Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2016shares | |
Document and Entity Information [Abstract] | |
Document Type | 20-F |
Amendment Flag | false |
Document Period End Date | Dec. 31, 2016 |
Entity Registrant Name | Allot Communications Ltd. |
Entity Central Index Key | 1,365,767 |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Period Focus | FY |
Document Fiscal Year Focus | 2,016 |
Entity Filer Category | Accelerated Filer |
Entity Common Stock, Shares Outstanding | 33,057,719 |
Entity Current Reporting Status | Yes |
Entity Well-known Seasoned Issuer | No |
Entity Voluntary Filers | No |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 23,326 | $ 15,470 |
Restricted deposit | 203 | |
Short-term bank deposits | 29,821 | 42,700 |
Available-for-sale marketable securities | 60,507 | 64,921 |
Trade receivables (net of allowance for doubtful accounts of $ 924 and $ 657 at December 31, 2016 and 2015, respectively) | 24,158 | 23,874 |
Other receivables and prepaid expenses | 3,879 | 4,513 |
Inventories | 7,235 | 10,169 |
Total current assets | 148,926 | 161,850 |
NON-CURRENT ASSETS: | ||
Severance pay fund | 252 | 282 |
Deferred taxes | 267 | 501 |
Other assets | 1,136 | 2,712 |
Total non-current assets | 1,655 | 3,495 |
PROPERTY AND EQUIPMENT, NET | 4,387 | 5,189 |
INTANGIBLE ASSETS, NET | 4,410 | 6,119 |
GOODWILL | 31,562 | 31,562 |
Total assets | 190,940 | 208,215 |
CURRENT LIABILITIES: | ||
Trade payables | 3,275 | 7,107 |
Employees and payroll accruals | 7,381 | 8,211 |
Deferred revenues | 11,133 | 14,066 |
Other payables and accrued expenses | 3,157 | 5,710 |
Total current liabilities | 24,946 | 35,094 |
LONG-TERM LIABILITIES: | ||
Deferred revenues | 3,597 | 4,912 |
Accrued severance pay | 592 | 651 |
Other long-term liability | 4,502 | 4,153 |
Total long-term liabilities | 8,691 | 9,716 |
COMMITMENTS AND CONTINGENT LIABILITIES | ||
SHAREHOLDERS' EQUITY: | ||
Ordinary shares of NIS 0.1 par value - Authorized: 200,000,000 shares at December 31, 2016 and 2015; Issued: 33,873,719 and 33,583,102 shares at December 31, 2016 and 2015, respectively; Outstanding: 33,057,719 and 33,558,102 shares at December 31, 2016 and 2015, respectively | 843 | 837 |
Additional paid-in capital | 264,782 | 259,385 |
Treasury stock at cost - 816,000 and 25,000 shares at December 31, 2016 and 2015, respectively | (3,998) | (166) |
Accumulated other comprehensive loss | (149) | (470) |
Accumulated deficit | (104,175) | (96,181) |
Total shareholders' equity | 157,303 | 163,405 |
Total liabilities and shareholders' equity | $ 190,940 | $ 208,215 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) $ in Thousands | Dec. 31, 2016USD ($)shares | Dec. 31, 2015USD ($)shares |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ | $ 924 | $ 657 |
Ordinary shares, shares authorized | 200,000,000 | 200,000,000 |
Ordinary shares, shares issued | 33,873,719 | 33,583,102 |
Ordinary shares, shares outstanding | 33,057,719 | 33,558,102 |
Treasury stock, shares | 816,000 | 25,000 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Revenues: | |||
Products | $ 54,432 | $ 62,642 | $ 77,240 |
Services | 35,937 | 37,325 | 39,946 |
Total revenues | 90,369 | 99,967 | 117,186 |
Cost of revenues: | |||
Products | 20,401 | 26,707 | 27,389 |
Services | 7,494 | 6,720 | 7,350 |
Total cost of revenues | 27,895 | 33,427 | 34,739 |
Gross profit | 62,474 | 66,540 | 82,447 |
Operating expenses: | |||
Research and development (net of grant participations of $ 606, $ 1,252 and $ 984 for the years ended December 31, 2016, 2015 and 2014, respectively) | 24,221 | 26,422 | 29,014 |
Sales and marketing | 35,290 | 43,318 | 44,599 |
General and administrative | 9,812 | 12,702 | 11,941 |
Total operating expenses | 69,323 | 82,442 | 85,554 |
Operating loss | (6,849) | (15,902) | (3,107) |
Financial income (expense), net | 1,059 | (584) | 660 |
Loss before income tax expense | (5,790) | (16,486) | (2,447) |
Income tax expense | 2,204 | 3,356 | 50 |
Net loss | (7,994) | (19,842) | (2,497) |
Unrealized gain (loss) on available-for-sale marketable securities | 337 | (261) | (205) |
Unrealized gain (loss) on foreign currency cash flow hedges transactions | (16) | 1,411 | (1,781) |
Total comprehensive loss | $ (7,673) | $ (18,692) | $ (4,483) |
Net loss per share: | |||
Basic and diluted | $ (0.24) | $ (0.59) | $ (0.08) |
Weighted average number of shares used in per share computations of net loss: | |||
Basic and diluted | 33,202,309 | 33,419,917 | 33,143,168 |
CONSOLIDATED STATEMENTS OF COM5
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Statement [Abstract] | |||
Grants participations excluded from research and development costs | $ 606 | $ 1,252 | $ 984 |
STATEMENTS OF CHANGES IN SHAREH
STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Ordinary shares [Member] | Additional paid-in capital [Member] | Treasury Stock [Member] | Accumulated other comprehensive income (loss) [Member] | Accumulated deficit [Member] | Total | ||
Balance at Dec. 31, 2013 | $ 774 | $ 242,629 | $ 366 | $ (73,842) | $ 169,927 | |||
Balance, shares at Dec. 31, 2013 | 32,877,118 | |||||||
Exercise of stock options | $ 45 | 1,431 | $ 1,476 | |||||
Exercise of stock options, shares | 442,805 | 353,368 | ||||||
Stock-based compensation | 8,060 | $ 8,060 | ||||||
Other comprehensive income (loss) | (1,986) | (1,986) | ||||||
Net loss | (2,497) | (2,497) | ||||||
Balance at Dec. 31, 2014 | $ 819 | 252,120 | (1,620) | (76,339) | $ 174,980 | |||
Balance, shares at Dec. 31, 2014 | 33,319,923 | 33,319,923 | ||||||
Exercise of stock options | $ 18 | 114 | $ 132 | |||||
Exercise of stock options, shares | 263,179 | 103,267 | ||||||
Treasury stock acquired, net | [1] | (166) | $ (166) | |||||
Treasury stock acquired, net, shares | (25,000) | [1] | (25,000) | |||||
Stock-based compensation | 7,151 | $ 7,151 | ||||||
Other comprehensive income (loss) | 1,150 | 1,150 | ||||||
Net loss | (19,842) | (19,842) | ||||||
Balance at Dec. 31, 2015 | $ 837 | 259,385 | (166) | (470) | (96,181) | $ 163,405 | ||
Balance, shares at Dec. 31, 2015 | 33,558,102 | 33,558,102 | ||||||
Exercise of stock options | $ 6 | 236 | $ 242 | |||||
Exercise of stock options, shares | 290,617 | 138,157 | ||||||
Treasury stock acquired, net | [1] | (3,832) | $ (3,832) | |||||
Treasury stock acquired, net, shares | (791,000) | [1] | (791,000) | |||||
Stock-based compensation | 5,161 | $ 5,161 | ||||||
Other comprehensive income (loss) | 321 | 321 | ||||||
Net loss | (7,994) | (7,994) | ||||||
Balance at Dec. 31, 2016 | $ 843 | $ 264,782 | $ (3,998) | $ (149) | $ (104,175) | $ 157,303 | ||
Balance, shares at Dec. 31, 2016 | 33,057,719 | 33,057,719 | ||||||
[1] | Including acquisition expenses of $ 5 and $ 35 for the years ended December 31, 2016 and 2015, respectively. |
STATEMENTS OF CHANGES IN SHARE7
STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Accumulated other comprehensive loss: | |||
Accumulated unrealized loss on available-for-sale marketable securities | $ (88) | $ (425) | $ (164) |
Accumulated unrealized loss on foreign currency cash flows hedge transactions | (61) | (45) | (1,456) |
Accumulated other comprehensive loss | (149) | (470) | $ (1,620) |
Issuance costs for issuance of shares capital related to secondary offering | $ 5 | $ 35 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Cash flows from operating activities: | |||
Net loss | $ (7,994) | $ (19,842) | $ (2,497) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | |||
Depreciation and amortization | 4,043 | 5,708 | 5,166 |
Impairment of intangible assets | 5,777 | ||
Stock-based compensation | 5,141 | 7,170 | 8,095 |
Capital loss | 24 | 328 | |
Increase (decrease) in accrued severance pay, net | (29) | 349 | (8) |
Decrease in other assets | 1,576 | 1,205 | 100 |
Decrease in accrued interest and amortization of premium on marketable securities | 1,238 | 967 | 793 |
Increase in trade receivables | (284) | (847) | (6,851) |
Decrease (increase) in other receivables and prepaid expenses | 699 | (2,623) | (1,321) |
Decrease (increase) in inventories | 2,934 | (60) | 3,689 |
Decrease (increase) in long-term deferred taxes, net | 234 | 1,403 | (224) |
Increase (decrease) in trade payables | (3,832) | 2,218 | 3,109 |
Increase (decrease) in employees and payroll accruals | (811) | 901 | 1,073 |
Increase (decrease) in deferred revenues | (4,248) | 1,961 | 1,911 |
Increase (decrease) in other payables and accrued expenses | (2,155) | (429) | 2,800 |
Net cash provided by (used in) operating activities | (3,464) | 4,186 | 15,835 |
Cash flows from investing activities: | |||
Redemption of (Investment in) restricted cash | 203 | (203) | |
Redemption of (Investment in) short-term deposits | 12,879 | 16,300 | (21,000) |
Purchase of property and equipment | (1,582) | (2,223) | (3,391) |
Investment in available-for sale marketable securities | (29,695) | (34,098) | (22,736) |
Proceeds from redemption or sale of marketable securities | 33,208 | 22,221 | 8,266 |
Proceeds from sale of property and equipment | 26 | ||
Loan granted to third party | (2,735) | ||
Repayment of loan to third party | 652 | ||
Acquisition of Optenet, net of cash (see schedule A below) | (9,859) | ||
Net cash (used in) provided by investing activities | 15,039 | (7,862) | (40,944) |
Cash flows from financing activities: | |||
Proceeds from exercise of stock options | 113 | 132 | 1,476 |
Purchase of treasury stock, net | (3,832) | (166) | |
Net cash provided by (used in) financing activities | (3,719) | (34) | 1,476 |
Increase (decrease) in cash and cash equivalents | 7,856 | (3,710) | (23,633) |
Cash and cash equivalents at the beginning of the year | 15,470 | 19,180 | 42,813 |
Cash and cash equivalents at the end of the year | 23,326 | 15,470 | 19,180 |
Supplementary cash flow information: | |||
Taxes | 175 | 139 | 82 |
Estimated net fair value of assets acquired and liabilities assumed at the date of acquisition was as follows: | |||
Working capital, net (excluding cash and cash equivalents) | (204) | ||
Equipment and other assets | 152 | ||
Intangible assets | 7,242 | ||
Goodwill | 10,748 | ||
Total consideration | 17,938 | ||
Non cash consideration | (8,079) | ||
Payment for acquisition, net of cash | $ 9,859 |
GENERAL
GENERAL | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
GENERAL | NOTE 1:- GENERAL a. Allot Communications Ltd. (the "Company") was incorporated in November 1996 under the laws of the State of Israel. The Company is engaged in developing, selling and marketing intelligent service optimization and monetization solutions for mobile, fixed and cloud service providers, and enterprises. The Company’s flexible and highly scalable service delivery framework, in the form of hardware platforms and software applications, leverages the intelligence in data networks enabling service providers to get closer to their customers; to safeguard network assets and users; and to accelerate time-to-revenue for value-added services. The Company's products consist of the Service Gateway and NetEnforcer service delivery platforms, the NetXplorer and Subscriber Management Platform network management and provisioning suites and value added services such as WebSafe Personal and Business Security solution, Service Protector network protection solution, ClearSee for Network analytics and MediaSwift E and VideoClass for media optimization. The Company's Ordinary Shares are listed in the NASDAQ Global Select Market under the symbol "ALLT" from its initial public offering in November 2006. Since November, 2010, the Company's Ordinary Shares have been listed for trading in the Tel Aviv Stock Exchange as well. The Company holds twelve wholly-owned subsidiaries (the Company together with said subsidiaries shall collectively be referred to as "Allot"): Allot Communications, Inc. in Woburn, Massachusetts, United-States (the "U.S. subsidiary"), which was incorporated in 1997 under the laws of the State of California, Allot Communication Europe SARL in Sophia, France (the "European subsidiary"), which was incorporated in 1998 under the laws of France, Allot Communications Japan K.K. in Tokyo, Japan (the "Japanese subsidiary"), which was incorporated in 2004 under the laws of Japan, Allot Communication (UK) Limited (the "UK subsidiary"), which was incorporated in 2006 under the laws of England and Wales, Allot Communications (Asia Pacific) Pte. Ltd. ("the Singaporean subsidiary"), which was incorporated in 2006 under the laws of Singapore, Allot Communications (New Zealand) Limited. (the "NZ subsidiary"), which was incorporated in 2007 under the laws of New Zealand, Allot India Private Limited. (the "Indian subsidiary”), which was incorporated in 2012 under the laws of India and commenced its activity in 2013, Allot Communications Africa (PTY) Ltd. (the "African subsidiary”), which was incorporated in 2013 under the laws of South Africa, Allot Communications (Hong Kong) Limited (the "HK subsidiary”), which was incorporated in 2013 under the laws of Hong-Kong, Allot Communications Spain, S.L. Sociedad Unipersonal (the "Spanish subsidiary”), which was incorporated in 2015 under the laws of Spain, Allot Communications (Colombia) S.A.S (the "Colombian subsidiary”), which was incorporated in 2015 under the laws of Colombia and Allot MexSub (the "Mexican subsidiary"), which was incorporated in 2015 under the laws of Mexico. The U.S. subsidiary is engaged in the sale, marketing and technical support and development services in the Americas of products manufactured and imported by the Company. The European, Japanese, NZ, UK, Singaporean, Indian, HK African, Colombian and Mexican subsidiaries are engaged in marketing and technical support services of the Company's products in Europe, Japan, Oceania, UK, Asia, Africa and Latin America, respectively. The Spanish subsidiary commenced its operations in 2015 and is engaged in the marketing, technical support and development activities of one of the Company's product lines. b. Acquisition: On March 23, 2015 (the "Optenet acquisition date"), the Company entered into an asset purchase agreement (the "Optenet APA") with the shareholders of Optenet S.A. ("Optenet") a private, global IT security company that develops security solutions for internet service providers and enterprises. The total consideration for the acquisition was $ 17,938, which consisted of $ 9,859 paid in cash and primarily an additional contingent consideration estimated at fair value of $ 8,079 at the Optenet acquisition date. As of December 31, 2016 and 2015, the contingent consideration is estimated at fair value of $ 4,504 and $ 6,102, respectively. The change in fair value of the contingent consideration was recorded as reduction to general and administrative expenses. The contingent consideration is payable over a five year term ending March 23, 2020 based on achievement of certain thresholds of revenues derived from Optenet’s products and has payments cap of $27,500. The obligation in respect of the contingent consideration is presented under Other payables and accrued expenses and Other long-term liability. The acquisition was accounted for using the purchase method of accounting in accordance with ASC No. 805, “Business Combinations” ("ASC No. 805"). Accordingly, the purchase price was allocated according to the estimated fair values of the assets acquired and liabilities assumed and the excess of the purchase price over the net tangible and identified intangible assets was assigned to goodwill. The fair value of intangible assets was determined by management with the assistance of a third party valuation. The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date: Fair value Current assets $ 54 Equipment 152 Deferred revenues (155 ) Current and non-current liabilities (103 ) Technology 4,032 Customer relationships 2,824 Backlog 386 Goodwill 10,748 Net assets acquired $ 17,938 Technology includes security solutions for internet service providers and enterprises such as encompass parental control, anti-malware and anti-spam products. The technology is amortized over the estimated useful life of 4.34 years using the straight line method. Backlog . Customer relationships The Company acquisition transaction costs amounted to $ 397. Unaudited pro forma condensed results of operations: The following represents the unaudited consolidated pro forma revenue and net loss for the years ended December 31, 2015 and 2014, to give effect to the acquisition of Optenet as if it had occurred on January 1, 2014. The pro forma information is not necessarily indicative of the results of operations that would have been had the acquisition actually occurred on January 1, 2014, nor does it purport to represent the results of operations for future periods. Year ended December 31, 2015 2014 Unaudited Revenues $ 100,683 $ 124,244 Net loss $ (21,177 ) $ (17,976 ) c. Cost reduction plans: During the third quarter of 2016, the Company initiated a limited restructuring plan to reduce its operating cost and improve its efficiency, mainly by reducing staff functions and some operations positions, as well as other measures. The restructuring expenses include mainly severance and other compensation related expenses associated with the termination of employment under a restructuring plan. The total restructuring costs in 2016 associated with exiting activities of the Company were $ 1,290 and recorded in operating expenses. As of December 31, 2016, the total liability balance for the restructuring plan was $ 309, mainly due to termination of employment expenses. |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES The consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP"). a. Use of estimates: The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions. The Company's management believes that the estimates, judgments and assumptions used are reasonable based upon information available at the time they are made. These estimates, judgments and assumptions can affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. b. Financial statements in U.S. dollars: The majority of the revenues of the Company and its subsidiaries are generated in U.S. dollars ("dollar") or linked to the dollar. In addition, a major portion of the Company's and certain of its subsidiaries' costs are incurred or determined in dollars. The Company's management believes that the dollar is the currency of the primary economic environment in which the Company and its subsidiaries operate. Thus, the functional and reporting currency of the Company and its subsidiaries is the dollar. Accordingly, monetary accounts maintained in currencies other than the dollar are remeasured into U.S. dollars in accordance with Accounting Standards Codification No. 830, "Foreign Currency Matters" ("ASC No. 830"). All transactions gains and losses from the remeasurement of monetary balance sheet items are reflected in the statements of operations as financial income or expenses as appropriate. c. Principles of consolidation: The consolidated financial statements include the accounts of the Company and its subsidiaries. Intercompany balances and transactions have been eliminated upon consolidation. d. Cash and cash equivalents: The Company considers all unrestricted highly liquid investments which are readily convertible into cash, with maturity of three months or less at the date of acquisition, to be cash equivalents. e. Restricted deposits: The restricted deposits are held in favor of financial institutions in respect of fulfillments of forward contract and operating obligations. f. Short-term bank deposits: Short-term bank deposits are deposits with maturities of more than three months but less than one year at the balance sheet date. The deposits are in dollars and bear interest at annual weighted average rate of 1.37% and 0.93% at December 31, 2016 and 2015, respectively. g. Marketable securities: The Company accounts for investments in marketable securities in accordance with ASC 320, "Investments - Debt and Equity Securities". Management determines the appropriate classification of its investments in debt securities at the time of purchase and re-evaluates such determinations at each balance sheet date. Marketable securities classified as "available-for-sale" are carried at fair value, based on quoted market prices. Unrealized gains and losses are reported in a separate component of shareholders' equity in accumulated other comprehensive income (loss). Gains and losses are recognized when realized, on a specific identification basis, in the Company's consolidated statements of comprehensive loss. The Company's securities are reviewed for impairment in accordance with ASC 320-10-35. If such assets are considered to be impaired, the impairment charge is recognized in earnings when a decline in the fair value of its investments below the cost basis is judged to be Other-Than-Temporary Impairment (OTTI). Factors considered in making such a determination include the duration and severity of the impairment, the reason for the decline in value, the potential recovery period and the Company's intent to sell, including whether it is more likely than not that the Company will be required to sell the investment before recovery of cost basis. Based on the above factors, the Company concluded that unrealized losses on its available-for-sale securities, for the years ended 2016, 2015 and 2014, were not OTTI. h. Inventories: Inventories are stated at the lower of cost or market value. Inventory write-offs are provided to cover risks arising primarily from end of life products and from slow-moving items, technological obsolescence, and excess inventory. Inventory write-offs during the year ended December 31, 2016, 2015 and 2014 amounted to $ 1,004, $ 775 and $ 4,097, respectively, and were recorded in cost of revenues for products. Inventory write-off provision as of December 31, 2016 and 2015 amounted to $ 1,957 and $ 1,663, respectively. Cost is determined using the weighted average cost method. i. Property and equipment, net: Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is calculated by the straight-line method over the estimated useful lives of the assets at the following annual rates: % Lab equipment 25 - 33 Computers and peripheral equipment 15 - 33 Office furniture 6 - 15 Leasehold improvements Over the shorter of the term of the lease or the useful life of the asset j. Goodwill impairment: Goodwill represents the excess of the purchase price over the fair value of net assets of purchased businesses. Under Accounting Standards Codification No. 350, "Intangibles-Goodwill and Other" ("ASC No. 350"), goodwill is not amortized, but rather subject to an annual impairment test, or more often if there are indicators of impairment present. In accordance with ASC No. 350 the Company performs an annual impairment test at December 31 each year. ASC 350 allows an entity to first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. If the qualitative assessment does not result in a more likely than not indication of impairment, no further impairment testing is required. If it does result in a more likely than not indication of impairment, the two-step impairment test is performed. Alternatively, ASC 350 permits an entity to bypass the qualitative assessment for any reporting unit and proceed directly to performing the first step of the goodwill impairment test. The first step, identifying a potential impairment, compares the fair value of the reporting unit with its carrying amount. If the carrying amount exceeds its fair value, the second step would need to be performed; otherwise, no further step is required. The second step, measuring the impairment loss, compares the implied fair value of the goodwill with the carrying amount of the goodwill. Any excess of the goodwill carrying amount over the applied fair value is recognized as an impairment loss, and the carrying value of goodwill is written down to fair value. The Company operates in a single reportable unit. The Company has performed an annual impairment analysis as of December 31, 2016 and determined that the carrying value of the reporting unit was less than the fair value of the reporting unit. Fair value is determined using market capitalization. During years 2016, 2015 and 2014, no impairment losses were recorded. k. Impairment of long lived assets and intangible assets subject to amortization: Property and equipment and intangible assets subject to amortization are reviewed for impairment in accordance with ASC No. 360, "Accounting for the Impairment or Disposal of Long-Lived Assets," whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Intangible assets acquired in a business combination are recorded at fair value at the date of acquisition. Following initial recognition, intangible assets are carried at cost less any accumulated amortization and any accumulated impairment losses. The useful lives of intangible assets are assessed to be either finite or indefinite. Intangible assets that are not considered to have an indefinite useful life are amortized over their estimated useful lives. Some of the acquired intangible assets are amortized over their estimated useful lives in proportion to the economic benefits realized. This accounting policy results in accelerated amortization of such customer relationships as compared to the straight-line method. All other intangible assets are amortized over their estimated useful lives on a straight-line basis. During the years ended December 31, 2016 and 2014, no impairment losses were recorded. During 2015, the Company recorded impairment loss (see Note 9). l. Revenue recognition: The Company generates revenues mainly from selling its products along with related maintenance and support services. At times, these arrangements may also include professional services, such as installation services or training. The Company generally sells its products through resellers, distributors, OEMs and system integrators, all of whom are considered end-users. Revenues from product sales are recognized when persuasive evidence of an agreement exists, title and risk of loss have transferred, no significant performance obligations remain, product payment is not contingent upon performance of installation or service obligations, the fee is fixed or determinable and collectability is probable. In instances where acceptance of the product or service is specified by the customer, revenue recognition is deferred until all acceptance criteria have been met. Maintenance and support related revenues included in multiple element arrangements are deferred and recognized on a straight-line basis over the term of the applicable maintenance and support agreement. Other services are recognized upon the completion of installation or when the service is provided. In instances where the services provided in a multiple element arrangement are considered essential to the functionality of the product and payment of the product is contingent upon performance of the services, the sales of the products and services would be considered one unit of accounting. Pursuant to the guidance of ASU 2009-13, "Multiple-Deliverable Revenue Arrangements, (amendments to ASC Topic 605, Revenue Recognition)" (ASU 2009-13) and ASU 2009-14, when a sales arrangement contains multiple elements, such as products and services, the Company allocates revenues to each element based on a selling price hierarchy. The selling price for a deliverable is based on VSOE if available, third party evidence ("TPE") if VSOE is not available, or estimated selling price ("ESP") if neither VSOE nor TPE is available. In multiple element arrangements, revenues are allocated to each separate unit of accounting for each of the deliverables using the relative selling prices of each of the deliverables in the arrangement based on the aforementioned selling price hierarchy. Revenue arrangements with multiple deliverables are allocated using the relative selling price method. The Company determines the estimated selling price in multiple elements arrangements as follows: The Company determines the ESP in multiple-element arrangements for the products, based on reviewing historical transactions, and considering several other external and internal factors including, but not limited to, pricing practices including discounting and competition. The Company determines the selling price for maintenance and support based on VSOE of the price charged based on standalone sales (renewals) of such elements using a consistent percentage of the Company's product price lists. Deferred revenues are classified as short and long-term based on their contractual term and recognized as revenues at the time the respective elements are provided The Company records a provision for estimated product returns based on its experience with historical product returns and other known factors. Such provisions amounted to $ 910 and $ 688 as of December 31, 2016 and 2015, respectively. m. Advertising expenses: Advertising expenses are charged to the statement of comprehensive loss, as incurred. Advertising expenses for the years ended December 31, 2016, 2015 and 2014 amounted to $ 1,081, $ 1,201 and $ 1,131, respectively. n. Research and development costs: Accounting Standards Codification No. 985-20, requires capitalization of certain software development costs subsequent to the establishment of technological feasibility. Based on the Company's product development process, technological feasibility is established upon the completion of a working model. The Company does not incur material costs between the completion of a working model and the point at which the products are ready for general release. Therefore, research and development costs are charged to the consolidated statement of comprehensive loss as incurred. o. Severance pay: The liability in Israel for substantially all of the Company`s employees in respect of severance pay liability is calculated in accordance with Section 14 of the Severance Pay Law -1963 (herein- "Section 14"). Section 14 states that Company's contributions for severance pay shall be in line of severance compensation and upon release of the policy to the employee, no additional obligations shall be conducted between the parties regarding the matter of severance pay and no additional payments shall be made by the Company to the employee. Furthermore, the related obligation and amounts deposited on behalf of such obligation under Section 14, are not stated on the balance sheet, because pursuant to current ruling, they are legally released from obligation to employees once the deposits have been paid. There are a limited number of employees in Israel, for whom the Company is liable for severance pay. The Company's liability for severance pay for its Israeli employees was calculated pursuant to Section 14, based on the most recent monthly salary of its Israeli employees multiplied by the number of years of employment as of the balance sheet date for such employees. The Company's liability was partly provided by monthly deposits with severance pay funds and insurance policies and the remainder by an accrual. Severance expense for the years ended December 31, 2016, 2015 and 2014, amounted to $ 1,976, $ 2,286 and $ 2,092, respectively. p. Restructuring costs: The Company accounts for restructuring activities in accordance to ASC 712 "Compensation-Nonretirement Postemployment Benefits" ("ASC 712"), which requires that a liability for a cost associated with a contractual postemployment benefits be recognized and measured, initially at fair value, only when it is probable that the employees will be entitled to the benefits and the amount is estimable. q. Accounting for stock-based compensation: The Company accounts for stock based compensation in accordance with Accounting Standards Codification No. 718, "Compensation - Stock Compensation" ("ASC No. 718") that requires companies to estimate the fair value of equity-based payment awards on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as an expense over the requisite service periods in the Company's consolidated statement of comprehensive loss. The Company recognizes compensation expenses for the value of its awards based on the straight line method over the requisite service period of each of the awards, net of estimated forfeitures. The Company accounted for changes in award terms as a modification in accordance with ASC 718. A modification to the terms of an award should be treated as an exchange of the original award for a new award with total compensation cost equal to the grant-date fair value of the original award plus the incremental value measured at the same date. Under ASC 718, the calculation of the incremental value is based on the excess of the fair value of the new (modified) award based on current circumstances over the fair value of the original award measured immediately before its terms are modified based on current circumstances. ASC No. 718 requires forfeitures to be estimated at the time of the grant and revised in subsequent periods if actual forfeitures differ from those estimates. The following table sets forth the total stock-based compensation expense resulting from stock options and restricted share units ("RSUs") Year ended December 31, 2016 2015 2014 Cost of revenues $ 367 $ 324 $ 353 Research and development 1,240 1,637 1,919 Sales and marketing 1,833 2,802 3,322 General and administrative 1,701 2,407 2,501 Total stock-based compensation expense $ 5,141 $ 7,170 $ 8,095 The Company selected the binomial option pricing model as the most appropriate fair value method for its stock-based compensation awards with the following assumptions for the years ended December 31, 2016, 2015 and 2014: Year ended December 31, 2016 2015 2014 Suboptimal exercise multiple 2.9-3.5 3 3 Risk free interest rate 0.47%-1.58% 0.23%-2.35% 0.10%-2.73% Volatility 33%-51% 37%-55% 44%-60% Dividend yield 0% 0% 0% The expected annual post-vesting and pre-vesting forfeiture rates affects the number of exercisable options. Based on the Company's historical experience, the annual pre-vesting and post-vesting are in the range of 0%-31% and 0%-29%, respectively, in the years 2016, 2015, and 2014. The computations of expected volatility and suboptimal exercise multiple is based on the average of the Company's realized historical stock price. The computation of the suboptimal exercise multiple and the forfeiture rates are based on the grantees expected exercise prior and post vesting termination behavior. The interest rate for period within the contractual life of the award is based on the U.S. Treasury Bills yield curve in effect at the time of grant. The Company currently has no plans to distribute dividends and intends to retain future earnings to finance the development of its business. The expected life of the stock options represents the weighted-average period the stock options are expected to remain outstanding and is a derived output of the binomial model. The expected life of the stock options is impacted by all of the underlying assumptions used in the Company's model. r. Treasury stock: The Company repurchases its Ordinary shares from time to time on the open market and holds such shares as treasury stock. The Company presents the cost to repurchase treasury stock as a reduction of shareholders' equity. s. Concentration of credit risks: Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents, marketable securities, short-term bank deposits, trade receivables and derivative instruments. The majority of cash and cash equivalents and short-term deposits of the Company are invested in dollar deposits in major U.S. and Israeli banks. Such investments in the United States may be in excess of insured limits and are not insured in other jurisdictions. Generally, the cash and cash equivalents and short-term bank deposits may be redeemed upon demand, and therefore, bear minimal risk. Marketable securities include investments in dollar linked corporate and municipal bonds. Marketable securities consist of highly liquid debt instruments with high credit standing. The Company’s investment policy, approved by the Board of Directors, limits the amount the Group may invest in any one type of investment or issuer, thereby reducing credit risk concentrations. Management believes that the portfolio is well diversified and, accordingly, minimal credit risk exists with respect to these marketable debt securities The Company's trade receivables are primarily derived from sales to customers located mainly in EMEA, as well as in APAC, Latin America and the United States. Concentration of credit risk with respect to trade receivables is limited by credit limits, ongoing credit evaluation and account monitoring procedures. The Company performs ongoing credit evaluations of its customers and establishes an allowance for doubtful accounts on a specific basis. Allowance for doubtful accounts amounted to $ 924 and $ 657 as of December 31, 2016 and 2015, respectively. The Company has no significant off balance sheet concentrations of credit risk. t. Grants from the Israel Innovation Authority: Participation grants from the Israel Innovation Authority (Previously known as the Office of the Chief Scientist) for research and development activity are recognized at the time the Company is entitled to such grants on the basis of the costs incurred and included as a deduction of research and development costs. Research and development non royalty bearing grants recognized amounted to $ 606, $ 1,252 and $ 984 in 2016, 2015 and 2014, respectively. u. Income taxes: The Company accounts for income taxes in accordance with Accounting Standards Codification No. 740, "Income Taxes" ("ASC No. 740"). ASC No. 740 prescribes the use of the liability method, whereby deferred tax asset and liability account balances are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value if it is more likely than not that some portion or all of the deferred tax assets will not be realized. ASC No. 740 contains a two-step approach to recognizing and measuring a liability for uncertain tax positions. The first step is to evaluate the tax position taken or expected to be taken in a tax return by determining if the weight of available evidence indicates that it is more likely than not that, on an evaluation of the technical merits, the tax position will be sustained on audit, including resolution of any related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. v. Basic and diluted net income (loss) per share: Basic net income (loss) per share is computed based on the weighted average number of Ordinary Shares outstanding during each year. Diluted net income (loss) per share is computed based on the weighted average number of Ordinary Shares outstanding during each year, plus dilutive potential Ordinary Shares considered outstanding during the year, in accordance with FASB ASC 260 "Earnings Per Share". For the years ended December 31, 2016, 2015 and 2014, all outstanding options and have been excluded from the calculation of the diluted net loss per share since their effect was anti-dilutive. w. Comprehensive income (loss): The Company accounts for comprehensive income (loss) in accordance with Accounting Standards Codification No. 220, "Comprehensive Income" ("ASC No. 220"). This statement establishes standards for the reporting and display of comprehensive income (loss) and its components in a full set of general purpose financial statements. Comprehensive loss represents all changes in shareholders' equity during the period except those resulting from investments by, or distributions to shareholders. The Company determined that its items of comprehensive income (loss) relate to unrealized gains and losses on hedging derivative instruments and unrealized gains and losses on available-for-sale marketable securities. The following table shows the components and the effects on net loss of amounts reclassified from accumulated other comprehensive loss as of December 31, 2016: Year ended December 31, 2016 Unrealized gains (losses) on marketable securities Unrealized gains (losses) on cash flow hedges Total Balance as of December 31, 2015 $ (425 ) $ (45 ) $ (470 ) Changes in other comprehensive income (loss) before reclassifications 293 226 519 Amounts reclassified from accumulated other comprehensive income (loss) to : Cost of revenues - (32 ) (32 ) Operating expenses - (210 ) (210 ) Financial income, net 44 - 44 Net current-period other comprehensive income (loss) 337 (16 ) 321 Balance as of December 31, 2016 $ (88 ) $ (61 ) $ (149 ) x. Fair value of financial instruments: The Company measures its cash and cash equivalents, marketable securities, derivative instruments, short-term bank deposits, trade receivables, other receivables, trade payables and other payables at fair value. Fair value is an exit price, representing the amount that would be received if the Company were to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. The Company uses a three-tier value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: Level 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2 - Include other inputs that are directly or indirectly observable in the marketplace, other than quoted prices included in Level 1, such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets with insufficient volume or infrequent transactions, or other inputs that are observable (model-derived valuations in which significant inputs are observable), or can be derived principally from or corroborated by observable market data; and Level 3 - Unobservable inputs which are supported by little or no market activity. The Company categorized each of its fair value measurements in one of those three levels of hierarchy. The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The Company's earn-out consideration is classified within Level 3. The valuation methodology used by the Company to calculate the fair value consideration is the discounted cash flow using Monte-Carlo simulation method by taking into account, forecast future revenues, expected volatility of 39.2% and weighted average cost of debt of 2%. y. Derivatives and hedging: The Company accounts for derivatives and hedging based on Accounting Standards Codification No. 815, "Derivatives and Hedging" ("ASC No. 815"). The Company accounts for its derivative instruments as either assets or liabilities and carries them at fair value. Derivative instruments that are not designated and qualified as hedging instruments must be adjusted to fair value through earnings. For derivative instruments that hedge the exposure to variability in expected future cash flows that are designated as cash flow hedges, the effective portion of the gain or loss on the derivative instrument is reported as a component of accumulated other comprehensive income (loss) in shareholders' equity and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. The ineffective portion of the gain or loss on the derivative instrument is recognized in current earnings. To apply hedge accounting treatment, cash flow hedges must be highly effective in offsetting changes to expected future cash flows on hedged transactions. z. Business combinations: The Company accounts for business combinations in accordance with ASC No. 805. ASC No. 805 requires recognition of assets acquired, liabilities assumed, and any non-controlling interest at the acquisition date, measured at their fair values as of that date. Any excess of the fair value of net assets acquired over the purchase price is recorded as goodwill and any subsequent changes in estimated contingencies are to be recorded in earnings. In addition, changes in valuation allowance related to acquired deferred tax assets and acquired income tax positions are to be recognized in earnings. aa. Warranty costs: The Company generally provides three months software and a one year hardware warranty for all of its products. A provision is recorded for estimated warranty costs at the time revenues are recognized based on the Company's experience. Warranty expenses for the years ab. Recently Issued Accounting Pronouncements: In November 2015, the FASB issued ASU 2015-17, “Balance Sheet Classification of Deferred Taxes”, which simplifies the presentation of deferred income taxes. This ASU requires that deferred tax assets and liabilities be classified as non-current in a statement of financial position. The Company early adopted ASU 2015-17 effective December 31, 2015 on a prospective basis. No prior periods were retrospectively adjusted. In January 2016, the FASB issued a new standard to amend certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. Most prominent among the amendments is the requirement for changes in the fair value of our equity investments, with certain exceptions, to be recognized through net income rather than accumulated other comprehensive income (loss). ASU 2016-01 is effective for annual reporting periods, and interim periods within those years beginning after December 15, 2017. Early adoption by public entities is permitted only for certain provisions. The Company is currently in the process of evaluating the impact of the adoption of this standard on its consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, “Leases”, on the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors). The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight line basis over the term of the lease, respectively. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for in a manner similar to the accounting under existing guidance for operating leases today. The new standard requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales-type leases, direct financing leases and operating leases. ASC 842 supersedes the previous leases standard, ASC 840, "Leases". The guidance is effective for the interim and annual periods beginning on or after December 15, 2018, and early adoption is permitted. The Company is currently in the process of evaluating the impact of the adoption of ASU 2016-02 on its consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, “Compensation – Stock Compensation”, which effects all entities that issue share-based payment awards to their employees. The amendments in this ASU cover such areas as the recognition of excess tax benefits and deficiencies, the classification of those excess tax benefits on the statement of cash flows, an accounting policy election for forfeitures, the amount an employer can withhold to cover income taxes and still qualify for equity classification and the classification of those taxes paid on the statement of cash flows. This ASU is effective for annual and interim periods beginning after December 15, 2016. This guidance can be applied either prospectively, retrospectively or using a modified retrospective transition method. Early adoption is permitted. The Company does not expect that this new guidance will have a material impact on the Company’s Consolidated Financial Statements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”). The standard changes the methodology for measuring credit losses on financial instruments and the timing of when such losses are recorded. ASU 2016-13 is effective for fiscal years, and interim periods within those years, beginning after December |
AVAILABLE-FOR-SALE MARKETABLE S
AVAILABLE-FOR-SALE MARKETABLE SECURITIES | 12 Months Ended |
Dec. 31, 2016 | |
Investments, Debt and Equity Securities [Abstract] | |
AVAILABLE-FOR-SALE MARKETABLE SECURITIES | NOTE 3:- AVAILABLE-FOR-SALE MARKETABLE SECURITIES The following is a summary of available-for-sale marketable securities: December 31, 2016 December 31, 2015 Amortized cost Gross unrealized gain Gross unrealized Fair value Amortized cost Gross unrealized Gross unrealized Fair value Available-for-sale - matures within one year: Governmental debentures $ 339 $ 0 $ (0 ) $ 339 $ 293 $ - $ (0 ) $ 293 Corporate debentures 19,693 31 (14 ) 19,710 20,077 1 (19 ) 20,059 20,032 31 (14 ) 20,049 20,370 1 (19 ) 20,352 Available-for-sale - matures after one year through three years: Governmental debentures - - - - 978 - (6 ) 972 Corporate debentures 34,472 70 (78 ) 34,464 29,004 3 (230 ) 28,777 34,472 70 (78 ) 34,464 29,982 3 (236 ) 29,749 Available-for-sale - matures after three years through five years: Governmental debentures 100 - - 100 344 - (5 ) 339 Corporate debentures 5,991 2 (99 ) 5,894 14,650 5 (174 ) 14,481 6,091 2 (99 ) 5,994 14,994 5 (179 ) 14,820 $ 60,595 $ 103 $ (191 ) $ 60,507 $ 65,346 $ 9 $ (434 ) $ 64,921 All investments with an unrealized loss as of December 31, 2016 are with continuous unrealized losses for less than 12 months. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | NOTE 4:- FAIR VALUE MEASUREMENTS In accordance with ASC No. 820, the Company measures its cash equivalents, marketable securities and foreign currency derivative instruments at fair value. Cash equivalents and available for sale marketable securities are classified within Level 1 or Level 2. This is because these assets are valued using quoted market prices or alternative pricing sources and models utilizing market observable inputs. The earn-out liability related to the acquisition of Optenet is classified within Level 3 because this liability is based on present value calculations and an external valuation model whose inputs include market interest rates, estimated operational capitalization rates and volatilities. The Company's financial net assets measured at fair value on a recurring basis, including accrued interest components, consisted of the following types of instruments as of December 31, 2016 and 2015, respectively: As of December 31, 2016 Fair value measurements using input type Level 1 Level 2 Level 3 Total Available-for-sale marketable securities $ - $ 60,507 $ - $ 60,507 Foreign currency derivative contracts - 28 - 28 Earn-out liability - - 4,504 4,504 Total financial net assets $ - $ 60,535 $ 4,504 $ 65,039 As of December 31, 201 5 Fair value measurements using input type Level 1 Level 2 Level 3 Total Available-for-sale marketable securities $ - $ 64,921 $ - $ 64,921 Foreign currency derivative contracts - 401 - 401 Earn-out liability - - 6,102 6,102 Total financial net assets $ - $ 65,322 $ 6,102 $ 71,424 Fair value measurements using significant unobservable inputs (Level 3): Balance at January 1, 2016 $ 6,102 Earn Out liability payments, settlements and adjustments due to exchange rates (636 ) Adjustment due to change in the forecast of earn-out consideration (962 ) Balance at December 31, 2016 $ 4,504 |
DERIVATIVE INSTRUMENTS
DERIVATIVE INSTRUMENTS | 12 Months Ended |
Dec. 31, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE INSTRUMENTS | NOTE 5:- DERIVATIVE INSTRUMENTS The Company enters into hedge transactions with a major financial institution, using derivative instruments, primarily forward contracts and options to purchase and sell foreign currencies, in order to reduce the net currency exposure associated with anticipated expenses (primarily salaries and related expenses that are designated as cash flow hedges) in currencies other than U.S. dollar, and forecasted revenues denominated in Euro. The net income recognized in "Financial income, net" during the years ended December 31, 2016, 2015 and 2014 was $ 286, $ 1,200 and $ 2,144, respectively. The Company currently hedges such future exposures for a maximum period of one year. However, the Company may choose not to hedge certain foreign currency exchange exposures for a variety of reasons, including but not limited to immateriality, accounting considerations and the prohibitive economic cost of hedging particular exposures. There can be no assurance the hedges will offset more than a portion of the financial impact resulting from movements in foreign currency exchange rates. The Company records all derivatives on the consolidated balance sheets at fair value in accordance with ASC No. 820 at Level 2. The effective portion of cash flow hedges are recorded in other comprehensive income (loss) until the hedged item is recognized in earnings. The ineffective portion of cash flow hedges are adjusted to fair value through earnings in financial income (expenses), net. The Company does not enter into derivative transactions for trading purposes. The Company had a net unrealized loss associated with cash flow hedges of $ 61 and $ 45 recorded in other comprehensive loss as of December 31, 2016 and 2015, respectively. As of December 31, 2016 and 2015, the Company had outstanding hedge transactions in the amount of $ 13,302 and $ 18,361, respectively. The fair value of the outstanding foreign exchange contracts recorded by the Company on its consolidated balance sheets as of December 31, 2016 and 2015, as assets and liabilities is as follows: Foreign exchange forward and December 31, options contracts Balance sheet 2016 2015 Fair value of foreign exchange hedge transactions Other receivables and prepaid expenses $ 40 $ 104 Fair value of foreign exchange hedge transactions Other payables and accrued expenses (101 ) (149 ) Total derivatives designated as hedging instruments Other Comprehensive loss $ (61 ) $ (45 ) Gain or loss on the derivative instruments, which partially offset the foreign currency impact from the underlying exposures, reclassified from other comprehensive loss to operating expenses for the years ended December 31, 2016, 2015 and 2014 were $ (242), $ 1,407 and $ 717, respectively. Non-designated hedges The Company also uses foreign currency forward contracts to mitigate variability in gains and losses generated from the re-measurement of certain monetary assets and liabilities denominated in foreign currencies. These derivatives do not qualify for special hedge accounting treatment. These derivatives are carried at fair value with changes recorded in financial income, net. Changes in the fair value of these derivatives are largely offset by re-measurement of the underlying assets and liabilities. Cash flows from such derivatives are classified as operating activities. The derivatives have maturities of approximately twelve months. As of December 31, 2016 and 2015, the Company’s transactions were $ 14,969 and $ 14,901, respectively. The fair value of the outstanding non-designated foreign exchange contracts recorded by the Company on its consolidated balance sheets as of December 31, 2016 and 2015, as assets and liabilities is as follows: Foreign exchange forward and December 31, options contracts Balance sheet 2016 2015 Fair value of foreign exchange non-designated hedge transactions Other receivables and prepaid expenses $ 181 $ 459 Fair value of foreign exchange non-designated hedge transactions Other payables and accrued expenses (92 ) (13 ) Total derivatives designated as hedging instruments $ 89 $ 446 |
OTHER RECEIVABLES AND PREPAID E
OTHER RECEIVABLES AND PREPAID EXPENSES | 12 Months Ended |
Dec. 31, 2016 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
OTHER RECEIVABLES AND PREPAID EXPENSES | NOTE 6:- OTHER RECEIVABLES AND PREPAID EXPENSES December 31, 2016 2015 Prepaid expenses $ 1,739 $ 1,959 Government authorities 1,003 898 Receivable from third-party 426 - Foreign currency derivative contracts 221 566 Short-term lease deposits 127 215 Grants receivable from the Israel Innovation Authority - 728 Others 363 147 $ 3,879 $ 4,513 |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | NOTE 7:- INVENTORIES December 31, 2016 2015 Raw materials $ 1,257 $ 1,584 Finished goods 5,978 8,585 $ 7,235 $ 10,169 As of December 31, 2016 and 2015, the finished products line item above includes deferral of the cost of goods sold for which revenue was not yet recognized in the amount of approximately $ 512 and $ 572, respectively. |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT, NET | NOTE 8:- PROPERTY AND EQUIPMENT, NET December 31, 2016 2015 Cost: Lab equipment $ 13,225 $ 12,527 Computers and peripheral equipment 18,704 18,667 Office furniture and equipment 975 955 Leasehold improvements 1,238 1,164 34,142 33,313 Accumulated depreciation: Lab equipment 10,788 9,483 Computers and peripheral equipment 17,750 17,453 Office furniture and equipment 521 568 Leasehold improvements 696 620 29,755 28,124 Depreciated cost $ 4,387 $ 5,189 Depreciation expense for the years ended December 31, 2016, 2015 and 2014 was $ 2,334, $ 2,813 and $ 3,308, respectively. |
INTANGIBLE ASSETS, NET
INTANGIBLE ASSETS, NET | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS, NET | NOTE 9:- INTANGIBLE ASSETS, NET a. The following table shows the Company's intangible assets for the periods presented: December 31, 2016 2015 Original Cost: Technology *) $ 9,111 $ 9,111 Backlog 1,877 1,877 Customer relationships **) 3,592 3,592 $ 14,580 $ 14,580 Accumulated amortization: Technology $ 6,705 $ 5,765 Backlog 1,867 1,632 Customer relationships 1,598 1,064 $ 10,170 $ 8,461 Amortized cost $ 4,410 $ 6,119 *) During 2015, the Company recorded an impairment loss of $ 3,214 and $ 2,432 related to technology purchased in 2012 from acquisitions of Ortiva Wireless Inc. and Oversi Networks Ltd. ("Oversi"), respectively, due to the Company's decision to reach end of life on the respective product lines. The impairment loss was recorded in cost of revenues. **) During 2015, the Company recorded an impairment loss of $ 131 related to Oversi's customer relationships, due to the Company's decision to reach end of life on the respective product line. b. Amortization expense for the years ended December 31, 2016, 2015 and 2014 was $ 1,709, $ 2,895 and $ 1,858, respectively. c. Estimated amortization expense for the years ending: Year ending December 31, 2017 1,478 2018 1,630 2019 1,302 Total 4,410 |
OTHER PAYABLES AND ACCRUED EXPE
OTHER PAYABLES AND ACCRUED EXPENSES | 12 Months Ended |
Dec. 31, 2016 | |
Payables and Accruals [Abstract] | |
OTHER PAYABLES AND ACCRUED EXPENSES | NOTE 10:- OTHER PAYABLES AND ACCRUED EXPENSES December 31, 2016 2015 Accrued expenses $ 2,255 $ 1,758 Accrued taxes 416 473 Foreign currency derivative contracts 193 163 Advances from customers 23 1,103 Contingent consideration - 1,949 Others 270 264 $ 3,157 $ 5,710 |
COMMITMENTS AND CONTINGENT LIAB
COMMITMENTS AND CONTINGENT LIABILITIES | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENT LIABILITIES | NOTE 11:- COMMITMENTS AND CONTINGENT LIABILITIES a. Lease commitments: The Company signed several non-cancelable agreements for its facilities which vary in dates and terms. In March 2013, the Company engaged in renting its main facilities for an average period of five years, starting July 2013. The total rental expenses are approximately $ 144 per month. The U.S. subsidiary has an operating lease for office facilities in Woburn, Massachusetts and in San Diego, California, the leases expire on August 31, 2019 and on April 30, 2018, respectively. The Spanish subsidiary has an operating lease for office facilities in Madrid, Spain, the leases expire within three month notice period. The Company's subsidiaries maintain smaller offices in South Africa, China, Singapore, Japan, New Zealand, Colombia and various locations in Europe. In addition, the Company has operating lease agreements for its motor vehicles, which terminate in 2016 through 2019. Operating leases (offices and motor vehicles) expense for the years ended December 31, 2016, 2015 and 2014 was $ 2,758, $ 2,828 and $ 3,155, respectively. As of December 31, 2016, the aggregate future minimum lease obligations (offices and motor vehicles) under non-cancelable operating leases agreements were as follows: Year ending December 31, 2017 $ 2,480 2018 651 2019 103 Total $ 3,234 b. Major subcontractor: The Company currently depends on one subcontractor to manufacture and provide hardware, warranty and support for its traffic management systems. If the subcontractor experiences delays, disruptions, quality control problems or a loss in capacity, shipments of products may be delayed and the Company's ability to deliver products could be materially adversely affected. Certain hardware components for the Company's products come from single or limited sources, and the Company could lose sales if these sources fail to satisfy its supply requirements. In the event that the Company terminates its business connection with the subcontractor, it will have to compensate the subcontractor for certain inventory costs, as specified in the agreement with the subcontractor. c. Litigations On November 8, 2016, a former employee filed a claim against the Company alleging that he is entitled to compensation for unlawful dismissal by the Company. A mediation attempt has failed, the Company is waiting for the first hearing to take place. The Company believes that it has valid defenses to the claim. According to the Company's legal counsel the award will not exceed $ 32. |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2016 | |
Stockholders' Equity Note [Abstract] | |
SHAREHOLDERS' EQUITY | NOTE 12:- SHAREHOLDERS' EQUITY a. Company's shares: As of December 31, 2016, the Company's authorized share capital consists of NIS 20,000,000 divided into 200,000,000 Ordinary Shares, par value NIS 0.1 per share. Ordinary Shares confer on their holders the right to receive notice to participate and vote in general meetings of the Company, the right to a share in the excess of assets upon liquidation of the Company, and the right to receive dividends, if declared. b. Treasury stock: On August 2015, the Company's Board of Directors authorized the repurchase of up to an aggregate of $ 15 million of the Company's Ordinary shares in the open market, subject to normal trading restrictions. During November 2015, the Company received court's approvals to purchase up to $ 15 million of its ordinary shares. The court's approval for share repurchases was expired on May 26, 2016. On July 6, 2016, the Company received the court's approval to extend the share repurchase period for additional 6 months. During 2015 the Company purchased 25,000 of its Ordinary shares for a total consideration of $ 166. During 2016 the Company purchased 791,000 of its Ordinary shares for a total consideration of $ 3,832. Total consideration for the purchase of these Ordinary shares was recorded as Treasury stock, at cost, as part of shareholders' equity. c. Stock option plan: A summary of the Company's stock option activity, pertaining to its option plans for employees and related information is as follows: Year ended December 31, 2016 2015 2014 Number of shares upon exercise Weighted average exercise price Number of shares upon exercise Weighted average exercise price Number of shares upon exercise Weighted average exercise price Outstanding at beginning of year 2,811,966 $ 10.70 2,531,381 $ 11.99 2,875,003 $ 12.02 Granted 643,697 $ 4.99 704,348 $ 6.73 572,533 $ 11.93 Forfeited (1, 358,492 ) $ 12.41 (320,496 ) $ 15.13 (562,787 ) $ 17.02 Exercised (138,157 ) $ 1.75 (103,267 ) $ 1.28 (353,368 ) $ 4.18 Outstanding at end of year 1,959,014 $ 8.24 2,811,966 $ 10.70 2,531,381 $ 11.99 Exercisable at end of year 1,072,658 $ 9.87 1,646,204 $ 11.99 1,440,143 $ 11.75 Vested and expected to vest 1,407,930 $ 9.04 2,197,848 $ 11.16 1,950,116 $ 11.97 The aggregate intrinsic value represents the total intrinsic value (the difference between the Company's closing stock price on the last trading day of the fiscal years 2016, 2015 and 2014 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on December 31, 2016, 2015 and 2014, respectively. This amount may change based on the fair market value of the Company's stock. The total intrinsic value of options outstanding at December 31, 2016, 2015 and 2014, were $ 728, $ 1,580 and $ 4,085, respectively. The total intrinsic value of exercisable options at December 31, 2016, 2015 and 2014, were approximately $ 604, $ 1,170 and $ 2,983, respectively. The total intrinsic value of options vested and expected to vest at December 31, 2016, 2015 and 2014, were approximately $ 634, $ 1,363 and $ 3,436, respectively. The total intrinsic value of options exercised during the years ended December 31, 2016, 2015 and 2014 were approximately $ 415, $ 469 and $ 1,901, respectively. The weighted-average grant-date fair value of the options granted during the years ended December 31, 2016, 2015 and 2014 were $ 2.12, $ 3.45 and $ 6.31, respectively. The number of options vested during the year ended December 31, 2016 was 279,088. The weighted-average remaining contractual life of the outstanding options as of December 31, 2016 is 5.53 years. The weighted-average remaining contractual life of exercisable options as of December 31, 2016 is 4.99 years. On May 2, 2016 the Board of Directors of the Company approved the repricing of 384,635 stock options for the Company's employees and executive officers, previously granted. As part of the repricing, options with exercise price higher than $ 7 per share were repriced. Repriced options were replaced by options with lower exercise price or RSU's. The vesting period for the new granted options and RSU's was schedule for two years. The incremental expense for the repricing of the options was approximately $ 470. For the year ended December 31, 2016, the Company recorded expenses totaling $ 155 associated with the repricing. The options outstanding as of December 31, 2016, have been classified by exercise price, as follows: Exercise price Shares upon exercise of options outstanding as of December 31, 2016 Weighted average remaining contractual life Shares upon exercise of options exercisable as of December 31, 2016 Years $ 23.31-27.58 73,000 5.62 73,000 $ 15.20-17.07 129,059 4.75 123,088 $ 10.16-14.68 383,233 6.59 297,998 $ 5.01-9.25 827,398 5.43 321,964 $ 0.03-4.95 546,324 5.12 256,608 1,959,014 1,072,658 The following provides a summary of the restricted stock unit activity for the Company for the two years ended December 31, 2016: Year ended December 31, 2016 2015 Number of shares upon exercise Weighted average share price Number of shares upon exercise Weighted average share price Outstanding at beginning of year 359,404 $ 10.95 445,264 $ 12.43 Granted 531,570 $ 4.59 158,551 $ 8.52 Vested (152,460 ) $ 10.08 (159,912 ) $ 11.22 Forfeited (146,388 ) $ 6.85 (84,499 ) $ 12.57 Unvested at end of year 592,126 $ 6.53 359,404 $ 10.95 As of December 31, 2016, $ 2,194 and $ 2,801 unrecognized compensation cost related to stock options and RSUs respectively is expected to be recognized over a weighted average vesting period of 2.34 years. As of December 31, 2016, the Company holds outstanding options under the 2016 option plan (formerly, 2006 Plan). The outstanding options and RSUs under the 2016 plan are exercisable to 1,959,014 and 592,126 Ordinary shares respectively. Under the terms of the above option plans, options may be granted to employees, officers, directors and various service providers of the Company and its subsidiaries. The options generally become exercisable quarterly over a four-year period, commencing one year after date of the grant, subject to the continued employment of the employee. The options generally expire no later than ten years from the date of the grant. The exercise price of the options at the date of grant under the plans may not be less than the nominal value of the shares into which such options are exercised, any options, which are forfeited or cancelled before expiration, become available for future grants. As of December 31, available for future issuance under the option plans. In 2015 the Company granted 1,732 options to employees with an exercise price of $ 0.03, which was lower than the trading price of the Company's Ordinary Shares quoted on the NASDAQ Global Select Market on the date of the grants. During 2016, the Company did not grant options with an exercise price lower than the trading price of the Company's Ordinary Shares. In addition to granting stock options, the Company granted 531,570 and 158,551 RSUs in 2016 and 2015, respectively under the 2016 option plan. RSUs vest over a four year period subject to the continued employment of the employee. RSUs that are cancelled or forfeited become available for future grants. |
TAXES ON INCOME
TAXES ON INCOME | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
TAXES ON INCOME | NOTE 13:- TAXES ON INCOME a. Corporate tax rates: The Israeli corporate income tax rate was 25% in 2016 and 26.5% in 2015 and 2014. In January 2016, the Law for Amending the Income Tax Ordinance (No. 216) (Reduction of Corporate Tax Rate), 2016 was approved, which includes a reduction of the corporate tax rate from 26.5% to 25%, effective from January 1, 2016. In December 2016, a further reduction in the corporate tax rate to 24% effective January 2017 and to 23% effective January 1, 2018 and thereafter was enacted. b. Foreign Exchange Regulations: Commencing in taxable year 2013, the Company has elected to measure its taxable income and file its tax return under the Israeli Income Foreign Tax Regulations. Under the Foreign Exchange Regulations, an Israeli company must calculate its tax liability in U.S. Dollars according to certain orders. The tax liability, as calculated in U.S. Dollars is translated into NIS according to the exchange rate as of December 31st of each year. c. Tax benefits under Israel's law for the Encouragement of Capital Investments, 1959 ("the Law"): In 1998, the production facilities of the Company related to its computational technologies were granted the status of an "Approved Enterprise" under the Law. In 2004, expansion program was granted the status of "Approved Enterprise". According to the provisions of the Law, the Company has elected the alternative track of benefits and has waived Government grants in return for tax benefits. The period of tax benefits, detailed above, is limited to the earlier of 12 years from the commencement of production, or 14 years from the approval date. According to the provisions of the Law under the alternative track, the Company's income may be tax-exempt for a period of two years commencing with the year it first earns taxable income, and subject to corporate taxes at the reduced rate of 10% to 25%, for an additional period of five to eight years depending upon the level of foreign ownership of the Company. The Law was significantly amended effective April 1, 2005 ("the Amendment"). The Amendment includes revisions to the criteria for investments qualified to receive tax benefits as a Beneficiary Enterprise and among other things, simplifies the approval process. The Amendment applies to new investment programs. Therefore, investment programs commencing after December 31, 2004, do not affect the approved programs of the Company. In addition, the Law provides that terms and benefits included in any letter of approval already granted will remain subject to the provisions of the Law as they were on the date of such approval. Therefore, the Company's existing Approved Enterprise will generally not be subject to the provisions of the Amendment. The Company elected 2006 and 2009 as "year of election" under the Amendment. The entitlement to the above benefits is contingent upon the fulfillment of the conditions stipulated in the Law, regulations published there under and the criteria set forth in the specific letters of approval. In the event of failure to comply with these conditions, the benefits may be canceled and the Company may be required to refund the amount of the benefits, in whole or in part, including interest and linked to changes in the Israeli CPI. As of December 31, 2016, management believes that the Company meets the aforementioned conditions. If the Company pays a dividend out of exempt income derived from the Approved and Beneficiary Enterprise, it will be subject to corporate tax in respect of the gross amount distributed, including any taxes thereon, at the rate which would have been applicable had it not enjoyed the alternative benefits, generally 10%-25%, depending on the percentage of the Company's Ordinary shares held by foreign shareholders. The dividend recipient is subject to withholding tax at the rate of 15% applicable to dividends from approved enterprises, if the dividend is distributed during the tax exemption period or within twelve years thereafter. As of December 31, 2016, there are no profits earned by the Company Israel’s “Approved Enterprises” and “Beneficiary Enterprise”. Income from sources other than the "Approved and Beneficiary Enterprise" during the benefit period will be subject to tax at the regular corporate tax rate. As of January 1, 2011, new legislation amending the Investment Law came into effect (the 2011 Amendment ). The 2011 Amendment introduced a new status of Preferred Company and Preferred Enterprise , replacing the then existing status of Beneficiary Company and Beneficiary Enterprise . Similarly to Beneficiary Company , a Preferred Company is an industrial company owning a Preferred Enterprise which meets certain conditions (including a minimum threshold of 25% export). However, under this new legislation the requirement for a minimum investment in productive assets was cancelled . Under the 2011 Amendment, a uniform corporate tax rate will apply to all qualifying income of the Preferred Company, as opposed to the former law, which was limited to income from the Approved Enterprises and Beneficiary Enterprise during the benefits period. The uniform corporate tax rate was 9% in areas in Israel designated as Development Zone A and 16% elsewhere in Israel during 2015 and 2016, an amendment to the Investment law from December 2016 reduced the tax rate in Development Zone A to 7.5% starting from 2017 while the tax rate in other areas remains 16%. In December 2016, the Economic Efficiency Law (Legislative Amendments for Applying the Economic Policy for the 2017 and 2018 Budget Years), 2016 which includes Amendment 73 to the Law for the Encouragement of Capital Investments ("the Amendment") was published. According to the Amendment, a preferred enterprise located in development area A will be subject to a tax rate of 7.5% instead of 9% effective from January 1, 2017 and thereafter (the tax rate applicable to preferred enterprises located in other areas remains at 16%). A dividend distributed from income which is attributed to a Preferred Enterprise/Special Preferred Enterprise will be subject to withholding tax at source at the following rates: (i) Israeli resident corporation – 0%, (ii) Israeli resident individual – 20% as of 2014 and thereafter (iii) non-Israeli resident - 20% as of 2014 and thereafter subject to a reduced tax rate under the provisions of an applicable double tax treaty. In December 2016 new legislation amended the Investment Law (the “2016 Amendment”). Under the 2016 Amendment a new status of “Technological Preferred Enterprise” was introduced to the Investment Law. Under the 2016 amendment, a Technological Preferred Enterprise which is located in areas other than Development Zone A will be subject to tax at a rate of 12% on profits derived from intellectual property. The implementation of the 2016 Amendment is subject to regulations to be promulgated by the Finance Minister by March 31, 2017. As such regulations have not yet been promulgated and as the definitive criteria to determine the tax benefits have not yet been established, it cannot be concluded that the legislation with respect to Technological Preferred Enterprises had been enacted or substantively enacted as of that date. Accordingly, the above changes in the tax rates were not taken into account in the computation of deferred taxes as of December 31, 2016. Under the transition provisions of the new legislation, the Company may decide to irrevocably implement the new law while waiving benefits provided under the current law or to remain subject to the current law. d. Tax benefits under the law for the Encouragement of Industry (Taxes), 1969 (the "Encouragement Law"): The Encouragement Law, provides several tax benefits for industrial companies. An industrial company is defined as a company resident in Israel, at least 90% of the income of which in a given tax year exclusive of income from specified Government loans, capital gains, interest and dividends, is derived from an industrial enterprise owned by it. An industrial enterprise is defined as an enterprise whose major activity in a given tax year is industrial production activity. Management believes that the Company is currently qualified as an "industrial company" under the Encouragement Law and as such, enjoys tax benefits, including: (1) deduction of purchase of know-how and patents and/or right to use a patent over an eight-year period; (2) the right to elect, under specified conditions, to file a consolidated tax return with additional related Israeli industrial companies and an industrial holding company; (3) accelerated depreciation rates on equipment and buildings; and (4) expenses related to a public offering on the Tel-Aviv Stock Exchange and on recognized stock markets outside of Israel, are deductible in equal amounts over three years. Eligibility for benefits under the Encouragement Law is not subject to receipt of prior approval from any governmental authority. No assurance can be given that the Israeli tax authorities will agree that the Company qualifies, or, if the Company qualifies, then the Company will continue to qualify as an industrial company or that the benefits described above will be available to the Company in the future. e. Pre-tax income (loss) is comprised as follows: Year ended December 31, 2016 2015 2014 Domestic $ (7,033 ) $ (16,898 ) $ (3,792 ) Foreign 1,243 412 1,345 $ (5,790 ) $ (16,486 ) $ (2,447 ) f. A reconciliation of the theoretical tax expenses, assuming all income is taxed at the statutory tax rate applicable to the income of the Company and the actual tax expenses is as follows: Year ended December 31, 2016 2015 2014 Loss before taxes on income $ (5,790 ) $ (16,486 ) $ (2,447 ) Theoretical tax expense computed at the Israeli statutory tax rate (25%, 26.5% and 26.5% for the years 2016, 2015 and 2014, respectively) $ (1,448 ) $ (4,369 ) $ (649 ) Changes in valuation allowance (469 ) 3,716 (1,328 ) Increase (decrease) in losses and temporary differences due to change in Israeli corporate and “Approved Enterprise" tax (216 ) 679 611 Write off of prepaid and withholding taxes 1,759 1,150 - Foreign tax rates differences related to subsidiaries 576 103 (34 ) Non-deductible expenses and other 567 181 (381 ) Non-deductible share-based compensation expense 1,435 1,896 1,831 Actual tax expense $ 2,204 $ 3,356 $ 50 g. Income tax expense is comprised as follows: Year ended December 31, 2016 2015 2014 Current taxes $ 203 $ 146 $ 612 Deferred taxes (benefit) 242 2,060 (562 ) Write off of prepaid and withholding taxes 1,759 1,150 - $ 2,204 $ 3,356 $ 50 h. Net operating losses carry forward: The Company has accumulated net operating losses for tax purposes as of December 31, 2016, in the amount of approximately $ 46,600, which may be carried forward and offset against taxable income in the future for an indefinite period. In December 2014, the Israeli Tax Authorities approved a final tax ruling with respect to the Company’s acquisition of Oversi. According to the ruling, the net operating losses may be offset against taxable income annually with a limitation of up to 14% of the total accumulated losses but no more than 50% of the Company's taxable income. As of December 31, 2016, the Company recorded a full valuation allowance with respect to its deferred tax assets in Allot Communications Ltd. and wrote-off prepaid and withholding taxes of $ 1,759 as the Company does not expect to utilize these tax assets in the near future. In addition, the Company has accumulated capital losses for tax purposes as of December 31, 2016, of approximately $ 27,300, which may be carried forward and offset against taxable capital gains in the future for an indefinite period, but are limited as stated above. Management currently believes that since the Company has a history of losses, and uncertainty with respect to future taxable income, it is more likely than not that the deferred tax assets regarding the loss carry forwards will not be utilized in the foreseeable future. Thus, a valuation allowance was provided to reduce deferred tax assets to their realizable value. The U.S. subsidiary has accumulated losses for U.S. federal income tax return purposes of approximately $ 5,517. The federal accumulated losses for tax purposes expire between 2026 and 2032. The state accumulated losses for tax purposes began to expire in 2014. An amount of $ 1,707 of the net operating loss carry-forwards relates to excess tax deductions from stock options. Such losses are subject to limitations of Internal Revenue Code, Section 382, which in general provides that utilization of net operating losses is subject to an annual limitation if an ownership change results from transactions increasing the ownership of certain shareholders or public groups in the stock of a corporation by more than 50 percentage points over a three-year period. The annual limitations may result in the expiration of losses before utilization. i. Deferred income taxes: Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company's deferred income taxes are as follows: December 31, 2016 2015 Deferred tax assets: Operating and capital loss carryforwards $ 12,900 $ 14,842 Reserves and allowances 2,022 948 Deferred tax asset before valuation allowance 14,922 15,790 Valuation allowance (14,655 ) (15,124 ) Net deferred tax asset 267 666 Deferred tax liability - (157 ) Net deferred tax asset $ 267 $ 509 j. As of December 31, 2016, the provision in respect of ASC 740-10 was immaterial. As of December 31, 2015, the Company recorded a provision in the amount of $293. The accrued interest and penalties related to the provision in income taxes is immaterial. The Company conducts business globally and, as a result, the Company or one or more of its subsidiaries file income tax returns in the U.S. federal jurisdiction and various states and foreign jurisdictions. In the normal course of business, the Company is subject to examination by taxing authorities throughout the world, including such major jurisdictions as Israel, France, and the United States. With a few exceptions, the Company is no longer subject to Israeli tax assessment through the year 2012 and the European and U.S. subsidiaries have final tax assessments through 2012. |
GEOGRAPHIC INFORMATION
GEOGRAPHIC INFORMATION | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
GEOGRAPHIC INFORMATION | NOTE 14:- GEOGRAPHIC INFORMATION Allot operates in a single reportable segment. Revenues are based on the location of the Company's channel partners which are considered as end customers, as well as direct customers of the Company: Year ended December 31, 2016 2015 2014 Europe $ 34,279 $ 39,110 $ 41,238 Asia and Oceania 27,700 28,495 41,990 Americas (excluding the United States) 13,094 14,347 3,299 Middle East and Africa 12,365 9,809 15,352 United States 2,931 8,206 15,307 $ 90,369 $ 99,967 $ 117,186 The following are the Company’s major customers: Year ended December 31, 2016 2015 2014 Customer A 25 % 27 % 27 % Customer B 17 % - - Customer C - 10 % 17 % 42 % 37 % 44 % The following presents total long-lived assets as of December 31, 2016 and 2015: December 31, 2016 2015 Long-lived assets: Israel $ 4,156 $ 4,924 United States 42 109 Other 189 156 $ 4,387 $ 5,189 |
FINANCIAL INCOME (EXPENSES), NE
FINANCIAL INCOME (EXPENSES), NET | 12 Months Ended |
Dec. 31, 2016 | |
Other Income and Expenses [Abstract] | |
FINANCIAL INCOME (EXPENSES), NET | NOTE 15:- FINANCIAL INCOME (EXPENSES), NET Year ended December 31, 2016 2015 2014 Financial income: Interest income $ 2,466 $ 2,174 $ 1,900 Financial expenses: Exchange rate differences and other 186 1,480 174 Amortization/accretion of premium/discount on marketable securities, net 1,221 1,278 1,066 $ 1,059 $ (584 ) $ 660 |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Dec. 31, 2016 | |
Net loss per share: | |
EARNINGS PER SHARE | NOTE 16:- EARNINGS PER SHARE The following table sets forth the computation of basic and diluted net loss per share: Year ended December 31, 2016 2015 2014 Numerator: Net loss $ (7,994 ) $ (19,842 ) $ (2,497 ) Denominator: Weighted average number of shares outstanding used in computing diluted net loss per share 33,202,309 33,419,917 33,143,168 Basic and diluted net loss per share $ (0.24 ) $ (0.59 ) $ (0.08 ) The following numbers of shares were excluded from the computation of diluted net loss per ordinary share for the periods presented because including them would have had an anti-dilutive effect: Year ended December 31, 2016 2015 2014 Ordinary shares 2,000,757 3,424,891 2,300,425 |
SIGNIFICANT ACCOUNTING POLICI25
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Use of estimates | a. Use of estimates: The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions. The Company's management believes that the estimates, judgments and assumptions used are reasonable based upon information available at the time they are made. These estimates, judgments and assumptions can affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. |
Financial statements in U.S. dollars | b. Financial statements in U.S. dollars: The majority of the revenues of the Company and its subsidiaries are generated in U.S. dollars ("dollar") or linked to the dollar. In addition, a major portion of the Company's and certain of its subsidiaries' costs are incurred or determined in dollars. The Company's management believes that the dollar is the currency of the primary economic environment in which the Company and its subsidiaries operate. Thus, the functional and reporting currency of the Company and its subsidiaries is the dollar. Accordingly, monetary accounts maintained in currencies other than the dollar are remeasured into U.S. dollars in accordance with Accounting Standards Codification No. 830, "Foreign Currency Matters" ("ASC No. 830"). All transactions gains and losses from the remeasurement of monetary balance sheet items are reflected in the statements of operations as financial income or expenses as appropriate. |
Principles of consolidation | c. Principles of consolidation: The consolidated financial statements include the accounts of the Company and its subsidiaries. Intercompany balances and transactions have been eliminated upon consolidation. |
Cash and cash equivalents | d. Cash and cash equivalents: The Company considers all unrestricted highly liquid investments which are readily convertible into cash, with maturity of three months or less at the date of acquisition, to be cash equivalents. |
Restricted deposits | e. Restricted deposits: The restricted deposits are held in favor of financial institutions in respect of fulfillments of forward contract and operating obligations. |
Short-term bank deposits | f. Short-term bank deposits: Short-term bank deposits are deposits with maturities of more than three months but less than one year at the balance sheet date. The deposits are in dollars and bear interest at annual weighted average rate of 1.37% and 0.93% at December 31, 2016 and 2015, respectively. |
Marketable securities | g. Marketable securities: The Company accounts for investments in marketable securities in accordance with ASC 320, "Investments - Debt and Equity Securities". Management determines the appropriate classification of its investments in debt securities at the time of purchase and re-evaluates such determinations at each balance sheet date. Marketable securities classified as "available-for-sale" are carried at fair value, based on quoted market prices. Unrealized gains and losses are reported in a separate component of shareholders' equity in accumulated other comprehensive income (loss). Gains and losses are recognized when realized, on a specific identification basis, in the Company's consolidated statements of comprehensive loss. The Company's securities are reviewed for impairment in accordance with ASC 320-10-35. If such assets are considered to be impaired, the impairment charge is recognized in earnings when a decline in the fair value of its investments below the cost basis is judged to be Other-Than-Temporary Impairment (OTTI). Factors considered in making such a determination include the duration and severity of the impairment, the reason for the decline in value, the potential recovery period and the Company's intent to sell, including whether it is more likely than not that the Company will be required to sell the investment before recovery of cost basis. Based on the above factors, the Company concluded that unrealized losses on its available-for-sale securities, for the years ended 2016, 2015 and 2014, were not OTTI. |
Inventories | h. Inventories: Inventories are stated at the lower of cost or market value. Inventory write-offs are provided to cover risks arising primarily from end of life products and from slow-moving items, technological obsolescence, and excess inventory. Inventory write-offs during the year ended December 31, 2016, 2015 and 2014 amounted to $ 1,004, $ 775 and $ 4,097, respectively, and were recorded in cost of revenues for products. Inventory write-off provision as of December 31, 2016 and 2015 amounted to $ 1,957 and $ 1,663, respectively. Cost is determined using the weighted average cost method. |
Property and equipment, net | i. Property and equipment, net: Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is calculated by the straight-line method over the estimated useful lives of the assets at the following annual rates: % Lab equipment 25 - 33 Computers and peripheral equipment 15 - 33 Office furniture 6 - 15 Leasehold improvements Over the shorter of the term of the lease or the useful life of the asset |
Goodwill impairment | j. Goodwill impairment: Goodwill represents the excess of the purchase price over the fair value of net assets of purchased businesses. Under Accounting Standards Codification No. 350, "Intangibles-Goodwill and Other" ("ASC No. 350"), goodwill is not amortized, but rather subject to an annual impairment test, or more often if there are indicators of impairment present. In accordance with ASC No. 350 the Company performs an annual impairment test at December 31 each year. ASC 350 allows an entity to first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. If the qualitative assessment does not result in a more likely than not indication of impairment, no further impairment testing is required. If it does result in a more likely than not indication of impairment, the two-step impairment test is performed. Alternatively, ASC 350 permits an entity to bypass the qualitative assessment for any reporting unit and proceed directly to performing the first step of the goodwill impairment test. The first step, identifying a potential impairment, compares the fair value of the reporting unit with its carrying amount. If the carrying amount exceeds its fair value, the second step would need to be performed; otherwise, no further step is required. The second step, measuring the impairment loss, compares the implied fair value of the goodwill with the carrying amount of the goodwill. Any excess of the goodwill carrying amount over the applied fair value is recognized as an impairment loss, and the carrying value of goodwill is written down to fair value. The Company operates in a single reportable unit. The Company has performed an annual impairment analysis as of December 31, 2016 and determined that the carrying value of the reporting unit was less than the fair value of the reporting unit. Fair value is determined using market capitalization. During years 2016, 2015 and 2014, no impairment losses were recorded. |
Impairment of long lived assets and intangible assets subject to amortization | k. Impairment of long lived assets and intangible assets subject to amortization: Property and equipment and intangible assets subject to amortization are reviewed for impairment in accordance with ASC No. 360, "Accounting for the Impairment or Disposal of Long-Lived Assets," whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Intangible assets acquired in a business combination are recorded at fair value at the date of acquisition. Following initial recognition, intangible assets are carried at cost less any accumulated amortization and any accumulated impairment losses. The useful lives of intangible assets are assessed to be either finite or indefinite. Intangible assets that are not considered to have an indefinite useful life are amortized over their estimated useful lives. Some of the acquired intangible assets are amortized over their estimated useful lives in proportion to the economic benefits realized. This accounting policy results in accelerated amortization of such customer relationships as compared to the straight-line method. All other intangible assets are amortized over their estimated useful lives on a straight-line basis. During the years ended December 31, 2016 and 2014, no impairment losses were recorded. During 2015, the Company recorded impairment loss (see Note 9). |
Revenue recognition | l. Revenue recognition: The Company generates revenues mainly from selling its products along with related maintenance and support services. At times, these arrangements may also include professional services, such as installation services or training. The Company generally sells its products through resellers, distributors, OEMs and system integrators, all of whom are considered end-users. Revenues from product sales are recognized when persuasive evidence of an agreement exists, title and risk of loss have transferred, no significant performance obligations remain, product payment is not contingent upon performance of installation or service obligations, the fee is fixed or determinable and collectability is probable. In instances where acceptance of the product or service is specified by the customer, revenue recognition is deferred until all acceptance criteria have been met. Maintenance and support related revenues included in multiple element arrangements are deferred and recognized on a straight-line basis over the term of the applicable maintenance and support agreement. Other services are recognized upon the completion of installation or when the service is provided. In instances where the services provided in a multiple element arrangement are considered essential to the functionality of the product and payment of the product is contingent upon performance of the services, the sales of the products and services would be considered one unit of accounting. Pursuant to the guidance of ASU 2009-13, "Multiple-Deliverable Revenue Arrangements, (amendments to ASC Topic 605, Revenue Recognition)" (ASU 2009-13) and ASU 2009-14, when a sales arrangement contains multiple elements, such as products and services, the Company allocates revenues to each element based on a selling price hierarchy. The selling price for a deliverable is based on VSOE if available, third party evidence ("TPE") if VSOE is not available, or estimated selling price ("ESP") if neither VSOE nor TPE is available. In multiple element arrangements, revenues are allocated to each separate unit of accounting for each of the deliverables using the relative selling prices of each of the deliverables in the arrangement based on the aforementioned selling price hierarchy. Revenue arrangements with multiple deliverables are allocated using the relative selling price method. The Company determines the estimated selling price in multiple elements arrangements as follows: The Company determines the ESP in multiple-element arrangements for the products, based on reviewing historical transactions, and considering several other external and internal factors including, but not limited to, pricing practices including discounting and competition. The Company determines the selling price for maintenance and support based on VSOE of the price charged based on standalone sales (renewals) of such elements using a consistent percentage of the Company's product price lists. Deferred revenues are classified as short and long-term based on their contractual term and recognized as revenues at the time the respective elements are provided The Company records a provision for estimated product returns based on its experience with historical product returns and other known factors. Such provisions amounted to $ 910 and $ 688 as of December 31, 2016 and 2015, respectively. |
Advertising expenses | m. Advertising expenses: Advertising expenses are charged to the statement of comprehensive loss, as incurred. Advertising expenses for the years ended December 31, 2016, 2015 and 2014 amounted to $ 1,081, $ 1,201 and $ 1,131, respectively. |
Research and development costs | n. Research and development costs: Accounting Standards Codification No. 985-20, requires capitalization of certain software development costs subsequent to the establishment of technological feasibility. Based on the Company's product development process, technological feasibility is established upon the completion of a working model. The Company does not incur material costs between the completion of a working model and the point at which the products are ready for general release. Therefore, research and development costs are charged to the consolidated statement of comprehensive loss as incurred. |
Severance pay | o. Severance pay: The liability in Israel for substantially all of the Company`s employees in respect of severance pay liability is calculated in accordance with Section 14 of the Severance Pay Law -1963 (herein- "Section 14"). Section 14 states that Company's contributions for severance pay shall be in line of severance compensation and upon release of the policy to the employee, no additional obligations shall be conducted between the parties regarding the matter of severance pay and no additional payments shall be made by the Company to the employee. Furthermore, the related obligation and amounts deposited on behalf of such obligation under Section 14, are not stated on the balance sheet, because pursuant to current ruling, they are legally released from obligation to employees once the deposits have been paid. There are a limited number of employees in Israel, for whom the Company is liable for severance pay. The Company's liability for severance pay for its Israeli employees was calculated pursuant to Section 14, based on the most recent monthly salary of its Israeli employees multiplied by the number of years of employment as of the balance sheet date for such employees. The Company's liability was partly provided by monthly deposits with severance pay funds and insurance policies and the remainder by an accrual. Severance expense for the years ended December 31, 2016, 2015 and 2014, amounted to $ 1,976, $ 2,286 and $ 2,092, respectively. |
Restructuring costs | p. Restructuring costs: The Company accounts for restructuring activities in accordance to ASC 712 "Compensation-Nonretirement Postemployment Benefits" ("ASC 712"), which requires that a liability for a cost associated with a contractual postemployment benefits be recognized and measured, initially at fair value, only when it is probable that the employees will be entitled to the benefits and the amount is estimable. |
Accounting for stock-based compensation | q. Accounting for stock-based compensation: The Company accounts for stock based compensation in accordance with Accounting Standards Codification No. 718, "Compensation - Stock Compensation" ("ASC No. 718") that requires companies to estimate the fair value of equity-based payment awards on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as an expense over the requisite service periods in the Company's consolidated statement of comprehensive loss. The Company recognizes compensation expenses for the value of its awards based on the straight line method over the requisite service period of each of the awards, net of estimated forfeitures. The Company accounted for changes in award terms as a modification in accordance with ASC 718. A modification to the terms of an award should be treated as an exchange of the original award for a new award with total compensation cost equal to the grant-date fair value of the original award plus the incremental value measured at the same date. Under ASC 718, the calculation of the incremental value is based on the excess of the fair value of the new (modified) award based on current circumstances over the fair value of the original award measured immediately before its terms are modified based on current circumstances. ASC No. 718 requires forfeitures to be estimated at the time of the grant and revised in subsequent periods if actual forfeitures differ from those estimates. The following table sets forth the total stock-based compensation expense resulting from stock options and restricted share units ("RSUs") Year ended December 31, 2016 2015 2014 Cost of revenues $ 367 $ 324 $ 353 Research and development 1,240 1,637 1,919 Sales and marketing 1,833 2,802 3,322 General and administrative 1,701 2,407 2,501 Total stock-based compensation expense $ 5,141 $ 7,170 $ 8,095 The Company selected the binomial option pricing model as the most appropriate fair value method for its stock-based compensation awards with the following assumptions for the years ended December 31, 2016, 2015 and 2014: Year ended December 31, 2016 2015 2014 Suboptimal exercise multiple 2.9-3.5 3 3 Risk free interest rate 0.47%-1.58% 0.23%-2.35% 0.10%-2.73% Volatility 33%-51% 37%-55% 44%-60% Dividend yield 0% 0% 0% The expected annual post-vesting and pre-vesting forfeiture rates affects the number of exercisable options. Based on the Company's historical experience, the annual pre-vesting and post-vesting are in the range of 0%-31% and 0%-29%, respectively, in the years 2016, 2015, and 2014. The computations of expected volatility and suboptimal exercise multiple is based on the average of the Company's realized historical stock price. The computation of the suboptimal exercise multiple and the forfeiture rates are based on the grantees expected exercise prior and post vesting termination behavior. The interest rate for period within the contractual life of the award is based on the U.S. Treasury Bills yield curve in effect at the time of grant. The Company currently has no plans to distribute dividends and intends to retain future earnings to finance the development of its business. The expected life of the stock options represents the weighted-average period the stock options are expected to remain outstanding and is a derived output of the binomial model. The expected life of the stock options is impacted by all of the underlying assumptions used in the Company's model. |
Treasury stock | r. Treasury stock: The Company repurchases its Ordinary shares from time to time on the open market and holds such shares as treasury stock. The Company presents the cost to repurchase treasury stock as a reduction of shareholders' equity. |
Concentration of credit risks | s. Concentration of credit risks: Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents, marketable securities, short-term bank deposits, trade receivables and derivative instruments. The majority of cash and cash equivalents and short-term deposits of the Company are invested in dollar deposits in major U.S. and Israeli banks. Such investments in the United States may be in excess of insured limits and are not insured in other jurisdictions. Generally, the cash and cash equivalents and short-term bank deposits may be redeemed upon demand, and therefore, bear minimal risk. Marketable securities include investments in dollar linked corporate and municipal bonds. Marketable securities consist of highly liquid debt instruments with high credit standing. The Company’s investment policy, approved by the Board of Directors, limits the amount the Group may invest in any one type of investment or issuer, thereby reducing credit risk concentrations. Management believes that the portfolio is well diversified and, accordingly, minimal credit risk exists with respect to these marketable debt securities The Company's trade receivables are primarily derived from sales to customers located mainly in EMEA, as well as in APAC, Latin America and the United States. Concentration of credit risk with respect to trade receivables is limited by credit limits, ongoing credit evaluation and account monitoring procedures. The Company performs ongoing credit evaluations of its customers and establishes an allowance for doubtful accounts on a specific basis. Allowance for doubtful accounts amounted to $ 924 and $ 657 as of December 31, 2016 and 2015, respectively. The Company has no significant off balance sheet concentrations of credit risk. |
Grants from the Israel Innovation Authority | t. Grants from the Israel Innovation Authority: Participation grants from the Israel Innovation Authority (Previously known as the Office of the Chief Scientist) for research and development activity are recognized at the time the Company is entitled to such grants on the basis of the costs incurred and included as a deduction of research and development costs. Research and development non royalty bearing grants recognized amounted to $ 606, $ 1,252 and $ 984 in 2016, 2015 and 2014, respectively. |
Income taxes | u. Income taxes: The Company accounts for income taxes in accordance with Accounting Standards Codification No. 740, "Income Taxes" ("ASC No. 740"). ASC No. 740 prescribes the use of the liability method, whereby deferred tax asset and liability account balances are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value if it is more likely than not that some portion or all of the deferred tax assets will not be realized. ASC No. 740 contains a two-step approach to recognizing and measuring a liability for uncertain tax positions. The first step is to evaluate the tax position taken or expected to be taken in a tax return by determining if the weight of available evidence indicates that it is more likely than not that, on an evaluation of the technical merits, the tax position will be sustained on audit, including resolution of any related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. |
Basic and diluted net income (loss) per share | v. Basic and diluted net income (loss) per share: Basic net income (loss) per share is computed based on the weighted average number of Ordinary Shares outstanding during each year. Diluted net income (loss) per share is computed based on the weighted average number of Ordinary Shares outstanding during each year, plus dilutive potential Ordinary Shares considered outstanding during the year, in accordance with FASB ASC 260 "Earnings Per Share". For the years ended December 31, 2016, 2015 and 2014, all outstanding options and have been excluded from the calculation of the diluted net loss per share since their effect was anti-dilutive. |
Comprehensive income (loss) | w. Comprehensive income (loss): The Company accounts for comprehensive income (loss) in accordance with Accounting Standards Codification No. 220, "Comprehensive Income" ("ASC No. 220"). This statement establishes standards for the reporting and display of comprehensive income (loss) and its components in a full set of general purpose financial statements. Comprehensive loss represents all changes in shareholders' equity during the period except those resulting from investments by, or distributions to shareholders. The Company determined that its items of comprehensive income (loss) relate to unrealized gains and losses on hedging derivative instruments and unrealized gains and losses on available-for-sale marketable securities. The following table shows the components and the effects on net loss of amounts reclassified from accumulated other comprehensive loss as of December 31, 2016: Year ended December 31, 2016 Unrealized gains (losses) on marketable securities Unrealized gains (losses) on cash flow hedges Total Balance as of December 31, 2015 $ (425 ) $ (45 ) $ (470 ) Changes in other comprehensive income (loss) before reclassifications 293 226 519 Amounts reclassified from accumulated other comprehensive income (loss) to : Cost of revenues - (32 ) (32 ) Operating expenses - (210 ) (210 ) Financial income, net 44 - 44 Net current-period other comprehensive income (loss) 337 (16 ) 321 Balance as of December 31, 2016 $ (88 ) $ (61 ) $ (149 ) |
Fair value of financial instruments | x. Fair value of financial instruments: The Company measures its cash and cash equivalents, marketable securities, derivative instruments, short-term bank deposits, trade receivables, other receivables, trade payables and other payables at fair value. Fair value is an exit price, representing the amount that would be received if the Company were to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. The Company uses a three-tier value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: Level 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2 - Include other inputs that are directly or indirectly observable in the marketplace, other than quoted prices included in Level 1, such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets with insufficient volume or infrequent transactions, or other inputs that are observable (model-derived valuations in which significant inputs are observable), or can be derived principally from or corroborated by observable market data; and Level 3 - Unobservable inputs which are supported by little or no market activity. The Company categorized each of its fair value measurements in one of those three levels of hierarchy. The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The Company's earn-out consideration is classified within Level 3. The valuation methodology used by the Company to calculate the fair value consideration is the discounted cash flow using Monte-Carlo simulation method by taking into account, forecast future revenues, expected volatility of 39.2% and weighted average cost of debt of 2%. |
Derivatives and hedging | y. Derivatives and hedging: The Company accounts for derivatives and hedging based on Accounting Standards Codification No. 815, "Derivatives and Hedging" ("ASC No. 815"). The Company accounts for its derivative instruments as either assets or liabilities and carries them at fair value. Derivative instruments that are not designated and qualified as hedging instruments must be adjusted to fair value through earnings. For derivative instruments that hedge the exposure to variability in expected future cash flows that are designated as cash flow hedges, the effective portion of the gain or loss on the derivative instrument is reported as a component of accumulated other comprehensive income (loss) in shareholders' equity and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. The ineffective portion of the gain or loss on the derivative instrument is recognized in current earnings. To apply hedge accounting treatment, cash flow hedges must be highly effective in offsetting changes to expected future cash flows on hedged transactions. |
Business combinations | z. Business combinations: The Company accounts for business combinations in accordance with ASC No. 805. ASC No. 805 requires recognition of assets acquired, liabilities assumed, and any non-controlling interest at the acquisition date, measured at their fair values as of that date. Any excess of the fair value of net assets acquired over the purchase price is recorded as goodwill and any subsequent changes in estimated contingencies are to be recorded in earnings. In addition, changes in valuation allowance related to acquired deferred tax assets and acquired income tax positions are to be recognized in earnings. |
Warranty costs | aa. Warranty costs: The Company generally provides three months software and a one year hardware warranty for all of its products. A provision is recorded for estimated warranty costs at the time revenues are recognized based on the Company's experience. Warranty expenses for the years |
Recently Issued Accounting Pronouncement | ab. Recently Issued Accounting Pronouncements: In November 2015, the FASB issued ASU 2015-17, “Balance Sheet Classification of Deferred Taxes”, which simplifies the presentation of deferred income taxes. This ASU requires that deferred tax assets and liabilities be classified as non-current in a statement of financial position. The Company early adopted ASU 2015-17 effective December 31, 2015 on a prospective basis. No prior periods were retrospectively adjusted. In January 2016, the FASB issued a new standard to amend certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. Most prominent among the amendments is the requirement for changes in the fair value of our equity investments, with certain exceptions, to be recognized through net income rather than accumulated other comprehensive income (loss). ASU 2016-01 is effective for annual reporting periods, and interim periods within those years beginning after December 15, 2017. Early adoption by public entities is permitted only for certain provisions. The Company is currently in the process of evaluating the impact of the adoption of this standard on its consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, “Leases”, on the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors). The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight line basis over the term of the lease, respectively. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for in a manner similar to the accounting under existing guidance for operating leases today. The new standard requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales-type leases, direct financing leases and operating leases. ASC 842 supersedes the previous leases standard, ASC 840, "Leases". The guidance is effective for the interim and annual periods beginning on or after December 15, 2018, and early adoption is permitted. The Company is currently in the process of evaluating the impact of the adoption of ASU 2016-02 on its consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, “Compensation – Stock Compensation”, which effects all entities that issue share-based payment awards to their employees. The amendments in this ASU cover such areas as the recognition of excess tax benefits and deficiencies, the classification of those excess tax benefits on the statement of cash flows, an accounting policy election for forfeitures, the amount an employer can withhold to cover income taxes and still qualify for equity classification and the classification of those taxes paid on the statement of cash flows. This ASU is effective for annual and interim periods beginning after December 15, 2016. This guidance can be applied either prospectively, retrospectively or using a modified retrospective transition method. Early adoption is permitted. The Company does not expect that this new guidance will have a material impact on the Company’s Consolidated Financial Statements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”). The standard changes the methodology for measuring credit losses on financial instruments and the timing of when such losses are recorded. ASU 2016-13 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019. Early adoption is permitted for fiscal years, and interim periods within those years, beginning after December 15, 2018. The Company is currently evaluating the impact of this standard on its Consolidated Financial Statements. In November 2016, the FASB issued Accounting Standards Update No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash (ASU 2016-18), which requires companies to include amounts generally described as restricted cash and restricted cash equivalents in cash and cash equivalents when reconciling beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The amendments in this Update are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. This new guidance doesn't have a material impact on the Company’s Consolidated Financial Statements. In May 2014, the FASB issued a new standard related to revenue recognition. The new revenue recognition standard provides a unified model to determine when and how revenue is recognized. The core principle of the new revenue recognition standard is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The FASB has recently issued several amendments to the standard, including clarification on identifying performance obligations. The guidance permits two methods of modification: retrospectively to each prior reporting period presented (full retrospective method), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (the cumulative catch-up transition method). The Company has not yet selected a transition method. The new standard will be effective for the Company beginning January 1, 2018, and adoption as of the original effective date of January 1, 2017 is permitted. The Company will adopt the new standard as of January 1, 2018. The Company has made progress toward completing its evaluation of the potential changes from adopting this new standard on its financial reporting and disclosures. The Company has developed a project plan to analyze the potential impact this guidance will have on its consolidated financial statements and related disclosures as well as its business processes, systems and controls. This includes reviewing revenue contracts across all revenue streams and evaluating potential differences that would result from applying the requirements under the new guidance, including among others, the impact on specific performance obligations and variable consideration transactions. The Company is still currently evaluating the impact of the adoption of this standard on its consolidated financial statements. |
GENERAL (Tables)
GENERAL (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Business Acquisition [Line Items] | |
Schedule of pro forma revenue and net loss | Year ended December 31, 2015 2014 Unaudited Revenues $ 100,683 $ 124,244 Net loss $ (21,177 ) $ (17,976 ) |
Optenet SA [Member] | |
Business Acquisition [Line Items] | |
Schedule of the Fair Value of Assets Acquired and Liabilities Assumed | Fair value Current assets $ 54 Equipment 152 Deferred revenues (155 ) Current and non-current liabilities (103 ) Technology 4,032 Customer relationships 2,824 Backlog 386 Goodwill 10,748 Net assets acquired $ 17,938 |
SIGNIFICANT ACCOUNTING POLICI27
SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Schedule of Estimated Useful Lives at an Annual Rate | % Lab equipment 25 - 33 Computers and peripheral equipment 15 - 33 Office furniture 6 - 15 Leasehold improvements Over the shorter of the term of the lease or the useful life of the asset |
Schedule of Stock-Based Compensation Expense | Year ended December 31, 2016 2015 2014 Cost of revenues $ 367 $ 324 $ 353 Research and development 1,240 1,637 1,919 Sales and marketing 1,833 2,802 3,322 General and administrative 1,701 2,407 2,501 Total stock-based compensation expense $ 5,141 $ 7,170 $ 8,095 |
Schedule of Stock-Based Compensation Assumptions | Year ended December 31, 2016 2015 2014 Suboptimal exercise multiple 2.9-3.5 3 3 Risk free interest rate 0.47%-1.58% 0.23%-2.35% 0.10%-2.73% Volatility 33%-51% 37%-55% 44%-60% Dividend yield 0% 0% 0% |
Schedule of Accumulated Other Comprehensive Income | Year ended December 31, 2016 Unrealized gains (losses) on marketable securities Unrealized gains (losses) on cash flow hedges Total Balance as of December 31, 2015 $ (425 ) $ (45 ) $ (470 ) Changes in other comprehensive income (loss) before reclassifications 293 226 519 Amounts reclassified from accumulated other comprehensive income (loss) to : Cost of revenues - (32 ) (32 ) Operating expenses - (210 ) (210 ) Financial income, net 44 - 44 Net current-period other comprehensive income (loss) 337 (16 ) 321 Balance as of December 31, 2016 $ (88 ) $ (61 ) $ (149 ) |
AVAILABLE-FOR-SALE MARKETABLE28
AVAILABLE-FOR-SALE MARKETABLE SECURITIES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Investments, Debt and Equity Securities [Abstract] | |
Summary of Available-for-Sale Marketable Securities | December 31, 2016 December 31, 2015 Amortized cost Gross unrealized gain Gross unrealized Fair value Amortized cost Gross unrealized Gross unrealized Fair value Available-for-sale - matures within one year: Governmental debentures $ 339 $ 0 $ (0 ) $ 339 $ 293 $ - $ (0 ) $ 293 Corporate debentures 19,693 31 (14 ) 19,710 20,077 1 (19 ) 20,059 20,032 31 (14 ) 20,049 20,370 1 (19 ) 20,352 Available-for-sale - matures after one year through three years: Governmental debentures - - - - 978 - (6 ) 972 Corporate debentures 34,472 70 (78 ) 34,464 29,004 3 (230 ) 28,777 34,472 70 (78 ) 34,464 29,982 3 (236 ) 29,749 Available-for-sale - matures after three years through five years: Governmental debentures 100 - - 100 344 - (5 ) 339 Corporate debentures 5,991 2 (99 ) 5,894 14,650 5 (174 ) 14,481 6,091 2 (99 ) 5,994 14,994 5 (179 ) 14,820 $ 60,595 $ 103 $ (191 ) $ 60,507 $ 65,346 $ 9 $ (434 ) $ 64,921 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Assets Measured at Fair Value on a Recurring Basis | As of December 31, 2016 Fair value measurements using input type Level 1 Level 2 Level 3 Total Available-for-sale marketable securities $ - $ 60,507 $ - $ 60,507 Foreign currency derivative contracts - 28 - 28 Earn-out liability - - 4,504 4,504 Total financial net assets $ - $ 60,535 $ 4,504 $ 65,039 As of December 31, 201 5 Fair value measurements using input type Level 1 Level 2 Level 3 Total Available-for-sale marketable securities $ - $ 64,921 $ - $ 64,921 Foreign currency derivative contracts - 401 - 401 Earn-out liability - - 6,102 6,102 Total financial net assets $ - $ 65,322 $ 6,102 $ 71,424 |
Schedule of Fair Value Measurements Using Significant Unobservable Inputs | Balance at January 1, 2016 $ 6,102 Earn Out liability payments, settlements and adjustments due to exchange rates (636 ) Adjustment due to change in the forecast of earn-out consideration (962 ) Balance at December 31, 2016 $ 4,504 |
DERIVATIVE INSTRUMENTS (Tables)
DERIVATIVE INSTRUMENTS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Designated as Hedging Instrument [Member] | |
Schedule of the Fair Value of Open Foreign Exchange Contracts | Foreign exchange forward and December 31, options contracts Balance sheet 2016 2015 Fair value of foreign exchange hedge transactions Other receivables and prepaid expenses $ 40 $ 104 Fair value of foreign exchange hedge transactions Other payables and accrued expenses (101 ) (149 ) Total derivatives designated as hedging instruments Other Comprehensive loss $ (61 ) $ (45 ) |
Not Designated as Hedging Instrument [Member] | |
Schedule of the Fair Value of Open Foreign Exchange Contracts | Foreign exchange forward and December 31, options contracts Balance sheet 2016 2015 Fair value of foreign exchange non-designated hedge transactions Other receivables and prepaid expenses $ 181 $ 459 Fair value of foreign exchange non-designated hedge transactions Other payables and accrued expenses (92 ) (13 ) Total derivatives designated as hedging instruments $ 89 $ 446 |
OTHER RECEIVABLES AND PREPAID31
OTHER RECEIVABLES AND PREPAID EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Other Accounts Receivable and Prepaid Expenses | December 31, 2016 2015 Prepaid expenses $ 1,739 $ 1,959 Government authorities 1,003 898 Receivable from third-party 426 - Foreign currency derivative contracts 221 566 Short-term lease deposits 127 215 Grants receivable from the Israel Innovation Authority - 728 Others 363 147 $ 3,879 $ 4,513 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | December 31, 2016 2015 Raw materials $ 1,257 $ 1,584 Finished goods 5,978 8,585 $ 7,235 $ 10,169 |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | December 31, 2016 2015 Cost: Lab equipment $ 13,225 $ 12,527 Computers and peripheral equipment 18,704 18,667 Office furniture and equipment 975 955 Leasehold improvements 1,238 1,164 34,142 33,313 Accumulated depreciation: Lab equipment 10,788 9,483 Computers and peripheral equipment 17,750 17,453 Office furniture and equipment 521 568 Leasehold improvements 696 620 29,755 28,124 Depreciated cost $ 4,387 $ 5,189 |
INTANGIBLE ASSETS, NET (Tables)
INTANGIBLE ASSETS, NET (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | December 31, 2016 2015 Original Cost: Technology *) $ 9,111 $ 9,111 Backlog 1,877 1,877 Customer relationships **) 3,592 3,592 $ 14,580 $ 14,580 Accumulated amortization: Technology $ 6,705 $ 5,765 Backlog 1,867 1,632 Customer relationships 1,598 1,064 $ 10,170 $ 8,461 Amortized cost $ 4,410 $ 6,119 *) During 2015, the Company recorded an impairment loss of $ 3,214 and $ 2,432 related to technology purchased in 2012 from acquisitions of Ortiva Wireless Inc. and Oversi Networks Ltd. ("Oversi"), respectively, due to the Company's decision to reach end of life on the respective product lines. The impairment loss was recorded in cost of revenues. **) During 2015, the Company recorded an impairment loss of $ 131 related to Oversi's customer relationships, due to the Company's decision to reach end of life on the respective product line. |
Schedule of Estimated Amortization Expense | Year ending December 31, 2017 1,478 2018 1,630 2019 1,302 Total 4,410 |
OTHER PAYABLES AND ACCRUED EX35
OTHER PAYABLES AND ACCRUED EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Payables and Accruals [Abstract] | |
Schedule of Other Payables and Accrued Expenses | December 31, 2016 2015 Accrued expenses $ 2,255 $ 1,758 Accrued taxes 416 473 Foreign currency derivative contracts 193 163 Advances from customers 23 1,103 Contingent consideration - 1,949 Others 270 264 $ 3,157 $ 5,710 |
COMMITMENTS AND CONTINGENT LI36
COMMITMENTS AND CONTINGENT LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Lease Obligations | Year ending December 31, 2017 $ 2,480 2018 651 2019 103 Total $ 3,234 |
SHAREHOLDERS' EQUITY (Tables)
SHAREHOLDERS' EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Stock Option Activity | Year ended December 31, 2016 2015 2014 Number of shares upon exercise Weighted average exercise price Number of shares upon exercise Weighted average exercise price Number of shares upon exercise Weighted average exercise price Outstanding at beginning of year 2,811,966 $ 10.70 2,531,381 $ 11.99 2,875,003 $ 12.02 Granted 643,697 $ 4.99 704,348 $ 6.73 572,533 $ 11.93 Forfeited (1, 358,492 ) $ 12.41 (320,496 ) $ 15.13 (562,787 ) $ 17.02 Exercised (138,157 ) $ 1.75 (103,267 ) $ 1.28 (353,368 ) $ 4.18 Outstanding at end of year 1,959,014 $ 8.24 2,811,966 $ 10.70 2,531,381 $ 11.99 Exercisable at end of year 1,072,658 $ 9.87 1,646,204 $ 11.99 1,440,143 $ 11.75 Vested and expected to vest 1,407,930 $ 9.04 2,197,848 $ 11.16 1,950,116 $ 11.97 |
Schedule of Stock Options Outstanding | Exercise price Shares upon exercise of options outstanding as of December 31, 2016 Weighted average remaining contractual life Shares upon exercise of options exercisable as of December 31, 2016 Years $ 23.31-27.58 73,000 5.62 73,000 $ 15.20-17.07 129,059 4.75 123,088 $ 10.16-14.68 383,233 6.59 297,998 $ 5.01-9.25 827,398 5.43 321,964 $ 0.03-4.95 546,324 5.12 256,608 1,959,014 1,072,658 |
Summary of Restricted Stock Unit Activity | Year ended December 31, 2016 2015 Number of shares upon exercise Weighted average share price Number of shares upon exercise Weighted average share price Outstanding at beginning of year 359,404 $ 10.95 445,264 $ 12.43 Granted 531,570 $ 4.59 158,551 $ 8.52 Vested (152,460 ) $ 10.08 (159,912 ) $ 11.22 Forfeited (146,388 ) $ 6.85 (84,499 ) $ 12.57 Unvested at end of year 592,126 $ 6.53 359,404 $ 10.95 |
TAXES ON INCOME (Tables)
TAXES ON INCOME (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule of Pre-tax Income (Loss) | Year ended December 31, 2016 2015 2014 Domestic $ (7,033 ) $ (16,898 ) $ (3,792 ) Foreign 1,243 412 1,345 $ (5,790 ) $ (16,486 ) $ (2,447 ) |
Schedule of the Reconciliation of the Theoretical Tax Expenses | Year ended December 31, 2016 2015 2014 Loss before taxes on income $ (5,790 ) $ (16,486 ) $ (2,447 ) Theoretical tax expense computed at the Israeli statutory tax rate (25%, 26.5% and 26.5% for the years 2016, 2015 and 2014, respectively) $ (1,448 ) $ (4,369 ) $ (649 ) Changes in valuation allowance (469 ) 3,716 (1,328 ) Increase (decrease) in losses and temporary differences due to change in Israeli corporate and “Approved Enterprise" tax (216 ) 679 611 Write off of prepaid and withholding taxes 1,759 1,150 - Foreign tax rates differences related to subsidiaries 576 103 (34 ) Non-deductible expenses and other 567 181 (381 ) Non-deductible share-based compensation expense 1,435 1,896 1,831 Actual tax expense $ 2,204 $ 3,356 $ 50 |
Schedule of Income Tax Expense | Year ended December 31, 2016 2015 2014 Current taxes $ 203 $ 146 $ 612 Deferred taxes (benefit) 242 2,060 (562 ) Write off of prepaid and withholding taxes 1,759 1,150 - $ 2,204 $ 3,356 $ 50 |
Schedule of Deferred Income Taxes | December 31, 2016 2015 Deferred tax assets: Operating and capital loss carryforwards $ 12,900 $ 14,842 Reserves and allowances 2,022 948 Deferred tax asset before valuation allowance 14,922 15,790 Valuation allowance (14,655 ) (15,124 ) Net deferred tax asset 267 666 Deferred tax liability - (157 ) Net deferred tax asset $ 267 $ 509 |
GEOGRAPHIC INFORMATION (Tables)
GEOGRAPHIC INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Schedule of Revenues by Geographic Location | Year ended December 31, 2016 2015 2014 Europe $ 34,279 $ 39,110 $ 41,238 Asia and Oceania 27,700 28,495 41,990 Americas (excluding the United States) 13,094 14,347 3,299 Middle East and Africa 12,365 9,809 15,352 United States 2,931 8,206 15,307 $ 90,369 $ 99,967 $ 117,186 |
Schedule of Major Customers | Year ended December 31, 2016 2015 2014 Customer A 25 % 27 % 27 % Customer B 17 % - - Customer C - 10 % 17 % 42 % 37 % 44 % |
Schedule of Long-Lived Assets by Geographic Location | December 31, 2016 2015 Long-lived assets: Israel $ 4,156 $ 4,924 United States 42 109 Other 189 156 $ 4,387 $ 5,189 |
FINANCIAL INCOME (EXPENSES), 40
FINANCIAL INCOME (EXPENSES), NET (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Other Income and Expenses [Abstract] | |
Schedule of Financial Income, Net | Year ended December 31, 2016 2015 2014 Financial income: Interest income $ 2,466 $ 2,174 $ 1,900 Financial expenses: Exchange rate differences and other 186 1,480 174 Amortization/accretion of premium/discount on marketable securities, net 1,221 1,278 1,066 $ 1,059 $ (584 ) $ 660 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Net loss per share: | |
Schedule of the Computation of Basic and Diluted Net Earnings (Loss) per Share | Year ended December 31, 2016 2015 2014 Numerator: Net loss $ (7,994 ) $ (19,842 ) $ (2,497 ) Denominator: Weighted average number of shares outstanding used in computing diluted net loss per share 33,202,309 33,419,917 33,143,168 Basic and diluted net loss per share $ (0.24 ) $ (0.59 ) $ (0.08 ) |
Summary of numbers of shares were excluded from the computation of diluted net loss per ordinary | Year ended December 31, 2016 2015 2014 Ordinary shares 2,000,757 3,424,891 2,300,425 |
GENERAL (Narrative) (Details)
GENERAL (Narrative) (Details) - USD ($) $ in Thousands | Mar. 23, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Business Acquisition [Line Items] | ||||
Cash paid to acquire entity | $ 9,859 | |||
Fair value of contingent liability | 1,949 | |||
Acquisition transaction costs | 397 | |||
Restructuring costs | 1,290 | |||
Liability balance for the restructuring plan termination of employment expenses | 309 | |||
Optenet SA [Member] | ||||
Business Acquisition [Line Items] | ||||
Acquisition date | Mar. 23, 2015 | |||
Cash paid to acquire entity | $ 9,859 | |||
Total purchase consideration | $ 17,938 | |||
Fair value of contingent liability | $ 4,504 | $ 6,102 | ||
Payment term for contingent consideration | 5 years | |||
Optenet SA [Member] | Technology [Member] | ||||
Business Acquisition [Line Items] | ||||
Weighted average remaining useful life | 4 years 4 months 2 days | |||
Optenet SA [Member] | Backlog [Member] | ||||
Business Acquisition [Line Items] | ||||
Weighted average remaining useful life | 2 years 9 months 18 days | |||
Optenet SA [Member] | Customer Relationships [Member] | ||||
Business Acquisition [Line Items] | ||||
Weighted average remaining useful life | 4 years 9 months 18 days | |||
Optenet [Member] | ||||
Business Acquisition [Line Items] | ||||
Contingent consideration payments cap based on achievement of certain thresholds of revenues | $ 27,500 |
GENERAL (Schedule of Estimated
GENERAL (Schedule of Estimated Fair Values of Assets Acquired and Liabilities Assumed) (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Mar. 23, 2015 |
Business Acquisition [Line Items] | |||
Goodwill | $ 31,562 | $ 31,562 | |
Optenet SA [Member] | |||
Business Acquisition [Line Items] | |||
Current assets | $ 54 | ||
Equipment | 152 | ||
Deferred revenues | (155) | ||
Current and non-current liabilities | (103) | ||
Goodwill | 10,748 | ||
Net assets acquired | 17,938 | ||
Optenet SA [Member] | Technology [Member] | |||
Business Acquisition [Line Items] | |||
Intangible assets | 4,032 | ||
Optenet SA [Member] | Backlog [Member] | |||
Business Acquisition [Line Items] | |||
Intangible assets | 386 | ||
Optenet SA [Member] | Customer Relationships [Member] | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 2,824 |
GENERAL (Schedule of pro forma
GENERAL (Schedule of pro forma revenue and net loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Unaudited pro forma condensed results of operations | ||
Revenues | $ 100,683 | $ 124,244 |
Net loss | $ (21,177) | $ (17,976) |
SIGNIFICANT ACCOUNTING POLICI45
SIGNIFICANT ACCOUNTING POLICIES (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Restricted Cash and Cash Equivalents Items [Line Items] | |||
Short-term deposits, weighted average interest rate | 1.37% | 0.93% | |
Inventory write-offs | $ 1,004 | $ 775 | $ 4,097 |
Cumulative inventory write-off | 1,957 | 1,663 | |
Impairment of intangible assets | 5,777 | ||
Reserve for sales returns | 910 | 688 | |
Advertising expenses | 1,081 | 1,201 | 1,131 |
Severance expense | 1,976 | 2,286 | 2,092 |
Allowance for doubtful accounts | 924 | 657 | |
Grants participations excluded from research and development costs | $ 606 | $ 1,252 | $ 984 |
Expected volatility | 39.20% | ||
Weighted average cost of debt | 2.00% | ||
Minimum [Member] | |||
Restricted Cash and Cash Equivalents Items [Line Items] | |||
Annual post-vesting and pre-vesting forfeiture rate | 0.00% | 0.00% | 0.00% |
Maximum [Member] | |||
Restricted Cash and Cash Equivalents Items [Line Items] | |||
Annual post-vesting and pre-vesting forfeiture rate | 29.00% | 29.00% | 29.00% |
SIGNIFICANT ACCOUNTING POLICI46
SIGNIFICANT ACCOUNTING POLICIES (Schedule of Estimated Useful Lives at Annual Rates) (Details) | 12 Months Ended |
Dec. 31, 2016 | |
Lab equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives, annual rate | 25.00% |
Lab equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives, annual rate | 33.00% |
Computers and peripheral equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives, annual rate | 15.00% |
Computers and peripheral equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives, annual rate | 33.00% |
Office furniture and equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives, annual rate | 6.00% |
Office furniture and equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives, annual rate | 15.00% |
Leasehold improvements [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | Over the shorter of the term of the lease or the useful life of the asset |
SIGNIFICANT ACCOUNTING POLICI47
SIGNIFICANT ACCOUNTING POLICIES (Schedule of Stock-Based Compensation Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total stock-based compensation expense | $ 5,141 | $ 7,170 | $ 8,095 |
Cost of revenues [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total stock-based compensation expense | 367 | 324 | 353 |
Research and development [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total stock-based compensation expense | 1,240 | 1,637 | 1,919 |
Sales and marketing [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total stock-based compensation expense | 1,833 | 2,802 | 3,322 |
General and administrative [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total stock-based compensation expense | $ 1,701 | $ 2,407 | $ 2,501 |
SIGNIFICANT ACCOUNTING POLICI48
SIGNIFICANT ACCOUNTING POLICIES (Schedule of Stock-Based Compensation Assumptions) (Details) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Accounting Policies [Abstract] | |||
Suboptimal exercise multiple | 3 | 3 | |
Suboptimal exercise multiple, minimum | 2.9 | ||
Suboptimal exercise multiple, maximum | 3.5 | ||
Risk free interest rate, minimum | 0.47% | 0.23% | 0.10% |
Risk free interest rate, maximum | 1.58% | 2.35% | 2.73% |
Volatility, minimum | 33.00% | 37.00% | 44.00% |
Volatility, maximum | 51.00% | 55.00% | 60.00% |
Dividend yield | 0.00% | 0.00% | 0.00% |
SIGNIFICANT ACCOUNTING POLICI49
SIGNIFICANT ACCOUNTING POLICIES (Schedule of Accumulated Other Comprehensive Income) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Balance | $ (470) | $ (1,620) | |
Changes in other comprehensive income (loss) before reclassifications | 519 | ||
Amounts reclassified from accumulated other comprehensive income (loss) to : | |||
Net current-period other comprehensive income (loss) | 321 | 1,150 | $ (1,986) |
Balance | (149) | (470) | $ (1,620) |
Cost of revenues [Member] | |||
Amounts reclassified from accumulated other comprehensive income (loss) to : | |||
Amounts reclassified from accumulated other comprehensive income | (32) | ||
Operating expenses [Member] | |||
Amounts reclassified from accumulated other comprehensive income (loss) to : | |||
Amounts reclassified from accumulated other comprehensive income | (210) | ||
Financial income, net [Member] | |||
Amounts reclassified from accumulated other comprehensive income (loss) to : | |||
Amounts reclassified from accumulated other comprehensive income | 44 | ||
Unrealized gains (losses) on marketable securities [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Balance | (425) | ||
Changes in other comprehensive income (loss) before reclassifications | 293 | ||
Amounts reclassified from accumulated other comprehensive income (loss) to : | |||
Net current-period other comprehensive income (loss) | 337 | ||
Balance | (88) | (425) | |
Unrealized gains (losses) on marketable securities [Member] | Cost of revenues [Member] | |||
Amounts reclassified from accumulated other comprehensive income (loss) to : | |||
Amounts reclassified from accumulated other comprehensive income | |||
Unrealized gains (losses) on marketable securities [Member] | Operating expenses [Member] | |||
Amounts reclassified from accumulated other comprehensive income (loss) to : | |||
Amounts reclassified from accumulated other comprehensive income | |||
Unrealized gains (losses) on marketable securities [Member] | Financial income, net [Member] | |||
Amounts reclassified from accumulated other comprehensive income (loss) to : | |||
Amounts reclassified from accumulated other comprehensive income | 44 | ||
Unrealized gains (losses) on cash flow hedges [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Balance | (45) | ||
Changes in other comprehensive income (loss) before reclassifications | 226 | ||
Amounts reclassified from accumulated other comprehensive income (loss) to : | |||
Net current-period other comprehensive income (loss) | (16) | ||
Balance | (61) | $ (45) | |
Unrealized gains (losses) on cash flow hedges [Member] | Cost of revenues [Member] | |||
Amounts reclassified from accumulated other comprehensive income (loss) to : | |||
Amounts reclassified from accumulated other comprehensive income | (32) | ||
Unrealized gains (losses) on cash flow hedges [Member] | Operating expenses [Member] | |||
Amounts reclassified from accumulated other comprehensive income (loss) to : | |||
Amounts reclassified from accumulated other comprehensive income | (210) | ||
Unrealized gains (losses) on cash flow hedges [Member] | Financial income, net [Member] | |||
Amounts reclassified from accumulated other comprehensive income (loss) to : | |||
Amounts reclassified from accumulated other comprehensive income |
AVAILABLE-FOR-SALE MARKETABLE50
AVAILABLE-FOR-SALE MARKETABLE SECURITIES (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | $ 60,595 | $ 65,346 |
Gross unrealized gain | 103 | 9 |
Gross unrealized loss | (191) | (434) |
Fair value | 60,507 | 64,921 |
Available-for-sale securities matures within one year [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 20,032 | 20,370 |
Gross unrealized gain | 31 | 1 |
Gross unrealized loss | (14) | (19) |
Fair value | 20,049 | 20,352 |
Available-for-sale securities matures after one year through three years [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 34,472 | 29,982 |
Gross unrealized gain | 70 | 3 |
Gross unrealized loss | (78) | (236) |
Fair value | 34,464 | 29,749 |
Available-for-sale securities matures after three year through five years [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 6,091 | 14,994 |
Gross unrealized gain | 2 | 5 |
Gross unrealized loss | (99) | (179) |
Fair value | 5,994 | 14,820 |
Governmental debentures [Member] | Available-for-sale securities matures within one year [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 339 | 293 |
Gross unrealized gain | 0 | |
Gross unrealized loss | 0 | 0 |
Fair value | 339 | 293 |
Governmental debentures [Member] | Available-for-sale securities matures after one year through three years [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 978 | |
Gross unrealized gain | ||
Gross unrealized loss | (6) | |
Fair value | 972 | |
Governmental debentures [Member] | Available-for-sale securities matures after three year through five years [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 100 | 344 |
Gross unrealized gain | ||
Gross unrealized loss | (5) | |
Fair value | 100 | 339 |
Corporate debentures [Member] | Available-for-sale securities matures within one year [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 19,693 | 20,077 |
Gross unrealized gain | 31 | 1 |
Gross unrealized loss | (14) | (19) |
Fair value | 19,710 | 20,059 |
Corporate debentures [Member] | Available-for-sale securities matures after one year through three years [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 34,472 | 29,004 |
Gross unrealized gain | 70 | 3 |
Gross unrealized loss | (78) | (230) |
Fair value | 34,464 | 28,777 |
Corporate debentures [Member] | Available-for-sale securities matures after three year through five years [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 5,991 | 14,650 |
Gross unrealized gain | 2 | 5 |
Gross unrealized loss | (99) | (174) |
Fair value | $ 5,894 | $ 14,481 |
FAIR VALUE MEASUREMENTS (Schedu
FAIR VALUE MEASUREMENTS (Schedule of Financial Assets Measured at Fair Value on a Recurring Basis) (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale marketable securities | $ 60,507 | $ 64,921 |
Foreign currency derivative contracts | 28 | 401 |
Earn-out liability | 4,504 | 6,102 |
Total financial assets | 65,039 | 71,424 |
Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale marketable securities | ||
Foreign currency derivative contracts | ||
Earn-out liability | ||
Total financial assets | ||
Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale marketable securities | 60,507 | 64,921 |
Foreign currency derivative contracts | 28 | 401 |
Earn-out liability | ||
Total financial assets | 60,535 | 65,322 |
Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale marketable securities | ||
Foreign currency derivative contracts | ||
Earn-out liability | 4,504 | 6,102 |
Total financial assets | $ 4,504 | $ 6,102 |
FAIR VALUE MEASUREMENTS (Sche52
FAIR VALUE MEASUREMENTS (Schedule of Fair value measurements using significant unobservable inputs) (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Fair Value Measurements Schedule Of Fair Value Measurements Using Significant Unobservable Inputs Details | |
Balance at January 1, 2016 | $ 6,102 |
Earn Out liability payments, settlements and adjustments due to exchange rates | (636) |
Adjustment due to change in the forecast of earn-out consideration | (962) |
Balance at December 31, 2016 | $ 4,504 |
DERIVATIVE INSTRUMENTS (Narrati
DERIVATIVE INSTRUMENTS (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||
Net losses recognized from currency transactions | $ 286 | $ 1,200 | $ 2,144 |
Unrealized gain (loss) on forward contracts, net | (61) | (45) | (1,456) |
Outstanding hedge transactions | 13,302 | 18,361 | |
Gain (loss) on derivative instruments reclassified from OCI to operating expenses | (242) | 1,407 | $ 717 |
Changes in fair value of derivatives not designated as hedging instrument | $ 89 | $ 446 |
DERIVATIVE INSTRUMENTS (Schedul
DERIVATIVE INSTRUMENTS (Schedule of the Fair Value Open Foreign Exchange Contracts) (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Fair value of foreign exchange hedge transactions | $ 40 | $ 104 |
Fair value of foreign exchange hedge transactions | (101) | (149) |
Total derivatives designated as hedging instruments | (61) | (45) |
Total derivatives not designated as hedging instrument, net | $ 92 | $ 13 |
DERIVATIVE INSTRUMENTS (Sched55
DERIVATIVE INSTRUMENTS (Schedule of the Fair value of the outstanding non-designated foreign exchange contracts) (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Derivative Instruments Schedule Of Fair Value Of Outstanding Non-designated Foreign Exchange Contracts Details | ||
Fair value of foreign exchange non-designated hedge transactions | $ 181 | $ 459 |
Fair value of foreign exchange non-designated hedge transactions | (92) | (13) |
Total derivatives designated as hedging instruments | $ 89 | $ 446 |
OTHER RECEIVABLES AND PREPAID56
OTHER RECEIVABLES AND PREPAID EXPENSES (Schedule of Other Accounts Receivable and Prepaid Expenses) (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Prepaid expenses | $ 1,739 | $ 1,959 |
Government authorities | 1,003 | 898 |
Receivable from third-party | 426 | |
Short-term lease deposits | 127 | 215 |
Grants receivable from the Israel Innovation Authority | 728 | |
Others | 363 | 147 |
Other receivables and prepaid expenses | 3,879 | 4,513 |
Foreign Exchange Contract [Member] | ||
Foreign currency derivative contracts | $ 221 | $ 566 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 1,257 | $ 1,584 |
Finished goods | 5,978 | 8,585 |
Total inventory | 7,235 | 10,169 |
Cost of goods sold, deferred finished goods inventory | $ 512 | $ 572 |
PROPERTY AND EQUIPMENT, NET (De
PROPERTY AND EQUIPMENT, NET (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Property, Plant and Equipment [Line Items] | |||
Cost | $ 34,142 | $ 33,313 | |
Accumulated depreciation | 29,755 | 28,124 | |
Deprecated cost | 4,387 | 5,189 | |
Depreciation | 2,334 | 2,813 | $ 3,308 |
Lab equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Cost | 13,225 | 12,527 | |
Accumulated depreciation | 10,788 | 9,483 | |
Computers and peripheral equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Cost | 18,704 | 18,667 | |
Accumulated depreciation | 17,750 | 17,453 | |
Office furniture and equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Cost | 975 | 955 | |
Accumulated depreciation | 521 | 568 | |
Leasehold improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Cost | 1,238 | 1,164 | |
Accumulated depreciation | $ 696 | $ 620 |
INTANGIBLE ASSETS, NET (Narrati
INTANGIBLE ASSETS, NET (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expense | $ 1,709 | $ 2,895 | $ 1,858 |
Technology [Member] | Ortiva [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Impairment loss | 3,214 | ||
Technology [Member] | Oversi [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Impairment loss | 2,432 | ||
Customer Relationships [Member] | Oversi [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Impairment loss | $ 131 |
INTANGIBLE ASSETS, NET (Schedul
INTANGIBLE ASSETS, NET (Schedule of Intangible Assets) (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | |
Finite-Lived Intangible Assets [Line Items] | |||
Cost | $ 14,580 | $ 14,580 | |
Accumulated amortization | 10,170 | 8,461 | |
Total | 4,410 | 6,119 | |
Technology [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Cost | [1] | 9,111 | 9,111 |
Accumulated amortization | 6,705 | 5,765 | |
Backlog [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Cost | 1,877 | 1,877 | |
Accumulated amortization | 1,867 | 1,632 | |
Customer Relationships [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Cost | [2] | 3,592 | 3,592 |
Accumulated amortization | $ 1,598 | $ 1,064 | |
[1] | During 2015, the Company recorded an impairment loss of $ 3,214 and $ 2,432 related to technology purchased in 2012 from acquisitions of Ortiva Wireless Inc. and Oversi Networks Ltd. ("Oversi"), respectively, due to the Company's decision to reach end of life on the respective product lines. The impairment loss was recorded in cost of revenues. | ||
[2] | During 2015, the Company recorded an impairment loss of $ 131 related to Oversi's customer relationships, due to the Company's decision to reach end of life on the respective product line. The impairment loss was recorded in sales and marketing. |
INTANGIBLE ASSETS, NET (Sched61
INTANGIBLE ASSETS, NET (Schedule of Estimated Amortization Expense) (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2,017 | $ 1,478 | |
2,018 | 1,630 | |
2,019 | 1,302 | |
Total | $ 4,410 | $ 6,119 |
OTHER PAYABLES AND ACCRUED EX62
OTHER PAYABLES AND ACCRUED EXPENSES (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
OTHER PAYABLES AND ACCRUED EXPENSES [Abstract] | ||
Accrued expenses | $ 2,255 | $ 1,758 |
Accrued taxes | 416 | 473 |
Advances from customers | 23 | 1,103 |
Contingent consideration | 1,949 | |
Others | 270 | 264 |
Total other payables and accrued expenses | 3,157 | 5,710 |
Foreign Exchange Contract [Member] | ||
OTHER PAYABLES AND ACCRUED EXPENSES [Abstract] | ||
Foreign currency derivative contracts | $ 193 | $ 163 |
COMMITMENTS AND CONTINGENT LI63
COMMITMENTS AND CONTINGENT LIABILITIES (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Lease period | 5 years | ||
Monthly rental expenses | $ 144 | ||
Rent expense | 2,758 | $ 2,828 | $ 3,155 |
Maximum possible litigation amount | $ 32 |
COMMITMENTS AND CONTINGENT LI64
COMMITMENTS AND CONTINGENT LIABILITIES (Schedule of Aggregate Future Minimum Lease Obligations) (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,017 | $ 2,480 |
2,018 | 651 |
2,019 | 103 |
Total | $ 3,234 |
SHAREHOLDERS' EQUITY (Narrative
SHAREHOLDERS' EQUITY (Narrative) (Details) ₪ / shares in Units, $ / shares in Units, ₪ in Thousands, $ in Thousands | 1 Months Ended | 12 Months Ended | |||||||||
May 02, 2016USD ($)$ / sharesshares | Dec. 31, 2016USD ($)$ / sharesshares | Dec. 31, 2016USD ($)$ / shares₪ / sharesshares | Dec. 31, 2015USD ($)$ / sharesshares | Dec. 31, 2015USD ($)₪ / sharesshares | Dec. 31, 2014USD ($)$ / sharesshares | Dec. 31, 2014USD ($)₪ / sharesshares | Dec. 31, 2016ILS (₪)₪ / sharesshares | Dec. 31, 2015₪ / shares | Aug. 31, 2015USD ($) | Dec. 31, 2013shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Share capital, amount authorized | ₪ | ₪ 20,000 | ||||||||||
Ordinary shares, shares authorized | 200,000,000 | 200,000,000 | 200,000,000 | 200,000,000 | 200,000,000 | ||||||
Ordinary shares, par value per share | ₪ / shares | ₪ 0.1 | ₪ 0.1 | |||||||||
Authorized amount of ordinary shares to repurchase | $ | $ 15,000 | ||||||||||
Number of ordinary shares repurchased | 791,000 | 25,000 | |||||||||
Purchase of ordinary shares | $ | $ 3,832 | $ 166 | |||||||||
Intrinsic value of options outstanding | $ | 728 | $ 728 | 1,580 | $ 1,580 | 4,085 | $ 4,085 | |||||
Intrinsic value of options exercisable | $ | 604 | 604 | 1,170 | 1,170 | 2,983 | 2,983 | |||||
Intrinsic value of options vested and expected to vest | $ | 634 | $ 634 | 1,363 | $ 1,363 | 3,436 | $ 3,436 | |||||
Intrinsic value of options exercised | $ | $ 415 | $ 469 | $ 1,901 | ||||||||
Stock options vested during period | 279,088 | ||||||||||
Weighted-average remaining contractual life of exercisable options | 4 years 11 months 27 days | ||||||||||
Weighted-average grant-date fair value of the options granted | ₪ / shares | $ 2.12 | $ 3.45 | $ 6.31 | ||||||||
Options outstanding | 1,959,014 | 1,959,014 | 2,811,966 | 2,811,966 | 2,531,381 | 2,531,381 | 1,959,014 | 2,875,003 | |||
Stock options granted | 643,697 | 704,348 | 572,533 | ||||||||
Stock options granted, exercise price | $ / shares | $ 4.99 | $ 6.73 | $ 11.93 | ||||||||
Repricing Program [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Vesting period for plan | 2 years | ||||||||||
Stock options granted | 384,635 | ||||||||||
Stock options granted, exercise price | $ / shares | $ 7 | ||||||||||
Incremental compensation cost | $ | $ 470 | ||||||||||
Share based compensation | $ | $ 155 | ||||||||||
Employees [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Options granted | 1,732 | ||||||||||
Exercise Price | $ / shares | $ 0.03 | $ 0.03 | |||||||||
2016 option plan [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Options outstanding | 1,959,014 | 1,959,014 | 1,959,014 | ||||||||
Stock Compensation Plan [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Unrecognized compensation cost related to non-vested stock options | $ | $ 2,194 | $ 2,194 | |||||||||
Unrecognized compensation cost, recognition period | 2 years 4 months 2 days | ||||||||||
Shares available for future issuance | 807,322 | 807,322 | 807,322 | ||||||||
Vesting period for plan | 4 years | ||||||||||
Options, expiration period | 10 years | ||||||||||
Restricted Stock Units (RSUs) [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Unrecognized compensation cost related to non-vested stock options | $ | $ 2,801 | $ 2,801 | |||||||||
Unrecognized compensation cost, recognition period | 2 years 4 months 2 days | ||||||||||
Number of restricted stock units outstanding | 592,126 | 592,126 | 359,404 | 359,404 | 445,264 | 445,264 | 592,126 | ||||
Granted | 531,570 | 158,551 | |||||||||
Restricted Stock Units (RSUs) [Member] | 2006 option plan [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Vesting period for plan | 4 years | ||||||||||
Restricted Stock Units (RSUs) [Member] | 2016 option plan [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Granted | 531,570 | 158,551 | |||||||||
Restricted Stock Units (RSUs) [Member] | 2016 option plan [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Number of restricted stock units outstanding | 592,126 | 592,126 | 592,126 |
SHAREHOLDERS' EQUITY (Schedule
SHAREHOLDERS' EQUITY (Schedule of Stock Option Activity) (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Number of shares upon exercise | |||
Outstanding at beginning of year | 2,811,966 | 2,531,381 | 2,875,003 |
Granted | 643,697 | 704,348 | 572,533 |
Forfeited | (1,358,492) | (320,496) | (562,787) |
Exercised | (138,157) | (103,267) | (353,368) |
Outstanding at end of year | 1,959,014 | 2,811,966 | 2,531,381 |
Exercisable at end of year | 1,072,658 | 1,646,204 | 1,440,143 |
Vested and expected to vest | 1,407,930 | 2,197,848 | 1,950,116 |
Weighted average exercise price | |||
Outstanding at beginning of year | $ 10.70 | $ 11.99 | |
Granted | 4.99 | 6.73 | $ 11.93 |
Forfeited | 12.41 | 15.13 | 17.02 |
Exercised | 1.75 | 1.28 | 4.18 |
Outstanding at end of year | 8.24 | 10.70 | 11.99 |
Exercisable at end of year | 9.87 | 11.99 | 11.75 |
Vested and expected to vest | $ 9.04 | $ 11.16 | $ 11.97 |
SHAREHOLDERS' EQUITY (Schedul67
SHAREHOLDERS' EQUITY (Schedule of Options Outstanding) (Details) - $ / shares | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Shares upon exercise of options | 1,959,014 | 2,811,966 | 2,531,381 | 2,875,003 |
Shares upon exercise of options exercisable as of December 31, 2016 | 1,072,658 | 1,646,204 | 1,440,143 | |
$23.31-27.58 [Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Prices, minimum | $ 23.31 | |||
Exercise Prices, maximum | $ 27.58 | |||
Shares upon exercise of options | 73,000 | |||
Weighted average remaining contractual life of options outstanding | 5 years 7 months 13 days | |||
Shares upon exercise of options exercisable as of December 31, 2016 | 73,000 | |||
$15.20-17.07 [Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Prices, minimum | $ 15.20 | |||
Exercise Prices, maximum | $ 17.07 | |||
Shares upon exercise of options | 129,059 | |||
Weighted average remaining contractual life of options outstanding | 4 years 9 months | |||
Shares upon exercise of options exercisable as of December 31, 2016 | 123,088 | |||
$10.16-14.68 [Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Prices, minimum | $ 10.16 | |||
Exercise Prices, maximum | $ 14.68 | |||
Shares upon exercise of options | 383,233 | |||
Weighted average remaining contractual life of options outstanding | 6 years 7 months 2 days | |||
Shares upon exercise of options exercisable as of December 31, 2016 | 297,998 | |||
$5.01-9.25 [Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Prices, minimum | $ 5.01 | |||
Exercise Prices, maximum | $ 9.25 | |||
Shares upon exercise of options | 827,398 | |||
Weighted average remaining contractual life of options outstanding | 5 years 5 months 5 days | |||
Shares upon exercise of options exercisable as of December 31, 2016 | 321,964 | |||
$0.03-4.95 [Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Prices, minimum | $ 0.03 | |||
Exercise Prices, maximum | $ 4.95 | |||
Shares upon exercise of options | 546,324 | |||
Weighted average remaining contractual life of options outstanding | 5 years 1 month 13 days | |||
Shares upon exercise of options exercisable as of December 31, 2016 | 256,608 |
SHAREHOLDERS' EQUITY (Summary o
SHAREHOLDERS' EQUITY (Summary of Restricted Stock Unit Activity) (Details) - Restricted Stock Units (RSUs) [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Number of shares upon exercise | ||
Outstanding at beginning of year | 359,404 | 445,264 |
Granted | 531,570 | 158,551 |
Vested | (152,460) | (159,912) |
Forfeited | (146,388) | (84,499) |
Outstanding at end of year | 592,126 | 359,404 |
Weighted average share price | ||
Outstanding at beginning of year | $ 10.95 | |
Granted | 4.59 | $ 8.52 |
Vested | 10.08 | 11.22 |
Forfeited | 6.85 | 12.57 |
Outstanding at end of year | $ 6.53 | $ 10.95 |
TAXES ON INCOME (Narrative) (De
TAXES ON INCOME (Narrative) (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Jan. 31, 2018 | Jan. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Taxes On Income [Line Items] | |||||
Israeli Income tax rate | 25.00% | 26.50% | 26.50% | ||
Tax-exempt period | 2 years | ||||
Dividend, withholding tax rate | 20.00% | ||||
Patent use right, period | 8 years | ||||
Expense deductible period | 3 years | ||||
Net operating loss carry forwards | $ 46,600 | ||||
Net operating loss offset limitation, percentage of accumulated losses | 14.00% | ||||
Net operating loss offset limitation, percentage of taxable income | 50.00% | ||||
Capital loss carry forwards | $ 27,300 | ||||
Provision | 293 | ||||
Deferred tax assets valuation allowance | $ 14,655 | $ 15,124 | |||
Commencement Of Production [Member] | |||||
Taxes On Income [Line Items] | |||||
Tax benefit period | 12 years | ||||
Approval Date [Member] | |||||
Taxes On Income [Line Items] | |||||
Tax benefit period | 14 years | ||||
Scenario, Forecast [Member] | |||||
Taxes On Income [Line Items] | |||||
Change in corporate tax rate | 23.00% | 24.00% | |||
Development Zone A [Member] | |||||
Taxes On Income [Line Items] | |||||
Israeli Income tax rate | 9.00% | ||||
Change in corporate tax rate | 7.50% | ||||
Outside Development Zone [Member] | |||||
Taxes On Income [Line Items] | |||||
Israeli Income tax rate | 16.00% | 16.00% | |||
United States of America [Member] | |||||
Taxes On Income [Line Items] | |||||
Net operating loss carry forwards | $ 5,517 | ||||
Excess tax deductions from stock options | 1,707 | ||||
Israel [Member] | |||||
Taxes On Income [Line Items] | |||||
Write-off prepaid and withholding taxes | $ 1,759 | ||||
Israeli resident corporation [Member] | |||||
Taxes On Income [Line Items] | |||||
Dividend, withholding tax rate | 20.00% | 20.00% | 20.00% | ||
Israeli resident individual [Member] | |||||
Taxes On Income [Line Items] | |||||
Dividend, withholding tax rate | 20.00% | 20.00% | 20.00% | ||
non-Israeli resident [Member] | |||||
Taxes On Income [Line Items] | |||||
Dividend, withholding tax rate | 20.00% | 20.00% | 20.00% | ||
Minimum [Member] | |||||
Taxes On Income [Line Items] | |||||
Change in corporate tax rate | 26.50% | ||||
Tax-exempt period | 5 years | ||||
Minimum [Member] | United States of America [Member] | |||||
Taxes On Income [Line Items] | |||||
Expiration of operating loss carry forward | Dec. 31, 2026 | ||||
Maximum [Member] | |||||
Taxes On Income [Line Items] | |||||
Change in corporate tax rate | 25.00% | ||||
Tax-exempt period | 8 years | ||||
Maximum [Member] | United States of America [Member] | |||||
Taxes On Income [Line Items] | |||||
Expiration of operating loss carry forward | Dec. 31, 2032 |
TAXES ON INCOME (Schedule of Pr
TAXES ON INCOME (Schedule of Pre-tax Income (Loss)) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
Domestic | $ (7,033) | $ (16,898) | $ (3,792) |
Foreign | 1,243 | 412 | 1,345 |
Pre-tax income (loss) | $ (5,790) | $ (16,486) | $ (2,447) |
TAXES ON INCOME (Schedule of th
TAXES ON INCOME (Schedule of the Reconciliation of the Theoretical Tax Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
Loss before taxes on income | $ (5,790) | $ (16,486) | $ (2,447) |
Theoretical tax expense computed at the Israeli statutory tax rate (25%, 26.5% and 26.5% for the years 2016, 2015 and 2014, respectively) | (1,448) | (4,369) | (649) |
Changes in valuation allowance | (469) | 3,716 | (1,328) |
Increase (decrease) in losses and temporary differences due to change in Israeli corporate and “Approved Enterprise" tax | (216) | 679 | 611 |
Write off of prepaid and withholding taxes | 1,759 | 1,150 | |
Foreign tax rates differences related to subsidiaries | 576 | 103 | (34) |
Non-deductible expenses and other | 567 | 181 | (381) |
Non-deductible share-based compensation expense | 1,435 | 1,896 | 1,831 |
Income tax expense | $ 2,204 | $ 3,356 | $ 50 |
Israeli Income tax rate | 25.00% | 26.50% | 26.50% |
TAXES ON INCOME (Schedule of In
TAXES ON INCOME (Schedule of Income Tax Expense (Benefit)) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
Current taxes | $ 203 | $ 146 | $ 612 |
Deferred taxes (benefit) | 242 | 2,060 | (562) |
Write off of prepaid and withholding taxes | 1,759 | 1,150 | |
Income tax expense | $ 2,204 | $ 3,356 | $ 50 |
TAXES ON INCOME (Schedule of De
TAXES ON INCOME (Schedule of Deferred Income Taxes) (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred tax assets: | ||
Operating and capital loss carry forwards | $ 12,900 | $ 14,842 |
Reserves and allowances | 2,022 | 948 |
Deferred tax asset before valuation allowance | 14,922 | 15,790 |
Valuation allowance | (14,655) | (15,124) |
Net deferred tax asset | 267 | 666 |
Deferred tax liability | (157) | |
Net deferred tax asset | $ 267 | $ 509 |
GEOGRAPHIC INFORMATION (Schedul
GEOGRAPHIC INFORMATION (Schedule of Revenue by Geographic Location) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Revenues | $ 90,369 | $ 99,967 | $ 117,186 |
Europe [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Revenues | 34,279 | 39,110 | 41,238 |
Asia And Oceania [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Revenues | 27,700 | 28,495 | 41,990 |
Americas (excluding the United States) [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Revenues | 13,094 | 14,347 | 3,299 |
Middle East And Africa [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Revenues | 12,365 | 9,809 | 15,352 |
United States [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Revenues | $ 2,931 | $ 8,206 | $ 15,307 |
GEOGRAPHIC INFORMATION (Sched75
GEOGRAPHIC INFORMATION (Schedule of Major Customers) (Details) - Sales [Member] | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Revenue, Major Customer [Line Items] | |||
Concentration risk percentage | 42.00% | 37.00% | 44.00% |
Customer A [Member] | |||
Revenue, Major Customer [Line Items] | |||
Concentration risk percentage | 25.00% | 27.00% | 27.00% |
Customer B [Member] | |||
Revenue, Major Customer [Line Items] | |||
Concentration risk percentage | 17.00% | ||
Customer C [Member] | |||
Revenue, Major Customer [Line Items] | |||
Concentration risk percentage | 10.00% | 17.00% |
GEOGRAPHIC INFORMATION (Sched76
GEOGRAPHIC INFORMATION (Schedule of Long-Lived Assets) (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Long-lived assets | $ 4,387 | $ 5,189 |
Israel [Member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Long-lived assets | 4,156 | 4,924 |
United States [Member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Long-lived assets | 42 | 109 |
Other [Member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Long-lived assets | $ 189 | $ 156 |
FINANCIAL INCOME (EXPENSES), 77
FINANCIAL INCOME (EXPENSES), NET (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Financial income: | |||
Interest income | $ 2,466 | $ 2,174 | $ 1,900 |
Financial expenses: | |||
Exchange rate differences and other | 186 | 1,480 | 174 |
Amortization/accretion of premium/discount on marketable securities , net | 1,221 | 1,278 | 1,066 |
Financial and other expenses, total | $ 1,059 | $ (584) | $ 660 |
EARNINGS PER SHARE (Schedule of
EARNINGS PER SHARE (Schedule of Basic and Diluted Net Earnings (loss) Per Share) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Numerator: | |||
Net loss | $ (7,994) | $ (19,842) | $ (2,497) |
Weighted average number of shares used in per share computations of net earnings (loss): | |||
Weighted average number of shares outstanding used in computing diluted net loss per share | 33,202,309 | 33,419,917 | 33,143,168 |
Basic and diluted net loss per share | $ (0.24) | $ (0.59) | $ (0.08) |
EARNINGS PER SHARE (Summary of
EARNINGS PER SHARE (Summary of Shares Excluded From Computation of Diluted Net Loss Per Ordinary) (Details) - shares | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Ordinary shares [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Number of shares excluded from computation of diluted net loss per share | 2,000,757 | 3,424,891 | 2,300,425 |