COVER PAGE
COVER PAGE - $ / shares | 9 Months Ended | ||
Sep. 30, 2020 | Nov. 09, 2020 | Dec. 31, 2019 | |
Cover [Abstract] | |||
Document Type | 10-Q | ||
Document Quarterly Report | true | ||
Document Period End Date | Sep. 30, 2020 | ||
Document Transition Report | false | ||
Entity File Number | 001-34528 | ||
Entity Registrant Name | ZAGG Inc | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 20-2559624 | ||
Entity Address, Address Line One | 910 West Legacy Center Way | ||
Entity Address, Address Line Two | Suite 500 | ||
Entity Address, City or Town | Midvale | ||
Entity Address, State or Province | UT | ||
Entity Address, Postal Zip Code | 84047 | ||
City Area Code | 801 | ||
Local Phone Number | 263-0699 | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Title of 12(b) Security | Common Stock, $0.001 par value | ||
Common stock, par or stated value per share (in dollars per share) | $ 0.001 | $ 0.001 | |
Trading Symbol | ZAGG | ||
Security Exchange Name | NASDAQ | ||
Entity Common Stock, Shares Outstanding | 29,848,506 | ||
Amendment Flag | false | ||
Document Fiscal Period Focus | Q3 | ||
Document Fiscal Year Focus | 2020 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Central Index Key | 0001296205 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 16,115 | $ 17,801 |
Accounts receivable, net of allowances of $1,088 and $1,143 | 91,196 | 142,804 |
Income tax receivable | 7,980 | 0 |
Inventories | 80,024 | 144,944 |
Prepaid expenses and other current assets | 8,539 | 6,124 |
Total current assets | 203,854 | 311,673 |
Property and equipment, net of accumulated depreciation of $14,354 and $14,159 | 15,759 | 18,019 |
Intangible assets, net of accumulated amortization of $105,168 and $95,632 | 51,704 | 63,110 |
Deferred income tax assets, net | 23,680 | 22,657 |
Operating lease right of use assets | 9,890 | 9,636 |
Goodwill | 24,920 | 43,569 |
Other assets | 243 | 567 |
Total assets | 330,050 | 469,231 |
Current liabilities: | ||
Accounts payable | 60,142 | 87,303 |
Income tax payable | 0 | 5,266 |
Sales returns liability | 25,668 | 43,853 |
Accrued wages and wage-related expenses | 6,225 | 6,328 |
Accrued liabilities | 5,440 | 15,164 |
Current portion of other long-term liabilities | 662 | 0 |
Current portion of operating lease liabilities | 2,786 | 2,099 |
Total current liabilities | 100,923 | 160,013 |
Line of credit | 87,655 | 107,140 |
Operating lease liabilities | 9,915 | 10,599 |
Other long-term liabilities | 8,782 | |
Total liabilities | 207,275 | 277,752 |
Commitments and contingencies (Note 12 and Note 13) | ||
Stockholders’ equity: | ||
Common stock, $0.001 par value; 100,000 shares authorized; 36,884 and 36,610 shares issued | 37 | 37 |
Treasury stock, 7,055 and 7,055 common shares at cost | (50,455) | (50,455) |
Additional paid-in capital | 120,188 | 116,533 |
Accumulated other comprehensive loss | (962) | (1,631) |
Retained earnings | 53,967 | 126,995 |
Total stockholders’ equity | 122,775 | 191,479 |
Total liabilities and stockholders’ equity | $ 330,050 | $ 469,231 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance for credit loss | $ 1,088 | $ 1,143 |
Accumulated depreciation, depletion and amortization, property, plant, and equipment | 14,354 | 14,159 |
Finite-lived intangible assets, accumulated amortization | $ 105,168 | $ 95,632 |
Common stock, par or stated value per share (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 36,884,000 | 36,610,000 |
Treasury stock, common shares (in shares) | 7,055,000 | 7,055,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Income Statement [Abstract] | ||||
Net sales | $ 115,456 | $ 146,488 | $ 283,554 | $ 332,034 |
Cost of sales | 77,023 | 92,143 | 240,751 | 216,108 |
Gross profit | 38,433 | 54,345 | 42,803 | 115,926 |
Operating expenses: | ||||
Advertising and marketing | 3,218 | 4,129 | 10,063 | 13,228 |
Selling, general, and administrative | 23,849 | 33,967 | 80,185 | 100,036 |
Transaction costs | 72 | 547 | 468 | 1,168 |
Impairment of goodwill | 0 | 0 | 18,649 | 0 |
Loss on disposal of intangible assets and equipment | 0 | 96 | 3,683 | 102 |
Amortization of intangible assets | 3,357 | 3,948 | 10,258 | 13,013 |
Total operating expenses | 30,496 | 42,687 | 123,306 | 127,547 |
Income (loss) from operations | 7,937 | 11,658 | (80,503) | (11,621) |
Other income (expense): | ||||
Interest expense | (885) | (1,221) | (3,375) | (3,334) |
Other income (expense) | 867 | (462) | 1,086 | 214 |
Total other expense | (18) | (1,683) | (2,289) | (3,120) |
Income (loss) before provision for income taxes | 7,919 | 9,975 | (82,792) | (14,741) |
Income tax (provision) benefit | (1,700) | (1,293) | 10,123 | 3,663 |
Net income (loss) | $ 6,219 | $ 8,682 | $ (72,669) | $ (11,078) |
Earnings (loss) per share attributable to stockholders: | ||||
Basic earnings (loss) per share (in usd per share) | $ 0.21 | $ 0.30 | $ (2.44) | $ (0.38) |
Diluted earnings (loss) per share (in usd per share) | $ 0.21 | $ 0.30 | $ (2.44) | $ (0.38) |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ 6,219 | $ 8,682 | $ (72,669) | $ (11,078) |
Other comprehensive gain (loss), net of tax: | ||||
Foreign currency translation gain (loss) | 272 | (941) | 669 | (956) |
Total other comprehensive income (loss) | 272 | (941) | 669 | (956) |
Total comprehensive income (loss) | $ 6,491 | $ 7,741 | $ (72,000) | $ (12,034) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Cash flows from operating activities: | |||||
Net income (loss) | $ 6,219 | $ 8,682 | $ (72,669) | $ (11,078) | |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | |||||
Stock-based compensation expense | 3,930 | 3,291 | |||
Depreciation and amortization | 15,435 | 18,007 | |||
Deferred income tax assets | (762) | (1,666) | |||
Loss on disposal of intangible assets and equipment | 0 | 96 | 3,683 | 102 | |
Amortization of deferred loan costs | 420 | 161 | |||
Impairment of goodwill | 0 | 0 | 18,649 | 0 | $ 0 |
Right of use asset expenses | 1,904 | 1,897 | |||
Changes in operating assets and liabilities: | |||||
Accounts receivable, net | 52,132 | 20,813 | |||
Inventories | 65,606 | (53,079) | |||
Prepaid expenses and other current assets | (2,519) | 1,883 | |||
Other assets | 249 | 381 | |||
Accounts payable | (27,304) | 14,758 | |||
Income tax payable | (13,466) | (3,033) | |||
Sales returns liability | (18,305) | (15,751) | |||
Accrued wages and wage related expenses | (110) | 1 | |||
Accrued liabilities | (6,050) | 103 | |||
Lease liabilities | (2,307) | (1,913) | |||
Other | (641) | 320 | |||
Net cash provided by (used in) operating activities | 17,875 | (24,803) | |||
Cash flows from investing activities: | |||||
Purchase of property and equipment | (5,495) | (7,002) | |||
Proceeds from disposal of equipment | 0 | 2 | |||
Purchase of HALO, net of cash acquired | 0 | (20,364) | |||
Net cash used in investing activities | (5,495) | (27,364) | |||
Cash flows from financing activities: | |||||
Proceeds from revolving credit facility | 106,130 | 243,140 | |||
Payments on revolving credit facility | (125,615) | (190,140) | |||
Proceeds from the paycheck protection program loan | 9,444 | 0 | |||
Contingent liability payments for HALO | (3,724) | 0 | |||
Purchase of treasury stock | 0 | (722) | |||
Payment of withholding on restricted stock units | (314) | (848) | |||
Payment of debt issuance costs | (257) | (40) | |||
Proceeds from issuance of stock under employee stock purchase plan | 39 | 61 | |||
Net cash (used in) provided by financing activities | (14,297) | 51,451 | |||
Effect of foreign currency exchange rates on cash equivalents | 231 | (408) | |||
Net decrease in cash and cash equivalents | (1,686) | (1,124) | |||
Cash and cash equivalents at beginning of the period | 17,801 | 15,793 | 15,793 | ||
Cash and cash equivalents at end of the period | 16,115 | 14,669 | 16,115 | 14,669 | $ 17,801 |
Supplemental disclosure of cash flow information: | |||||
Cash paid during the period for interest | 2,953 | 3,154 | |||
Cash paid during the period for income taxes, net | 4,107 | 1,009 | |||
Cash paid during the period for rent expenses included in the measurement of lease liabilities | 2,749 | 2,393 | |||
Supplemental disclosure of non-cash investing and financing activities: | |||||
Purchase of property and equipment financed through accounts payable | 246 | 742 | |||
Withholding tax on restricted stock units recorded in accrued wages and wage related expenses | $ 0 | $ 39 | 0 | 39 | |
Purchase of HALO through amounts due to seller, contingent payments and common stock | 0 | 16,642 | |||
Noncash change in lease asset and operating liabilities from reassessment of existing leases and addition of new leases | $ 2,159 | $ 2,473 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY - USD ($) shares in Thousands, $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Cumulative Effect, Period of Adoption, Adjusted Balance | Common Stock | Common StockCumulative Effect, Period of Adoption, Adjusted Balance | Additional Paid-in Capital | Additional Paid-in CapitalCumulative Effect, Period of Adoption, Adjusted Balance | Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive LossCumulative Effect, Period of Adoption, Adjusted Balance | Treasury Stock | Treasury StockCumulative Effect, Period of Adoption, Adjusted Balance | Retained Earnings | Retained EarningsCumulative Effect, Period of Adoption, Adjustment | Retained EarningsCumulative Effect, Period of Adoption, Adjusted Balance |
Beginning balance (in shares) at Dec. 31, 2018 | 34,457 | 34,457 | ||||||||||||
Beginning balance at Dec. 31, 2018 | $ 158,491 | $ (39) | $ 158,452 | $ 34 | $ 34 | $ 96,486 | $ 96,486 | $ (1,410) | $ (1,410) | $ (49,733) | $ (49,733) | $ 113,114 | $ (39) | $ 113,075 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Net income (loss) | (11,078) | (11,078) | ||||||||||||
Other comprehensive income (loss) | (956) | (956) | ||||||||||||
Treasury stock purchase | (722) | (722) | ||||||||||||
Restricted stock release (in shares) | 241 | |||||||||||||
Employee stock purchase plan release (in shares) | 7 | |||||||||||||
Employee stock purchase plan release | 61 | 61 | ||||||||||||
Stock-based compensation expense | 3,291 | 3,291 | ||||||||||||
Payment of withholding taxes on restricted stock units | (887) | (887) | ||||||||||||
Shares issued as consideration for acquisition (in shares) | 1,458 | |||||||||||||
Shares issued as consideration for acquisition | 12,968 | $ 2 | 12,966 | |||||||||||
Ending balance (in shares) at Sep. 30, 2019 | 36,163 | |||||||||||||
Ending balance at Sep. 30, 2019 | 161,129 | $ 36 | 111,917 | (2,366) | (50,455) | 101,997 | ||||||||
Beginning balance (in shares) at Jun. 30, 2019 | 36,140 | |||||||||||||
Beginning balance at Jun. 30, 2019 | 152,750 | $ 36 | 111,279 | (1,425) | (50,455) | 93,315 | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Net income (loss) | 8,682 | 8,682 | ||||||||||||
Other comprehensive income (loss) | (941) | (941) | ||||||||||||
Restricted stock release (in shares) | 19 | |||||||||||||
Employee stock purchase plan release (in shares) | 4 | |||||||||||||
Employee stock purchase plan release | 48 | |||||||||||||
Stock-based compensation expense | 631 | 631 | ||||||||||||
Payment of withholding taxes on restricted stock units | (41) | (41) | ||||||||||||
Ending balance (in shares) at Sep. 30, 2019 | 36,163 | |||||||||||||
Ending balance at Sep. 30, 2019 | 161,129 | $ 36 | 111,917 | (2,366) | (50,455) | 101,997 | ||||||||
Beginning balance (in shares) at Dec. 31, 2019 | 36,610 | 36,610 | ||||||||||||
Beginning balance at Dec. 31, 2019 | 191,479 | $ (359) | $ 191,120 | $ 37 | $ 37 | 116,533 | $ 116,533 | (1,631) | $ (1,631) | (50,455) | $ (50,455) | 126,995 | $ (359) | $ 126,636 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Net income (loss) | (72,669) | (72,669) | ||||||||||||
Other comprehensive income (loss) | 669 | 669 | ||||||||||||
Restricted stock release (in shares) | 270 | |||||||||||||
Employee stock purchase plan release (in shares) | 4 | |||||||||||||
Employee stock purchase plan release | 39 | 39 | ||||||||||||
Stock-based compensation expense | 3,930 | 3,930 | ||||||||||||
Payment of withholding taxes on restricted stock units | (314) | (314) | ||||||||||||
Ending balance (in shares) at Sep. 30, 2020 | 36,884 | |||||||||||||
Ending balance at Sep. 30, 2020 | 122,775 | $ 37 | 120,188 | (962) | (50,455) | 53,967 | ||||||||
Beginning balance (in shares) at Jun. 30, 2020 | 36,884 | |||||||||||||
Beginning balance at Jun. 30, 2020 | 114,958 | $ 37 | 118,862 | (1,234) | (50,455) | 47,748 | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Net income (loss) | 6,219 | 6,219 | ||||||||||||
Other comprehensive income (loss) | 272 | 272 | ||||||||||||
Stock-based compensation expense | 1,326 | 1,326 | ||||||||||||
Payment of withholding taxes on restricted stock units | 0 | |||||||||||||
Ending balance (in shares) at Sep. 30, 2020 | 36,884 | |||||||||||||
Ending balance at Sep. 30, 2020 | $ 122,775 | $ 37 | $ 120,188 | $ (962) | $ (50,455) | $ 53,967 |
NATURE OF OPERATIONS AND BASIS
NATURE OF OPERATIONS AND BASIS OF PRESENTATION | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
NATURE OF OPERATIONS AND BASIS OF PRESENTATION | NATURE OF OPERATIONS AND BASIS OF PRESENTATION ZAGG Inc and its subsidiaries (the “Company”) are innovation leaders in mobile tech accessories for smartphones and tablets. For over 15 years, the Company has developed creative product solutions that enhance and protect mobile devices for consumers around the world. The Company has an award-winning product portfolio that includes screen protection, power management, wireless charging, audio, mobile keyboards, protective cases, and other mobile accessories sold under the ZAGG ® , InvisibleShield ® , mophie ® , IFROGZ ® , Gear4 ® , and HALO ® brands. The accompanying unaudited condensed consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the United States (“U.S.”) Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) have been condensed or omitted pursuant to such rules and regulations. These condensed consolidated financial statements reflect all adjustments (consisting only of normal recurring adjustments) that, in the opinion of management, are necessary to present fairly the financial position, the results of operations, and cash flows of the Company for the periods presented. The Company recommends that these condensed consolidated financial statements be read in conjunction with the consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 (the “2019 Form 10-K”). Operating results for the interim periods are not necessarily indicative of the results that may be expected for the full year. The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting periods, with related disclosures of these amounts in the notes to the financial statements. Actual results could differ from those estimates. Coronavirus Outbreak and Company Impact In December 2019, a mutated strain of coronavirus (“COVID-19”) was reported to have surfaced in Wuhan, China. The outbreak, which had previously been concentrated in China, has largely spread through the U.S. and the world. This COVID-19 pandemic has materially impacted the Company's financial condition and results of operations. The Company recommends that the condensed consolidated financial statements and notes thereto in this Quarterly Report on Form 10-Q be read in conjunction with Management’s Discussion and Analysis of Financial Condition and Results of Operations in Item 2 of Part I to this Quarterly Report on Form 10-Q, and the Company's Risk Factors in Item 1A of Part II to this Quarterly Report on Form 10-Q for further information. Significant Accounting Policies The Company’s significant accounting policies are described in Note 1 to the Company’s consolidated financial statements included in the 2019 Form 10-K. Except for the changes below, the Company has consistently applied the accounting policies to all periods presented in these condensed consolidated financial statements. Adoption of Accounting Standards Codification (“ASC”) Topic 326, “Financial Instruments - Credit Losses” The Company adopted ASC Topic 326 ,“Financial Instruments - Credit Losses” (“Topic 326”) with a date of initial application of January 1, 2020. As a result of this adoption, the Company has changed its accounting policy for estimating allowance for credit losses on its accounts receivable, as detailed below. The Company applied Topic 326 prospectively by recording a cumulative effect adjustment in retained earnings beginning January 1, 2020, which allows for the application of the standard solely to the transition period in 2020 but does not require application to prior fiscal comparative periods presented. Therefore, the prior period comparative information has not been adjusted and continues to be reported under the previous incurred credit loss allowance methodology. The adoption of Topic 326 Allowance for credit losses accounting policy The Company estimates the allowance for credit losses in relation to accounts receivable based on relevant qualitative and quantitative information about historical events, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported accounts receivable. Topic 326 permits different methods to calculate the estimate for the allowance for credit losses. The Company started with its historical loss experience as suggested by Topic 326 and evaluated its previous method of estimating the allowance for credit losses. The Company determined that its previous method of using an aging schedule to develop historical credit loss percentages, which is allowed under Topic 326, is appropriate. The historical credit loss percentages are developed for each aging category based on eight quarters of credit loss history and the Company determined that its customers in each of these aging categories share similar risk characteristics. Additionally, as required by Topic 326, the Company adjusts the historical credit loss percentage by current and forecasted economic conditions. Due to the short-term nature of its accounts receivable and that it carries credit insurance on a significant portion of the accounts receivable balance, the Company believes changes to economic conditions may not have significant effect on the estimate of the allowance for credit losses for accounts receivable; thus, the Company determined to include a baseline credit loss percentage into the historical credit loss percentage for each aging category to reflect the potential impact of the current and future economic conditions. Such baseline credit loss is adjusted when changes in the economic environment change the Company's expectation for future credit losses. As of September 30, 2020, the Company determined the baseline of credit loss percentage should be increased in response to the COVID-19 pandemic and estimated the allowance for credit losses to be $1,088. |
REVENUE
REVENUE | 9 Months Ended |
Sep. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE | REVENUE Disaggregation of revenue from contracts with customers In the following tables, revenue from contracts with customers are disaggregated by key product lines, key distribution channels, and key geographic regions. The percentage of net sales related to the Company’s key product lines for the three and nine months ended September 30, 2020, and 2019, was a pproximately as follows: For the Three Months Ended For the Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Protection (screen protection and cases) 63% 59% 60% 57% Power (power management and power cases) 26% 31% 28% 31% Productivity (keyboards and other) 6% 7% 9% 8% Audio 5% 3% 3% 4% During the three and nine months ended September 30, 2020, the Company revised the online channel to include sales to a key direct-to-consumer customer whose sales were included within the indirect channel in prior periods. The Company also made the same change to 2019 net sales by key distribution channels to make the net sales comparable. The percentage of net sales related to the Company’s key distribution channels for the three and nine months ended September 30, 2020, and 2019, was approximately as follows: For the Three Months Ended For the Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Indirect channel 84% 86% 82% 82% Online 12% 9% 14% 12% Franchisees 4% 5% 4% 6% The percentage of net sales related to the Company’s key geographic regions for the three and nine months ended September 30, 2020, an d 2019, wa s approximately as follows: For the Three Months Ended For the Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 United States 74% 79% 78% 75% Europe 19% 12% 16% 13% Other 7% 9% 6% 12% Contract Balances Timing of revenue recognition may differ from timing of invoicing to customers or timing of consideration received. The following table provides information about receivables, right of return assets, contract liabilities, refund liabilities, and warranty liabilities from the Company’s contracts with customers as of September 30, 2020, and December 31, 2019: September 30, 2020 December 31, 2019 Receivables, which comprises the balance in accounts receivable, net of allowances $ 91,196 $ 142,804 Right of return assets, which are included in prepaid expenses and other current assets 431 2,177 Refund liabilities, which are included in sales return liability 23,175 39,790 Warranty liabilities, which are included in sales return liability 2,493 4,063 Contract liabilities, which are included in accrued liabilities 30 39 The current balance of the right of return assets is the estimated amount of inventory to be returned that is expected to be resold. The current balance of refund liabilities is the expected amount of estimated sales returns, discounts, and other credits from sales that have occurred. The current balance of warranty liabilities is the expected amount of warranty claim returns from sales that have occurred. The current balance of contract liabilities primarily relates to the advance consideration received from customers for products for which transfer of control has not yet occurred and therefore, revenue is deferred and will be recognized when the transfer of control has been completed. The following table summarizes the activities in the Company’s warranty liabilities for the nine months ended September 30, 2020, and 2019: For the Nine Months Ended September 30, 2020 September 30, 2019 Balance at beginning of period $ 4,063 $ 4,646 Accrual for product warranty 3,372 7,858 Warranty claims charged (4,943) (8,581) Foreign currency translation gain 1 — Balance at end of period $ 2,493 $ 3,923 |
ACQUISITION OF HALO
ACQUISITION OF HALO | 9 Months Ended |
Sep. 30, 2020 | |
Business Combinations [Abstract] | |
ACQUISITION OF HALO | ACQUISITION OF HALO On January 3, 2019 (the “Acquisition Date”), ZAGG Hampton LLC, a Delaware limited liability company and wholly owned subsidiary of the Company, entered into a membership interest purchase agreement (the “Purchase Agreement”) with Halo2Cloud, LLC (“HALO”) and its equity owners to acquire all of the outstanding equity interests of HALO (the “HALO Acquisition”). HALO is a leading direct-to-consumer mobile accessories company with an extensive intellectual property portfolio that specializes in wireless charging, car and wall chargers, portable power, and other accessories. The Company acquired HALO primarily to enter into new distribution channels and to expand its product and intellectual property portfolio. During the nine months ended September 30, 2020, the Company paid $4,089 to HALO upon the achievement of the target Adjusted EBITDA as set forth in the Purchase Agreement and also $2,130 to HALO for cash held back by the Company at the Acquisition Date in relation to HALO's indemnification obligations. |
INVENTORIES
INVENTORIES | 9 Months Ended |
Sep. 30, 2020 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | INVENTORIES As a result of current and expected 2020 demand reductions due to the COVID-19 pandemic, the Company reassessed the (1) long-term profitability of all brands and product lines, and (2) the recoverability of inventory on-hand in the first half of 2020 (the “Strategic Review”). As a result of the Strategic Review, the Company determined to discontinue the BRAVEN audio brand, exit the fitted battery case product category, and simplify the following product lines: IFROGZ audio, ZAGG keyboards, and mophie power stations. Ultimately, the demand reduction linked to COVID-19 combined with these efforts to exit less profitable categories, resulted in a write-down to inventory during the first quarter of 2020 of $44,833, which was included in the cost of sales in the condensed consolidated statements of operations. Inventories consisted of the following as of September 30, 2020, and December 31, 2019: September 30, 2020 December 31, 2019 Finished goods $ 78,702 $ 142,054 Raw materials 1,322 2,890 Total inventories $ 80,024 $ 144,944 Included in prepaid expenses and other current assets were inventory deposits with third-party manufacturers of $4,961 and $148 as of September 30, 2020, and December 31, 2019, respectively. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 9 Months Ended |
Sep. 30, 2020 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | PROPERTY AND EQUIPMENT In connection with the Strategic Review, the Company determined to dispose of certain equipment and molds that would no longer be used on go-forward brands and product lines, and wrote-off $2,535 during the first quarter of 2020. These write-offs were included in loss on disposal of intangible assets and equipment in the condensed consolidated statements of operations. Property and equipment, net consisted of the following as of September 30, 2020, and December 31, 2019: Useful Lives September 30, 2020 December 31, 2019 Equipment and molds 3 to 10 years $ 16,471 $ 18,851 Leasehold improvements 1 to 8 years 7,053 7,710 Building and improvements 40 years 2,429 2,429 Computer equipment and software 3 to 5 years 2,266 1,237 Furniture and fixtures 7 years 1,858 1,876 Automobiles 5 years 36 75 Property and equipment, gross 30,113 32,178 Less accumulated depreciation and amortization (14,354) (14,159) Property and equipment, net $ 15,759 $ 18,019 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 9 Months Ended |
Sep. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS | GOODWILL AND INTANGIBLE ASSETS There was no change in goodwill during the three months ended September 30, 2020. There was an $18,649 impairment to goodwill during the nine months ended September 30, 2020, as the carrying value of the Company's net assets as of March 31, 2020, exceeded the Company's calculation of its diminished market capitalization caused by a decrease of the Company's stock price that occurred during the three months ended March 31, 2020. The market capitalization was determined by multiplying the total number of the Company's outstanding shares by the Company's average stock price for a determined reasonable period with an estimated additional control premium included as part of the market capitalization. This adjustment was recorded during the first quarter of 2020. There was no change in goodwill during the three months ended September 30, 2019. During the nine months ended September 30, 2019, goodwill increased by $15,931 in connection with the HALO Acquisition. The following table summarizes the changes in goodwill during the nine months ended September 30, 2020, and the twelve months ended December 31, 2019: For the Nine Months Ended For the Twelve Months Ended September 30, 2020 December 31, 2019 Balance at beginning of period $ 43,569 $ 27,638 Addition in connection with the acquisition of HALO — 15,931 Impairment of goodwill (18,649) — Balance at end of period $ 24,920 $ 43,569 There were no additions to intangible assets during the three and nine months ended September 30, 2020. There were no additions to intangible assets for the three months ended September 30, 2019. For the nine months ended September 30, 2019, as a consequence of the HALO Acquisition, intangible assets increased $28,061 for patents and technology, trade names, customer relationships, net of unfavorable leases obtained. During the nine months ended September 30, 2020, the Company discontinued its use of certain trade names, patents and technology in connection with the Strategic Review. As such, a loss of $1,148 was recorded to reduce intangible assets and was included in loss on disposal of intangible assets and equipment in the condensed consolidated statements of operations. This adjustment was recorded during the first quarter of 2020. Other than the previously noted loss of $1,148, there was no other losses and/or impairments of intangible assets for the three and nine months ended September 30, 2020, and 2019. Intangible assets, net of accumulated amortization as of September 30, 2020, and December 31, 2019, were as follows: September 30, 2020 Weighted Average Amortization Period December 31, 2019 Weighted Average Amortization Period Trade names $ 21,459 9.7 years $ 25,871 9.7 years Customer relationships 17,742 7.7 years 21,514 7.7 years Patents and technology 12,353 8.4 years 15,306 8.3 years Non-compete agreements 150 4.9 years 419 4.9 years Total intangible assets, net of accumulated amortization $ 51,704 8.3 years $ 63,110 8.3 years |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXESFor interim periods, the tax provision is generally determined utilizing an estimate of the Company’s annual effective tax rate adjusted for discrete items, if any. Due to the Company's year-to-date loss and forecasted loss for the year, the tax benefit related to the net loss during the nine months ended September 30, 2020, was limited to the expected annual tax benefit for the year ended December 31, 2020. The Company’s effective tax rate was 21% and 12% for the three and nine months ended September 30, 2020, respectively. The Company’s effective tax rate was 13% and 25% for the three and nine months ended September 30, 2019, respectively. Any changes in the effective tax rate for the nine months ended September 30, 2020, compared to the nine months ended September 30, 2019, was primarily due to the impact of the methodology used in the tax provision calculation described above, as well as an inclusion of an additional benefit related to the projected carryback of the net operating loss (“NOL”). Under the CARES Act, a temporary five-year NOL carryback enables most corporate taxpayers to offset 2015 income taxed at 35% by 2020 income taxed at 21%. This projected benefit is included in the effective tax rate for the period. The Company’s effective tax rate will generally differ from the U.S. Federal statutory rate of 21%, due to state taxes, permanent items including amounts disallowed under §162(m) of the Internal Revenue Code, the Company’s global tax strategy, and the inclusion of global intangible low taxed income and the corresponding foreign tax credit. |
LONG-TERM DEBT
LONG-TERM DEBT | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | LONG-TERM DEBT Long-term debt, net as of September 30, 2020, and December 31, 2019, was as follows: September 30, 2020 December 31, 2019 Line of credit $ 87,655 $ 107,140 PPP Loan (which comprises the balances in current portion of other long-term liabilities and other long-term liabilities) 9,444 — Total debt outstanding $ 97,099 $ 107,140 Current portion of other long-term liabilities 662 — Total long-term debt outstanding $ 96,437 $ 107,140 On April 12, 2018, the Company entered into an amended and restated credit and security agreement (the “2018 Credit and Security Agreement”) with KeyBank National Association (“KeyBank”), as administrative agent, Swing Line Lender and Issuing Lender, KeyBanc Capital Markets Inc., as sole lead arranger and sole book runner, and other members of the lender group, which was subsequently amended by a first amendment agreement dated as of November 28, 2018, a second amendment agreement dated as of August 30, 2019, a third amendment agreement dated as of December 4, 2019, and a fourth amendment agreement dated as of April 13, 2020 (the “Fourth Amendment Agreement”). The maturity date of the 2018 Credit and Security Agreement, as amended, is April 11, 2023. The Fourth Amendment Agreement temporarily increased the revolving credit amount from $125,000 to $144,800 from April 13, 2020, through March 31, 2021, respectively. Under the Fourth Amendment Agreement, interest rates were revised to add an additional 50 basis points to the prior rates; the applicable interest rates are based on the Company's leverage ratio as defined in the Fourth Amendment Agreement. In connection with the Fourth Amendment Agreement, the Company paid approximately $257 in debt issuance costs. As of September 30, 2020, there were no letters of credit issued, and $57,145 was available to be issued for letters of credit under the terms of the 2018 Credit and Security Agreement, as amended. On April 13, 2020, the Company entered into a loan agreement with KeyBank as the lender under the Paycheck Protection Program of the CARES Act administered by U.S. Small Business Administration (the “SBA”), and on April 17, 2020 (the “Disbursement Date”), received a loan in the amount of $9,444 (the “PPP Loan”) to help sustain its employee payroll costs, rent, and utilities due to the impact of the COVID-19 pandemic. Under the Paycheck Protection Program, the Company's PPP Loan is fully forgivable if the Company meets certain requirements and receives formal approval, as defined by the CARES Act, subject to an audit by the SBA. The Company intends to seek partial or full forgiveness of the PPP Loan; however, there can be no assurance that the Company will obtain forgiveness of all or part of the PPP Loan amount. The interest rate for the PPP Loan is 1% per annum, and all required payments are deferred until August 2021 (interest will accrue over this deferral period). Unless the PPP Loan is fully or partially forgiven, the Company must pay $398 of the principal and interest every month once the deferral period is over and pay a balloon payment of $6,441 on the maturity date in April 2022, which is two years from the Disbursement Date. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 9 Months Ended |
Sep. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
STOCK-BASED COMPENSATION | STOCK-BASED COMPENSATION The grant of restricted stock units with respective weighted-average fair value per share for the three and nine months ended September 30, 2020, and 2019, is summarized as follows: For the Three Months Ended For the Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Units Granted 338 75 1,065 718 Weighted average fair value per share $ 2.98 $ 6.59 $ 5.66 $ 9.48 The fair value of the restricted stock units granted is based on the closing share price of the Company’s common stock on the date of grant. The restricted stock units vest annually on a straight-line basis over a nine-month (annual board of directors’ grant) to a three-year vesting term, depending on the terms of the individual grant. None of the the 338 and 75 restricted stock units granted during the three months ended September 30, 2020, and 2019, respectively, were related to performance-based restricted stock where vesting is linked to specific performance criterion. As part of the 1,065 and 718 restricted stock units granted during the nine months ended September 30, 2020, and 2019, respectively, the Company granted 417 and 287 restricted stock units to certain executives and employees of the Company where vesting is linked to specific performance criterion. These performance-based restricted stock units only vest upon the (1) Company’s achievement of specified thresholds of net sales, Adjusted EBITDA, and other specific net sales and profitability goals, and (2) continued employment through the applicable vesting date. The estimated fair value of the restricted stock units is recognized on a straight-line basis over the requisite service period of the award, which is generally the vesting term of the award. The following are stock-based compensation expenses related to restricted stock units recorded for the three and nine months ended September 30, 2020, and 2019, respectively, which are included as a component of selling, general, and administrative expense on the condensed consolidated statement of operations: For the Three Months Ended For the Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Stock-based compensation expense $ 1,326 $ 631 $ 3,930 $ 3,291 Certain Company employees have elected to receive a net amount of shares upon the vesting of restricted stock unit grants in exchange for the Company paying up to the maximum statutory withholding amount of the employees’ tax liabilities for the fair value of the award on the vesting date. These elections have resulted in the Company recording $0 and $314, respectively, during the three and nine months ended September 30, 2020, and $41 and $887, respectively, during the three and nine months ended September 30, 2019, reflected as a reduction of additional paid-in capital. All of the $314 recorded as a reduction of additional paid-in capital was paid as of September 30, 2020. Of the $887 recorded as a reduction of additional paid-in capital, $39 was included in accrued wages and wage related expenses as of September 30, 2019. |
EARNINGS (LOSS) PER SHARE
EARNINGS (LOSS) PER SHARE | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
EARNINGS (LOSS) PER SHARE | EARNINGS (LOSS) PER SHAREBasic earnings (loss) per common share excludes dilution and is computed by dividing net earnings (loss) by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per common share, when applicable, reflects the potential dilution that could occur if stock options, restricted stock, or other common stock equivalents were exercised or converted into common stock. The dilutive effect of stock options or other common stock equivalents is calculated using the treasury stock method. The following is a reconciliation of the numerator and denominator used to calculate basic earnings (loss) per common share and diluted earnings (loss) per common share for the three and nine months ended September 30, 2020, and 2019: For the Three Months Ended For the Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Net income (loss) $ 6,219 $ 8,682 $ (72,669) $ (11,078) Weighted average shares outstanding: Basic 29,829 29,077 29,796 29,009 Dilutive effect of restricted stock units 2 50 — — Diluted 29,831 29,127 29,796 29,009 Earnings (loss) per share: Basic $ 0.21 $ 0.30 $ (2.44) $ (0.38) Diluted $ 0.21 $ 0.30 $ (2.44) $ (0.38) For the three months ended September 30, 2020, and 2019, respectively, 1,192 and 562 restricted stock units used to purchase shares of common stock were not considered in calculating diluted earnings per share as their effect would have been anti-dilutive. For the nine months ended September 30, 2020 and 2019, respectively, 1,529 and 776 restricted stock units were not considered in calculating diluted loss per share because the Company was in a loss position and, therefore, the effect would have been anti-dilutive. |
TREASURY STOCK
TREASURY STOCK | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
TREASURY STOCK | TREASURY STOCK During the fourth quarter of 2015, the Company’s board of directors authorized the repurchase of up to $20,000 of the Company’s outstanding common stock with no expiration date (the “2015 Stock Repurchase Program”). On March 11, 2019, the Company's board of directors authorized the cancellation of the 2015 Stock Repurchase Program, and authorized a new stock repurchase program of up to $20,000 of the Company's outstanding common stock (the “2019 Stock Repurchase Program”). During the three and nine months ended September 30, 2020, the Company did not purchase any shares of the Company's common stock. During the three months ended September 30, 2019, the Company did not purchase any shares of the Company's common stock. During the nine months ended September 30, 2019, the Company purchased 72 shares of the Company's common stock under the 2015 Stock Repurchase Program for total consideration of $722 with a weighted average price of $10 per share, which included commissions and processing fees totaling $2. As of September 30, 2020, and December 31, 2019, a total of $20,000 remained authorized for the repurchase of the Company's outstanding common stock under the 2019 Stock Repurchase Program. The consideration paid has been recorded within stockholders’ equity in the condensed consolidated balance sheet. |
LEASES
LEASES | 9 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
LEASES | LEASESThe Company has operating leases for offices, retail stores, and warehouse space that expire through 2027. The Company’s leases have remaining lease terms of 4 months to 7.3 years, some of which include options to extend the leases up to 10 years. For the three and nine months ended September 30, 2020, rent expense was $905 and $2,924, respectively. For the three and nine months ended September 30, 2019, rent expense was $1,123 and $2,775, respectively. Rent expense is recognized on a basis which approximates straight-line over the lease term and is recorded as a component of selling, general, and administrative expense on the condensed consolidated statement of operations. As of September 30, 2020, the Company had a weighted-average remaining lease term of 4.5 years and a weighted-average discount rate used to calculate the lease liability of 4.37%. Future maturities of lease liabilities as of September 30, 2020, were as follows: Remaining of 2020 $ 879 2021 3,321 2022 3,223 2023 2,796 2024 1,858 Thereafter 1,977 Total lease payments 14,054 Less: imputed interest (1,353) Lease liabilities $ 12,701 No other leases have been entered into under which the Company has significant rights and obligations as the lessee except those noted above. |
CONTINGENCIES
CONTINGENCIES | 9 Months Ended |
Sep. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
CONTINGENCIES | CONTINGENCIES Commercial Litigation Dan Dolar, an individual and on behalf of those similarly situated, Plaintiff, v. mophie Inc., a California corporation, Defendant, Superior Court of the State of California, Orange County, Case No. 30-2019-01066228-CU-BT-CXC . On April 25, 2019, Dolar filed a complaint against mophie inc. (“mophie”) alleging, among other things, violation of California Consumers Legal Remedies Act, California False Advertising Law, breach of express warranty, violation of the Magnuson-Moss Warranty Act, violation of California Unfair Competition Law, and violation of state Consumer Protection Statutes. The complaint alleged that mophie mischaracterizes the mAh ratings of the batteries in its products, and asked the court to certify a class of Californians who purchased mophie battery-enabled products. On June 14, 2019, the court dismissed the complaint without prejudice at Dolar’s request so that Dolar’s claims could be pursued in the U.S. District Court in the case of Young v. mophie Inc. , Case No. 8:19-cv-00827-JVS-DFM, discussed below. Michael Young and Dan Dolar, individually and on behalf of other similarly situated individuals, Plaintiff, v. mophie Inc., Defendant, U.S. District Court, Central District of California, Case No. 8:19-cv-00827-JVS-DFM. This action started with a complaint filed by Young against mophie on May 2, 2019. On June 13, 2019, Young and Dolar joined together as plaintiffs and filed a first amended complaint (the “FAC”). In the FAC, Young and Dolar allege, among other things, that mophie has engaged in unfair and deceptive acts and practices in violation of California and Florida laws, violation of purportedly material identical state consumer protection statutes in various other states, violation of the Magnuson-Moss Warranty Act, breach of express warranty, and unjust enrichment. The FAC is based on Young’s and Dolar’s allegation that mophie mischaracterizes the mAh ratings of the batteries in certain of its products. Young and Dolar seek to certify a class of consumers nationwide and in various states who purchased mophie battery-enabled products. The FAC does not specify an amount of damages claimed, but alleges that damages will be in excess of $5,000. mophie denies that it has engaged in the alleged practices, and intends to vigorously defend the lawsuit. On October 1, 2020, the parties entered into a written settlement agreement. Pursuant to this agreement, mophie will pay a nominal service award to Young and Dolar, reimburse their counsel for up to $325 in attorney fees, costs and expenses, and agrees to entry of a permanent injunction ordering changes to its package labeling and advertising practices for certain battery products. There is currently pending a motion for court approval of the parties’ settlement agreement. SEC Investigation In September 2020, the Company received a subpoena from the SEC seeking documents related to certain sales transactions from late 2018, the inventory write down disclosed in the Company’s May 28, 2020 Form 10-Q, and related accounting practices and guidance. The Company has been cooperating and intends to continue cooperating fully with the SEC’s investigation. Following receipt of the subpoena, the Company began an internal investigation with the assistance of outside counsel and forensic accountants. The investigation is ongoing and is being directed by the Audit Committee. At this time, the Company is unable to predict the outcome of this matter or provide meaningful quantification of how the final resolution of this matter may impact its future consolidated financial statements, results of operations, or cash flows. Other Litigation The Company is not a party to any other material litigation or claims at this time. While the Company currently believes that the amount of any ultimate probable loss for known matters would not be material to the Company’s financial condition, the outcome of these actions is inherently difficult to predict. In the event of an adverse outcome, the ultimate potential loss could have a material adverse effect on the Company’s financial condition or results of operations in a particular period. The Company establishes reserves when a particular contingency is probable and estimable. The Company has accrued estimated liabilities of $400 and $750 in the condensed consolidated balance sheets as of September 30, 2020, and December 31, 2019, respectively. |
CONCENTRATIONS
CONCENTRATIONS | 9 Months Ended |
Sep. 30, 2020 | |
Risks and Uncertainties [Abstract] | |
CONCENTRATIONS | CONCENTRATIONS Concentration of credit risk Financial instruments which potentially subject the Company to concentrations of credit risk consist principally of cash and accounts receivable. The Company places its cash with high credit quality financial institutions. The Company maintains its cash in bank deposit accounts, which customarily exceed federally insured limits. The Company has not experienced any losses in cash accounts for the nine months ended September 30, 2020, and 2019. As of September 30, 2020, and December 31, 2019, accounts receivable for Best Buy Co., Inc. (“Best Buy”) and Verizon Wireless (“Verizon”) exceeded 10% of the Company's aggregate accounts receivable. The amount of accounts receivable for each of these customers are outlined as follows: September 30, 2020 December 31, 2019 Best Buy 16% 14% Verizon 13% 24% Other than the customers noted in the table above, no other customer account balances exceeded 10% of the Company's aggregate accounts receivable as of September 30, 2020, and December 31, 2019. If one or more of the Company’s significant customers were to become insolvent or were otherwise unable to pay for the products provided, it could have a material adverse effect on the Company’s financial condition and results of operations. Concentration of net sales For the three and nine months ended September 30, 2020, purchases by Best Buy exceeded 10% of net sales. For the nine months ended September 30, 2020, and for the three and nine months ended September 30, 2019, purchases by Verizon exceeded 10% of net sales. The amount of net sales for each of these customers are outlined as follows: For the Three Months Ended For the Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Best Buy 14% 9% 11% 9% Verizon 9% 23% 15% 15% For the three and nine months ended September 30, 2020, and 2019, no other customers exceeded 10% of net sales. Although the Company has contracts in place governing the relationships with its retail distribution customers (“Retailers”), the contracts are not long-term and all Retailers generally purchase from the Company using purchase orders. As a result, these Retailers generally may, with little or no notice or penalty, cease ordering and selling the Company’s products, or materially reduce their orders. If any of these Retailers cease selling the Company’s products, slow their rate of purchase of its products, or decrease the number of products they purchase, the Company’s results of operations could be adversely affected. |
NATURE OF OPERATIONS AND BASI_2
NATURE OF OPERATIONS AND BASIS OF PRESENTATION (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Use of estimates | The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting periods, with related disclosures of these amounts in the notes to the financial statements. Actual results could differ from those estimates. |
Significant Accounting Policies | Adoption of Accounting Standards Codification (“ASC”) Topic 326, “Financial Instruments - Credit Losses” The Company adopted ASC Topic 326 ,“Financial Instruments - Credit Losses” (“Topic 326”) with a date of initial application of January 1, 2020. As a result of this adoption, the Company has changed its accounting policy for estimating allowance for credit losses on its accounts receivable, as detailed below. The Company applied Topic 326 prospectively by recording a cumulative effect adjustment in retained earnings beginning January 1, 2020, which allows for the application of the standard solely to the transition period in 2020 but does not require application to prior fiscal comparative periods presented. Therefore, the prior period comparative information has not been adjusted and continues to be reported under the previous incurred credit loss allowance methodology. The adoption of Topic 326 |
Allowance for credit losses accounting policy | Allowance for credit losses accounting policy The Company estimates the allowance for credit losses in relation to accounts receivable based on relevant qualitative and quantitative information about historical events, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported accounts receivable. Topic 326 permits different methods to calculate the estimate for the allowance for credit losses. The Company started with its historical loss experience as suggested by Topic 326 and evaluated its previous method of estimating the allowance for credit losses. The Company determined that its previous method of using an aging schedule to develop historical credit loss percentages, which is allowed under Topic 326, is appropriate. The historical credit loss percentages are developed for each aging category based on eight quarters of credit loss history and the Company determined that its customers in each of these aging categories share similar risk characteristics. Additionally, as required by Topic 326, the Company adjusts the historical credit loss percentage by current and forecasted economic conditions. Due to the short-term nature of its accounts receivable and that it carries credit insurance on a significant portion of the accounts receivable balance, the Company believes changes to economic conditions may not have significant effect on the estimate of the allowance for credit losses for accounts receivable; thus, the Company determined to include a baseline credit loss percentage into the historical credit loss percentage for each aging category to reflect the potential impact of the current and future economic conditions. Such baseline credit loss is adjusted when changes in the economic environment change the Company's expectation for future credit losses. As of September 30, 2020, the Company determined the baseline of credit loss percentage should be increased in response to the COVID-19 pandemic and estimated the allowance for credit losses to be $1,088. |
REVENUE (Tables)
REVENUE (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | The percentage of net sales related to the Company’s key product lines for the three and nine months ended September 30, 2020, and 2019, was a pproximately as follows: For the Three Months Ended For the Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Protection (screen protection and cases) 63% 59% 60% 57% Power (power management and power cases) 26% 31% 28% 31% Productivity (keyboards and other) 6% 7% 9% 8% Audio 5% 3% 3% 4% During the three and nine months ended September 30, 2020, the Company revised the online channel to include sales to a key direct-to-consumer customer whose sales were included within the indirect channel in prior periods. The Company also made the same change to 2019 net sales by key distribution channels to make the net sales comparable. The percentage of net sales related to the Company’s key distribution channels for the three and nine months ended September 30, 2020, and 2019, was approximately as follows: For the Three Months Ended For the Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Indirect channel 84% 86% 82% 82% Online 12% 9% 14% 12% Franchisees 4% 5% 4% 6% The percentage of net sales related to the Company’s key geographic regions for the three and nine months ended September 30, 2020, an d 2019, wa s approximately as follows: For the Three Months Ended For the Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 United States 74% 79% 78% 75% Europe 19% 12% 16% 13% Other 7% 9% 6% 12% |
Schedule of Receivables, Right of Return Assets, Contract Liabilities, Refund Liabilities, and Warranty Liabilities | The following table provides information about receivables, right of return assets, contract liabilities, refund liabilities, and warranty liabilities from the Company’s contracts with customers as of September 30, 2020, and December 31, 2019: September 30, 2020 December 31, 2019 Receivables, which comprises the balance in accounts receivable, net of allowances $ 91,196 $ 142,804 Right of return assets, which are included in prepaid expenses and other current assets 431 2,177 Refund liabilities, which are included in sales return liability 23,175 39,790 Warranty liabilities, which are included in sales return liability 2,493 4,063 Contract liabilities, which are included in accrued liabilities 30 39 |
Schedule of Warrant Liabilities Activity | The following table summarizes the activities in the Company’s warranty liabilities for the nine months ended September 30, 2020, and 2019: For the Nine Months Ended September 30, 2020 September 30, 2019 Balance at beginning of period $ 4,063 $ 4,646 Accrual for product warranty 3,372 7,858 Warranty claims charged (4,943) (8,581) Foreign currency translation gain 1 — Balance at end of period $ 2,493 $ 3,923 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Inventory Disclosure [Abstract] | |
Schedule of inventories | Inventories consisted of the following as of September 30, 2020, and December 31, 2019: September 30, 2020 December 31, 2019 Finished goods $ 78,702 $ 142,054 Raw materials 1,322 2,890 Total inventories $ 80,024 $ 144,944 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | Property and equipment, net consisted of the following as of September 30, 2020, and December 31, 2019: Useful Lives September 30, 2020 December 31, 2019 Equipment and molds 3 to 10 years $ 16,471 $ 18,851 Leasehold improvements 1 to 8 years 7,053 7,710 Building and improvements 40 years 2,429 2,429 Computer equipment and software 3 to 5 years 2,266 1,237 Furniture and fixtures 7 years 1,858 1,876 Automobiles 5 years 36 75 Property and equipment, gross 30,113 32,178 Less accumulated depreciation and amortization (14,354) (14,159) Property and equipment, net $ 15,759 $ 18,019 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The following table summarizes the changes in goodwill during the nine months ended September 30, 2020, and the twelve months ended December 31, 2019: For the Nine Months Ended For the Twelve Months Ended September 30, 2020 December 31, 2019 Balance at beginning of period $ 43,569 $ 27,638 Addition in connection with the acquisition of HALO — 15,931 Impairment of goodwill (18,649) — Balance at end of period $ 24,920 $ 43,569 |
Schedule of Long-Lived Intangible Assets, Net of Amortization | Intangible assets, net of accumulated amortization as of September 30, 2020, and December 31, 2019, were as follows: September 30, 2020 Weighted Average Amortization Period December 31, 2019 Weighted Average Amortization Period Trade names $ 21,459 9.7 years $ 25,871 9.7 years Customer relationships 17,742 7.7 years 21,514 7.7 years Patents and technology 12,353 8.4 years 15,306 8.3 years Non-compete agreements 150 4.9 years 419 4.9 years Total intangible assets, net of accumulated amortization $ 51,704 8.3 years $ 63,110 8.3 years |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | Long-term debt, net as of September 30, 2020, and December 31, 2019, was as follows: September 30, 2020 December 31, 2019 Line of credit $ 87,655 $ 107,140 PPP Loan (which comprises the balances in current portion of other long-term liabilities and other long-term liabilities) 9,444 — Total debt outstanding $ 97,099 $ 107,140 Current portion of other long-term liabilities 662 — Total long-term debt outstanding $ 96,437 $ 107,140 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Share-based Compensation, Restricted Stock Units Award Activity | The grant of restricted stock units with respective weighted-average fair value per share for the three and nine months ended September 30, 2020, and 2019, is summarized as follows: For the Three Months Ended For the Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Units Granted 338 75 1,065 718 Weighted average fair value per share $ 2.98 $ 6.59 $ 5.66 $ 9.48 |
Schedule of Stock-Based Compensation Expense Related To Restricted Stock Units | The following are stock-based compensation expenses related to restricted stock units recorded for the three and nine months ended September 30, 2020, and 2019, respectively, which are included as a component of selling, general, and administrative expense on the condensed consolidated statement of operations: For the Three Months Ended For the Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Stock-based compensation expense $ 1,326 $ 631 $ 3,930 $ 3,291 |
EARNINGS (LOSS) PER SHARE (Tabl
EARNINGS (LOSS) PER SHARE (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of reconciliation of the numerator and denominator used to calculate basic earnings (loss) per share and diluted earnings (loss) per share | The following is a reconciliation of the numerator and denominator used to calculate basic earnings (loss) per common share and diluted earnings (loss) per common share for the three and nine months ended September 30, 2020, and 2019: For the Three Months Ended For the Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Net income (loss) $ 6,219 $ 8,682 $ (72,669) $ (11,078) Weighted average shares outstanding: Basic 29,829 29,077 29,796 29,009 Dilutive effect of restricted stock units 2 50 — — Diluted 29,831 29,127 29,796 29,009 Earnings (loss) per share: Basic $ 0.21 $ 0.30 $ (2.44) $ (0.38) Diluted $ 0.21 $ 0.30 $ (2.44) $ (0.38) |
LEASES (Tables)
LEASES (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
Schedule of Future Maturities of Lease Liabilities | Future maturities of lease liabilities as of September 30, 2020, were as follows: Remaining of 2020 $ 879 2021 3,321 2022 3,223 2023 2,796 2024 1,858 Thereafter 1,977 Total lease payments 14,054 Less: imputed interest (1,353) Lease liabilities $ 12,701 |
CONCENTRATIONS (Tables)
CONCENTRATIONS (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Risks and Uncertainties [Abstract] | |
Schedule of concentration risk by accounts receivable | As of September 30, 2020, and December 31, 2019, accounts receivable for Best Buy Co., Inc. (“Best Buy”) and Verizon Wireless (“Verizon”) exceeded 10% of the Company's aggregate accounts receivable. The amount of accounts receivable for each of these customers are outlined as follows: September 30, 2020 December 31, 2019 Best Buy 16% 14% Verizon 13% 24% |
Schedule of concentration risk by net sales | For the three and nine months ended September 30, 2020, purchases by Best Buy exceeded 10% of net sales. For the nine months ended September 30, 2020, and for the three and nine months ended September 30, 2019, purchases by Verizon exceeded 10% of net sales. The amount of net sales for each of these customers are outlined as follows: For the Three Months Ended For the Nine Months Ended September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019 Best Buy 14% 9% 11% 9% Verizon 9% 23% 15% 15% |
NATURE OF OPERATIONS AND BASI_3
NATURE OF OPERATIONS AND BASIS OF PRESENTATION - Narrative (Details) - USD ($) $ in Thousands | 9 Months Ended | ||||||
Sep. 30, 2020 | Jun. 30, 2020 | Jan. 01, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2018 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201911Member | ||||||
Increase (decrease) of retained earnings | $ 122,775 | $ 114,958 | $ 191,479 | $ 161,129 | $ 152,750 | $ 158,491 | |
Accounts receivable, allowance for credit loss | 1,088 | 1,143 | |||||
Cumulative Effect, Period of Adoption, Adjustment | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Increase (decrease) of retained earnings | (359) | (39) | |||||
Retained Earnings | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Increase (decrease) of retained earnings | $ 53,967 | $ 47,748 | 126,995 | $ 101,997 | $ 93,315 | 113,114 | |
Retained Earnings | Cumulative Effect, Period of Adoption, Adjustment | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Increase (decrease) of retained earnings | $ (359) | $ (359) | $ (39) |
REVENUE - Percentage of Net Sal
REVENUE - Percentage of Net Sales (Details) - Revenue from Contract with Customer | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Product Concentration Risk | Protection (screen protection and cases) | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of sales | 63.00% | 59.00% | 60.00% | 57.00% |
Product Concentration Risk | Power (power management and power cases) | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of sales | 26.00% | 31.00% | 28.00% | 31.00% |
Product Concentration Risk | Productivity (keyboards and other) | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of sales | 6.00% | 7.00% | 9.00% | 8.00% |
Product Concentration Risk | Audio | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of sales | 5.00% | 3.00% | 3.00% | 4.00% |
Distribution Channel Concentration Risk | Indirect channel | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of sales | 84.00% | 86.00% | 82.00% | 82.00% |
Distribution Channel Concentration Risk | Online | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of sales | 12.00% | 9.00% | 14.00% | 12.00% |
Distribution Channel Concentration Risk | Franchisees | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of sales | 4.00% | 5.00% | 4.00% | 6.00% |
Geographic Concentration Risk | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of sales | 74.00% | 79.00% | 78.00% | 75.00% |
Geographic Concentration Risk | Europe | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of sales | 19.00% | 12.00% | 16.00% | 13.00% |
Geographic Concentration Risk | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of sales | 7.00% | 9.00% | 6.00% | 12.00% |
REVENUE - Contract With Custome
REVENUE - Contract With Customers (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Revenue from Contract with Customer [Abstract] | ||
Receivables, which comprises the balance in accounts receivable, net of allowances | $ 91,196 | $ 142,804 |
Right of return assets, which are included in prepaid expenses and other current assets | 431 | 2,177 |
Refund liabilities, which are included in sales return liability | 23,175 | 39,790 |
Warranty liabilities, which are included in sales return liability | 2,493 | 4,063 |
Contract liabilities, which are included in accrued liabilities | $ 30 | $ 39 |
REVENUE - Warranty Liability Ac
REVENUE - Warranty Liability Activity (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Movement in Standard and Extended Product Warranty Accrual, Increase (Decrease) [Roll Forward] | ||
Beginning balance | $ 4,063 | $ 4,646 |
Accrual for product warranty | 3,372 | 7,858 |
Warranty claims charged | (4,943) | (8,581) |
Foreign currency translation gain | 1 | 0 |
Ending balance | $ 2,493 | $ 3,923 |
ACQUISITION OF HALO (Details)
ACQUISITION OF HALO (Details) - HALO $ in Thousands | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Earnout Consideration | |
Restructuring Cost and Reserve [Line Items] | |
Business combination, contingent consideration payment | $ 4,089 |
Third Party Indemnification Liability | |
Restructuring Cost and Reserve [Line Items] | |
Business combination, contingent consideration payment | $ 2,130 |
INVENTORIES - Schedule Of Inven
INVENTORIES - Schedule Of Inventories (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 78,702 | $ 142,054 |
Raw materials | 1,322 | 2,890 |
Total inventories | $ 80,024 | $ 144,944 |
INVENTORIES - Narrative (Detail
INVENTORIES - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Sep. 30, 2020 | Dec. 31, 2019 | |
Inventory [Line Items] | |||
Inventory deposits with third-party manufacturers | $ 4,961 | $ 148 | |
COVID-19 | |||
Inventory [Line Items] | |||
Inventory write-down | $ 44,833 |
PROPERTY AND EQUIPMENT - Narrat
PROPERTY AND EQUIPMENT - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |||||
Impairment of long-lived assets to be disposed of | $ 2,535 | ||||
Depreciation | $ 1,733 | $ 1,803 | $ 5,177 | $ 4,994 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Dec. 31, 2019 | |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 30,113 | $ 32,178 |
Less accumulated depreciation and amortization | (14,354) | (14,159) |
Property and equipment, net | 15,759 | 18,019 |
Equipment and molds | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 16,471 | 18,851 |
Equipment and molds | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives | 3 years | |
Equipment and molds | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives | 10 years | |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 7,053 | 7,710 |
Leasehold improvements | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives | 1 year | |
Leasehold improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives | 8 years | |
Building and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives | 40 years | |
Property and equipment, gross | $ 2,429 | 2,429 |
Computer equipment and software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 2,266 | 1,237 |
Computer equipment and software | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives | 3 years | |
Computer equipment and software | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives | 5 years | |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives | 7 years | |
Property and equipment, gross | $ 1,858 | 1,876 |
Automobiles | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives | 5 years | |
Property and equipment, gross | $ 36 | $ 75 |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Finite-Lived Intangible Assets [Line Items] | |||||
Change in goodwill | $ 0 | $ 0 | $ 0 | $ 15,931,000 | |
Impairment of goodwill | 0 | 0 | (18,649,000) | $ 0 | $ 0 |
Increase in intangible assets | 0 | 0 | 0 | ||
Loss on disposition of intangible assets | (1,148,000) | ||||
Impairment of finite-lived intangible asset | $ 0 | $ 0 | $ 0 | 0 | |
HALO | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Increase in intangible assets | $ 28,061,000 |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS - Goodwill Reconciliation (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Goodwill [Roll Forward] | |||||
Goodwill, beginning balance | $ 43,569,000 | $ 27,638,000 | $ 27,638,000 | ||
Addition in connection with the acquisition of HALO | $ 0 | $ 0 | 0 | 15,931,000 | |
Impairment of goodwill | 0 | $ 0 | (18,649,000) | $ 0 | 0 |
Goodwill, ending balance | $ 24,920,000 | $ 24,920,000 | $ 43,569,000 |
GOODWILL AND INTANGIBLE ASSET_4
GOODWILL AND INTANGIBLE ASSETS - Long-lived Intangible Assets, Net of Amortization (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Dec. 31, 2019 | |
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets, net of accumulated amortization | $ 51,704 | $ 63,110 |
Weighted Average Amortization Period | 8 years 3 months 18 days | 8 years 3 months 18 days |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets, net of accumulated amortization | $ 21,459 | $ 25,871 |
Weighted Average Amortization Period | 9 years 8 months 12 days | 9 years 8 months 12 days |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets, net of accumulated amortization | $ 17,742 | $ 21,514 |
Weighted Average Amortization Period | 7 years 8 months 12 days | 7 years 8 months 12 days |
Patents and technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets, net of accumulated amortization | $ 12,353 | $ 15,306 |
Weighted Average Amortization Period | 8 years 4 months 24 days | 8 years 3 months 18 days |
Non-compete agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets, net of accumulated amortization | $ 150 | $ 419 |
Weighted Average Amortization Period | 4 years 10 months 24 days | 4 years 10 months 24 days |
INCOME TAXES (Details)
INCOME TAXES (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Income Tax Disclosure [Abstract] | ||||
Effective tax rate | 21.00% | 13.00% | 12.00% | 25.00% |
LONG-TERM DEBT - Schedule of Lo
LONG-TERM DEBT - Schedule of Long-term Debt Instruments (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Debt Disclosure [Abstract] | ||
Line of credit | $ 87,655 | $ 107,140 |
PPP Loan (which comprises the balances in current portion of other long-term liabilities and other long-term liabilities) | 9,444 | 0 |
Total debt outstanding | 97,099 | 107,140 |
Current portion of other long-term liabilities | 662 | 0 |
Total long-term debt outstanding | $ 96,437 | $ 107,140 |
LONG-TERM DEBT - Additional Inf
LONG-TERM DEBT - Additional Information (Details) - USD ($) | Apr. 17, 2020 | Apr. 13, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | Apr. 12, 2020 |
Line of Credit Facility [Line Items] | |||||
Payment of debt issuance costs | $ 257,000 | $ 40,000 | |||
Fourth Amendment Agreement | Line of Credit | |||||
Line of Credit Facility [Line Items] | |||||
Maximum borrowing capacity | $ 144,800,000 | $ 125,000,000 | |||
Debt instrument, interest rate, increase (decrease) | 0.50% | ||||
Payment of debt issuance costs | $ 257,000 | ||||
Payment Protection Program Loan | |||||
Line of Credit Facility [Line Items] | |||||
Debt face amount | $ 9,444,000 | ||||
Debt instrument, interest rate, stated percentage | 1.00% | ||||
Debt instrument, periodic payment | $ 398,000 | ||||
Debt instrument, periodic payment terms, balloon payment to be paid | $ 6,441,000 | ||||
Debt instrument, term | 2 years | ||||
Credit And Security Agreement, 2018 | |||||
Line of Credit Facility [Line Items] | |||||
Letters of credit outstanding, amount | 0 | ||||
Credit And Security Agreement, 2018 | Letter of Credit | |||||
Line of Credit Facility [Line Items] | |||||
Line of credit facility, remaining borrowing capacity | $ 57,145,000 |
STOCK-BASED COMPENSATION (Detai
STOCK-BASED COMPENSATION (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Adjustments to additional paid-in capital | $ 41 | $ 314 | $ 887 | |
Withholding tax on restricted stock units recorded in accrued wages and wage related expenses | $ 0 | 39 | 0 | 39 |
Additional Paid-in Capital | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Adjustments to additional paid-in capital | 0 | 41 | 314 | 887 |
Selling, general, and administrative expense | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 1,326 | $ 631 | $ 3,930 | $ 3,291 |
Restricted stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Restricted stock granted (in shares) | 338 | 75 | 1,065 | 718 |
Weighted-average fair value of restricted stock per share (in usd per share) | $ 2.98 | $ 6.59 | $ 5.66 | $ 9.48 |
Restricted stock units | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting period | 9 months | |||
Restricted stock units | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting period | 3 years | |||
Restricted stock units, performance-based | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Restricted stock granted (in shares) | 417 | 287 |
EARNINGS (LOSS) PER SHARE - Rec
EARNINGS (LOSS) PER SHARE - Reconciliation of Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Earnings Per Share [Abstract] | ||||
Net income (loss) | $ 6,219 | $ 8,682 | $ (72,669) | $ (11,078) |
Weighted average shares outstanding: | ||||
Basic (in shares) | 29,829 | 29,077 | 29,796 | 29,009 |
Dilutive effect of restricted stock units and warrants (in shares) | 2 | 50 | 0 | 0 |
Diluted (in shares) | 29,831 | 29,127 | 29,796 | 29,009 |
Earnings (loss) per share: | ||||
Basic (in usd per share) | $ 0.21 | $ 0.30 | $ (2.44) | $ (0.38) |
Diluted (in usd per share) | $ 0.21 | $ 0.30 | $ (2.44) | $ (0.38) |
EARNINGS (LOSS) PER SHARE - Nar
EARNINGS (LOSS) PER SHARE - Narrative (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Earnings Per Share [Abstract] | ||||
Restricted stock (in shares) | 1,192 | 562 | 1,529 | 776 |
TREASURY STOCK (Details)
TREASURY STOCK (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | Mar. 11, 2019 | Dec. 31, 2015 | |
Equity [Abstract] | |||||||
Authorized stock repurchase amount (up to) | $ 20,000,000 | $ 20,000,000 | |||||
Shares repurchased (in shares) | 0 | 0 | 0 | 72,000 | |||
Payments for repurchase of common stock | $ 0 | $ 722,000 | |||||
Weighted average price per share repurchased (in usd per share) | $ 10 | ||||||
Payments for commissions | $ 2,000 | ||||||
Remaining amount authorized under stock repurchase program | $ 20,000,000 | $ 20,000,000 | $ 20,000,000 |
LEASES - Narrative (Details)
LEASES - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Lessee, Lease, Description [Line Items] | ||||
Lease term, option to extend | 10 years | 10 years | ||
Rent expense, under Topic 842 | $ 905 | $ 1,123 | $ 2,924 | $ 2,775 |
Weighted average remaining lease term | 4 years 6 months | 4 years 6 months | ||
Lessee, operating lease, discount rate | 4.37% | 4.37% | ||
Minimum | ||||
Lessee, Lease, Description [Line Items] | ||||
Remaining lease term | 4 months | 4 months | ||
Maximum | ||||
Lessee, Lease, Description [Line Items] | ||||
Remaining lease term | 7 years 3 months 18 days | 7 years 3 months 18 days |
LEASES - Maturities of Operatin
LEASES - Maturities of Operating Lease Liabilities After Adoption of 842 (Details) $ in Thousands | Sep. 30, 2020USD ($) |
Leases [Abstract] | |
Remaining of 2020 | $ 879 |
2021 | 3,321 |
2022 | 3,223 |
2023 | 2,796 |
2024 | 1,858 |
Thereafter | 1,977 |
Total lease payments | 14,054 |
Less: imputed interest | (1,353) |
Lease liabilities | $ 12,701 |
CONTINGENCIES (Details)
CONTINGENCIES (Details) - USD ($) | Oct. 01, 2020 | Jun. 13, 2019 | Sep. 30, 2020 | Dec. 31, 2019 |
Loss Contingencies [Line Items] | ||||
Loss contingency accrual | $ 400,000 | $ 750,000 | ||
Young and Dolar | Subsequent Event | ||||
Loss Contingencies [Line Items] | ||||
Reimbursement Paid | $ 325 | |||
Young and Dolar | Minimum | Pending Litigation | ||||
Loss Contingencies [Line Items] | ||||
Estimated damages sought, minimum | $ 5,000,000 |
CONCENTRATIONS - Concentration
CONCENTRATIONS - Concentration of Credit Risk and Concentration of Net Sales (Details) - Customer Concentration Risk | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Accounts Receivable | Best Buy | |||||
Concentration Risk [Line Items] | |||||
Percentage of sales | 16.00% | 14.00% | |||
Accounts Receivable | Verizon | |||||
Concentration Risk [Line Items] | |||||
Percentage of sales | 13.00% | 24.00% | |||
Revenue from Contract with Customer | Best Buy | |||||
Concentration Risk [Line Items] | |||||
Percentage of sales | 14.00% | 9.00% | 11.00% | 9.00% | |
Revenue from Contract with Customer | Verizon | |||||
Concentration Risk [Line Items] | |||||
Percentage of sales | 9.00% | 23.00% | 15.00% | 15.00% |