Company adopted this new guidance effective January 1, 2019, prospectively. Upon adoption, the Company defers eligible costs related to the implementation of cloud computing arrangements within other current and non-current assets and amortizes these costs over the expected term if the hosting arrangement to the same income statement line as the associated cloud operating expenses. Adoption of this standard resulted in the Company capitalizing $1.3 million of cloud computing implementation costs to the consolidated balance sheet for the period ending March 31, 2019. Accounting Standards Issued and Not Yet Adopted In January 2017, the Financial Accounting Standards Board ("FASB") issued ASU 2017-04, Simplifying the Test for Goodwill Impairment ("ASU 2017-04"). ASU 2017-04 simplifies the accounting for goodwill impairments by eliminating "Step 2" from the goodwill impairment test, which requires an entity to calculate the implied fair value of goodwill to measure a goodwill impairment charge, and alternatively, requires an entity to measure the impairment of goodwill assigned to a reporting unit as the amount by which the carrying value of the assets and liabilities of the reporting unit, including goodwill, exceeds the reporting unit's fair value. The guidance is effective for annual reporting periods beginning after December 15, 2019, and interim periods within those years. Early adoption is permitted for all entities. The Company is currently evaluating the impact of ASU 2017-04 but does not expect it to be material to the consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Changes to the Disclosure Requirements for Fair Value Measurement ("ASU 2018-13"). ASU 2018-13 modifies certain disclosure requirements related to fair value measurements primarily associated with Level 3 investments. The guidance is effective no later than January 1, 2020 for the Company and can be early-adopted prospectively in any interim period for certain disclosure requirements or retrospectively for others. The Company does not expect the adoption of this guidance to have a material impact on its fair value disclosures. In June 2016, the FASB issued ASU 2016-13, Credit Losses (Topic 326) ("ASU 2016-13"). ASU 2016-13 requires that financial assets measured at amortized cost, such as trade receivables and contract assets, be presented net of expected credit losses, which may be estimated based on relevant information such as historical experience, current conditions, and future expectation for each pool of similar financial asset. The new guidance requires enhanced disclosures related to trade receivables and associated credit losses. The guidance is effective beginning January 1, 2020. The adoption of this guidance is expected to increase the level of disclosures related to the Company's trade receivables and is not expected to have a material impact on its consolidated financial statements. |
Accounts Receivable, Net | Accounts receivable consist of amounts due from third-party payors, patients and third-party intermediaries. The Company records an allowance for doubtful accounts at the time potential collection risk is identified. The Company estimates its allowance based on historical experience, assessment of specific risk, and discussions with individual customers. The Company believes the reserve is adequate to mitigate current collection risk. |
Inventories | Inventories are carried at the lower of cost or market, determined under the first-in, first-out method, and include the costs of material, labor and overhead. Inventory has been recorded at cost, or net realizable value as appropriate, as of March 31, 2019 and December 31, 2018 . The Company reviews inventories for net realizable value based on quantities on hand and expectations of future use. Work in process is calculated based upon a buildup in the stage of completion using estimated labor inputs for each stage in production. |
Goodwill | The Company performs an assessment of its goodwill for impairment on at least an annual basis or whenever events or changes in circumstances indicate there might be an impairment. The Company's annual impairment test date is October 1st. |
Intangible Assets, Net | Intangible Assets, Net The Company’s finite-lived intangible assets are stated at cost less accumulated amortization and include customer relationships acquired in prior business acquisitions and from the Company's former European Distributor. See Note 12 for a discussion of the Company's accounting for estimated fees owed to its former European Distributor following the expiration of its distribution agreement on June 30, 2018. |
Product Warranty Costs | Product Warranty Costs The Company generally provides a four -year warranty on its PDMs sold in the United States and Europe and a five -year warranty on its PDMs sold in Canada and may replace any Omnipod that does not function in accordance with product specifications. The Company estimates its warranty at the time the product is shipped based on historical experience and the estimated cost to service the claims. Warranty expense is recorded in cost of goods sold on the consolidated statement of operations. Cost to service the claims reflects the current product cost. As these estimates are based on historical experience, and the Company continues to introduce new products and versions, the Company also considers the anticipated performance of the product over its warranty period in estimating warranty reserves. |
Income Taxes | The Company files federal, state and foreign tax returns. These returns are generally open to examination by the relevant tax authorities from three to four years from the date they are filed, although there is variation by jurisdiction. |
Revenue from Contracts with C_2
Revenue from Contracts with Customers (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table summarizes revenue from contracts with customers for the three months ended March 31, 2019 and 2018: Three months Ended March 31, (in thousands) 2019 2018 U.S. Omnipod $ 86,103 $ 70,272 International Omnipod 56,888 38,404 Total Diabetes Revenue: 142,991 108,676 Drug Delivery 16,564 14,902 Total $ 159,555 $ 123,578 |
Schedule of revenue from major customers | Revenue for customers comprising more than 10% of total revenue were as follows: Three Months Ended March 31, 2019 2018 Amgen, Inc. 10% 12% Ypsomed * 27% Cardinal Health Inc. and affiliates 10% 10% * Represents less than 10% of consolidated revenue. |
Investments and Fair Value (Tab
Investments and Fair Value (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule investments | The following table provides amortized cost, gross unrealized gains and losses, fair value and the level in the fair value hierarchy within which those measurements fall: (in thousands) Amortized cost Gross Unrealized Gains Gross Unrealized Gains (Losses) Fair Value Level 1 Level 2 March 31, 2019 Money market mutual funds $ 26,644 $ — $ — $ 26,644 $ 26,644 $ — Total cash equivalents $ 26,644 $ — $ — $ 26,644 $ 26,644 $ — U.S. government and agency bonds $ 104,649 $ — $ (280 ) $ 104,369 $ 59,671 $ 44,698 Corporate bonds 75,598 37 (113 ) 75,522 — 75,522 Certificates of deposit 7,242 — (13 ) 7,229 — 7,229 Total short-term investments $ 187,489 $ 37 $ (406 ) $ 187,120 $ 59,671 $ 127,449 U.S. government and agency bonds $ 59,877 $ 164 $ (11 ) $ 60,030 $ 49,517 $ 10,513 Corporate bonds 13,265 63 — 13,328 — 13,328 Certificates of deposit 3,420 11 — 3,431 — 3,431 Total long-term investments $ 76,562 $ 238 $ (11 ) $ 76,789 $ 49,517 $ 27,272 December 31, 2018 Money market mutual funds $ 47,199 $ — $ — $ 47,199 $ 47,199 $ — Total cash equivalents $ 47,199 $ — $ — $ 47,199 $ 47,199 $ — U.S. government and agency bonds $ 112,995 $ — $ (486 ) $ 112,509 $ 69,605 $ 42,904 Corporate bonds 56,235 — (210 ) 56,025 — 56,025 Certificates of deposit 6,506 — — 6,506 — 6,506 Total short-term investments $ 175,736 $ — $ (696 ) $ 175,040 $ 69,605 $ 105,435 U.S. government and agency bonds $ 90,458 $ 99 $ (155 ) $ 90,402 $ 64,086 $ 26,316 Corporate bonds 46,743 43 (68 ) 46,718 — 46,718 Certificates of deposit 3,664 — — 3,664 — 3,664 Total long-term investments $ 140,865 $ 142 $ (223 ) $ 140,784 $ 64,086 $ 76,698 |
Convertible Debt, Net (Tables)
Convertible Debt, Net (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Outstanding Convertible Debt and Related Deferred Financing Costs | The Company had outstanding convertible debt and related debt issuance costs on its consolidated balance sheet as follows: As of (in thousands) March 31, 2019 December 31, 2018 Principal amount of 1.25% Convertible Senior Notes, due September 2021 $ 344,992 $ 344,992 Principal amount of 1.375% Convertible Senior Notes, due November 2024 402,500 402,500 Unamortized debt discount (136,673 ) (143,616 ) Debt issuance costs (11,218 ) (11,898 ) Total convertible debt, net $ 599,601 $ 591,978 |
Interest and Other Expense | Interest expense related to the convertible debt was as follows: Three Months Ended March 31, (in thousands) 2019 2018 Contractual coupon interest $ 2,462 $ 2,480 Accretion of debt discount 6,943 6,522 Amortization of debt issuance costs 680 641 Total interest expense related to convertible debt $ 10,085 $ 9,643 Interest expense related to convertible debt for the three months ended March 31, 2019 is as follows: Three Months Ended March 31, 2019 (in thousands) 1.375% 1.25% Total Contractual coupon interest $ 1,384 $ 1,078 $ 2,462 Amortization of debt discount and issuance costs 3,879 3,744 7,623 Total interest expense related to convertible debt $ 5,263 $ 4,822 $ 10,085 Total interest expense for the three months ended March 31, 2019 was $6.6 million , which includes the interest expense related to convertible debt of $10.1 million , net of capitalized interest expense of $3.5 million . Total interest expense for the three months ended March 31, 2018 was $7.9 million , which includes the interest expense related to convertible debt of $9.6 million , net of capitalized interest expense of $1.7 million . Interest expense related to convertible debt for the three months ended March 31, 2018 is as follows: Three Months Ended March 31, 2018 (in thousands) 1.375% 1.25% 2.0% Total Contractual coupon interest $ 1,384 $ 1,078 $ 18 $ 2,480 Amortization of debt discount and issuance costs 3,611 3,513 39 7,163 Total interest expense related to convertible debt $ 4,995 $ 4,591 $ 57 $ 9,643 |
Fair Value, Liabilities Measured on Recurring and Nonrecurring Basis | The carrying amount and the estimated fair value of the Company's convertible debt, which is based on the Level 2 quoted market prices as of March 31, 2019 and December 31, 2018 are as follows: As of March 31, 2019 December 31, 2018 (in thousands) Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value 1.375% Convertible Senior Notes, due November 2024 $ 294,851 $ 485,737 $ 290,972 $ 426,026 1.25% Convertible Senior Notes, due September 2021 304,750 558,887 301,006 483,851 Total $ 599,601 $ 1,044,624 $ 591,978 $ 909,877 |
Accounts Receivable, Net (Table
Accounts Receivable, Net (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Receivables [Abstract] | |
Components of Accounts Receivable | The components of accounts receivable are as follows: As of (in thousands) March 31, 2019 December 31, 2018 Trade receivables $ 72,513 $ 66,904 Allowance for doubtful accounts (3,858 ) (3,610 ) Total accounts receivable, net $ 68,655 $ 63,294 |
Net Income (Loss) Per Share (Ta
Net Income (Loss) Per Share (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure Potential Common Shares Excluded From Computation Of Diluted Net Loss Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table sets forth the components used in the computation of basic and diluted net income (loss) per share for the three months ended March 31, 2019. Because the Company reported a net loss for the three months ended March 31, 2018, all potential dilutive common shares have been excluded from the computation of the diluted net loss per share for the three months ended March 31, 2018, as the effect would have been anti-dilutive. (in thousands, except share and per share data) Three months ended March 31, 2019 Numerator: Net income $ 4,378 Denominator: Weighted average common shares outstanding 59,355,031 Effective of dilutive potential common share equivalents Stock options 1,524,315 Restricted stock units 269,082 Convertible debt — Shares used for diluted net income per share 61,148,428 Net income per share: Basic $ 0.07 Diluted $ 0.07 |
Potential Common Shares Excluded from Computation of Diluted Net Loss per Share | The number of potential common share equivalents excluded from the computation of diluted net income (loss) per share for the three months ended March 31, 2019 and 2018 are as follows: Three Months Ended March 31, 2019 2018 1.375% Convertible Senior Notes 4,319,429 4,319,429 2.00% Convertible Senior Notes — 78,589 1.25% Convertible Senior Notes 5,910,954 5,910,954 Unvested restricted stock units 360,278 970,802 Stock options 280,887 3,433,110 Total potential common share equivalents excluded from computation of diluted net income (loss) per share 10,871,548 14,712,884 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Components of Inventories | The components of inventories are as follows: As of (in thousands) March 31, 2019 December 31, 2018 Raw materials $ 12,246 $ 10,347 Work-in-process 30,922 30,222 Finished goods 30,654 30,845 Total inventories $ 73,822 $ 71,414 |
Prepaid Expenses and Other As_2
Prepaid Expenses and Other Assets (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of prepaid expenses and other assets | The components of prepaid expenses and other current assets are as follows: As of (in thousands) March 31, 2019 December 31, 2018 Prepaid expenses and other current assets $ 20,122 $ 16,977 Capitalized contract acquisition costs, current portion 7,906 7,277 Total prepaid expenses and other current assets $ 28,028 $ 24,254 The components of other assets are as follows: As of (in thousands) March 31, 2019 December 31, 2018 Other assets $ 3,161 $ 2,278 Capitalized contract acquisition costs, net of current portion 17,211 15,988 Right of use asset - lease (Note 13) 8,286 — Total other assets $ 28,658 $ 18,266 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets, Net (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Components of Other Intangible Assets | The components of other intangible assets are as follows: As of March 31, 2019 December 31, 2018 (in thousands) Gross Carrying Amount Accumulated Amortization Net Book Value Gross Carrying Amount Accumulated Amortization Net Book Value Customer and contractual relationships $ 8,423 $ (2,087 ) $ 6,336 $ 6,109 $ (1,880 ) $ 4,229 Internal-use software 10,702 (5,554 ) 5,148 11,262 (5,108 ) 6,154 Total intangible assets $ 19,125 $ (7,641 ) $ 11,484 $ 17,371 $ (6,988 ) $ 10,383 |
Amortization Expense Expected for Next Five Years | Amortization expense expected for the next five years and thereafter is as follows: (in thousands) Years Ending December 31, Customer and Contractual Relationships Internal-Use Software Total 2019 (remaining) $ 598 $ 1,312 $ 1,910 2020 732 1,593 2,325 2021 668 1,154 1,822 2022 668 565 1,233 2023 668 178 846 Thereafter 3,002 346 3,348 Total $ 6,336 $ 5,148 $ 11,484 |
Accrued Expenses and Other Cu_2
Accrued Expenses and Other Current Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Payables and Accruals [Abstract] | |
Components of accrued expenses and other current liabilities | The components of accrued expenses and other current liabilities are as follows: As of (in thousands) March 31, 2019 December 31, 2018 Employee compensation and related costs $ 31,184 $ 37,822 Professional and consulting services 15,405 14,925 Supplier charges 7,496 7,742 Value added taxes payable 7,898 8,463 Warranty 2,665 2,701 Other 21,297 17,320 Total accrued expenses and other current liabilities $ 85,945 $ 88,973 |
Reconciliation of Changes in Product Warranty Liability | A reconciliation of the changes in the Company’s product warranty liability is as follows: Three Months Ended March 31, (in thousands) 2019 2018 Product warranty liability at the beginning of the period $ 6,379 $ 5,337 Warranty expense 2,219 1,972 Warranty claims settled (2,315 ) (1,923 ) Product warranty liability at the end of the period $ 6,283 $ 5,386 Composition of balance: As of (in thousands) March 31, 2019 December 31, 2018 Short-term $ 2,665 $ 2,701 Long-term 3,618 3,678 Total warranty liability: $ 6,283 $ 6,379 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Future Minimum Undiscounted Lease Payments | The future minimum undiscounted lease payments under operating leases as of March 31, 2019 are as follows: Years Ending December 31, (in thousands) 2019 (remaining) $ 2,484 2020 2,954 2021 2,899 2022 2,575 2023 269 Thereafter 561 Total future minimum lease payments 11,742 Less: imputed interest (1,548 ) Total future minimum lease payments $ 10,194 Amounts recognized in consolidated balance sheet as of March 31, 2019 Other current liabilities $ 2,315 Other long-term liabilities 7,879 Total operating lease liabilities $ 10,194 |
Stock-Based Compensation and _2
Stock-Based Compensation and Stockholder' Equity (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock option activity | The following table reflects the Company's stock-based compensation expense related to share-based awards recognized in the three months ended March 31, 2019 and 2018 : Three Months Ended March 31, Unamortized Expense Weighted Average Remaining Expense Period (Years) ($ in thousands) 2019 2018 At March 31, 2019 Stock options $ 1,640 $ 2,359 $ 13,562 2.6 Restricted stock units 3,744 5,528 38,641 2.2 Employee stock purchase plan 400 294 267 0.2 Total $ 5,784 $ 8,181 $ 52,470 The following summarizes stock option activity during the three months ended March 31, 2019 : Number of Options (#) Weighted Average Exercise Price ($) Aggregate Intrinsic Value ($ in thousands) Weighted Average Remaining Contractual Term (Years) Outstanding at December 31, 2018 3,077,624 $ 39.16 Granted 114,040 92.16 Exercised (273,082 ) 34.45 $ 15,810 Cancelled (35,965 ) 38.32 Outstanding at March 31, 2019 2,882,617 $ 41.71 $ 153,897 5.5 Vested, March 31, 2019 2,191,005 $ 36.21 $ 129,008 4.6 Vested or expected to vest, March 31, 2019 (1) 2,743,607 $ 149,128 (1) Represents total outstanding stock options as of March 31, 2019 , adjusted for estimated forfeitures. |
Summary of restricted stock units | The following table summarizes the status of the Company’s restricted stock units during the three months ended March 31, 2019 : Number of Shares (#) Weighted Average Fair Value ($) Outstanding at December 31, 2018 752,207 $ 55.02 Granted 261,650 91.64 Vested (266,448 ) 42.70 Forfeited (13,163 ) 64.61 Outstanding at March 31, 2019 734,246 $ 72.37 |
Basis of Presentation and Sum_3
Basis of Presentation and Summary of Significant Accounting Policies (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019USD ($)segment | Mar. 31, 2018USD ($) | |
Significant Accounting Policies [Line Items] | ||
Capitalized contract acquisition costs | $ 25,100 | |
Number of operating segments (in segments) | segment | 1 | |
Cost of revenue | $ 52,859 | $ 47,763 |
Shipping and Handling | ||
Significant Accounting Policies [Line Items] | ||
Cost of revenue | 2,600 | $ 1,000 |
Accounting Standards Update 2015-05 [Member] | ||
Significant Accounting Policies [Line Items] | ||
Capitalized contract acquisition costs | $ 1,300 |
Revenue from Contracts with C_3
Revenue from Contracts with Customers - Summary of Revenue from Contracts with Customers (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 159,555 | $ 123,578 |
U.S. Omnipod | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 86,103 | 70,272 |
International Omnipod | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 56,888 | 38,404 |
Diabetes | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 142,991 | 108,676 |
Drug Delivery | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 16,564 | $ 14,902 |
Revenue from Contracts with C_4
Revenue from Contracts with Customers - Summary of Revenue from Customers (Details) - Customer concentration risk - Sales revenue | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Amgen, Inc. | ||
Significant Accounting Policies [Line Items] | ||
Total revenue, percentage | 10.00% | 12.00% |
Ypsomed | ||
Significant Accounting Policies [Line Items] | ||
Total revenue, percentage | 27.00% | |
Cardinal Health Inc. | ||
Significant Accounting Policies [Line Items] | ||
Total revenue, percentage | 10.00% | 10.00% |
Revenue from Contracts with C_5
Revenue from Contracts with Customers - Narrative (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |||
Unsatisfied performance obligation | $ 2,200,000 | $ 2,100,000 | |
Deferred revenue | 1,000,000 | $ 900,000 | |
Revenue recognized | 900,000 | $ 2,100,000 | |
Revenue recognized from performance obligations satisfied in previous periods | $ 0 | $ 0 |
Investments and Fair Value - Na
Investments and Fair Value - Narrative (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2019USD ($)Security | Dec. 31, 2018USD ($) | |
Debt Securities, Available-for-sale [Line Items] | ||
Restricted cash and cash equivalents | $ | $ 2.7 | $ 2.7 |
Number of positions | Security | 74 | |
Minimum | ||
Debt Securities, Available-for-sale [Line Items] | ||
Derivative maturity date range | 1 day | |
Maximum | ||
Debt Securities, Available-for-sale [Line Items] | ||
Derivative maturity date range | 1 year 11 months 27 days |
Investments and Fair Value - Sc
Investments and Fair Value - Schedule of Assets Measured on a Recurring and Nonrecurring Basis (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Recurring fair value measurements: | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | $ 26,644 | $ 47,199 |
Recurring fair value measurements: | Money market mutual funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 26,644 | 47,199 |
Level 1 | Recurring fair value measurements: | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 26,644 | 47,199 |
Level 1 | Recurring fair value measurements: | Money market mutual funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 26,644 | 47,199 |
Level 2 | Recurring fair value measurements: | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Level 2 | Recurring fair value measurements: | Money market mutual funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Short-term investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized cost | 187,489 | 175,736 |
Gross Unrealized Gains | 37 | 0 |
Gross Unrealized Gains (Losses) | (406) | (696) |
Short-term investments | Recurring fair value measurements: | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 187,120 | 175,040 |
Short-term investments | Level 1 | Recurring fair value measurements: | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 59,671 | 69,605 |
Short-term investments | Level 1 | Recurring fair value measurements: | U.S. government and agency bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 59,671 | 69,605 |
Short-term investments | Level 1 | Recurring fair value measurements: | Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 0 | 0 |
Short-term investments | Level 1 | Recurring fair value measurements: | Certificates of deposit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 0 | 0 |
Short-term investments | Level 2 | Recurring fair value measurements: | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 127,449 | 105,435 |
Short-term investments | Level 2 | Recurring fair value measurements: | U.S. government and agency bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 44,698 | 42,904 |
Short-term investments | Level 2 | Recurring fair value measurements: | Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 75,522 | 56,025 |
Short-term investments | Level 2 | Recurring fair value measurements: | Certificates of deposit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 7,229 | 6,506 |
Short-term investments | U.S. government and agency bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized cost | 104,649 | 112,995 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Gains (Losses) | (280) | (486) |
Short-term investments | U.S. government and agency bonds | Recurring fair value measurements: | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 104,369 | 112,509 |
Short-term investments | Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized cost | 75,598 | 56,235 |
Gross Unrealized Gains | 37 | 0 |
Gross Unrealized Gains (Losses) | (113) | (210) |
Short-term investments | Corporate bonds | Recurring fair value measurements: | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 75,522 | 56,025 |
Short-term investments | Certificates of deposit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized cost | 7,242 | 6,506 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Gains (Losses) | (13) | 0 |
Short-term investments | Certificates of deposit | Recurring fair value measurements: | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 7,229 | 6,506 |
Long-term investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized cost | 76,562 | 140,865 |
Gross Unrealized Gains | 238 | 142 |
Gross Unrealized Gains (Losses) | (11) | (223) |
Long-term investments | Recurring fair value measurements: | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 76,789 | 140,784 |
Long-term investments | Level 1 | Recurring fair value measurements: | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 49,517 | 64,086 |
Long-term investments | Level 1 | Recurring fair value measurements: | U.S. government and agency bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 49,517 | 64,086 |
Long-term investments | Level 1 | Recurring fair value measurements: | Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 0 | 0 |
Long-term investments | Level 1 | Recurring fair value measurements: | Certificates of deposit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 0 | 0 |
Long-term investments | Level 2 | Recurring fair value measurements: | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 27,272 | 76,698 |
Long-term investments | Level 2 | Recurring fair value measurements: | U.S. government and agency bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 10,513 | 26,316 |
Long-term investments | Level 2 | Recurring fair value measurements: | Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 13,328 | 46,718 |
Long-term investments | Level 2 | Recurring fair value measurements: | Certificates of deposit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 3,431 | 3,664 |
Long-term investments | U.S. government and agency bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized cost | 59,877 | 90,458 |
Gross Unrealized Gains | 164 | 99 |
Gross Unrealized Gains (Losses) | (11) | (155) |
Long-term investments | U.S. government and agency bonds | Recurring fair value measurements: | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 60,030 | 90,402 |
Long-term investments | Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized cost | 13,265 | 46,743 |
Gross Unrealized Gains | 63 | 43 |
Gross Unrealized Gains (Losses) | 0 | (68) |
Long-term investments | Corporate bonds | Recurring fair value measurements: | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 13,328 | 46,718 |
Long-term investments | Certificates of deposit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized cost | 3,420 | 3,664 |
Gross Unrealized Gains | 11 | 0 |
Gross Unrealized Gains (Losses) | 0 | 0 |
Long-term investments | Certificates of deposit | Recurring fair value measurements: | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | $ 3,431 | $ 3,664 |
Convertible Debt, Net - Outstan
Convertible Debt, Net - Outstanding Convertible Debt and Related Deferred Financing Costs (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2018 | Sep. 30, 2016 |
Debt Instrument [Line Items] | ||||
Unamortized debt discount | $ (136,673) | $ (143,616) | ||
Debt issuance costs | (11,218) | (11,898) | ||
Total convertible debt, net | $ 599,601 | 591,978 | ||
1.25% Convertible Notes | ||||
Debt Instrument [Line Items] | ||||
Debt, interest rate | 1.25% | 1.25% | 1.25% | |
1.375% Convertible Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Total convertible debt, net | $ 294,900 | |||
Debt, interest rate | 1.375% | 1.375% | ||
Convertible Debt | 1.25% Convertible Notes | ||||
Debt Instrument [Line Items] | ||||
Principal amount of Senior Notes | $ 344,992 | 344,992 | ||
Convertible Debt | 1.375% Convertible Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Principal amount of Senior Notes | $ 402,500 | $ 402,500 |
Convertible Debt, Net - Interes
Convertible Debt, Net - Interest Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2019 | Mar. 31, 2018 | Sep. 30, 2016 | Jun. 30, 2014 | |
Debt Instrument [Line Items] | ||||
Contractual coupon interest | $ 2,462 | $ 2,480 | ||
Accretion of debt discount | 6,943 | 6,522 | ||
Amortization of debt issuance costs | 680 | 641 | ||
Total interest expense related to convertible debt | 10,085 | 9,643 | ||
Non-cash interest expense | 7,623 | 7,163 | ||
1.375% Convertible Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Contractual coupon interest | 1,384 | 1,384 | ||
Total interest expense related to convertible debt | 5,263 | 4,995 | ||
Non-cash interest expense | $ 3,879 | $ 3,611 | ||
Debt, interest rate | 1.375% | 1.375% | ||
1.25% Convertible Notes | ||||
Debt Instrument [Line Items] | ||||
Contractual coupon interest | $ 1,078 | $ 1,078 | ||
Total interest expense related to convertible debt | 4,822 | 4,591 | ||
Non-cash interest expense | $ 3,744 | $ 3,513 | ||
Debt, interest rate | 1.25% | 1.25% | 1.25% | |
2% Convertible Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Contractual coupon interest | $ 18 | |||
Total interest expense related to convertible debt | 57 | |||
Non-cash interest expense | $ 39 | |||
Debt, interest rate | 2.00% | 2.00% | 2.00% |
Convertible Debt, Net Convertib
Convertible Debt, Net Convertible Debt, Net - Summary of Convertible Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2018 |
1.375% Convertible Senior Notes | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Debt, interest rate | 1.375% | 1.375% | |
1.25% Convertible Senior Notes | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Debt, interest rate | 1.25% | 1.25% | |
Level 2 | Carrying Value | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Financial instrument value | $ 599,601 | $ 591,978 | |
Level 2 | Carrying Value | 1.375% Convertible Senior Notes | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Financial instrument value | 294,851 | 290,972 | |
Level 2 | Carrying Value | 1.25% Convertible Senior Notes | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Financial instrument value | 304,750 | 301,006 | |
Level 2 | Estimated Fair Value | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Financial instrument value | 1,044,624 | 909,877 | |
Level 2 | Estimated Fair Value | 1.375% Convertible Senior Notes | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Financial instrument value | 485,737 | 426,026 | |
Level 2 | Estimated Fair Value | 1.25% Convertible Senior Notes | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Financial instrument value | $ 558,887 | $ 483,851 |
Convertible Debt, Net - Narrati
Convertible Debt, Net - Narrative (Details) | 1 Months Ended | 3 Months Ended | ||||||
Nov. 30, 2017USD ($)$ / shares | Sep. 30, 2016USD ($)$ / shares | Jun. 30, 2014USD ($)$ / shares | Mar. 31, 2019USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2018USD ($) | |
Debt Instrument [Line Items] | ||||||||
Interest expense | $ 6,615,000 | $ 7,918,000 | ||||||
Interest expense related to convertible debt | 10,085,000 | 9,643,000 | ||||||
Capitalized interest expense | 3,500,000 | 1,700,000 | ||||||
Unamortized discount | 136,673,000 | $ 143,616,000 | ||||||
Convertible debt, net of current portion | 599,601,000 | 591,978,000 | ||||||
Repayment of convertible notes | 0 | 15,000 | ||||||
1.375% Convertible Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest expense related to convertible debt | $ 5,263,000 | $ 4,995,000 | ||||||
Principal amount of senior notes | $ 402,500,000 | |||||||
Debt, interest rate | 1.375% | 1.375% | ||||||
Convertible debt, net of current portion | $ 294,900,000 | |||||||
1.25% Convertible Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest expense related to convertible debt | $ 4,822,000 | $ 4,591,000 | ||||||
Principal amount of senior notes | $ 344,992,000 | |||||||
Debt, interest rate | 1.25% | 1.25% | 1.25% | |||||
Conversion price, per share (USD per share) | $ / shares | $ 58.37 | |||||||
Nonconvertible debt borrowing rate | 5.80% | |||||||
Debt discount amortization period | 5 years | |||||||
Deferred financing costs, gross | $ 11,300,000 | |||||||
Finance costs reclassified against equity | $ 2,200,000 | |||||||
Deferred financing costs, amortization period | 5 years | |||||||
Long-term debt | $ 304,800,000 | |||||||
1.25% Convertible Notes | Investor | ||||||||
Debt Instrument [Line Items] | ||||||||
Unamortized discount | $ 66,700,000 | |||||||
2% Convertible Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest expense related to convertible debt | $ 57,000 | |||||||
Principal amount of senior notes | $ 63,400,000 | $ 201,300,000 | ||||||
Debt, interest rate | 2.00% | 2.00% | 2.00% | |||||
Conversion price, per share (USD per share) | $ / shares | $ 46.51 | |||||||
Repurchased amount | $ 134,200,000 | |||||||
Repayment of convertible notes | $ 6,700,000 | |||||||
Carrying amount of equity component | 3,200,000 | |||||||
Convertible debt | 3,500,000 | |||||||
Gain (loss) on extinguishment of debt | $ 0 | |||||||
Senior Notes | 1.375% Convertible Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt, interest rate | 1.375% | |||||||
Debt conversion rate | 10.7315 | |||||||
Principle amount per note | $ 1,000 | |||||||
Conversion price, per share (USD per share) | $ / shares | $ 93.18 | |||||||
Nonconvertible debt borrowing rate | 6.80% | |||||||
Debt discount amortization period | 7 years | |||||||
Deferred financing costs, gross | 10,900,000 | |||||||
Finance costs reclassified against equity | $ 3,300,000 | |||||||
Debt issuance costs | $ 7,600,000 | |||||||
Senior Notes | 1.375% Convertible Senior Notes | Investor | ||||||||
Debt Instrument [Line Items] | ||||||||
Unamortized discount | $ 120,700,000 | |||||||
Senior Notes | 1.25% Convertible Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt conversion rate | 17.1332 | |||||||
Principle amount per note | $ 1,000 | |||||||
Senior Notes | 2% Convertible Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt conversion rate | 21.5019 | |||||||
Principle amount per note | $ 1,000 |
Accounts Receivable, Net (Detai
Accounts Receivable, Net (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Receivables [Abstract] | ||
Trade receivables | $ 72,513 | $ 66,904 |
Allowance for doubtful accounts | (3,858) | (3,610) |
Total accounts receivable, net | $ 68,655 | $ 63,294 |
Net Income (Loss) Per Share - S
Net Income (Loss) Per Share - Schedule of Earnings per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Numerator: | ||
Net income (loss) | $ 4,378 | $ (6,569) |
Denominator: | ||
Weighted average number of shares outstanding, basic (in shares) | 59,355,031 | 58,482,786 |
Effective of dilutive potential common share equivalents | ||
Weighted average number of shares outstanding, diluted (in shares) | 61,148,428 | 58,482,786 |
Net income (loss) per share: | ||
Net income (loss) per share: basic (in dollars per share) | $ 0.07 | $ (0.11) |
Net income (loss) per shares: diluted (in dollars per share) | $ 0.07 | $ 0 |
Stock options | ||
Effective of dilutive potential common share equivalents | ||
Effective of dilutive potential common share equivalents | 1,524,315 | |
Stock options | ||
Effective of dilutive potential common share equivalents | ||
Effective of dilutive potential common share equivalents | 269,082 | |
Convertible debt | ||
Effective of dilutive potential common share equivalents | ||
Effective of dilutive potential common share equivalents | 0 |
- Potential Common Shares Exclu
- Potential Common Shares Excluded from Computation of Diluted Net Loss Per Share (Detail) - shares | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total dilutive common shares (in shares) | 10,871,548 | 14,712,884 |
1.375% Convertible Senior Notes | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total dilutive common shares (in shares) | 4,319,429 | 4,319,429 |
2% Convertible Senior Notes | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total dilutive common shares (in shares) | 0 | 78,589 |
1.25% Convertible Senior Notes | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total dilutive common shares (in shares) | 5,910,954 | 5,910,954 |
Unvested restricted stock units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total dilutive common shares (in shares) | 360,278 | 970,802 |
Stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total dilutive common shares (in shares) | 280,887 | 3,433,110 |
Inventories - Components of Inv
Inventories - Components of Inventories (Detail) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 12,246 | $ 10,347 |
Work-in-process | 30,922 | 30,222 |
Finished goods | 30,654 | 30,845 |
Total inventories | $ 73,822 | $ 71,414 |
Prepaid Expenses and Other As_3
Prepaid Expenses and Other Assets - Summary of Prepaid Expenses and Other Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid expenses and other current assets | $ 20,122 | $ 16,977 |
Capitalized contract acquisition costs, current portion | 7,906 | 7,277 |
Total prepaid expenses and other current assets | 28,028 | 24,254 |
Other assets | 3,161 | 2,278 |
Capitalized contract acquisition costs, net of current portion | 17,211 | 15,988 |
Right of use asset - lease | 8,286 | |
Total other assets | $ 28,658 | $ 18,266 |
Prepaid Expenses and Other As_4
Prepaid Expenses and Other Assets - Narrative (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Dec. 31, 2018 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Capitalized contract acquisition costs | $ 25,100,000 | |
Capitalized contract acquisition costs, current portion | 7,906,000 | $ 7,277,000 |
Capitalized contract acquisition costs, net of current portion | 17,211,000 | $ 15,988,000 |
Amortization of capitalized commission costs | 2,000,000 | |
impairments to capitalized costs | $ 0 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets, Net - Narrative (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Impairment of goodwill | $ 0 | ||
Goodwill | 39,694,000 | $ 39,646,000 | |
Amortization of other intangible assets | $ 600,000 | $ 400,000 | |
Customer and Contractual Relationships | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Intangible asset, weighted average amortization period | 9 years 1 month | ||
Internal-use software | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Intangible asset, weighted average amortization period | 3 years 7 months |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets, Net - Components of Other Intangible Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 19,125 | $ 17,371 |
Accumulated Amortization | (7,641) | (6,988) |
Net Book Value | 11,484 | 10,383 |
Customer and Contractual Relationships | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 8,423 | 6,109 |
Accumulated Amortization | (2,087) | (1,880) |
Net Book Value | 6,336 | 4,229 |
Internal-use software | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 10,702 | 11,262 |
Accumulated Amortization | (5,554) | (5,108) |
Net Book Value | $ 5,148 | $ 6,154 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets, Net - Amortization Expense Expected for Next Five Years (Details) $ in Thousands | Mar. 31, 2019USD ($) |
Expected Amortization Expense [Line Items] | |
2019 (remaining) | $ 1,910 |
2020 | 2,325 |
2021 | 1,822 |
2022 | 1,233 |
2023 | 846 |
Thereafter | 3,348 |
Net Book Value | 11,484 |
Customer and Contractual Relationships | |
Expected Amortization Expense [Line Items] | |
2019 (remaining) | 598 |
2020 | 732 |
2021 | 668 |
2022 | 668 |
2023 | 668 |
Thereafter | 3,002 |
Net Book Value | 6,336 |
Internal-use software | |
Expected Amortization Expense [Line Items] | |
2019 (remaining) | 1,312 |
2020 | 1,593 |
2021 | 1,154 |
2022 | 565 |
2023 | 178 |
Thereafter | 346 |
Net Book Value | $ 5,148 |
Accrued Expenses and Other Cu_3
Accrued Expenses and Other Current Liabilities - Summary of Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Payables and Accruals [Abstract] | ||
Employee compensation and related costs | $ 31,184 | $ 37,822 |
Professional and consulting services | 15,405 | 14,925 |
Supplier charges | 7,496 | 7,742 |
Value added taxes payable | 7,898 | 8,463 |
Short-term | 2,665 | 2,701 |
Other | 21,297 | 17,320 |
Total accrued expenses and other current liabilities | $ 85,945 | $ 88,973 |
Accrued Expenses and Other Cu_4
Accrued Expenses and Other Current Liabilities - Narrative (Details) | 3 Months Ended |
Mar. 31, 2019 | |
United States | |
Product Warranty Liability [Line Items] | |
Product warranty term for PDMs | 4 years |
CANADA | |
Product Warranty Liability [Line Items] | |
Product warranty term for PDMs | 5 years |
Accrued Expenses and Other Cu_5
Accrued Expenses and Other Current Liabilities - Product Warranty Liability (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Dec. 31, 2018 | |
Movement in Standard and Extended Product Warranty Accrual, Increase (Decrease) [Roll Forward] | ||||
Product warranty liability at the beginning of the period | $ 6,379 | $ 5,337 | ||
Warranty expense | 2,219 | 1,972 | ||
Warranty claims settled | (2,315) | (1,923) | ||
Product warranty liability at the end of the period | 6,283 | 5,386 | ||
Composition of balance: | ||||
Short-term | $ 2,665 | $ 2,701 | ||
Long-term | 3,618 | 3,678 | ||
Total warranty balance | $ 6,379 | $ 5,337 | $ 6,283 | $ 6,379 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) $ in Millions | 1 Months Ended | |
Jun. 16, 2015LegalMatter | Mar. 31, 2019USD ($) | |
Loss Contingencies [Line Items] | ||
Number of class actions filed (in legal matters) | LegalMatter | 3 | |
Number of class actions dismissed (in legal matters) | LegalMatter | 2 | |
Fees To Former European Distributor | Minimum | ||
Loss Contingencies [Line Items] | ||
Commitment due in next twelve months | $ 10 | |
Accrued liabilities | 6.4 | |
Fees To Former European Distributor | Maximum | ||
Loss Contingencies [Line Items] | ||
Commitment due in next twelve months | $ 55 |
Leases - Narrative (Details)
Leases - Narrative (Details) ft² in Thousands, $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019USD ($)ft²lease | Mar. 31, 2018USD ($) | Jan. 01, 2019USD ($) | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Right of use asset - lease | $ 8,286 | ||
Operating lease liability | 10,194 | ||
ROU assets obtained in exchange for lease obligations | $ 8,300 | ||
Option to extend lease, maximum number of years | 5 years | ||
Operating lease cost | $ 900 | ||
Operating lease cost | $ 800 | ||
Operating cash outflows from operating leases | $ 800 | $ 600 | |
Weighted average remaining lease term | 3 years 11 months 9 days | ||
Weighted average discount rate (as a percentage) | 6.70% | ||
Additional operating leases not yet commenced | lease | 0 | ||
Accounting Standards Update 2016-02 | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Right of use asset - lease | $ 8,800 | ||
Operating lease liability | $ 10,800 | ||
Billerica Massachusetts | Laboratory and Office Space | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Area of real estate property (in square feet) | ft² | 100 | ||
Billerica Massachusetts | Warehouse | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Area of real estate property (in square feet) | ft² | 29 |
Stock-Based Compensation and _3
Stock-Based Compensation and Stockholder' Equity - Schedule of Stock-Based Compensation Expense Related to Share-Based Awards (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Stock-based compensation expense | $ 5,784 | $ 8,181 |
Unamortized Expense | 52,470 | |
Employee stock purchase plan | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Stock-based compensation expense | 400 | 294 |
Unamortized Expense | $ 267 | |
Share-based compensation arrangement by share-based payment award, equity instruments other than options, outstanding, weighted average remaining contractual term | 2 months | |
Stock options | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Stock-based compensation expense | $ 1,640 | 2,359 |
Unamortized Expense | $ 13,562 | |
Share-based compensation arrangement by share-based payment award, options, vested and expected to vest, exercisable, weighted average remaining contractual term | 2 years 7 months | |
Unvested restricted stock units | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Stock-based compensation expense | $ 3,744 | $ 5,528 |
Unamortized Expense | $ 38,641 | |
Share-based compensation arrangement by share-based payment award, equity instruments other than options, outstanding, weighted average remaining contractual term | 2 years 2 months 24 days |
Leases - Future Minimum Undisco
Leases - Future Minimum Undiscounted Lease Payments (Details) $ in Thousands | Mar. 31, 2019USD ($) |
Operating Lease Liabilities, Payments Due [Abstract] | |
2019 (remaining) | $ 2,484 |
2020 | 2,954 |
2021 | 2,899 |
2022 | 2,575 |
2023 | 269 |
Thereafter | 561 |
Total future minimum lease payments | 11,742 |
Less: imputed interest | (1,548) |
Total future minimum lease payments | 10,194 |
Other current liabilities | 2,315 |
Other long-term liabilities | $ 7,879 |
Stock-Based Compensation and _4
Stock-Based Compensation and Stockholder' Equity - Stock Option Activity (Details) $ / shares in Units, $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($)$ / sharesshares | |
Number of Options | |
Beginning balance (in shares) | 3,077,624 |
Granted (in shares) | 114,040 |
Exercised (in shares) | (273,082) |
Canceled (in shares) | (35,965) |
Ending balance (in shares) | 2,882,617 |
Vested, at end of period (in shares) | 2,191,005 |
Vested and expected to vest, at end of period (in shares) | 2,743,607 |
Weighted Average Exercise Price | |
Beginning balance (in dollars per share) | $ / shares | $ 39.16 |
Granted (in dollars per share) | $ / shares | 92.16 |
Exercised (in dollars per share) | $ / shares | 34.45 |
Canceled (in dollars per share) | $ / shares | 38.32 |
Ending balance (in dollars per share) | $ / shares | 41.71 |
Vested, at end of period (in dollars per share) | $ / shares | $ 36.21 |
Aggregate Intrinsic Value | |
Exercised | $ | $ 15,810 |
Ending balance | $ | 153,897 |
Vested, at end of period | $ | 129,008 |
Vested and expected to vest, at end of period | $ | $ 149,128 |
Options outstanding, weighted average remaining contractual life | 5 years 5 months 16 days |
Options exercisable, weighted average remaining contractual life | 4 years 6 months 26 days |
Stock-Based Compensation and _5
Stock-Based Compensation and Stockholder' Equity - Summary of Restricted Stock Units (Details) - Unvested restricted stock units | 3 Months Ended |
Mar. 31, 2019$ / sharesshares | |
Number of Shares | |
Beginning balance (in shares) | shares | 752,207 |
Granted (in shares) | shares | 261,650 |
Vested (in shares) | shares | (266,448) |
Forfeited (in shares) | shares | (13,163) |
Ending balance (in shares) | shares | 734,246 |
Weighted Average Grant Date Fair Value | |
Beginning balance (in dollars per share) | $ / shares | $ 55.02 |
Granted (in dollars per share) | $ / shares | 91.64 |
Vested (in dollars per share) | $ / shares | 42.70 |
Forfeited (in dollars per share) | $ / shares | 64.61 |
Ending balance (in dollars per share) | $ / shares | $ 72.37 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Significant Accounting Policies [Line Items] | ||
Unrecognized tax benefits | $ 0 | |
Income tax expense | $ 326,000 | $ 333,000 |
Minimum | ||
Significant Accounting Policies [Line Items] | ||
Number of open tax years | 3 years | |
Maximum | ||
Significant Accounting Policies [Line Items] | ||
Number of open tax years | 4 years |
Uncategorized Items - podd-2019
Label | Element | Value |
Accounting Standards Update 2014-09 [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 20,349,000 |
Accounting Standards Update 2014-09 [Member] | Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 20,349,000 |