Cover
Cover - shares | 6 Months Ended | |
Jun. 30, 2021 | Aug. 04, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-36067 | |
Entity Registrant Name | FireEye, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 20-1548921 | |
Entity Address, Address Line One | 601 McCarthy Blvd | |
Entity Address, City or Town | Milpitas | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 95035 | |
City Area Code | 408 | |
Local Phone Number | 321-6300 | |
Title of 12(b) Security | Common Stock, $0.0001 par value per share | |
Trading Symbol | FEYE | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 239,191,838 | |
Entity Central Index Key | 0001370880 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 387,310 | $ 676,454 |
Short-term investments | 866,301 | 624,824 |
Accounts receivable, net of allowance for doubtful accounts of $1,011 and $2,137 at June 30, 2021 and December 31, 2020, respectively | 77,257 | 94,339 |
Prepaid expenses and other current assets | 40,634 | 39,913 |
Current assets held for sale | 500,688 | 126,715 |
Total current assets | 1,872,190 | 1,562,245 |
Property and equipment, net | 65,886 | 64,336 |
Operating lease right-of-use assets, net | 36,096 | 36,728 |
Goodwill | 1,050,924 | 1,050,962 |
Intangible assets, net | 98,447 | 120,555 |
Deposits and other long-term assets | 18,390 | 18,084 |
Long-term assets held for sale | 0 | 392,974 |
TOTAL ASSETS | 3,141,933 | 3,245,884 |
Current liabilities: | ||
Accounts payable | 9,375 | 4,027 |
Operating lease liabilities, current | 12,157 | 14,556 |
Accrued and other current liabilities | 19,564 | 19,730 |
Accrued compensation | 65,226 | 78,842 |
Convertible senior notes, current, net | 440,497 | 0 |
Deferred revenue, current | 235,960 | 226,356 |
Current liabilities held for sale | 637,669 | 410,233 |
Total current liabilities | 1,420,448 | 753,744 |
Convertible senior notes, non-current, net | 543,306 | 960,896 |
Deferred revenue, non-current | 61,366 | 57,897 |
Operating lease liabilities, non-current | 56,624 | 41,802 |
Other long-term liabilities | 4,586 | 12,339 |
Long-term liabilities held for sale | 0 | 285,251 |
TOTAL LIABILITIES | 2,086,330 | 2,111,929 |
Commitments and contingencies | ||
Series A Convertible Preferred Stock, par value of $0.0001 per share; 400 shares authorized, issued and outstanding as of June 30, 2021 and December 31, 2020 | 410,124 | 401,050 |
Stockholders' equity: | ||
Common stock, par value of $0.0001 per share; 1,000,000 shares authorized, 239,177 shares and 235,690 shares issued and outstanding as of June 30, 2021 and December 31, 2020, respectively | 24 | 24 |
Additional paid-in capital | 3,653,574 | 3,623,243 |
Treasury stock, at cost; 1,778 shares as of June 30, 2021 and December 31, 2020, respectively | (80,000) | (80,000) |
Accumulated other comprehensive income | 1,419 | 3,834 |
Accumulated deficit | (2,929,538) | (2,814,196) |
Total stockholders’ equity | 645,479 | 732,905 |
TOTAL LIABILITIES, CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY | $ 3,141,933 | $ 3,245,884 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 1,011 | $ 2,137 |
Series A convertible preferred stock, par value (usd per share) | $ 0.0001 | $ 0.0001 |
Series A convertible preferred stock, shares authorized (shares) | 400,000 | 400,000 |
Series A convertible preferred stock, shares issued (shares) | 400,000 | 400,000 |
Series A convertible preferred stock, shares outstanding (shares) | 400,000 | 400,000 |
Common stock, par value (usd per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued (shares) | 239,177,000 | 235,690,000 |
Common stock, shares outstanding (shares) | 239,177,000 | 235,690,000 |
Treasury stock (shares) | 1,778,000 | 1,778,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Revenue: | ||||
Total revenue | $ 113,910 | $ 97,230 | $ 228,598 | $ 189,384 |
Cost of revenue: | ||||
Total cost of revenue | 63,525 | 53,546 | 122,610 | 108,198 |
Total gross profit | 50,385 | 43,684 | 105,988 | 81,186 |
Operating expenses: | ||||
Research and development | 40,930 | 28,665 | 82,835 | 57,743 |
Sales and marketing | 63,018 | 52,840 | 124,231 | 111,586 |
General and administrative | 29,020 | 26,349 | 54,371 | 54,857 |
Restructuring charges | 1,927 | 12,558 | 1,927 | 18,775 |
Total operating expenses | 134,895 | 120,412 | 263,364 | 242,961 |
Operating loss | (84,510) | (76,728) | (157,376) | (161,775) |
Interest income | 1,365 | 2,863 | 3,009 | 7,287 |
Interest expense | (14,762) | (15,356) | (29,386) | (31,202) |
Other income (expense), net | (471) | (119) | 100 | (1,107) |
Loss before income taxes from continuing operations | (98,378) | (89,340) | (183,653) | (186,797) |
Provision for income taxes | 763 | 656 | 1,943 | 1,006 |
Loss from continuing operations | (99,141) | (89,996) | (185,596) | (187,803) |
Net income from discontinued operations, net of income taxes | 34,445 | 36,721 | 70,254 | 58,222 |
Net loss | (64,696) | (53,275) | (115,342) | (129,581) |
Dividend on series A convertible preferred stock | (4,563) | 0 | (9,075) | 0 |
Accretion of series A convertible preferred stock | 0 | 0 | (82) | 0 |
Net loss attributable to common stockholders | (69,259) | (53,275) | (124,499) | (129,581) |
Net loss attributable to common stockholders | $ (69,259) | $ (53,275) | $ (124,499) | $ (129,581) |
Net loss per share attributable to common stockholders, basic and diluted: | ||||
Continuing operations, basic (usd per share) | $ (0.44) | $ (0.41) | $ (0.83) | $ (0.86) |
Continuing operations, diluted (usd per share) | (0.44) | (0.41) | (0.83) | (0.86) |
Discontinued operations, basic (usd per share) | 0.15 | 0.17 | 0.30 | 0.27 |
Discontinued operations, diluted (usd per share) | 0.15 | 0.17 | 0.30 | 0.27 |
Net loss per share attributable to common stockholders, basic (usd per share) | (0.29) | (0.24) | (0.53) | (0.59) |
Net loss per share attributable to common stockholders, diluted (usd per share) | $ (0.29) | $ (0.24) | $ (0.53) | $ (0.59) |
Weighted average shares used in computing net loss per share, basic (shares) | 237,279 | 221,352 | 236,016 | 219,570 |
Weighted average shares used in computing net loss per share, diluted (shares) | 237,279 | 221,352 | 236,016 | 219,570 |
Platform, cloud subscription and managed services | ||||
Revenue: | ||||
Total revenue | $ 51,936 | $ 48,051 | $ 107,935 | $ 93,353 |
Cost of revenue: | ||||
Total cost of revenue | 28,243 | 26,497 | 54,856 | 52,357 |
Professional services | ||||
Revenue: | ||||
Total revenue | 61,974 | 49,179 | 120,663 | 96,031 |
Cost of revenue: | ||||
Total cost of revenue | $ 35,282 | $ 27,049 | $ 67,754 | $ 55,841 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (64,696) | $ (53,275) | $ (115,342) | $ (129,581) |
Change in net unrealized gain (loss) on available-for-sale investments | (621) | 7,980 | (2,415) | 5,131 |
Comprehensive loss | $ (65,317) | $ (45,295) | $ (117,757) | $ (124,450) |
Condensed Consolidated Statem_3
Condensed Consolidated Statement of Convertible Preferred Stock and Stockholders' Equity - USD ($) $ in Thousands | Total | Series A convertible preferred stock: | Common stock and additional paid-in-capital: | Treasury stock: | Accumulated other comprehensive income (loss): | Accumulated deficit: |
Beginning balance at Dec. 31, 2019 | $ 701,666 | $ 3,457,381 | $ (150,000) | $ 1,180 | $ (2,606,895) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock for equity awards, net of tax withholdings | 3,731 | |||||
Shares withheld for taxes | (8,039) | |||||
Issuance of common stock related to employee stock purchase plan | 12,300 | |||||
Shares repurchased | 0 | |||||
Shares retired | 70,000 | (70,000) | ||||
Accretion of series A convertible preferred stock | 0 | |||||
Dividends on series A convertible preferred stock | 0 | |||||
Stock-based compensation | 75,152 | |||||
Unrealized gain (loss) on investments | 5,131 | |||||
Net loss | (129,581) | (129,581) | ||||
Ending balance at Jun. 30, 2020 | 660,360 | 3,470,525 | (80,000) | 6,311 | (2,736,476) | |
Beginning balance at Dec. 31, 2019 | $ 0 | |||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||
Series A convertible preferred stock issuance costs | 0 | |||||
Accretion of series A convertible preferred stock | 0 | 0 | ||||
Dividend on series A convertible preferred stock | 0 | 0 | ||||
Ending balance at Jun. 30, 2020 | 0 | |||||
Beginning balance at Mar. 31, 2020 | 653,608 | 3,488,478 | (150,000) | (1,669) | (2,683,201) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock for equity awards, net of tax withholdings | 2,383 | |||||
Shares withheld for taxes | (640) | |||||
Issuance of common stock related to employee stock purchase plan | 12,300 | |||||
Shares repurchased | 0 | |||||
Shares retired | 70,000 | (70,000) | ||||
Accretion of series A convertible preferred stock | 0 | |||||
Dividends on series A convertible preferred stock | 0 | |||||
Stock-based compensation | 38,004 | |||||
Unrealized gain (loss) on investments | 7,980 | |||||
Net loss | (53,275) | (53,275) | ||||
Ending balance at Jun. 30, 2020 | 660,360 | 3,470,525 | (80,000) | 6,311 | (2,736,476) | |
Beginning balance at Mar. 31, 2020 | 0 | |||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||
Series A convertible preferred stock issuance costs | 0 | |||||
Accretion of series A convertible preferred stock | 0 | |||||
Dividend on series A convertible preferred stock | 0 | |||||
Ending balance at Jun. 30, 2020 | 0 | |||||
Beginning balance at Dec. 31, 2020 | 732,905 | 3,623,268 | (80,000) | 3,834 | (2,814,196) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock for equity awards, net of tax withholdings | 3,599 | |||||
Shares withheld for taxes | (9,725) | |||||
Issuance of common stock related to employee stock purchase plan | 12,335 | |||||
Shares repurchased | (68,300) | (68,334) | ||||
Shares retired | 0 | 0 | ||||
Accretion of series A convertible preferred stock | (82) | |||||
Dividends on series A convertible preferred stock | (9,075) | |||||
Stock-based compensation | 101,612 | |||||
Unrealized gain (loss) on investments | (2,415) | |||||
Net loss | (115,342) | (115,342) | ||||
Ending balance at Jun. 30, 2021 | 645,479 | 3,653,598 | (80,000) | 1,419 | (2,929,538) | |
Beginning balance at Dec. 31, 2020 | 401,050 | 401,050 | ||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||
Series A convertible preferred stock issuance costs | (82) | |||||
Accretion of series A convertible preferred stock | 82 | 82 | ||||
Dividend on series A convertible preferred stock | 9,075 | 9,075 | ||||
Ending balance at Jun. 30, 2021 | 410,124 | 410,125 | ||||
Beginning balance at Mar. 31, 2021 | 715,131 | 3,657,934 | (80,000) | 2,040 | (2,864,842) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock for equity awards, net of tax withholdings | 2,502 | |||||
Shares withheld for taxes | (926) | |||||
Issuance of common stock related to employee stock purchase plan | 12,335 | |||||
Shares repurchased | (68,300) | (68,334) | ||||
Shares retired | 0 | 0 | ||||
Accretion of series A convertible preferred stock | 0 | |||||
Dividends on series A convertible preferred stock | (4,563) | |||||
Stock-based compensation | 54,650 | |||||
Unrealized gain (loss) on investments | (621) | |||||
Net loss | (64,696) | (64,696) | ||||
Ending balance at Jun. 30, 2021 | 645,479 | $ 3,653,598 | $ (80,000) | $ 1,419 | $ (2,929,538) | |
Beginning balance at Mar. 31, 2021 | 405,562 | |||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||
Series A convertible preferred stock issuance costs | 0 | |||||
Accretion of series A convertible preferred stock | 0 | |||||
Dividend on series A convertible preferred stock | 4,563 | |||||
Ending balance at Jun. 30, 2021 | $ 410,124 | $ 410,125 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (115,342) | $ (129,581) |
Less: income from discontinued operations | 70,254 | 58,222 |
Loss from continuing operations | (185,596) | (187,803) |
Adjustments to reconcile loss from continuing operations to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 46,648 | 37,684 |
Stock-based compensation | 72,173 | 52,802 |
Non-cash interest expense related to convertible senior notes | 22,907 | 24,367 |
Deferred income taxes | (114) | 154 |
Other | 20 | 1,166 |
Changes in operating assets and liabilities, net of business acquisitions: | ||
Accounts receivable | 17,294 | 25,910 |
Prepaid expenses and other assets | 6,323 | 5,089 |
Accounts payable | 4,331 | (6,203) |
Accrued liabilities | (1,540) | (5,046) |
Accrued compensation | (13,616) | 14,245 |
Deferred revenue | 13,072 | (29,157) |
Other long-term liabilities | (4,914) | (5,701) |
Net cash used in operating activities - continuing operations | (23,012) | (72,493) |
Net cash provided by operating activities - discontinued operations | 67,317 | 62,727 |
Net cash provided by (used in) operating activities | 44,305 | (9,766) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchases of property and equipment and demonstration units | (13,497) | (14,037) |
Purchases of short-term investments | (512,642) | (106,631) |
Proceeds from maturities of short-term investments | 264,160 | 277,749 |
Purchase of investment in privately held company | 0 | (1,000) |
Proceeds from sales of short-term investments | 0 | 28,208 |
Business acquisitions, net of cash acquired | 50 | (6,284) |
Lease deposits | 725 | 34 |
Net cash provided by (used in) investing activities - continuing operations | (261,204) | 178,039 |
Net cash used in investing activities - discontinued operations | (10,039) | (10,130) |
Net cash provided by (used in) investing activities | (271,243) | 167,909 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Repurchase of convertible senior notes | 0 | (96,392) |
Share repurchases | (68,334) | 0 |
Series A convertible preferred stock issuance costs | (9,075) | 0 |
Dividends on series A convertible preferred stock | 8,993 | 0 |
Payment related to shares withheld for taxes | (9,725) | (8,039) |
Proceeds from employee stock purchase plan | 12,335 | 12,300 |
Proceeds from exercise of equity awards | 3,600 | 3,731 |
Net cash used in financing activities | (62,206) | (88,400) |
Net change in cash and cash equivalents | (289,144) | 69,743 |
Cash and cash equivalents, beginning of period | 676,454 | 334,603 |
Cash and cash equivalents, end of period | 387,310 | 404,346 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: | ||
Cash paid for income taxes | 3,581 | 1,449 |
Cash paid for interest | 6,480 | 6,962 |
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
Purchases of property and equipment and demonstration units in accounts payable and accrued liabilities | 3,735 | 2,348 |
Dividend on series A convertible preferred stock | 9,075 | 0 |
Accretion of series A convertible preferred stock | $ 82 | $ 0 |
Description of Business and Sum
Description of Business and Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business and Summary of Significant Accounting Policies | Description of Business and Summary of Significant Accounting Policies Description of Business FireEye, Inc., with principal executive offices located in Milpitas, California, was incorporated as NetForts, Inc. on February 18, 2004, under the laws of the State of Delaware, and changed its name to FireEye, Inc. on September 7, 2005. FireEye, Inc. and its wholly owned subsidiaries (collectively, the “Company”, “we”, “us” or “our”) provide intelligence-based cybersecurity products, solutions and services that allow organizations to prepare for, prevent, investigate, respond to and remediate cyber attacks, including attacks that target on-premise, cloud and critical infrastructure environments. Unless otherwise noted, discussion in these Notes to Condensed Consolidated Financial Statements refers to our continuing operations. Refer to Note 2, “Discontinued Operations” for further information. Our portfolio of cybersecurity solutions and services is comprised of the following: • Mandiant Solutions, including the Mandiant Advantage software-as-a-service (SaaS) platform with integrated modules for threat intelligence, validation and security automation, managed services, and professional services. Our products, solutions and services help customers minimize the risk of costly cybersecurity breaches by: • detecting and preventing advanced, targeted and evasive attacks missed by other security control products, • automating the investigation and triage of security alerts generated by FireEye products, as well as security control products from other vendors, • providing visibility into the latest threats and the tools and techniques used by threat actors, • validating the effectiveness of existing cybersecurity controls against attacks before an attack occurs and, • providing assessment, training and other strategic security consulting services that help organizations improve their resilience to attack. The majority of our solutions and services are sold to end-customers through distributors, resellers, and strategic partners, with a lesser percentage of sales directly to our end-customers. On June 2, 2021, we announced a stock repurchase program for the repurchase of up to $500 million of our common stock. There is no expiration date on this authorization, and we may suspend, amend or discontinue the repurchase program at any time. As of the three and six months ended June 30, 2021, we had repurchased approximately 3.5 million shares of our common stock at an average repurchase price of approximately $19.41 per share for a total repurchase price of approximately $68.3 million. The repurchases were recorded to additional paid-in capital as the Company is in an accumulated net deficit position. On May 29, 2021, we entered into an Asset Purchase Agreement (the “Purchase Agreement”), pursuant to which we agreed to sell our FireEye Products business to a consortium led by Symphony Technology Group (“STG”) in exchange for total cash consideration of $1.2 billion and assumption of certain liabilities of the Products business as specified in the Purchase Agreement. The transaction is expected to close by the end of the fourth quarter of 2021, subject to customary regulatory approvals and closing conditions. As a result, the FireEye Products business was classified as discontinued operations in our condensed consolidated financial statements and excluded from continuing operations and the related assets and liabilities were classified as held for sale. In November 2020, we acquired Respond Software, Inc. ("Respond Software"), a cybersecurity investigation automation company. In connection with this acquisition, we paid cash consideration of $116.1 million, and issued 4,931,862 shares of our common stock of which 694,768 shares are subject to vesting conditions. The estimated fair value of the common stock issued and not subject to vesting conditions was $60.3 million. We also assumed unvested stock options, which are now exercisable for our common stock, of which $1.2 million of the fair value has been accounted for as consideration for assumed awards pertaining to pre-combination service prior to acquisition. Based on the above, total purchase consideration for Respond Software was $177.6 million. In November 2020, we entered into a Securities Purchase Agreement with BTO Delta Holdings DE L.P., an investment vehicle of funds affiliated with The Blackstone Group Inc., and a Securities Purchase Agreement with ClearSky Security Fund I LLC and ClearSky Power & Technology Fund II LLC (together, the “Series A Securities Financing Agreements”). Pursuant to the Series A Securities Financing Agreements, in December 2020 we issued and sold 400,000 shares of a newly designated 4.5% Series A Convertible Preferred Stock, par value $0.0001 per share, at a price of $1,000 per share, for an aggregate purchase price of $400.0 million. We intend to use the net proceeds from the issuance and sale to fund acquisitions, buybacks of our common stock, and for working capital purposes. In January 2020, we acquired Cloudvisory LLC ("Cloudvisory"), a provider of cloud visibility and control solutions. As consideration for the acquisition, we paid approximately $13.2 million in cash and assumed $0.3 million in net tangible liabilities. Basis of Presentation and Consolidation The accompanying unaudited condensed consolidated financial statements include the accounts of FireEye, Inc. and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), and following the requirements of the Securities and Exchange Commission (“SEC”), for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP can be condensed or omitted. These unaudited condensed consolidated financial statements have been prepared on the same basis as our annual consolidated financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, that are necessary for a fair statement of our financial information. The results of operations for the three and six months ended June 30, 2021 are not necessarily indicative of the results to be expected for the year ending December 31, 2021 or for any other interim period or for any other future year. As a result of the Purchase Agreement, the FireEye Products business is in discontinued operations in our condensed consolidated financial statements and all prior periods presented have been adjusted to reflect the assets and liabilities held for sale and discontinued operations. The balance sheet as of December 31, 2020 has been derived from audited consolidated financial statements at that date but does not include all information required by U.S. GAAP for annual consolidated financial statements. The accompanying unaudited condensed consolidated financial statements and related financial information should be read in conjunction with the audited consolidated financial statements and the related notes thereto for the year ended December 31, 2020 included in our Annual Report on Form 10-K for the year ended December 31, 2020. Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Such management estimates include, but are not limited to, determining the nature and timing of satisfaction of performance obligations, useful life of our security appliances that are dependent on intelligence and assessing the material rights associated with it, determining the standalone selling price of performance obligations, subscriptions and services, commissions expense including the period of benefit of customer acquisition cost, bonus expense, future taxable income, contract manufacturer liabilities, litigation and settlement costs and other loss contingencies, fair value of our equity awards, achievement of targets for performance stock units, fair value of the liability and equity components of the Convertible Senior Notes (as defined in Note 10), results of operations of the Company’s discontinued operations and the purchase price allocation of acquired businesses. We base our estimates on historical experience and on assumptions that we believe are reasonable. Changes in facts or circumstances may cause us to change our assumptions and estimates in future periods, and it is possible that actual results could differ from current or revised future estimates. Summary of Significant Accounting Policies Our accounting policies are set forth in Note 1 to Consolidated Financial Statements contained in our Annual Report on Form 10-K for the year ended December 31, 2020. We include herein certain updates to those policies. Discontinued Operations We consider assets to be held for sale when management commits to a formal plan to actively market the assets for sale at a price reasonable in relation to fair value, it is unlikely that significant changes will be made to the plan, the assets are available for immediate sale in its present condition, an active program to locate a buyer and other actions required to complete the sale have been initiated and the sale of the assets is expected to be completed within one year. Upon designation as held for sale, we record the carrying value of the assets at the lower of carrying value or estimated fair value, less costs to sell and assets held for sale are not depreciated or amortized. If the disposal of the component of an entity (or group of components) represents a strategic shift that has (or will have) a major effect on an entity’s operations and financial results, it meets the criteria for discontinued operations. The results of discontinued operations, as well as any gain or loss on the disposal transaction, are presented separately, net of tax, from the results of continuing operations for all periods presented. The revenue and expenses included in the results of discontinued operations are the revenue and direct operating expenses incurred by the discontinued component that may be reasonably segregated from the revenue and costs of the ongoing operations of the Company. The assets and liabilities have been accounted for as assets and liabilities held for sale in our condensed consolidated balance sheets. The operating results have been included in discontinued operations in our condensed consolidated financial statements. Assets and liabilities held for sale are classified as current as of June 30, 2021 as it is probable that the sale will occur and proceeds will be collected within one year. The condensed consolidated statement of cash flows presents combined cash flows from continuing operations with cash flows from discontinued operations within each cash flow statement category. The prior periods have been adjusted to reflect the assets and liabilities held for sale and discontinued operations. See Note 2, “Discontinued Operations,” to our condensed consolidated financial statements for additional information. Recently Adopted Accounting Pronouncements Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract In August 2018, the FASB issued ASU 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract. This standard requires capitalization of the implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. Further, the standard also requires the Company to expense the capitalized implementation costs of a hosting arrangement over the term of the hosting arrangement. We adopted the standard effective January 1, 2020. The standard did not have a significant impact on our unaudited condensed consolidated financial statements. Simplifying the Test for Goodwill Impairment In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. This standard eliminates the requirement to calculate the implied fair value of goodwill to measure a goodwill impairment charge (i.e. Step 2 of the current guidance), instead measuring the impairment charge as the excess of the reporting unit's carrying amount over its fair value (i.e. Step 1 of the current guidance). We adopted the standard effective January 1, 2020. The standard did not have a significant impact on our unaudited condensed consolidated financial statements. Measurement of Credit Losses on Financial Instruments In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This standard changes the impairment model for most financial assets and certain other instruments by introducing a current expected credit loss ("CECL") model. The CECL model is a more forward-looking approach based on expected losses rather than incurred losses, requiring entities to estimate and record losses expected over the remaining contractual life of an asset. The guidance was effective for the Company beginning in the first quarter of 2020. We adopted the standard effective January 1, 2020. The standard did not have a significant impact on our unaudited condensed consolidated financial statements. Simplifying Accounting for Income Taxes In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. This standard simplifies the accounting for income taxes by eliminating certain exceptions to the guidance in Topic 740 related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. The new guidance also simplifies aspects of the accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill and allocating consolidated income taxes to separate financial statements of entities not subject to income tax. ASU 2019-12 is effective for annual and interim periods in fiscal years beginning after December 15, 2020. We adopted ASU 2019-12 as of January 1, 2020. The adoption did not have a significant impact on our unaudited condensed consolidated financial statements. Recent Legislation On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was enacted and signed into U.S. law to provide economic relief to individuals and businesses facing economic hardship as a result of the COVID-19 pandemic. Changes in tax laws or rates are accounted for in the period of enactment. The income tax provisions of the CARES Act do not have a significant impact on our current taxes, deferred taxes, or uncertain tax positions. Recent Accounting Pronouncements Not Yet Adopted In August 2020, the FASB issued ASU No. 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (ASU 2020-06): This standard simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts in an entity’s own equity. Among other changes, ASU 2020-06 removes from U.S. GAAP the liability and equity separation model for convertible instruments with a cash conversion feature, and as a result, after adoption, entities will no longer separately present in equity an embedded conversion feature for such debt. Similarly, the embedded conversion feature will no longer be amortized into income as interest expense over the life of the instrument. Instead, entities will account for a convertible debt instrument wholly as debt unless (1) a convertible instrument contains features that require bifurcation |
Discontinued Operations
Discontinued Operations | 6 Months Ended |
Jun. 30, 2021 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | Discontinued Operations On May 29, 2021, we entered into the Purchase Agreement, pursuant to which we agreed to sell our Products business to STG in exchange for total cash consideration of $1.2 billion and assumption of certain liabilities of the Products business as specified in the Purchase Agreement. As a result, the FireEye Products business was classified as discontinued operations in our condensed consolidated statements of operations and excluded from continuing operations. The assets and liabilities have been accounted for as assets and liabilities held for sale in our condensed consolidated balance sheets. The transaction is expected to close by the end of the fourth quarter of 2021, subject to customary regulatory approvals and closing conditions. The following table summarizes the assets and liabilities held for sale relating to our discontinued operations (dollars in thousands): As of June 30, 2021 As of December 31, 2020 MAJOR CLASSES OF ASSETS Current: Accounts receivable, net of allowance for doubtful accounts of $339 and $422 at June 30, 2021 and December 31, 2020, respectively $ 46,961 $ 59,236 Inventories 4,772 4,023 Prepaid expenses and other current assets 60,070 63,456 Property and equipment, net 20,706 — Goodwill 313,912 — Intangible assets, net 4,292 — Deposits and other long-term assets 49,256 — Operating lease right-of-use assets, net 719 — Total current assets held for sale $ 500,688 $ 126,715 Non-current: Property and equipment, net — 15,434 Goodwill — 313,924 Intangible assets, net — 5,512 Deposits and other long-term assets — 56,580 Operating lease right-of-use assets, net — 1,524 Total assets classified as held for sale $ 500,688 $ 519,689 MAJOR CLASSES OF LIABILITIES Current: Accounts payable $ 4,367 $ 1,080 Accrued and other current liabilities 8,762 3,510 Deferred revenue, current 614,802 387,353 Operating lease liabilities 768 1,468 Accrued compensation 8,970 16,822 Total current liabilities held for sale $ 637,669 $ 410,233 Non-current: Deferred revenue, non-current — 284,851 Operating lease liabilities — 400 Total liabilities classified as held for sale $ 637,669 $ 695,484 Commitments and contingencies Contract manufacturer commitments $ 7,005 $ 5,996 The following table summarizes the results of the discontinued operations (dollars in thousands): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 MAJOR LINE ITEMS CONSTITUTING NET INCOME Revenue from discontinued operations $ 134,045 $ 132,671 $ 265,704 $ 265,238 Cost of revenue 28,001 29,947 55,802 60,200 Research & development 28,665 29,260 56,086 64,980 Sales and marketing 36,886 36,306 74,530 76,066 General and administrative 5,466 — 8,126 — Restructuring charges — — — 4,757 Net income from discontinued operations before income taxes $ 35,027 $ 37,158 $ 71,160 $ 59,235 Provision for income taxes 582 437 906 1,013 Net income from discontinued operations, net of income taxes $ 34,445 $ 36,721 $ 70,254 $ 58,222 At the closing of the sale of the Products business, we intend to enter into a Transition Services Agreement with STG, which will be designed to ensure and facilitate an orderly transfer of business operations. The transition period is expected to be approximately 12 to 18 months after the sale closes. No revenues or expenses have been incurred for the transitional services as of June 30, 2021. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The accounting guidance for fair value measurements provides a framework for measuring fair value on either a recurring or nonrecurring basis, whereby the inputs used in our valuation techniques are assigned a hierarchical level. The following are the three levels of inputs to measure fair value: • Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. • Level 2: Inputs that reflect quoted prices for identical assets or liabilities in less active markets; quoted prices for similar assets or liabilities in active markets; benchmark yields, reported trades, broker/dealer quotes, inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means. • Level 3: Unobservable inputs that reflect our own assumptions incorporated in valuation techniques used to measure fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available. We consider an active market to be one in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis, and consider an inactive market to be one in which there are infrequent or few transactions for the asset or liability, the prices are not current, or price quotations vary substantially either over time or among market makers. Where appropriate, our own or the counterparty’s non-performance risk is considered in measuring the fair values of assets. The following table presents our assets and liabilities measured at fair value on a recurring basis using the above input categories (in thousands): As of June 30, 2021 As of December 31, 2020 Description Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Assets Cash equivalents: Money market funds $ 141,708 $ — $ — $ 141,708 $ 32,954 $ — $ — $ 32,954 Total cash equivalents 141,708 — — 141,708 32,954 — — 32,954 Short-term investments: Certificates of deposit — 4,418 — 4,418 — 2,752 — 2,752 Commercial paper — — — — — 19,994 — 19,994 Corporate notes and bonds — 579,385 — 579,385 — 437,652 — 437,652 U.S. Treasuries — 82,135 — 82,135 — 74,934 — 74,934 U.S. Government agencies — 200,363 — 200,363 — 89,492 — 89,492 Total short-term investments — 866,301 — 866,301 — 624,824 — 624,824 Total assets measured at fair value $ 141,708 $ 866,301 $ — $ 1,008,009 $ 32,954 $ 624,824 $ — $ 657,778 Additionally, we have a restructuring liability related to certain real estate facilities that was calculated based on the present value of future non-lease payments, discounted at a rate commensurate with our current cost of financing as well as external ratings. This non-recurring fair value measurement is considered to be a Level 3 measurement due to the use of significant unobservable inputs. See Note 7 Restructuring Charges for a reconciliation of this liability. We measure certain assets, including goodwill, intangible assets and our equity-method investment in a privately held company at fair value on a nonrecurring basis when there are identifiable events or changes in circumstances that may have a significant adverse impact on the fair value of these assets. In light of the COVID-19 pandemic, we performed an analysis of impairment indicators of these assets and noted no adverse impact to their fair values as of June 30, 2021. The estimated fair value of the Convertible Senior Notes was determined to be $1.0 billion as of June 30, 2021 and as of December 31, 2020. The fair value was determined based on the closing trading prices per $1,000 principal amount of the respective Convertible Senior Notes as of the last day of trading for the period. We consider the fair value of the Convertible Senior Notes to be a Level 2 measurement as they are not actively traded. |
Investments
Investments | 6 Months Ended |
Jun. 30, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | Investments Our investments consisted of the following (in thousands): As of June 30, 2021 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Certificates of deposit $ 4,370 $ 48 $ — $ 4,418 Corporate notes and bonds 577,356 2,190 (161) 579,385 U.S. Treasuries 82,148 7 (20) 82,135 U.S. Government agencies 200,500 9 (146) 200,363 Total $ 864,374 $ 2,254 $ (327) $ 866,301 As of December 31, 2020 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Certificates of deposit $ 2,679 $ 73 $ — $ 2,752 Commercial paper 19,994 — — 19,994 Corporate notes and bonds 433,445 4,248 (41) 437,652 U.S. Treasuries 74,914 26 (6) 74,934 U.S. Government agencies 89,451 54 (13) 89,492 Total $ 620,483 $ 4,401 $ (60) $ 624,824 The following tables present the gross unrealized losses and related fair values of our investments that have been in a continuous unrealized loss position (in thousands): As of June 30, 2021 Less Than 12 Months Greater Than 12 Months Total Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss Certificates of deposit $ 490 $ — $ — $ — $ 490 $ — Commercial paper — — — — — — Corporate notes and bonds 267,699 (159) 17,902 (2) 285,601 (161) U.S. Treasuries 70,599 (20) — — 70,599 (20) U.S. Government agencies 159,570 (143) 2,497 (3) 162,067 (146) Total $ 498,358 $ (322) $ 20,399 $ (5) $ 518,757 $ (327) As of December 31, 2020 Less Than 12 Months Greater Than 12 Months Total Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss Commercial paper $ 4,997 $ — $ — $ — $ 4,997 $ — Corporate notes and bonds 92,855 (41) 870 — 93,725 (41) U.S. Treasuries 42,799 (6) — — 42,799 (6) U.S. Government agencies 37,488 (13) 1,700 — 39,188 (13) Total $ 178,139 $ (60) $ 2,570 $ — $ 180,709 $ (60) Unrealized losses related to these investments are due to interest rate fluctuations as opposed to credit quality. In addition, we do not intend to sell, and it is not more likely than not that we would be required to sell, these investments before recovery of their cost basis. The following table summarizes the contractual maturities of our investments as of June 30, 2021 (in thousands): Amortized Cost Fair Value Due within one year $ 464,094 $ 465,435 Due within one to three years 400,280 400,866 Total $ 864,374 $ 866,301 All available-for-sale securities have been classified as current, based on management's ability to use the funds in current operations. |
Property and Equipment
Property and Equipment | 6 Months Ended |
Jun. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment Property and equipment, net consisted of the following (in thousands): As of June 30, 2021 As of December 31, 2020 Computer equipment and software $ 149,231 $ 139,147 Leasehold improvements 56,304 56,401 Furniture and fixtures 12,698 12,955 Machinery and equipment 160 160 Total property and equipment 218,393 208,663 Less: accumulated depreciation (152,507) (144,327) Total property and equipment, net $ 65,886 $ 64,336 Depreciation and amortization expense related to property and equipment during the three months ended June 30, 2021 and 2020 was $7.7 million and $5.9 million, respectively. Depreciation and amortization expense related to property and equipment during the six months ended June 30, 2021 and 2020 was $16.3 million and $11.1 million, respectively. During the three months ended June 30, 2021 and 2020, we capitalized $4.8 million and $3.4 million, respectively, of software development costs primarily related to our platform and cloud subscription offerings. Amortization expense related to capitalized software development costs during the three months ended June 30, 2021 and 2020 were $3.0 million and $2.6 million, respectively. During the six months ended June 30, 2021 and 2020, we capitalized $8.8 million and $7.9 million, respectively, of software development costs primarily related to our platform and cloud subscription offerings. Amortization expense related to capitalized software development costs during the six months ended June 30, 2021 and 2020 were $6.0 million and $4.7 million, respectively. Refer to Note 7 Restructuring Charges regarding fixed assets write-offs. |
Business Combinations
Business Combinations | 6 Months Ended |
Jun. 30, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Business Combinations | Business Combinations Acquisition of Cloudvisory In January 2020, we acquired Cloudvisory, a provider of cloud visibility and control solutions. As consideration for the acquisition, we paid approximately $13.2 million in cash and assumed $0.3 million in net tangible liabilities. The acquisition of Cloudvisory was accounted for in accordance with the acquisition method of accounting for business combinations with FireEye as the accounting acquirer. Under the acquisition method of accounting, the total purchase consideration is allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values. The total purchase price of $13.2 million was allocated using the information available to us. The results of operations of Cloudvisory have been included in our consolidated statements of operations from the acquisition date, though revenue and net income from Cloudvisory were not material for the six months ended June 30, 2021. Transaction costs were immaterial and expensed as incurred. Pro forma financial information has not been presented for this acquisition as the impact to our consolidated financial statements was not material. Allocation of the purchase price is as follows (in thousands): Amount Net tangible liabilities assumed $ (288) Intangible assets 5,650 Goodwill 7,846 Total purchase price allocation $ 13,208 The purchase price exceeded the fair value of the net tangible liabilities and identifiable intangible assets acquired, resulting in the recognition of goodwill. Goodwill is primarily attributable to expected synergies in our subscription offerings and cross-selling opportunities. The goodwill generated as a result of the Cloudvisory acquisition is deductible for tax purposes. Intangible assets consist primarily of developed technology and trade name. Intangible assets attributable to developed technology include a combination of patented and unpatented technology, trade secrets, computer software and research processes that represent the foundation for the existing and planned new products to facilitate the generation of new content. Trade name is attributable to marketing goods and services under the Cloudvisory brand. The estimated useful life and fair values of the identifiable intangible assets are as follows (in thousands): Estimated Useful Life (in years) Amount Developed technology 3 $ 5,500 Trade name 1 150 Total identifiable intangible assets $ 5,650 The value of developed technology was estimated using the excess earnings method, an income approach (Level 3), which converts projected revenues and costs into cash flows. To reflect the fact that certain other assets contribute to the cash flows generated, the returns for these contributory assets were removed to arrive at estimated cash flows solely attributable to the acquired technology, which were discounted at a rate of 35% to determine the fair value. The value of the trade name was estimated using the relief-from-royalty method, an income approach (Level 3), which estimates the cost savings that accrue to the owner of the intangibles asset that would otherwise be payable as royalties or license fees on revenues earned through the use of the asset. A royalty rate of 1% was applied to the projected revenues associated with the intangible asset to determine the amount of savings using a discount rate of 35% to determine the fair value. Discount rates for each respective intangible asset were determined by accounting for the risk associated with each asset, including required technology development necessary to support respective projections, the uncertainty of market success and the risk inherent with projected financial results. The estimated useful lives were determined by evaluating the expected economic and useful lives of the assets and of similar intangible assets from previous business combinations and adjusting accordingly for circumstances that may be unique to Cloudvisory. The intangibles acquired and net tangible liability assumed in this acquisition are reported as held for sale. Goodwill generated by the Cloudvisory acquisition amounted to $1.8 million and was allocated to the Products business based on relative fair value and is reported as held for sale. Acquisition of Respond Software In November 2020, we acquired all outstanding shares of privately held Respond Software, a cybersecurity investigation automation company. The acquisition of Respond Software, a leader in automation of extended detection and response (XDR), is intended to add significant capabilities to our Mandiant Advantage platform by automating threat detection and reducing the amount of analyst time necessary to investigate threats due to the reduction in false positives as well as to accelerate Respond Software's learning models with our unique expertise and threat intelligence. In connection with this acquisition, we paid cash consideration of $116.1 million and issued 4,931,862 shares of our common stock, 694,768 of these shares were subject to vesting conditions as of December 31, 2020, of which 257,852 were canceled during the three months ended March 31, 2021 and 436,916 shares remained subject to vesting conditions as of June 30, 2021. The estimated fair value of the common stock issued and not subject to vesting conditions was $60.3 million. We also assumed unvested stock options, which are now exercisable for our common stock, of which $1.2 million of the fair value has been accounted for as consideration for assumed awards pertaining to pre-combination service prior to acquisition. Based on the above, total purchase consideration for Respond Software was $177.6 million. The acquisition of Respond Software was accounted for in accordance with the acquisition method of accounting for business combinations with FireEye as the accounting acquirer. Under the acquisition method of accounting, the total purchase consideration is allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values. The total purchase price of $177.6 million was allocated using the information available to us. As a result, we may continue to adjust the preliminary purchase price allocation after obtaining more information regarding asset valuations, liabilities assumed, and revisions of preliminary estimates. The results of operations of Respond Software have been included in our consolidated statements of operations from the acquisition date, and revenue and net income from Respond Software were not material for the year ended December 31, 2020. Transaction costs were immaterial and expensed as incurred. Pro forma financial information has not been presented for this acquisition as the impact to our consolidated financial statements was not material. Allocation of the preliminary purchase price is as follows (in thousands): Amount Net tangible assets assumed $ (4,551) Intangible assets 31,880 Deferred tax liability (1,120) Goodwill 151,388 Total purchase price allocation $ 177,597 The preliminary purchase price exceeded the fair value of the net tangible liabilities and identifiable intangible assets acquired, resulting in the recognition of goodwill. Goodwill is primarily attributable to expected synergies in our subscription offerings and cross-selling opportunities. The goodwill is not expected to be deductible for U.S. income tax purposes. Intangible assets consist primarily of developed technology, in-process technology, customer relationships and trade name. Intangible assets attributable to developed technology include a combination of patented and unpatented technology, trade secrets, computer software and research processes that represent the foundation for the existing and planned new products to facilitate the generation of new content. Customer relationship intangibles relate to Respond Software's ability to sell current and future content, as well as products built around this content, to its existing customers. Trade name is attributable to marketing goods and services under the Respond Software brand. The estimated useful life and fair values of the identifiable intangible assets are as follows (dollars in thousands): Estimated Useful Life (in years) Amount Developed technology 5 $ 22,300 In-Process technology 4 2,200 Customer relationships 5 6,760 Trade name 2 620 Total identifiable intangible assets $ 31,880 The value of developed technology was estimated using the excess earnings method, an income approach (Level 3), which converts projected revenues and costs into cash flows. To reflect the fact that certain other assets contribute to the cash flows generated, the returns for these contributory assets were removed to arrive at estimated cash flows solely attributable to the acquired technology, which were discounted at a rate of 12% to determine the fair value. The value of in-process technology was estimated using the excess earnings method, an income approach (Level 3), which converts projected revenues and costs into cash flows. To reflect the fact that certain other assets contribute to the cash flows generated, the returns for these contributory assets were removed to arrive at estimated cash flows solely attributable to the acquired technology, which were discounted at a rate of 13% to determine the fair value. The value of customer relationships was estimated using the "with and without" version of the Income Approach, which measures the difference between cash flows generated assuming the existence of the current customer relationships and the cash flows assuming those relationships do not exist and are replaced over time. Estimated costs on projected revenues, excluding acquired contract backlog, were made using historical data pertaining to sales to new and existing customers. The cash flow impact of projected cost savings, primarily avoidance of legal costs pertaining to new customers and lower commission rates applicable to existing customers than new customers, were discounted at a rate of 11% to determine the fair value. The value of the trade name was estimated using the relief-from-royalty method, an income approach (Level 3), which estimates the cost savings that accrue to the owner of the intangibles asset that would otherwise be payable as royalties or license fees on revenues earned through the use of the asset. A royalty rate of 1% was applied to the projected revenues associated with the intangible asset to determine the amount of savings using a discount rate of 12% to determine the fair value. Discount rates for each respective intangible asset were determined by accounting for the risk associated with each asset, including required technology development necessary to support respective projections, the uncertainty of market success and the risk inherent with projected financial results. The estimated useful lives were determined by evaluating the expected economic and useful lives of the assets and of similar intangible assets from previous business combinations and adjusting accordingly for circumstances that may be unique to Respond Software. Goodwill generated by the Respond acquisition amounted to $34.8 million and was allocated to the Products business based on relative fair value and is reported as held for sale. Goodwill and Purchased Intangible Assets Goodwill and purchased intangible assets held for sale pursuant to our agreement to sell the FireEye Products business to STG were included in assets held for sale in our condensed consolidated balance sheets as of June 30, 2021 and December 31, 2020, and accordingly, are excluded from the amounts shown in the tables below. Goodwill increased by $0.04 million for tax adjustment for the six months ended June 30, 2021. There were no other changes to the carrying amount of goodwill. Purchased intangible assets consisted of the following (in thousands): As of June 30, 2021 As of December 31, 2020 Developed technology $ 147,493 $ 147,493 Content 158,700 158,700 Customer relationships 112,360 112,360 Contract backlog 13,200 13,200 Trade names 17,720 17,720 Non-competition agreements 1,100 1,100 Total intangible assets 450,573 450,573 Less: accumulated amortization (352,126) (330,018) Total net intangible assets $ 98,447 $ 120,555 Amortization expense of intangible assets during the three months ended June 30, 2021 and 2020 was $11.0 million and $10.0 million, respectively. Amortization expense of intangible assets during the six months ended June 30, 2021 and 2020 was $22.1 million and $20.4 million, respectively. The expected future annual amortization expense of intangible assets as of June 30, 2021 is presented below (in thousands): Years Ending December 31, Amount 2021 (remaining six months) $ 21,865 2022 33,305 2023 28,287 2024 9,905 2025 5,085 Total $ 98,447 |
Restructuring Charges
Restructuring Charges | 6 Months Ended |
Jun. 30, 2021 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Charges | Restructuring Charges The following table sets forth the restructuring balance as of June 30, 2021 related to previous restructuring activities and a summary of restructuring activities during the six months ended June 30, 2021 (in thousands): Severance and related costs Facilities costs Total costs Balance, December 31, 2020 $ 570 $ 478 $ 1,048 Provision for restructuring charges 1,898 — 1,898 Cash payments (1,797) (351) (2,148) Other adjustments (127) 15 (112) Balance, June 30, 2021 $ 544 $ 142 $ 686 The remainder of the restructuring balance of $0.7 million at June 30, 2021 is composed of $0.1 million of non-cancelable non-lease costs which we expect to pay over the terms of the related obligations through the first quarter of 2022 and $0.5 million of severance costs. |
Leases
Leases | 6 Months Ended |
Jun. 30, 2021 | |
Leases [Abstract] | |
Leases | Leases We have operating leases primarily for corporate offices. Our leases have remaining lease terms of one Operating leases held for sale related to our discontinued operations were included in assets and liabilities held for sale in our condensed consolidated balance sheets as of June 30, 2021 and December 31, 2020, and accordingly, are excluded from the amounts shown in the tables below. The components of lease expenses were as follows (in thousands): Three Months Ended June 30, 2021 Six Months Ended June 30, 2021 Operating lease costs $ 3,192 $ 6,783 Short-term lease costs 384 682 Sublease income (221) (444) Total net lease costs $ 3,355 $ 7,021 Supplemental balance sheet information related to leases is as follows (in thousands, except lease term and discount rate): As of June 30, 2021 Operating leases: Operating lease right-of-use assets, net $ 36,096 Operating lease liabilities, current $ 12,157 Operating lease liabilities, non-current 56,624 Total operating lease liabilities $ 68,781 Weighted average remaining lease term (in years) 7.0 Weighted average discount rate 6.1 % Supplemental cash flow and other information related to leases is as follows (in thousands): Three Months Ended June 30, 2021 Six Months Ended June 30, 2021 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 4,513 $ 9,327 Lease liabilities arising from obtaining right-of-use assets: Operating leases $ — $ 11,683 Cash flows of operating lease liabilities are as follows (in thousands): Years Ending December 31, Amount 2021 (remaining six months) $ 5,529 2022 14,093 2023 12,586 2024 11,235 2025 10,639 2026 10,608 2027 and thereafter 20,278 Total lease payments 84,968 Less: imputed interest (16,187) Total lease obligations 68,781 Less: current lease obligations (12,157) Long-term lease obligations $ 56,624 As of June 30, 2021, we did not have any additional operating lease commitments for office leases that have not yet commenced. |
Deferred Revenue
Deferred Revenue | 6 Months Ended |
Jun. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Deferred Revenue | Deferred Revenue Deferred revenue held for sale related to our discontinued operations was included in liabilities held for sale in our condensed consolidated balance sheets as of June 30, 2021 and December 31, 2020, and accordingly, is excluded from the amounts shown in the tables below. Deferred revenue consisted of the following (in thousands): As of June 30, 2021 As of December 31, 2020 Platform, cloud subscription and managed services, current $ 128,149 $ 126,086 Professional services, current 107,811 100,270 Total deferred revenue, current 235,960 226,356 Platform, cloud subscription and managed services, non-current 60,024 56,691 Professional services, non-current 1,342 1,206 Total deferred revenue, non-current 61,366 57,897 Total deferred revenue $ 297,326 $ 284,253 Changes in the balance of deferred revenue for the periods presented are as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Deferred revenue, beginning of period $ 280,291 $ 250,534 $ 284,253 $ 273,241 Billings for the period 130,945 90,780 241,671 160,227 Revenue recognized (113,910) (97,230) (228,598) (189,384) Deferred revenue, end of period $ 297,326 $ 244,084 $ 297,326 $ 244,084 Remaining Performance Obligations Transaction price allocated to remaining performance obligations for continuing operations represents contracted revenue that has not yet been recognized, which includes deferred revenue and non-cancelable contracts that will be invoiced and recognized as revenue in future periods ("backlog"). While deferred revenue is recorded on our balance sheet as a liability, backlog is not recorded in revenue, deferred revenue or elsewhere in our consolidated financial statements until we establish a contractual right to invoice, at which point it is recorded as revenue or deferred revenue as appropriate. As of June 30, 2021, the aggregate amount of the transaction price allocated to remaining performance obligations was $297.3 million in deferred revenue and $13.4 million in backlog. We expect that the amount of backlog relative to the total value of our contracts will change from year to year due to several factors, including the amount invoiced early in the contract term, the timing and duration of customer agreements, varying invoicing cycles of agreements and changes in customer financial circumstances. Accordingly, we believe that fluctuations in backlog are not always a reliable indicator of future revenues and we do not utilize backlog internally as a key management metric. We expect to recognize these remaining performance obligations as follows (in percentages): Total Less than 1 year 1-2 years 2-3 years More than 3 years Deferred revenue 100% 79% 14% 6% 1% Backlog 100% 65% 24% 10% 1% |
Convertible Senior Notes
Convertible Senior Notes | 6 Months Ended |
Jun. 30, 2021 | |
Debt Disclosure [Abstract] | |
Convertible Senior Notes | Convertible Senior Notes Convertible Senior Notes due 2024 On May 24, 2018, we issued $525.0 million aggregate principal amount of 0.875% Convertible Senior Notes due 2024 (the "2024 Notes") in a private placement to qualified institutional purchasers pursuant to an exemption from registration provided by Section 4(a)(2) and Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"). In addition, on June 5, 2018, we issued an additional $75.0 million aggregate principal amount of the 2024 Notes pursuant to the full exercise of the initial purchasers' option to purchase additional 2024 Notes, in a private placement exempt from the registration requirements of the Securities Act. The net proceeds from the offerings, after deducting the initial purchasers' discount of approximately $15.0 million and the issuance costs of approximately $0.6 million, were $584.4 million. We used (i) approximately $330.4 million of the net proceeds to repurchase approximately $340.2 million in aggregate principal amount outstanding of the Series A Notes (as defined below) in negotiated transactions with institutional investors and (ii) approximately $65.2 million of the net proceeds from the offering of the 2024 Notes to enter into capped call transactions (the "Capped Calls"). The 2024 Notes are unsecured obligations and rank senior in right of payment to any of our indebtedness that is expressly subordinated in right of payment to the 2024 Notes. They rank equally in right of payment with all of our existing and future liabilities that are not expressly subordinated to the 2024 Notes, including the Series A Notes and the Series B Notes (as defined below); and effectively rank junior in right of payment to any of our secured indebtedness to the extent of the value of the assets securing such indebtedness. The 2024 Notes are structurally junior to all indebtedness and other liabilities (including trade payables) of our subsidiaries. The 2024 Notes do not contain any financial covenants and do not restrict us from paying dividends or issuing or repurchasing other securities. The 2024 Notes bear interest at 0.875% per year, payable semiannually in arrears on June 1 and December 1 of each year. The 2024 Notes mature on June 1, 2024, unless earlier repurchased, redeemed or converted. The initial conversion rate of the 2024 Notes is 43.1667 shares of our common stock per $1,000 of principal amount of the 2024 Notes, which is equivalent to an initial conversion price of approximately $23.17 per share of common stock. The conversion rate of the 2024 Notes may be adjusted pursuant to the terms of the indenture governing the 2024 Notes upon the occurrence of certain specified events, but not for accrued and unpaid interest. Holders may convert the 2024 Notes at their option in multiples of $1,000 principal amount prior to the business day preceding March 1, 2024, only under the following circumstances: • during any calendar quarter (and only during such calendar quarter), if the last reported sale price of the common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price of the 2024 Notes on each applicable trading day; • during the five business day period after any five • if we call any or all of the 2024 Notes for redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the relevant redemption date; or • upon the occurrence of specified corporate events, as specified in each indenture governing the 2024 Notes. Regardless of the foregoing conditions, holders may convert their 2024 Notes at their option in multiples of $1,000 principal amount during the period from, and including, March 1, 2024 to the close of business on the second scheduled trading day immediately preceding the maturity date. Upon conversion, the 2024 Notes can be settled in cash, shares of our common stock or any combination of cash and shares of common stock at our option. Holders may also require us to repurchase the 2024 Notes if we undergo a "fundamental change," as defined in each indenture governing the 2024 Notes, at a repurchase price equal to 100% of the principal amount, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. Additionally, we may redeem for cash all or any portion of the 2024 Notes, if the last reported sale price of our common stock has been at least 130% of the conversion price of the 2024 Notes then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) immediately preceding the date on which we provide notice of redemption at a redemption price equal to 100% of the principal amount of the notes to be redeemed, plus any accrued and unpaid interest to, but excluding, the redemption date. As of June 30, 2021, none of the conditions permitting holders to convert their 2024 Notes had been satisfied and no shares of our common stock had been issued in connection with any conversions of the 2024 Notes. Based on the closing price of our common stock of $20.22 per share on June 30, 2021, the conversion value of the 2024 Notes was less than the principal amount of the 2024 Notes outstanding on a per 2024 Note basis. In accordance with accounting for debt with conversions and other options, we bifurcated the principal amount of the 2024 Notes into liability and equity components. The initial liability component of the 2024 Notes was valued at $458.3 million based on the contractual cash flows discounted at an appropriate comparable market non-convertible debt borrowing rate at the date of issuance of 5.5% with the equity component representing the residual amount of the proceeds of $141.7 million, which was recorded as a debt discount. Issuance costs were allocated pro rata based on the relative initial carrying amounts of the liability and equity components. As a result, transaction costs of $0.5 million and $0.1 million and initial purchasers' discount of $11.5 million and $3.5 million were attributable to the liability component and equity component of the 2024 Notes, respectively. The debt discount and the issuance costs allocated to the liability component are amortized as additional interest expense over the term of the 2024 Notes using the effective interest method as noted in the table below. The liability and equity components of the 2024 Notes consisted of the following (in thousands): As of June 30, 2021 As of December 31, 2020 2024 Notes 2024 Notes Liability component: Principal $ 600,000 $ 600,000 Less: 2024 Notes discounts and issuance costs, net of amortization (80,130) (92,750) Net carrying amount $ 519,870 $ 507,250 Equity component, net of issuance costs $ 138,064 $ 138,064 The unamortized issuance costs as of June 30, 2021 will be amortized over a weighted-average remaining period of approximately 2.9 years. Interest expense related to the 2024 Notes consisted of the following (dollars in thousands): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 2024 Notes 2024 Notes 2024 Notes 2024 Notes Coupon interest $ 1,313 $ 1,313 $ 2,625 $ 2,625 Amortization of 2024 Notes discounts and issuance costs 6,349 6,044 12,620 12,015 Total interest expense recognized $ 7,662 $ 7,357 $ 15,245 $ 14,640 Effective interest rate on the liability component 6.0 % 6.0 % 6.0 % 6.1 % In connection with the 2024 Notes offering, we entered into the Capped Calls with certain counterparties affiliated with the initial purchasers of the 2024 Notes. The Capped Calls are expected to reduce potential dilution of earnings per share upon conversion of the 2024 Notes, and have an initial strike price of $23.17 per share, which corresponds to the initial conversion price of the 2024 Notes and which have a cap price of $34.32 per share. The Capped Calls do not meet the criteria for separate accounting as a derivative as they are indexed to our own stock and are accounted for as freestanding financial instruments. The premiums paid for the purchase of the Capped Calls in the amount of $65.2 million have been recorded as a reduction of the Company's additional paid-in capital in stockholder's equity in the accompanying Condensed Consolidated Financial Statements and fair values of the Capped Calls are not re-measured at each reporting period. Convertible Senior Notes due 2035 In June 2015, we issued $460.0 million principal amount of 1.000% Convertible Senior Notes due 2035 (the "Series A Notes") and $460.0 million principal amount of 1.625% Convertible Senior Notes due 2035 (the “Series B Notes” and together with the Series A Notes, the "2035 Notes", and the 2035 Notes, together with the 2024 Notes, the "Convertible Senior Notes") in a private placement to qualified institutional purchasers pursuant to an exemption from registration provided by Section 4(a)(2) and Rule 144A under the Securities Act. The net proceeds after the initial purchasers' discount of $23.0 million and issuance costs of $0.5 million from the 2035 Notes were $896.5 million. The Series A Notes and Series B Notes bear interest at 1.000% per year and 1.625% per year, respectively, payable semiannually in arrears on June 1 and December 1 of each year. The 2035 Notes mature on June 1, 2035, unless earlier repurchased, redeemed or converted. The 2035 Notes are unsecured obligations and rank senior in right of payment to any of our indebtedness that is expressly subordinated in right of payment to the 2035 Notes. They rank equally in right of payment with all of our existing and future liabilities that are not expressly subordinated to the 2035 Notes and effectively rank junior in right of payment to any of our secured indebtedness to the extent of the value of the assets securing such indebtedness. They are structurally junior to all indebtedness and other liabilities (including trade payables) of our subsidiaries. The 2035 Notes do not contain any financial covenants and do not restrict us from paying dividends or issuing or repurchasing our other securities. The initial conversion rate on each series of 2035 Notes is 16.4572 shares of our common stock per $1,000 principal amount of 2035 Notes, which is equivalent to an initial conversion price of approximately $60.76 per share of common stock. The conversion rate of each series of 2035 Notes may be adjusted upon the occurrence of certain specified events, but not for accrued and unpaid interest. Holders may convert the 2035 Notes at their option in multiples of $1,000 principal amount prior to March 1, 2035, only under the following circumstances: • during any calendar quarter (and only during such calendar quarter), if the last reported sale price of the common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price for the 2035 Notes of the relevant series on each applicable trading day; • during the five business day period after any five • if we call any or all of the 2035 Notes of a series for redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the relevant redemption date; or • upon the occurrence of specified corporate events, as specified in each indenture governing the 2035 Notes. Regardless of the foregoing conditions, holders may convert their 2035 Notes at their option in multiples of $1,000 principal amount at any time after March 1, 2035 until maturity for either series of 2035 Notes. Upon conversion, the 2035 Notes can be settled in cash, shares of our common stock or any combination thereof at our option. We may be required by holders of the 2035 Notes to repurchase all or any portion of their 2035 Notes at 100% of the principal amount plus accrued and unpaid interest, on each of June 1, 2025 and June 1, 2030, in the case of the Series A Notes, and each of June 1, 2022, June 1, 2025 and June 1, 2030 in the case of the Series B Notes. Holders may also require us to repurchase the 2035 Notes if we undergo a "fundamental change," as defined in each indenture governing the 2035 Notes, at a purchase price equal to 100% of the principal amount, plus accrued and unpaid interest. Additionally, we may redeem for cash all or any portion of the Series B Notes at any time prior to June 1, 2022 if the last reported sale price of our common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending not more than three In accordance with accounting for debt with conversions and other options, we allocated the principal amount of the 2035 Notes into liability and equity components. We also allocated the total amount of initial purchasers' discount and transaction costs incurred to the liability and equity components using the same proportions as the proceeds from the 2035 Notes. Transaction costs of $0.4 million and $0.1 million and initial purchasers' discount of $17.6 million and $5.4 million were attributable to the liability component and equity component of the 2035 Notes, respectively. Repurchase of a portion of the Series A Notes In May 2018, we used approximately $330.4 million of the net proceeds from the offering of the 2024 Notes to repurchase $340.2 million aggregate principal amount of the Series A Notes. The repurchase was accounted for as a partial extinguishment of the Series A Notes. The consideration of approximately $330.4 million used to repurchase the Series A Notes was allocated between the liability and equity components of the amount extinguished by determining the fair value of the liability component immediately prior to the debt extinguishment and allocating that portion of the repurchase price to the liability component in the amount of $317.4 million. The residual of the repurchase price of $13.0 million was allocated to the equity component of the Series A Notes as a reduction of additional paid-in capital. The fair value of the debt extinguished was calculated using a discount rate of 4.5%, representing an estimate of the Company's borrowing rate at the date of repurchase with a remaining expected life of two years. As part of the repurchase, we wrote-off a portion of the unamortized debt issuance cost apportioned to the principal amount of Series A Notes repurchased. We also recorded a loss on partial extinguishment of the Series A Notes of $10.8 million in Other Expense, net, representing the difference between the consideration attributed to the liability component and the sum of the net carrying amount of the liability component and unamortized costs. In June 2020, the Company delivered a notice to the holders of Series A Notes to notify such holders of their option to require the Company to repurchase their Series A Notes on June 1, 2020. Holders representing $96.4 million aggregate principal amount of Series A Notes chose to exercise their option to require the Company to repurchase their Series A Notes. The repurchase was accounted for as a partial extinguishment of the Series A Notes. The consideration of approximately $96.4 million was used to repurchase the Series A Notes. The fair value of the debt extinguished was deemed to be the same as the par value of $96.4 million and no gain or loss was recognized. As of June 30, 2021, $23.4 million aggregate principal amount of the Series A Notes remained outstanding. The liability and equity components of the remaining portion of 2035 Notes consisted of the following (in thousands): As of June 30, 2021 As of December 31, 2020 Series A Notes Series B Notes Series A Notes Series B Notes Liability component: Principal $ 23,436 $ 460,000 $ 23,436 $ 460,000 Less: 2035 Notes discount and issuance costs, net of amortization — (19,503) — (29,790) Net carrying amount $ 23,436 $ 440,497 $ 23,436 $ 430,210 Equity component, net of issuance costs $ 15,559 $ 117,834 $ 15,559 $ 117,834 The unamortized discounts and issuance costs as of June 30, 2021 will be amortized over a weighted-average remaining period of approximately 0.9 years. Interest expense for the three and six months ended June 30, 2021 related to the 2035 Notes consisted of the following (dollars in thousands): Three Months Ended June 30, 2021 Six Months Ended June 30, 2021 Series A Notes Series B Notes Series A Notes Series B Notes Coupon interest $ 59 $ 1,869 $ 117 $ 3,738 Amortization of 2035 Notes discount and issuance costs — 5,174 — 10,287 Total interest expense recognized $ 59 $ 7,043 $ 117 $ 14,025 Effective interest rate on the liability component 1.0 % 6.5 % 1.0 % 6.5 % Interest expense for the three and six months ended June 30, 2020 related to the 2035 Notes consisted of the following (dollars in thousands): Three Months Ended June 30, 2020 Six Months Ended June 30, 2020 Series A Notes Series B Notes Series A Notes Series B Notes Coupon interest $ 219 $ 1,869 $ 519 $ 3,738 Amortization of 2035 Notes discount and issuance costs 1,023 4,935 2,540 9,812 Total interest expense recognized $ 1,242 $ 6,804 $ 3,059 $ 13,550 Effective interest rate on the liability component 4.2 % 6.6 % 5.2 % 6.6 % Prepaid Forward Stock Purchase In connection with the issuance of the 2035 Notes, we also entered into privately negotiated prepaid forward transactions (the "Prepaid Forwards") with one of the initial purchasers of the 2035 Notes (the "Forward Counterparty"), pursuant to which we paid approximately $150.0 million. The amount of the Prepaid Forward entered into in connection with the issuance of the Series A Notes was equivalent to approximately 1.6 million shares which was settled on June 3, 2020. The amount of the Prepaid Forward entered into in connection with the issuance of the Series B Notes was equivalent to approximately 1.8 million shares which is to be settled on or around June 1, 2022, subject to any early settlement, in whole or in part, of such Prepaid Forward. Such Prepaid Forward is intended to facilitate privately negotiated derivative transactions by which investors in the Series B Notes will be able to hedge their investment in the Series B Notes. In the event we pay any cash dividends on our common stock, the Forward Counterparty will pay an equivalent amount back to us. The related shares were accounted for as a repurchase of common stock, and are presented as Treasury Stock in the unaudited condensed consolidated balance sheets. On June 3, 2020, we retired approximately 1.6 million shares delivered under the Prepaid Forward entered into in connection with the issuance of the Series A Notes. The remaining approximately 1.8 million shares of common stock purchased under the Prepaid Forward entered into in connection with the issuance of the Series B Notes are excluded from weighted-average shares outstanding for basic and diluted EPS purposes although they remain legally outstanding. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Letters of Credit We were party to letters of credit totaling $3.4 million and $3.9 million as of June 30, 2021 and December 31, 2020, respectively, issued primarily in support of operating leases for our facilities. These letters of credit are collateralized by a line with our bank. No amounts have been drawn against these letters of credit. Purchase Obligations As of June 30, 2021, we had approximately $23.1 million of non-cancelable firm purchase commitments primarily for purchases of software and services. In situations where we have received delivery of the goods or services as of June 30, 2021 under purchase orders outstanding as of the same date, such amounts are reflected in the condensed consolidated balance sheet as accounts payable or accrued liabilities and are excluded from the $23.1 million. Litigation From time to time, we are involved in claims and legal proceedings that arise in the ordinary course of business. Any claims or proceedings against us, whether meritorious or not, could be time consuming, result in costly litigation, require significant amounts of management time, result in the diversion of significant operational resources, or require us to enter into agreements which may not be available on terms favorable to us or at all. To the extent there is a reasonable possibility that a loss exceeding amounts already recognized may be incurred, and the amount of such additional loss would be material, we will either disclose the estimated additional loss or state that such an estimate cannot be made. We do not currently believe that it is reasonably possible that additional losses in connection with litigation arising in the ordinary course of business would be material. Indemnification Under the indemnification provisions of our standard sales related contracts, we agree to defend our customers against third-party claims asserting infringement of certain intellectual property rights, which may include patents, copyrights, trademarks, or trade secrets, and to pay judgments entered on such claims. Our exposure under these indemnification provisions is generally limited to the total amount paid by our customer under the agreement. However, certain agreements include indemnification provisions that could potentially expose us to losses in excess of the amount received under the agreement. In addition, we indemnify our officers, directors, and certain key employees for actions taken while they are or were serving in good faith in such capacities. Through June 30, 2021, there have been no claims under any indemnification provisions. |
Redeemable Convertible Preferre
Redeemable Convertible Preferred Stock | 6 Months Ended |
Jun. 30, 2021 | |
Equity [Abstract] | |
Redeemable Convertible Preferred Stock | Redeemable Convertible Preferred Stock On November 18, 2020, we entered into the Series A Securities Financing Agreements. Pursuant to the Series A Securities Financing Agreements, on December 11, 2020 we issued and sold 400,000 shares of a newly designated 4.5% Series A Convertible Preferred Stock (“Series A Preferred Stock”), at a price of $1,000 per share, for an aggregate purchase price of $400.0 million. We intend to use the net proceeds from the issuance and sale to fund acquisitions, buybacks of our common stock, and for working capital purposes. Each share of Series A Preferred Stock has the powers, designations, preferences, and other rights of the shares of such series as are set forth in the Certificate of Designations of the Series A Preferred Stock filed by us with the Secretary of State of the State of Delaware on December 11, 2020 (the “Certificate of Designations”). The Series A Preferred Stock ranks senior to our common stock, with respect to dividend rights and rights upon the voluntary or involuntary liquidation, dissolution, or winding up of our affairs (a “Liquidation”). Upon a Liquidation, each share of Series A Preferred Stock is entitled to receive an amount per share equal to the greater of (i) the purchase price paid by the Purchaser, plus all accrued and unpaid dividends and (ii) the amount that the holder of Series A Preferred Stock (each, a “Holder” and collectively, the “Holders”) would have been entitled to receive at such time if the Series A Preferred Stock were converted into our common stock (the “Liquidation Preference”). The initial purchase price of the Series A Preferred Stock is $1,000 per share (the “Original Purchase Price”). The Holders are entitled to dividends on the Original Purchase Price paid by the Purchaser at the rate of 4.5%, cumulatively, per annum that (i) for the first three years after December 11, 2020 will be paid in-kind, and (ii) after the third anniversary of December 11, 2020, will, at our election either be paid in cash, or, if not, will accrue and accumulate, in each case, accruing daily and paid quarterly in arrears. The Holders are also entitled to participate in dividends declared or paid on our common stock on an as-converted basis. The Holder has the right, at its option, to convert its Series A Preferred Stock, in whole or in part, into fully paid and non-assessable shares of our common stock at a conversion price equal to $17.25 per share subject to certain customary adjustments in the event of certain adjustments to our common stock. The conversion price was equal to $17.25 per share as of June 30, 2021. After the third anniversary of December 11, 2020, subject to certain conditions, we may, at our option, require conversion of all of the outstanding shares of Series A Preferred Stock to Common Stock if, for at least 20 trading days during the 30 consecutive trading days immediately preceding the date we notify the Holders of the election to convert, the closing price of our common stock is at least 175% of the conversion price. After the seventh anniversary of December 11, 2020, each Holder shall have the right to require us to redeem all or any part of the Holder’s Series A Preferred Stock for cash at a price equal to the Original Purchase Price paid by the Purchaser plus any accrued and unpaid dividends. Upon a “Fundamental Change” (involving a change of control, bankruptcy, insolvency, liquidation or de-listing as further described in the Certificate of Designations), each Holder shall have the right to require us to redeem all or any part of the Holder’s Series A Preferred Stock for an amount equal to the Liquidation Preference at a repurchase price calculated in accordance with the Certificate of Designations plus any accrued and unpaid dividends. The Holders are generally entitled to vote with the holders of the shares of our common stock on all matters submitted for a vote of holders of shares of our common stock (voting together with the holders of shares of our common stock as one class) on an as-converted basis, subject to certain Nasdaq voting limitations, if applicable. Additionally, the consent of the Holders of a majority of the outstanding shares of Series A Preferred Stock is required for so long as any shares of the Series A Preferred Stock remain outstanding for (i) amendments to our organizational documents that have an adverse effect on the holders of Series A Preferred Stock and (ii) issuances by us of securities that are senior to, or equal in priority with, the Series A Preferred Stock. In addition, for so long as 25% of the Series A Preferred Stock issued in connection with the Financing Agreements remains outstanding, consent of the Holders of a majority of the outstanding shares of Series A Preferred Stock is required for (i) any change to the size of our Board of Directors, (ii) any voluntary dissolution, liquidation, bankruptcy, winding up or deregistration or delisting and (iii) incurrence by us of net debt in excess of $350,000,000. We have applied the guidance in ASC 480‑10‑S99‑3A, SEC Staff Announcement: Classification and Measurement of Redeemable Securities and have therefore classified the Series A Preferred Stock as mezzanine equity. The Series A Preferred Stock was recorded outside of stockholders’ deficit because it is probable that the shares will be redeemed at the option of the Holders and that redemption option is not solely within the Company's control. Upon issuance, we elected to record the Series A Preferred Stock at redemption value. As such, we recognized $0.1 million and $4.7 million of accretion as of June 30, 2021 and December 31, 2020, respectively. We accrued $9.1 million of dividends on the Series A Preferred Stock during the six months ended June 30, 2021. The cumulative dividend accrued on the Series A Preferred Stock as of June 30, 2021 was $10.1 million. Accrued dividends are recorded against additional paid-in capital due to the Company being in an accumulated deficit position. |
Common Shares Reserved for Issu
Common Shares Reserved for Issuance | 6 Months Ended |
Jun. 30, 2021 | |
Equity [Abstract] | |
Common Shares Reserved for Issuance | Common Shares Reserved for Issuance Under our amended and restated certificate of incorporation, we are authorized to issue 100,000,000 shares of convertible preferred stock with a par value of $0.0001 per share, of which 400,000 shares of Series A Preferred Stock were issued and outstanding as of June 30, 2021 and December 31, 2020. Under our amended and restated certificate of incorporation, we are authorized to issue 1,000,000,000 shares of common stock with a par value of $0.0001 per share as of June 30, 2021 and December 31, 2020. Each share of common stock outstanding is entitled to one vote. The holders of common stock are also entitled to receive dividends whenever funds are legally available and when declared by our Board of Directors, subject to the prior rights of holders of all classes of convertible preferred stock outstanding. We had reserved shares of common stock for issuance as follows (in thousands): As of June 30, 2021 As of December 31, 2020 Reserved under stock award plans 44,327 38,745 Convertible senior notes 33,856 33,856 Convertible preferred stock 23,775 23,249 Employee Stock Purchase Plan (ESPP) 4,684 3,425 Total 106,642 99,275 |
Equity Award Plans
Equity Award Plans | 6 Months Ended |
Jun. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Equity Award Plans | Equity Award Plans We have operated under our 2013 Equity Incentive Plan ("2013 Plan") since our initial public offering ("IPO") in September 2013. Our 2013 Plan provides for the issuance of restricted stock and the granting of options, stock appreciation rights, performance shares, performance units and restricted stock uni ts to our employees, officers, directors and consultants. Our 2013 Plan provides for annual increases in the number of shares available for issuance on the first day of each fiscal year. Awards granted under the 2013 Plan vest over the periods determined by our Board of Directors or compensation committee of our Board of Directors, generally four years, and stock options granted under the 2013 Plan expire no more than ten years after the date of grant. In the case of an incentive stock option granted to an employee who at the time of grant owns stock representing more than 10% of the total combined voting power of all classes of stock, the exercise price shall be no less than 110% of the fair value per share on the date of grant, and the award shall expire five years from the date of grant. For options granted to any other employee, the per share exercise price shall be no less than 100% of the fair value per share on the date of grant. In the case of non-statutory stock options and options granted to consultants, the per share exercise price shall be no less than 100% of the fair value per share on the date of grant. Approximately 14.4 million shares and 14.9 million shares of our c ommon stock were reserved for future grants as of June 30, 2021 and December 31, 2020 , respectively, under the 2013 Plan . Our 2013 Employee Stock Purchase Plan ("ESPP") allows eligible employees to acquire shares of our common stock at 85% of the lower of the fair market value of our common stock on the first trading day of each offering period or on the exercise date. Our ESPP provides for annual increases in the number of shares available for issuance on the first day of each fiscal year. An aggregate of approximately 4.7 million shares and 3.4 million shares of common stock were available for future issuance as of June 30, 2021 and December 31, 2020, respectively, under our ESPP. From time to time, we also grant restricted common stock or restricted stock awards outside of our equity incentive plans to certain employees in connection with acquisitions. Stock Option Activity A summary of the activity, for continuing and discontinued operations, for our stock option changes during the reporting period and a summary of information related to options outstanding and options exercisable are presented below (in thousands, except per share amounts and contractual life years): Options Outstanding Number of Weighted- Weighted- Aggregate Balance — December 31, 2020 3,485 $ 8.33 5.3 $ 60,679 Exercised (714) 5.04 11,034 Cancelled (66) 20.30 Balance — June 30, 2021 2,705 $ 8.90 5.3 $ 39,960 Options exercisable — June 30, 2021 1,694 $ 12.81 3.71 $ 21,912 The aggregate intrinsic value above represents the pre-tax difference between the exercise price of stock options and the quoted market price of our stock on that day for all in-the-money stock options. Restricted Stock Award ("RSA") and Restricted Stock Unit ("RSU") Activity A summary of the activity, for continuing and discontinued operations, for our restricted common stock, RSAs and RSUs during the reporting periods and a summary of information related to unvested restricted common stock, RSAs and RSUs, including those expected to vest based on the achievement of a performance condition, are presented below (in thousands, except per share amounts and contractual life years): Number of Weighted- Weighted- Aggregate Unvested balance — December 31, 2020 20,400 $ 15.35 1.4 $ 470,424 Granted 14,427 20.72 Vested (5,899) 15.24 Cancelled (1,669) 16.91 Unvested balance — June 30, 2021 27,259 $ 18.17 1.6 $ 551,195 Unvested awards for which the requisite service period has not been rendered and vesting is subject to the achievement of a performance condition — June 30, 2021 2,748 $ 19.04 1.9 $ 55,556 Stock-Based Compensation We record stock-based compensation based on the fair value as determined on the date granted. We determine the fair value of stock options and shares of common stock to be issued under our ESPP using the Black-Scholes option-pricing model. The fair value of restricted stock units and restricted stock awards equals the market value of the underlying stock on the date of grant. We grant performance-based restricted stock units and restricted stock awards to certain employees which vest upon the achievement of certain performance conditions, subject to the employees’ continued service relationship with us. With respect to performance-based restricted stock units, we assess the probability of vesting at each reporting period and adjust our compensation cost based on this probability assessment. We recognize such compensation expense on a straight-line basis over the service providers' requisite service period. The following table summarizes the assumptions used in the Black-Scholes option-pricing model to determine fair value of our common shares to be issued under the ESPP for the offering periods beginning in May 2020: Three and Six Months Ended June 30, 2021 Three and Six Months Ended June 30, 2020 Fair value of common stock $22.33 $13.06 Risk-free interest rate 0.04% 0.17% - 0.18% Expected term (in years) 0.5 - 1.0 0.5 - 1.0 Volatility 55% - 62% 52% - 68% Dividend yield —% —% Stock-based compensation expense related to stock options, ESPP and restricted stock unit awards, relating to continuing operations, is included in the condensed consolidated statements of operations as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Cost of platform, subscription and support revenue $ 3,487 $ 2,486 $ 6,301 $ 4,865 Cost of professional services revenue $ 6,135 $ 4,171 $ 11,321 $ 7,748 Research and development 9,320 4,850 17,743 10,366 Sales and marketing 11,539 8,162 21,429 17,043 General and administrative 8,261 6,981 15,349 12,486 Total $ 38,742 $ 26,650 $ 72,143 $ 52,508 As of June 30, 2021, total compensation cost related to stock-based awards not yet recognized was $458.6 million, which is expected to be amortized on a straight-line basis over the weighted-average remaining vesting period of approximately 2.8 years. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes We account for income taxes under the asset and liability method. Under this method, deferred income tax assets and liabilities are determined based upon the difference between the financial statement carrying amounts and the tax basis of assets and liabilities and are measured using the enacted tax rate expected to apply to taxable income in the years in which the differences are expected to be reversed. We recognized a provision for income taxes of $0.8 million and $0.7 million for the three months ended June 30, 2021 and 2020, respectively. We recognized a provision for income taxes of $1.9 million and $1.0 million for the six months ended June 30, 2021 and 2020, respectively. The provision for income taxes was primarily comprised of income taxes in foreign jurisdictions and withholding taxes, offset by tax benefits from business combinations. On March 27, 2020, the Coronavirus Aid, Relief and Economic Security (CARES) Act was enacted and signed into U.S. law to provide economic relief to individuals and businesses facing economic hardship as a result of the COVID-19 pandemic. Changes in tax laws or rates are accounted for in the period of enactment. The income tax provisions of the CARES Act do not have a significant impact on our current taxes, deferred taxes, or uncertain tax positions. |
Net Loss per Share
Net Loss per Share | 6 Months Ended |
Jun. 30, 2021 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | Net Loss per Share Basic net loss per share is calculated by dividing net loss attributable to common stockholders by the weighted average number of common shares outstanding during the period, less shares subject to repurchase, and excludes any dilutive effects of employee share based awards and options. Diluted net income per common share is computed giving effect to all potentially dilutive common shares, including common stock issuable upon exercise of stock options, convertible preferred stock, conversion of the Convertible Senior Notes, and unvested restricted common stock and stock units. As we had net losses for continuing operations for the three and six months ended June 30, 2021 and 2020, all potentially issuable common shares were determined to be anti-dilutive. The following table sets forth the computation of net loss per common share (in thousands, except per share amounts): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Numerator: Loss from continuing operations $ (99,141) $ (89,996) $ (185,596) $ (187,803) Net income from discontinued operations 34,445 36,721 70,254 58,222 Net loss (64,696) (53,275) (115,342) (129,581) Dividend on series A convertible preferred stock (4,563) — (9,075) — Accretion of series A convertible preferred stock — — (82) — Net loss attributable to common stockholders (69,259) (53,275) (124,499) (129,581) Denominator: Weighted average number of shares outstanding—basic and diluted 237,279 221,352 236,016 219,570 Net loss per share attributable to common stockholders, basic and diluted: Continuing operations $ (0.44) $ (0.41) $ (0.83) $ (0.86) Discontinued operations 0.15 0.17 0.30 0.27 Total net loss per share attributable to common stockholders, basic and diluted $ (0.29) $ (0.24) $ (0.53) $ (0.59) The following outstanding options, unvested shares and units, ESPP shares, shares issuable upon the conversion of the Convertible Senior Notes, convertible preferred stock and shares contingently issuable were excluded (as common stock equivalents) from the computation of diluted net loss per common share for the periods presented as their effect would have been anti-dilutive (in thousands): As of June 30, 2021 2020 Options to purchase common stock 2,705 3,425 Unvested restricted stock awards and units 27,259 22,680 Convertible preferred stock 23,775 — Convertible senior notes 33,856 33,856 ESPP shares 133 198 |
Employee Benefit Plan
Employee Benefit Plan | 6 Months Ended |
Jun. 30, 2021 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plan | Employee Benefit Plan 401(k) Plan We have established a 401(k) tax-deferred savings plan (the “401(k) Plan”) which permits participants to make contributions by salary deduction pursuant to Section 401(k) of the Internal Revenue Code of 1986, as amended. All participants’ interests in their deferrals are 100% vested when contributed. We are responsible for administrative costs of the 401(k) Plan and have made no matching contributions into our 401(k) Plan since inception. Under the 401(k) Plan, pre-tax contributions are allocated to each participant’s individual account and are then invested in selected investment alternatives according to the participants’ directions. The 401(k) Plan is intended to qualify under Sections 401(a) and 501(a) of the Code. As a tax-qualified retirement plan, contributions to the 401(k) Plan and earnings on those contributions are not taxable to the employees until distributed, and all contributions are deductible by us when and if made. |
Segment and Major Customers Inf
Segment and Major Customers Information | 6 Months Ended |
Jun. 30, 2021 | |
Segment Reporting [Abstract] | |
Segment and Major Customers Information | Segment and Major Customers Information Disaggregation of revenue by geography We conduct business globally and are primarily managed on a geographic basis. Our Chief Executive Officer, who is our chief operating decision maker, reviews financial information presented on a consolidated basis accompanied by information about revenue by geographic region for purposes of allocating resources and evaluating financial performance. We define our regions as United States ("U.S."), Europe, the Middle East, and Africa ("EMEA"), Asia Pacific and Japan ("APAC"), and all remaining geographies (primarily Latin America and Canada) included in Others. There are no segment managers who are held accountable for operations, operating results, and plans for levels, components, or types of products or services below the consolidated unit level. Accordingly, we are considered to be a single reportable segment and operating unit structure. As discussed in Note 2, the results of product and related subscription and support revenue during the three and six months ended June 30, 2021 have been included in discontinued operations due to the Purchase Agreement entered into with STG. Revenue by geographic region based on the billing address is as follows (in thousands): Three Months Ended June 30, 2021 2020 2021 2020 2021 2020 2021 2020 U.S. EMEA APAC Other Platform, cloud subscription and managed services $ 34,669 $ 34,976 $ 8,439 $ 6,032 $ 6,266 $ 4,736 $ 2,562 $ 2,307 Professional services 42,804 34,003 7,978 6,655 4,953 3,612 6,239 4,909 Total revenue $ 77,473 $ 68,979 $ 16,417 $ 12,687 $ 11,219 $ 8,348 $ 8,801 $ 7,216 Six Months Ended June 30, 2021 2020 2021 2020 2021 2020 2021 2020 U.S. EMEA APAC Other Platform, cloud subscription and managed services $ 71,843 $ 67,913 $ 17,015 $ 11,507 $ 13,798 $ 9,875 $ 5,278 $ 4,058 Professional services 83,427 66,156 16,418 13,328 9,124 7,090 11,695 9,457 Total revenue $ 155,270 $ 134,069 $ 33,433 $ 24,835 $ 22,922 $ 16,965 $ 16,973 $ 13,515 Our continuing operations generate revenue from sales of our Mandiant Solutions software-as-a-service platform and modules, subscriptions to our managed services and professional services engagements. We disaggregate our revenue from continuing operations into two main categories: (i) platform, cloud subscription and managed services and (ii) professional services. Our platform, cloud subscription and managed services category includes our Mandiant Advantage software-as-a-service platform and our threat intelligence, security validation, and automated defense modules, as well as our managed services for detection and response and validation. We deliver our managed services and platform entirely through the cloud or, in the case of our security validation software, either through the cloud or in a hybrid on-premise/cloud configuration. Our professional services include incident response and other security consulting services to our customers who have experienced a cybersecurity breach or desire assistance assessing the resilience of their information systems infrastructure. The majority of our professional services are offered on a time and materials basis, through a fixed fee arrangement, or on a retainer basis. Revenue from professional services is recognized as services are delivered. Revenue from our pre-paid expertise-on-demand subscription and some pre-paid professional services is deferred and recognized when services are delivered. The following table depicts the disaggregation of revenue according to revenue type and is consistent with how we evaluate our financial performance (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Platform, cloud subscription and managed services $ 51,936 $ 48,051 $ 107,935 $ 93,353 Professional services 61,974 49,179 120,663 96,031 Total revenue $ 113,910 $ 97,230 $ 228,598 $ 189,384 Long lived assets by geography Long lived assets by geographic region based on physical location is as follows (in thousands): As of June 30, 2021 As of December 31, 2020 Property and equipment, net: United States $ 62,017 $ 59,998 International 3,869 4,338 Total property and equipment, net $ 65,886 $ 64,336 For the three and six months ended June 30, 2021, one reseller represented 10% of our total revenue but did not represent 10% or greater of our total revenue for the three or six months ended June 30, 2020. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent EventsOn August 4, 2021, we acquired a privately held company. As consideration for the acquisition, we paid approximately $16.3 million in cash. |
Description of Business and S_2
Description of Business and Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation The accompanying unaudited condensed consolidated financial statements include the accounts of FireEye, Inc. and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), and following the requirements of the Securities and Exchange Commission (“SEC”), for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP can be condensed or omitted. These unaudited condensed consolidated financial statements have been prepared on the same basis as our annual consolidated financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, that are necessary for a fair statement of our financial information. The results of operations for the three and six months ended June 30, 2021 are not necessarily indicative of the results to be expected for the year ending December 31, 2021 or for any other interim period or for any other future year. As a result of the Purchase Agreement, the FireEye Products business is in discontinued operations in our condensed consolidated financial statements and all prior periods presented have been adjusted to reflect the assets and liabilities held for sale and discontinued operations. The balance sheet as of December 31, 2020 has been derived from audited consolidated financial statements at that date but does not include all information required by U.S. GAAP for annual consolidated financial statements. The accompanying unaudited condensed consolidated financial statements and related financial information should be read in conjunction with the audited consolidated financial statements and the related notes thereto for the year ended December 31, 2020 included in our Annual Report on Form 10-K for the year ended December 31, 2020. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Such management estimates include, but are not limited to, determining the nature and timing of satisfaction of performance obligations, useful life of our security appliances that are dependent on intelligence and assessing the material rights associated with it, determining the standalone selling price of performance obligations, subscriptions and services, commissions expense including the period of benefit of customer acquisition cost, bonus expense, future taxable income, contract manufacturer liabilities, litigation and settlement costs and other loss contingencies, fair value of our equity awards, achievement of targets for performance stock units, fair value of the liability and equity components of the Convertible Senior Notes (as defined in Note 10), results of operations of the Company’s discontinued operations and the purchase price allocation of acquired businesses. We base our estimates on historical experience and on assumptions that we believe are reasonable. Changes in facts or circumstances may cause us to change our assumptions and estimates in future periods, and it is possible that actual results could differ from current or revised future estimates. |
Discontinued Operations | Discontinued Operations We consider assets to be held for sale when management commits to a formal plan to actively market the assets for sale at a price reasonable in relation to fair value, it is unlikely that significant changes will be made to the plan, the assets are available for immediate sale in its present condition, an active program to locate a buyer and other actions required to complete the sale have been initiated and the sale of the assets is expected to be completed within one year. Upon designation as held for sale, we record the carrying value of the assets at the lower of carrying value or estimated fair value, less costs to sell and assets held for sale are not depreciated or amortized. If the disposal of the component of an entity (or group of components) represents a strategic shift that has (or will have) a major effect on an entity’s operations and financial results, it meets the criteria for discontinued operations. The results of discontinued operations, as well as any gain or loss on the disposal transaction, are presented separately, net of tax, from the results of continuing operations for all periods presented. The revenue and expenses included in the results of discontinued operations are the revenue and |
Recently Adopted Accounting Pronouncements and Recent Accounting Pronouncements Not Yet Adopted | Recently Adopted Accounting Pronouncements Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract In August 2018, the FASB issued ASU 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract. This standard requires capitalization of the implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. Further, the standard also requires the Company to expense the capitalized implementation costs of a hosting arrangement over the term of the hosting arrangement. We adopted the standard effective January 1, 2020. The standard did not have a significant impact on our unaudited condensed consolidated financial statements. Simplifying the Test for Goodwill Impairment In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. This standard eliminates the requirement to calculate the implied fair value of goodwill to measure a goodwill impairment charge (i.e. Step 2 of the current guidance), instead measuring the impairment charge as the excess of the reporting unit's carrying amount over its fair value (i.e. Step 1 of the current guidance). We adopted the standard effective January 1, 2020. The standard did not have a significant impact on our unaudited condensed consolidated financial statements. Measurement of Credit Losses on Financial Instruments In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This standard changes the impairment model for most financial assets and certain other instruments by introducing a current expected credit loss ("CECL") model. The CECL model is a more forward-looking approach based on expected losses rather than incurred losses, requiring entities to estimate and record losses expected over the remaining contractual life of an asset. The guidance was effective for the Company beginning in the first quarter of 2020. We adopted the standard effective January 1, 2020. The standard did not have a significant impact on our unaudited condensed consolidated financial statements. Simplifying Accounting for Income Taxes In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. This standard simplifies the accounting for income taxes by eliminating certain exceptions to the guidance in Topic 740 related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. The new guidance also simplifies aspects of the accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill and allocating consolidated income taxes to separate financial statements of entities not subject to income tax. ASU 2019-12 is effective for annual and interim periods in fiscal years beginning after December 15, 2020. We adopted ASU 2019-12 as of January 1, 2020. The adoption did not have a significant impact on our unaudited condensed consolidated financial statements. Recent Legislation On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was enacted and signed into U.S. law to provide economic relief to individuals and businesses facing economic hardship as a result of the COVID-19 pandemic. Changes in tax laws or rates are accounted for in the period of enactment. The income tax provisions of the CARES Act do not have a significant impact on our current taxes, deferred taxes, or uncertain tax positions. Recent Accounting Pronouncements Not Yet Adopted In August 2020, the FASB issued ASU No. 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (ASU 2020-06): This standard simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts in an entity’s own equity. Among other changes, ASU 2020-06 removes from U.S. GAAP the liability and equity separation model for convertible instruments with a cash conversion feature, and as a result, after adoption, entities will no longer separately present in equity an embedded conversion feature for such debt. Similarly, the embedded conversion feature will no longer be amortized into income as interest expense over the life of the instrument. Instead, entities will account for a convertible debt instrument wholly as debt unless (1) a convertible instrument contains features that require bifurcation |
Fair Value Measurements | The accounting guidance for fair value measurements provides a framework for measuring fair value on either a recurring or nonrecurring basis, whereby the inputs used in our valuation techniques are assigned a hierarchical level. The following are the three levels of inputs to measure fair value: • Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. • Level 2: Inputs that reflect quoted prices for identical assets or liabilities in less active markets; quoted prices for similar assets or liabilities in active markets; benchmark yields, reported trades, broker/dealer quotes, inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means. • Level 3: Unobservable inputs that reflect our own assumptions incorporated in valuation techniques used to measure fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available. We consider an active market to be one in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis, and consider an inactive market to be one in which there are infrequent or few transactions for the asset or liability, the prices are not current, or price quotations vary substantially either over time or among market makers. Where appropriate, our own or the counterparty’s non-performance risk is considered in measuring the fair values of assets. |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Assets and Liabilities, Operations & Supplemental Information of the Discontinued Operations | The following table summarizes the assets and liabilities held for sale relating to our discontinued operations (dollars in thousands): As of June 30, 2021 As of December 31, 2020 MAJOR CLASSES OF ASSETS Current: Accounts receivable, net of allowance for doubtful accounts of $339 and $422 at June 30, 2021 and December 31, 2020, respectively $ 46,961 $ 59,236 Inventories 4,772 4,023 Prepaid expenses and other current assets 60,070 63,456 Property and equipment, net 20,706 — Goodwill 313,912 — Intangible assets, net 4,292 — Deposits and other long-term assets 49,256 — Operating lease right-of-use assets, net 719 — Total current assets held for sale $ 500,688 $ 126,715 Non-current: Property and equipment, net — 15,434 Goodwill — 313,924 Intangible assets, net — 5,512 Deposits and other long-term assets — 56,580 Operating lease right-of-use assets, net — 1,524 Total assets classified as held for sale $ 500,688 $ 519,689 MAJOR CLASSES OF LIABILITIES Current: Accounts payable $ 4,367 $ 1,080 Accrued and other current liabilities 8,762 3,510 Deferred revenue, current 614,802 387,353 Operating lease liabilities 768 1,468 Accrued compensation 8,970 16,822 Total current liabilities held for sale $ 637,669 $ 410,233 Non-current: Deferred revenue, non-current — 284,851 Operating lease liabilities — 400 Total liabilities classified as held for sale $ 637,669 $ 695,484 Commitments and contingencies Contract manufacturer commitments $ 7,005 $ 5,996 The following table summarizes the results of the discontinued operations (dollars in thousands): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 MAJOR LINE ITEMS CONSTITUTING NET INCOME Revenue from discontinued operations $ 134,045 $ 132,671 $ 265,704 $ 265,238 Cost of revenue 28,001 29,947 55,802 60,200 Research & development 28,665 29,260 56,086 64,980 Sales and marketing 36,886 36,306 74,530 76,066 General and administrative 5,466 — 8,126 — Restructuring charges — — — 4,757 Net income from discontinued operations before income taxes $ 35,027 $ 37,158 $ 71,160 $ 59,235 Provision for income taxes 582 437 906 1,013 Net income from discontinued operations, net of income taxes $ 34,445 $ 36,721 $ 70,254 $ 58,222 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of Assets Measured at Fair Value on a Recurring Basis | The following table presents our assets and liabilities measured at fair value on a recurring basis using the above input categories (in thousands): As of June 30, 2021 As of December 31, 2020 Description Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Assets Cash equivalents: Money market funds $ 141,708 $ — $ — $ 141,708 $ 32,954 $ — $ — $ 32,954 Total cash equivalents 141,708 — — 141,708 32,954 — — 32,954 Short-term investments: Certificates of deposit — 4,418 — 4,418 — 2,752 — 2,752 Commercial paper — — — — — 19,994 — 19,994 Corporate notes and bonds — 579,385 — 579,385 — 437,652 — 437,652 U.S. Treasuries — 82,135 — 82,135 — 74,934 — 74,934 U.S. Government agencies — 200,363 — 200,363 — 89,492 — 89,492 Total short-term investments — 866,301 — 866,301 — 624,824 — 624,824 Total assets measured at fair value $ 141,708 $ 866,301 $ — $ 1,008,009 $ 32,954 $ 624,824 $ — $ 657,778 |
Investments (Tables)
Investments (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
Summary of Investments | Our investments consisted of the following (in thousands): As of June 30, 2021 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Certificates of deposit $ 4,370 $ 48 $ — $ 4,418 Corporate notes and bonds 577,356 2,190 (161) 579,385 U.S. Treasuries 82,148 7 (20) 82,135 U.S. Government agencies 200,500 9 (146) 200,363 Total $ 864,374 $ 2,254 $ (327) $ 866,301 As of December 31, 2020 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Certificates of deposit $ 2,679 $ 73 $ — $ 2,752 Commercial paper 19,994 — — 19,994 Corporate notes and bonds 433,445 4,248 (41) 437,652 U.S. Treasuries 74,914 26 (6) 74,934 U.S. Government agencies 89,451 54 (13) 89,492 Total $ 620,483 $ 4,401 $ (60) $ 624,824 |
Summary of Gross Unrealized Losses and Fair Value of Investments in a Continuous Unrealized Loss Position | The following tables present the gross unrealized losses and related fair values of our investments that have been in a continuous unrealized loss position (in thousands): As of June 30, 2021 Less Than 12 Months Greater Than 12 Months Total Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss Certificates of deposit $ 490 $ — $ — $ — $ 490 $ — Commercial paper — — — — — — Corporate notes and bonds 267,699 (159) 17,902 (2) 285,601 (161) U.S. Treasuries 70,599 (20) — — 70,599 (20) U.S. Government agencies 159,570 (143) 2,497 (3) 162,067 (146) Total $ 498,358 $ (322) $ 20,399 $ (5) $ 518,757 $ (327) As of December 31, 2020 Less Than 12 Months Greater Than 12 Months Total Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss Commercial paper $ 4,997 $ — $ — $ — $ 4,997 $ — Corporate notes and bonds 92,855 (41) 870 — 93,725 (41) U.S. Treasuries 42,799 (6) — — 42,799 (6) U.S. Government agencies 37,488 (13) 1,700 — 39,188 (13) Total $ 178,139 $ (60) $ 2,570 $ — $ 180,709 $ (60) |
Summary of Contractual Maturities of Investments | The following table summarizes the contractual maturities of our investments as of June 30, 2021 (in thousands): Amortized Cost Fair Value Due within one year $ 464,094 $ 465,435 Due within one to three years 400,280 400,866 Total $ 864,374 $ 866,301 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment, net consisted of the following (in thousands): As of June 30, 2021 As of December 31, 2020 Computer equipment and software $ 149,231 $ 139,147 Leasehold improvements 56,304 56,401 Furniture and fixtures 12,698 12,955 Machinery and equipment 160 160 Total property and equipment 218,393 208,663 Less: accumulated depreciation (152,507) (144,327) Total property and equipment, net $ 65,886 $ 64,336 |
Business Combinations (Tables)
Business Combinations (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Purchase Price Allocation | Allocation of the purchase price is as follows (in thousands): Amount Net tangible liabilities assumed $ (288) Intangible assets 5,650 Goodwill 7,846 Total purchase price allocation $ 13,208 Amount Net tangible assets assumed $ (4,551) Intangible assets 31,880 Deferred tax liability (1,120) Goodwill 151,388 Total purchase price allocation $ 177,597 |
Schedule of Purchased Intangible Assets | The estimated useful life and fair values of the identifiable intangible assets are as follows (in thousands): Estimated Useful Life (in years) Amount Developed technology 3 $ 5,500 Trade name 1 150 Total identifiable intangible assets $ 5,650 The estimated useful life and fair values of the identifiable intangible assets are as follows (dollars in thousands): Estimated Useful Life (in years) Amount Developed technology 5 $ 22,300 In-Process technology 4 2,200 Customer relationships 5 6,760 Trade name 2 620 Total identifiable intangible assets $ 31,880 Purchased intangible assets consisted of the following (in thousands): As of June 30, 2021 As of December 31, 2020 Developed technology $ 147,493 $ 147,493 Content 158,700 158,700 Customer relationships 112,360 112,360 Contract backlog 13,200 13,200 Trade names 17,720 17,720 Non-competition agreements 1,100 1,100 Total intangible assets 450,573 450,573 Less: accumulated amortization (352,126) (330,018) Total net intangible assets $ 98,447 $ 120,555 |
Schedule of Expected Annual Amortization Expense of Intangible Assets | The expected future annual amortization expense of intangible assets as of June 30, 2021 is presented below (in thousands): Years Ending December 31, Amount 2021 (remaining six months) $ 21,865 2022 33,305 2023 28,287 2024 9,905 2025 5,085 Total $ 98,447 |
Restructuring Charges (Tables)
Restructuring Charges (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Restructuring and Related Activities [Abstract] | |
Summary of Restructuring Activities | The following table sets forth the restructuring balance as of June 30, 2021 related to previous restructuring activities and a summary of restructuring activities during the six months ended June 30, 2021 (in thousands): Severance and related costs Facilities costs Total costs Balance, December 31, 2020 $ 570 $ 478 $ 1,048 Provision for restructuring charges 1,898 — 1,898 Cash payments (1,797) (351) (2,148) Other adjustments (127) 15 (112) Balance, June 30, 2021 $ 544 $ 142 $ 686 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Leases [Abstract] | |
Schedule of Components of Lease Expenses and Supplemental Balance Sheet, Cash Flow and Other Information | The components of lease expenses were as follows (in thousands): Three Months Ended June 30, 2021 Six Months Ended June 30, 2021 Operating lease costs $ 3,192 $ 6,783 Short-term lease costs 384 682 Sublease income (221) (444) Total net lease costs $ 3,355 $ 7,021 Supplemental balance sheet information related to leases is as follows (in thousands, except lease term and discount rate): As of June 30, 2021 Operating leases: Operating lease right-of-use assets, net $ 36,096 Operating lease liabilities, current $ 12,157 Operating lease liabilities, non-current 56,624 Total operating lease liabilities $ 68,781 Weighted average remaining lease term (in years) 7.0 Weighted average discount rate 6.1 % Supplemental cash flow and other information related to leases is as follows (in thousands): Three Months Ended June 30, 2021 Six Months Ended June 30, 2021 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 4,513 $ 9,327 Lease liabilities arising from obtaining right-of-use assets: Operating leases $ — $ 11,683 |
Schedule of Cash Flows of Operating Lease Liabilities | Cash flows of operating lease liabilities are as follows (in thousands): Years Ending December 31, Amount 2021 (remaining six months) $ 5,529 2022 14,093 2023 12,586 2024 11,235 2025 10,639 2026 10,608 2027 and thereafter 20,278 Total lease payments 84,968 Less: imputed interest (16,187) Total lease obligations 68,781 Less: current lease obligations (12,157) Long-term lease obligations $ 56,624 |
Deferred Revenue (Tables)
Deferred Revenue (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Deferred Revenue | Deferred revenue consisted of the following (in thousands): As of June 30, 2021 As of December 31, 2020 Platform, cloud subscription and managed services, current $ 128,149 $ 126,086 Professional services, current 107,811 100,270 Total deferred revenue, current 235,960 226,356 Platform, cloud subscription and managed services, non-current 60,024 56,691 Professional services, non-current 1,342 1,206 Total deferred revenue, non-current 61,366 57,897 Total deferred revenue $ 297,326 $ 284,253 Changes in the balance of deferred revenue for the periods presented are as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Deferred revenue, beginning of period $ 280,291 $ 250,534 $ 284,253 $ 273,241 Billings for the period 130,945 90,780 241,671 160,227 Revenue recognized (113,910) (97,230) (228,598) (189,384) Deferred revenue, end of period $ 297,326 $ 244,084 $ 297,326 $ 244,084 |
Schedule of Expected Recognition of Remaining Performance Obligations | We expect to recognize these remaining performance obligations as follows (in percentages): Total Less than 1 year 1-2 years 2-3 years More than 3 years Deferred revenue 100% 79% 14% 6% 1% Backlog 100% 65% 24% 10% 1% |
Convertible Senior Notes (Table
Convertible Senior Notes (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of the Liability and Equity Components of the Convertible Senior Notes | The liability and equity components of the 2024 Notes consisted of the following (in thousands): As of June 30, 2021 As of December 31, 2020 2024 Notes 2024 Notes Liability component: Principal $ 600,000 $ 600,000 Less: 2024 Notes discounts and issuance costs, net of amortization (80,130) (92,750) Net carrying amount $ 519,870 $ 507,250 Equity component, net of issuance costs $ 138,064 $ 138,064 The liability and equity components of the remaining portion of 2035 Notes consisted of the following (in thousands): As of June 30, 2021 As of December 31, 2020 Series A Notes Series B Notes Series A Notes Series B Notes Liability component: Principal $ 23,436 $ 460,000 $ 23,436 $ 460,000 Less: 2035 Notes discount and issuance costs, net of amortization — (19,503) — (29,790) Net carrying amount $ 23,436 $ 440,497 $ 23,436 $ 430,210 Equity component, net of issuance costs $ 15,559 $ 117,834 $ 15,559 $ 117,834 |
Schedule of Interest Expense Related to the Convertible Senior Notes | Interest expense related to the 2024 Notes consisted of the following (dollars in thousands): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 2024 Notes 2024 Notes 2024 Notes 2024 Notes Coupon interest $ 1,313 $ 1,313 $ 2,625 $ 2,625 Amortization of 2024 Notes discounts and issuance costs 6,349 6,044 12,620 12,015 Total interest expense recognized $ 7,662 $ 7,357 $ 15,245 $ 14,640 Effective interest rate on the liability component 6.0 % 6.0 % 6.0 % 6.1 % Interest expense for the three and six months ended June 30, 2021 related to the 2035 Notes consisted of the following (dollars in thousands): Three Months Ended June 30, 2021 Six Months Ended June 30, 2021 Series A Notes Series B Notes Series A Notes Series B Notes Coupon interest $ 59 $ 1,869 $ 117 $ 3,738 Amortization of 2035 Notes discount and issuance costs — 5,174 — 10,287 Total interest expense recognized $ 59 $ 7,043 $ 117 $ 14,025 Effective interest rate on the liability component 1.0 % 6.5 % 1.0 % 6.5 % Interest expense for the three and six months ended June 30, 2020 related to the 2035 Notes consisted of the following (dollars in thousands): Three Months Ended June 30, 2020 Six Months Ended June 30, 2020 Series A Notes Series B Notes Series A Notes Series B Notes Coupon interest $ 219 $ 1,869 $ 519 $ 3,738 Amortization of 2035 Notes discount and issuance costs 1,023 4,935 2,540 9,812 Total interest expense recognized $ 1,242 $ 6,804 $ 3,059 $ 13,550 Effective interest rate on the liability component 4.2 % 6.6 % 5.2 % 6.6 % |
Common Shares Reserved for Is_2
Common Shares Reserved for Issuance (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Equity [Abstract] | |
Schedule of Reserved Shares of Common Stock for Issuance | We had reserved shares of common stock for issuance as follows (in thousands): As of June 30, 2021 As of December 31, 2020 Reserved under stock award plans 44,327 38,745 Convertible senior notes 33,856 33,856 Convertible preferred stock 23,775 23,249 Employee Stock Purchase Plan (ESPP) 4,684 3,425 Total 106,642 99,275 |
Equity Award Plans (Tables)
Equity Award Plans (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Summary of the Activity for Stock Option Changes and Summary of Information Related to Options Outstanding and Options Exercisable | A summary of the activity, for continuing and discontinued operations, for our stock option changes during the reporting period and a summary of information related to options outstanding and options exercisable are presented below (in thousands, except per share amounts and contractual life years): Options Outstanding Number of Weighted- Weighted- Aggregate Balance — December 31, 2020 3,485 $ 8.33 5.3 $ 60,679 Exercised (714) 5.04 11,034 Cancelled (66) 20.30 Balance — June 30, 2021 2,705 $ 8.90 5.3 $ 39,960 Options exercisable — June 30, 2021 1,694 $ 12.81 3.71 $ 21,912 |
Summary of Activity for Restricted Common Stock, RSAs and RSUs and Summary of Information Related to Unvested Restricted Common Stock, RSAs and RSUs and those Expected to Vest | A summary of the activity, for continuing and discontinued operations, for our restricted common stock, RSAs and RSUs during the reporting periods and a summary of information related to unvested restricted common stock, RSAs and RSUs, including those expected to vest based on the achievement of a performance condition, are presented below (in thousands, except per share amounts and contractual life years): Number of Weighted- Weighted- Aggregate Unvested balance — December 31, 2020 20,400 $ 15.35 1.4 $ 470,424 Granted 14,427 20.72 Vested (5,899) 15.24 Cancelled (1,669) 16.91 Unvested balance — June 30, 2021 27,259 $ 18.17 1.6 $ 551,195 Unvested awards for which the requisite service period has not been rendered and vesting is subject to the achievement of a performance condition — June 30, 2021 2,748 $ 19.04 1.9 $ 55,556 |
Schedule of Assumptions used in Black-Scholes Option Pricing Model | The following table summarizes the assumptions used in the Black-Scholes option-pricing model to determine fair value of our common shares to be issued under the ESPP for the offering periods beginning in May 2020: Three and Six Months Ended June 30, 2021 Three and Six Months Ended June 30, 2020 Fair value of common stock $22.33 $13.06 Risk-free interest rate 0.04% 0.17% - 0.18% Expected term (in years) 0.5 - 1.0 0.5 - 1.0 Volatility 55% - 62% 52% - 68% Dividend yield —% —% |
Schedule of Stock-Based Compensation Expense Related to Stock Options, ESPP and Restricted Stock Units and Awards | Stock-based compensation expense related to stock options, ESPP and restricted stock unit awards, relating to continuing operations, is included in the condensed consolidated statements of operations as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Cost of platform, subscription and support revenue $ 3,487 $ 2,486 $ 6,301 $ 4,865 Cost of professional services revenue $ 6,135 $ 4,171 $ 11,321 $ 7,748 Research and development 9,320 4,850 17,743 10,366 Sales and marketing 11,539 8,162 21,429 17,043 General and administrative 8,261 6,981 15,349 12,486 Total $ 38,742 $ 26,650 $ 72,143 $ 52,508 |
Net Loss per Share (Tables)
Net Loss per Share (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Computation of Net Loss Per Common Share | The following table sets forth the computation of net loss per common share (in thousands, except per share amounts): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Numerator: Loss from continuing operations $ (99,141) $ (89,996) $ (185,596) $ (187,803) Net income from discontinued operations 34,445 36,721 70,254 58,222 Net loss (64,696) (53,275) (115,342) (129,581) Dividend on series A convertible preferred stock (4,563) — (9,075) — Accretion of series A convertible preferred stock — — (82) — Net loss attributable to common stockholders (69,259) (53,275) (124,499) (129,581) Denominator: Weighted average number of shares outstanding—basic and diluted 237,279 221,352 236,016 219,570 Net loss per share attributable to common stockholders, basic and diluted: Continuing operations $ (0.44) $ (0.41) $ (0.83) $ (0.86) Discontinued operations 0.15 0.17 0.30 0.27 Total net loss per share attributable to common stockholders, basic and diluted $ (0.29) $ (0.24) $ (0.53) $ (0.59) |
Schedule of Outstanding Options and Unvested Shares Excluded From Computation of Diluted Net Loss Per Common Share | The following outstanding options, unvested shares and units, ESPP shares, shares issuable upon the conversion of the Convertible Senior Notes, convertible preferred stock and shares contingently issuable were excluded (as common stock equivalents) from the computation of diluted net loss per common share for the periods presented as their effect would have been anti-dilutive (in thousands): As of June 30, 2021 2020 Options to purchase common stock 2,705 3,425 Unvested restricted stock awards and units 27,259 22,680 Convertible preferred stock 23,775 — Convertible senior notes 33,856 33,856 ESPP shares 133 198 |
Segment and Major Customers I_2
Segment and Major Customers Information (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Segment Reporting [Abstract] | |
Revenue From External Customers by Geographic Areas | Revenue by geographic region based on the billing address is as follows (in thousands): Three Months Ended June 30, 2021 2020 2021 2020 2021 2020 2021 2020 U.S. EMEA APAC Other Platform, cloud subscription and managed services $ 34,669 $ 34,976 $ 8,439 $ 6,032 $ 6,266 $ 4,736 $ 2,562 $ 2,307 Professional services 42,804 34,003 7,978 6,655 4,953 3,612 6,239 4,909 Total revenue $ 77,473 $ 68,979 $ 16,417 $ 12,687 $ 11,219 $ 8,348 $ 8,801 $ 7,216 Six Months Ended June 30, 2021 2020 2021 2020 2021 2020 2021 2020 U.S. EMEA APAC Other Platform, cloud subscription and managed services $ 71,843 $ 67,913 $ 17,015 $ 11,507 $ 13,798 $ 9,875 $ 5,278 $ 4,058 Professional services 83,427 66,156 16,418 13,328 9,124 7,090 11,695 9,457 Total revenue $ 155,270 $ 134,069 $ 33,433 $ 24,835 $ 22,922 $ 16,965 $ 16,973 $ 13,515 |
Schedule of Disaggregation of Revenue | The following table depicts the disaggregation of revenue according to revenue type and is consistent with how we evaluate our financial performance (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Platform, cloud subscription and managed services $ 51,936 $ 48,051 $ 107,935 $ 93,353 Professional services 61,974 49,179 120,663 96,031 Total revenue $ 113,910 $ 97,230 $ 228,598 $ 189,384 |
Summary of Long Lived Assets by Geographic Region Based on Physical Location | Long lived assets by geographic region based on physical location is as follows (in thousands): As of June 30, 2021 As of December 31, 2020 Property and equipment, net: United States $ 62,017 $ 59,998 International 3,869 4,338 Total property and equipment, net $ 65,886 $ 64,336 |
Description of Business and S_3
Description of Business and Summary of Significant Accounting Policies (Details) $ / shares in Units, $ in Millions | Jun. 30, 2021$ / sharesshares | Dec. 31, 2020$ / sharesshares | Dec. 11, 2020USD ($)$ / sharesshares | Dec. 31, 2020USD ($)$ / sharesshares | Nov. 30, 2020USD ($)shares | Jan. 31, 2020USD ($) | Jun. 30, 2021USD ($)$ / sharesshares | Jun. 30, 2021USD ($)$ / sharesshares | Jun. 02, 2021USD ($) | May 29, 2021USD ($) | Apr. 28, 2021USD ($) |
Business Acquisition [Line Items] | |||||||||||
Stock repurchase program of common stock amount | $ 500 | ||||||||||
Shares repurchased (in shares) | shares | 3,500,000 | 3,500,000 | |||||||||
Shares repurchased, average cost per share (in dollars per share) | $ / shares | $ 19.41 | $ 19.41 | |||||||||
Shares repurchased | $ 68.3 | $ 68.3 | |||||||||
Series A convertible preferred stock, par value (usd per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||
Private Placement | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Number of shares issued and sold (shares) | shares | 400,000 | ||||||||||
Sale price (usd per share) | $ / shares | $ 1,000 | ||||||||||
Aggregate purchase price | $ 400 | ||||||||||
Series A Preferred Stock | Private Placement | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Number of shares issued and sold (shares) | shares | 400,000 | ||||||||||
Dividend rate | 0.045 | ||||||||||
Series A convertible preferred stock, par value (usd per share) | $ / shares | 0.0001 | $ 0.0001 | |||||||||
Sale price (usd per share) | $ / shares | $ 1,000 | $ 1,000 | |||||||||
Aggregate purchase price | $ 400 | ||||||||||
Respond Software | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Purchase consideration, cash paid | $ 116.1 | ||||||||||
Common stock issued to acquire company (shares) | shares | 4,931,862 | ||||||||||
Common stock issued to acquire company, with vesting conditions (shares) | shares | 436,916 | 694,768 | 694,768 | ||||||||
Consideration transferred, equity interests | $ 60.3 | ||||||||||
Fair value of replacement awards | 1.2 | ||||||||||
Total purchase consideration | $ 177.6 | ||||||||||
Cloudvisory LLC | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Purchase consideration, cash paid | $ 13.2 | ||||||||||
Liabilities assumed | $ 0.3 | ||||||||||
Products Business | Discontinued Operations, Held-for-sale | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Total cash consideration | $ 1,200 | $ 1,200 |
Discontinued Operations - Narra
Discontinued Operations - Narrative (Details) - Products Business - Discontinued Operations, Held-for-sale - USD ($) $ in Billions | May 29, 2021 | Apr. 28, 2021 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Total cash consideration | $ 1.2 | $ 1.2 |
Minimum | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Transition period | 12 months | |
Maximum | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Transition period | 18 months |
Discontinued Operations - The A
Discontinued Operations - The Assets and Liabilities Included Within Discontinued Operations (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Current: | ||
Total current assets held for sale | $ 500,688 | $ 126,715 |
Current: | ||
Total current liabilities held for sale | 637,669 | 410,233 |
Discontinued Operations, Held-for-sale | Products Business | ||
Current: | ||
Accounts receivable, net of allowance for doubtful accounts of $339 and $422 at June 30, 2021 and December 31, 2020, respectively | 46,961 | 59,236 |
Allowance for doubtful accounts | 339 | 422 |
Inventories | 4,772 | 4,023 |
Prepaid expenses and other current assets | 60,070 | 63,456 |
Property and equipment, net | 20,706 | 0 |
Goodwill | 313,912 | 0 |
Intangible assets, net | 4,292 | 0 |
Deposits and other long-term assets | 49,256 | 0 |
Operating lease right-of-use assets, net | 719 | 0 |
Total current assets held for sale | 500,688 | 126,715 |
Non-current: | ||
Property and equipment, net | 0 | 15,434 |
Goodwill | 0 | 313,924 |
Intangible assets, net | 0 | 5,512 |
Deposits and other long-term assets | 0 | 56,580 |
Operating lease right-of-use assets, net | 0 | 1,524 |
Total assets classified as held for sale | 500,688 | 519,689 |
Current: | ||
Accounts payable | 4,367 | 1,080 |
Accrued and other current liabilities | 8,762 | 3,510 |
Deferred revenue, current | 614,802 | 387,353 |
Operating lease liabilities | 768 | 1,468 |
Accrued compensation | 8,970 | 16,822 |
Total current liabilities held for sale | 637,669 | 410,233 |
Non-current: | ||
Deferred revenue, non-current | 0 | 284,851 |
Operating lease liabilities | 0 | 400 |
Total liabilities classified as held for sale | 637,669 | 695,484 |
Commitments and contingencies | ||
Contract manufacturer commitments | $ 7,005 | $ 5,996 |
Discontinued Operations - Major
Discontinued Operations - Major Line Items Constituting Net Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
MAJOR LINE ITEMS CONSTITUTING NET INCOME | ||||
Net income from discontinued operations, net of income taxes | $ 34,445 | $ 36,721 | $ 70,254 | $ 58,222 |
Discontinued Operations, Held-for-sale | Products Business | ||||
MAJOR LINE ITEMS CONSTITUTING NET INCOME | ||||
Revenue from discontinued operations | 134,045 | 132,671 | 265,704 | 265,238 |
Cost of revenue | 28,001 | 29,947 | 55,802 | 60,200 |
Research & development | 28,665 | 29,260 | 56,086 | 64,980 |
Sales and marketing | 36,886 | 36,306 | 74,530 | 76,066 |
General and administrative | 5,466 | 0 | 8,126 | 0 |
Restructuring charges | 0 | 0 | 0 | 4,757 |
Net income from discontinued operations before income taxes | 35,027 | 37,158 | 71,160 | 59,235 |
Provision for income taxes | 582 | 437 | 906 | 1,013 |
Net income from discontinued operations, net of income taxes | $ 34,445 | $ 36,721 | $ 70,254 | $ 58,222 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Assets Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total cash equivalents | $ 141,708 | $ 32,954 |
Total short-term investments | 866,301 | 624,824 |
Total assets measured at fair value | 1,008,009 | 657,778 |
Certificates of deposit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total short-term investments | 4,418 | 2,752 |
Commercial paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total short-term investments | 0 | 19,994 |
Corporate notes and bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total short-term investments | 579,385 | 437,652 |
U.S. Treasuries | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total short-term investments | 82,135 | 74,934 |
U.S. Government agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total short-term investments | 200,363 | 89,492 |
Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total cash equivalents | 141,708 | 32,954 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total cash equivalents | 141,708 | 32,954 |
Total short-term investments | 0 | 0 |
Total assets measured at fair value | 141,708 | 32,954 |
Level 1 | Certificates of deposit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total short-term investments | 0 | 0 |
Level 1 | Commercial paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total short-term investments | 0 | 0 |
Level 1 | Corporate notes and bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total short-term investments | 0 | 0 |
Level 1 | U.S. Treasuries | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total short-term investments | 0 | 0 |
Level 1 | U.S. Government agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total short-term investments | 0 | 0 |
Level 1 | Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total cash equivalents | 141,708 | 32,954 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total cash equivalents | 0 | 0 |
Total short-term investments | 866,301 | 624,824 |
Total assets measured at fair value | 866,301 | 624,824 |
Level 2 | Certificates of deposit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total short-term investments | 4,418 | 2,752 |
Level 2 | Commercial paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total short-term investments | 0 | 19,994 |
Level 2 | Corporate notes and bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total short-term investments | 579,385 | 437,652 |
Level 2 | U.S. Treasuries | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total short-term investments | 82,135 | 74,934 |
Level 2 | U.S. Government agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total short-term investments | 200,363 | 89,492 |
Level 2 | Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total cash equivalents | 0 | 0 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total cash equivalents | 0 | 0 |
Total short-term investments | 0 | 0 |
Total assets measured at fair value | 0 | 0 |
Level 3 | Certificates of deposit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total short-term investments | 0 | 0 |
Level 3 | Commercial paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total short-term investments | 0 | 0 |
Level 3 | Corporate notes and bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total short-term investments | 0 | 0 |
Level 3 | U.S. Treasuries | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total short-term investments | 0 | 0 |
Level 3 | U.S. Government agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total short-term investments | 0 | 0 |
Level 3 | Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total cash equivalents | $ 0 | $ 0 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - Level 2 - Convertible Senior Notes - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||
Fair value of debt | $ 1,000,000,000 | $ 1,000,000,000 |
Measurement Input, Share Price | ||
Debt Instrument [Line Items] | ||
Measurement input | 1,000 |
Investments - Summary of Invest
Investments - Summary of Investments (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Debt Securities, Available-for-sale [Line Items] | ||
Total | $ 864,374 | $ 620,483 |
Gross Unrealized Gains | 2,254 | 4,401 |
Gross Unrealized Losses | (327) | (60) |
Estimated Fair Value | 866,301 | 624,824 |
Certificates of deposit | ||
Debt Securities, Available-for-sale [Line Items] | ||
Total | 4,370 | 2,679 |
Gross Unrealized Gains | 48 | 73 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 4,418 | 2,752 |
Commercial paper | ||
Debt Securities, Available-for-sale [Line Items] | ||
Total | 19,994 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | 0 | |
Estimated Fair Value | 0 | 19,994 |
Corporate notes and bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Total | 577,356 | 433,445 |
Gross Unrealized Gains | 2,190 | 4,248 |
Gross Unrealized Losses | (161) | (41) |
Estimated Fair Value | 579,385 | 437,652 |
U.S. Treasuries | ||
Debt Securities, Available-for-sale [Line Items] | ||
Total | 82,148 | 74,914 |
Gross Unrealized Gains | 7 | 26 |
Gross Unrealized Losses | (20) | (6) |
Estimated Fair Value | 82,135 | 74,934 |
U.S. Government agencies | ||
Debt Securities, Available-for-sale [Line Items] | ||
Total | 200,500 | 89,451 |
Gross Unrealized Gains | 9 | 54 |
Gross Unrealized Losses | (146) | (13) |
Estimated Fair Value | $ 200,363 | $ 89,492 |
Investments - Summary of Gross
Investments - Summary of Gross Unrealized Losses and Fair Value of Investments in a Continuous Unrealized Loss Position (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Fair Value | ||
Less Than 12 Months | $ 498,358 | $ 178,139 |
Greater Than 12 Months | 20,399 | 2,570 |
Total | 518,757 | 180,709 |
Unrealized Loss | ||
Less Than 12 Months | (322) | (60) |
Greater Than 12 Months | (5) | 0 |
Total | (327) | (60) |
Certificates of deposit | ||
Fair Value | ||
Less Than 12 Months | 490 | |
Greater Than 12 Months | 0 | |
Total | 490 | |
Unrealized Loss | ||
Less Than 12 Months | 0 | |
Greater Than 12 Months | 0 | |
Total | 0 | |
Commercial paper | ||
Fair Value | ||
Less Than 12 Months | 0 | 4,997 |
Greater Than 12 Months | 0 | 0 |
Total | 0 | 4,997 |
Unrealized Loss | ||
Less Than 12 Months | 0 | 0 |
Greater Than 12 Months | 0 | 0 |
Total | 0 | 0 |
Corporate notes and bonds | ||
Fair Value | ||
Less Than 12 Months | 267,699 | 92,855 |
Greater Than 12 Months | 17,902 | 870 |
Total | 285,601 | 93,725 |
Unrealized Loss | ||
Less Than 12 Months | (159) | (41) |
Greater Than 12 Months | (2) | 0 |
Total | (161) | (41) |
U.S. Treasuries | ||
Fair Value | ||
Less Than 12 Months | 70,599 | 42,799 |
Greater Than 12 Months | 0 | 0 |
Total | 70,599 | 42,799 |
Unrealized Loss | ||
Less Than 12 Months | (20) | (6) |
Greater Than 12 Months | 0 | 0 |
Total | (20) | (6) |
U.S. Government agencies | ||
Fair Value | ||
Less Than 12 Months | 159,570 | 37,488 |
Greater Than 12 Months | 2,497 | 1,700 |
Total | 162,067 | 39,188 |
Unrealized Loss | ||
Less Than 12 Months | (143) | (13) |
Greater Than 12 Months | (3) | 0 |
Total | $ (146) | $ (13) |
Investments - Summary of Contra
Investments - Summary of Contractual Maturities of Investments (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Amortized Cost | ||
Due within one year | $ 464,094 | |
Due within one to three years | 400,280 | |
Total | 864,374 | $ 620,483 |
Fair Value | ||
Due within one year | 465,435 | |
Due within one to three years | 400,866 | |
Total | $ 866,301 | $ 624,824 |
Investments - Narrative (Detail
Investments - Narrative (Details) - Private Company - USD ($) | 6 Months Ended | |
Jun. 30, 2021 | Dec. 31, 2020 | |
Schedule of Equity Method Investments [Line Items] | ||
Ownership percentage | 11.00% | 11.00% |
Gain (loss) from investment | $ 0 | |
Amounts paid to shareholders | $ 0 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 218,393 | $ 208,663 |
Less: accumulated depreciation | (152,507) | (144,327) |
Total property and equipment, net | 65,886 | 64,336 |
Computer equipment and software | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 149,231 | 139,147 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 56,304 | 56,401 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 12,698 | 12,955 |
Machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 160 | $ 160 |
Property and Equipment - Narrat
Property and Equipment - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation and amortization | $ 7,700 | $ 5,900 | $ 16,300 | $ 11,100 |
Capitalized software development costs | 4,800 | 3,400 | 8,800 | 7,900 |
Amortization of capitalized software development costs | $ 3,000 | $ 2,600 | $ 6,000 | $ 4,700 |
Business Combinations - Narrati
Business Combinations - Narrative (Details) | Jun. 30, 2021USD ($)shares | Dec. 31, 2020USD ($)shares | Nov. 30, 2020USD ($)shares | Jan. 31, 2020USD ($) | Jun. 30, 2021USD ($) | Mar. 31, 2021shares | Jun. 30, 2020USD ($) | Jun. 30, 2021USD ($) | Jun. 30, 2020USD ($) | Jan. 17, 2020USD ($) |
Business Acquisition [Line Items] | ||||||||||
Goodwill | $ 1,050,924,000 | $ 1,050,962,000 | $ 1,050,924,000 | $ 1,050,924,000 | ||||||
Goodwill, tax adjustment | 40,000 | |||||||||
Amortization expense | $ 11,000,000 | $ 10,000,000 | $ 22,100,000 | $ 20,400,000 | ||||||
Cloudvisory LLC | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Purchase consideration, cash paid | $ 13,200,000 | |||||||||
Liabilities assumed | 300,000 | |||||||||
Goodwill | $ 7,846,000 | |||||||||
Cloudvisory LLC | Discontinued Operations, Held-for-sale | Products Business | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Goodwill | $ 1,800,000 | |||||||||
Cloudvisory LLC | Measurement Input, Discount Rate | Developed Technology | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Intangible assets, measurement input | 0.35 | |||||||||
Cloudvisory LLC | Measurement Input, Discount Rate | Trade Names | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Intangible assets, measurement input | 0.35 | |||||||||
Cloudvisory LLC | Measurement Input, Royalty Rate | Trade Names | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Intangible assets, measurement input | 0.01 | |||||||||
Respond Software | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Purchase consideration, cash paid | $ 116,100,000 | |||||||||
Goodwill | $ 151,388,000 | |||||||||
Common stock issued to acquire company (shares) | shares | 4,931,862 | |||||||||
Common stock issued to acquire company, with vesting conditions (shares) | shares | 436,916 | 694,768 | 694,768 | |||||||
Number of shares cancelled (shares) | shares | 257,852 | |||||||||
Consideration transferred, equity interests | $ 60,300,000 | |||||||||
Fair value of replacement awards | 1,200,000 | |||||||||
Total purchase consideration | 177,600,000 | |||||||||
Goodwill, expected tax deductible amount | 0 | |||||||||
Respond Software | Discontinued Operations, Held-for-sale | Products Business | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Goodwill | $ 34,800,000 | |||||||||
Respond Software | Measurement Input, Discount Rate | Developed Technology | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Intangible assets, measurement input | 0.12 | |||||||||
Respond Software | Measurement Input, Discount Rate | Trade Names | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Intangible assets, measurement input | 0.12 | |||||||||
Respond Software | Measurement Input, Discount Rate | In-Process technology | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Intangible assets, measurement input | 0.13 | |||||||||
Respond Software | Measurement Input, Discount Rate | Customer Relationships | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Intangible assets, measurement input | 0.11 | |||||||||
Respond Software | Measurement Input, Royalty Rate | Trade Names | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Intangible assets, measurement input | 0.01 |
Business Combinations - Purchas
Business Combinations - Purchase Price Allocation (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 | Nov. 30, 2020 | Jan. 31, 2020 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 1,050,924 | $ 1,050,962 | ||
Cloudvisory LLC | ||||
Business Acquisition [Line Items] | ||||
Net tangible assets assumed | $ (288) | |||
Intangible assets | 5,650 | |||
Goodwill | 7,846 | |||
Total purchase price allocation | $ 13,208 | |||
Respond Software | ||||
Business Acquisition [Line Items] | ||||
Net tangible assets assumed | $ (4,551) | |||
Intangible assets | 31,880 | |||
Deferred tax liability | (1,120) | |||
Goodwill | 151,388 | |||
Total purchase price allocation | $ 177,597 |
Business Combinations - Identif
Business Combinations - Identifiable Intangible Assets Acquired (Details) - USD ($) $ in Thousands | 1 Months Ended | |
Nov. 30, 2020 | Jan. 31, 2020 | |
Cloudvisory LLC | ||
Business Acquisition [Line Items] | ||
Amount | $ 5,650 | |
Cloudvisory LLC | Developed technology | ||
Business Acquisition [Line Items] | ||
Estimated Useful Life (in years) | 3 years | |
Amount | $ 5,500 | |
Cloudvisory LLC | Trade name | ||
Business Acquisition [Line Items] | ||
Estimated Useful Life (in years) | 1 year | |
Amount | $ 150 | |
Respond Software | ||
Business Acquisition [Line Items] | ||
Amount | $ 31,880 | |
Respond Software | Developed technology | ||
Business Acquisition [Line Items] | ||
Estimated Useful Life (in years) | 5 years | |
Amount | $ 22,300 | |
Respond Software | In-Process technology | ||
Business Acquisition [Line Items] | ||
Estimated Useful Life (in years) | 4 years | |
Amount | $ 2,200 | |
Respond Software | Customer relationships | ||
Business Acquisition [Line Items] | ||
Estimated Useful Life (in years) | 5 years | |
Amount | $ 6,760 | |
Respond Software | Trade name | ||
Business Acquisition [Line Items] | ||
Estimated Useful Life (in years) | 2 years | |
Amount | $ 620 |
Business Combinations - Purch_2
Business Combinations - Purchased Intangible Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Business Acquisition [Line Items] | ||
Total intangible assets | $ 450,573 | $ 450,573 |
Less: accumulated amortization | (352,126) | (330,018) |
Total net intangible assets | 98,447 | 120,555 |
Developed technology | ||
Business Acquisition [Line Items] | ||
Total intangible assets | 147,493 | 147,493 |
Content | ||
Business Acquisition [Line Items] | ||
Total intangible assets | 158,700 | 158,700 |
Customer relationships | ||
Business Acquisition [Line Items] | ||
Total intangible assets | 112,360 | 112,360 |
Contract backlog | ||
Business Acquisition [Line Items] | ||
Total intangible assets | 13,200 | 13,200 |
Trade names | ||
Business Acquisition [Line Items] | ||
Total intangible assets | 17,720 | 17,720 |
Non-competition agreements | ||
Business Acquisition [Line Items] | ||
Total intangible assets | $ 1,100 | $ 1,100 |
Business Combinations - Schedul
Business Combinations - Schedule of Expected Annual Amortization Expense of Intangible Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Business Combination and Asset Acquisition [Abstract] | ||
2021 (remaining six months) | $ 21,865 | |
2022 | 33,305 | |
2023 | 28,287 | |
2024 | 9,905 | |
2025 | 5,085 | |
Total net intangible assets | $ 98,447 | $ 120,555 |
Restructuring Charges - Summary
Restructuring Charges - Summary of Restructuring Activities (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2021USD ($) | |
Restructuring Reserve | |
Balance, December 31, 2020 | $ 1,048 |
Provision for restructuring charges | 1,898 |
Cash payments | (2,148) |
Other adjustments | (112) |
Balance, June 30, 2021 | 686 |
Severance and related costs | |
Restructuring Reserve | |
Balance, December 31, 2020 | 570 |
Provision for restructuring charges | 1,898 |
Cash payments | (1,797) |
Other adjustments | (127) |
Balance, June 30, 2021 | 544 |
Facilities costs | |
Restructuring Reserve | |
Balance, December 31, 2020 | 478 |
Provision for restructuring charges | 0 |
Cash payments | (351) |
Other adjustments | 15 |
Balance, June 30, 2021 | $ 142 |
Restructuring Charges - Narrati
Restructuring Charges - Narrative (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring reserve | $ 686 | $ 1,048 |
Facilities Costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring reserve | $ 142 | $ 478 |
Leases - Narrative (Details)
Leases - Narrative (Details) | 6 Months Ended |
Jun. 30, 2021 | |
Lessee, Lease, Description [Line Items] | |
Optional extension term | 5 years |
Optional termination period | 1 year |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Remaining lease term | 1 year |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Remaining lease term | 11 years |
Leases - Components of Lease Ex
Leases - Components of Lease Expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2021 | Jun. 30, 2021 | |
Leases [Abstract] | ||
Operating lease costs | $ 3,192 | $ 6,783 |
Short-term lease costs | 384 | 682 |
Sublease income | (221) | (444) |
Total net lease costs | $ 3,355 | $ 7,021 |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Operating leases: | ||
Operating lease right-of-use assets, net | $ 36,096 | $ 36,728 |
Operating lease liabilities, current | 12,157 | 14,556 |
Operating lease liabilities, non-current | 56,624 | $ 41,802 |
Total operating lease liabilities | $ 68,781 | |
Weighted average remaining lease term (in years) | 7 years | |
Weighted average discount rate | 6.10% |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2021 | Jun. 30, 2021 | |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash flows from operating leases | $ 4,513 | $ 9,327 |
Lease liabilities arising from obtaining right-of-use assets: | ||
Operating leases | $ 0 | $ 11,683 |
Leases - Schedule of Undiscount
Leases - Schedule of Undiscounted Cash Flows of Operating Lease Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | ||
2021 (remaining six months) | $ 5,529 | |
2022 | 14,093 | |
2023 | 12,586 | |
2024 | 11,235 | |
2025 | 10,639 | |
2026 | 10,608 | |
2027 and thereafter | 20,278 | |
Total lease payments | 84,968 | |
Less: imputed interest | (16,187) | |
Total operating lease liabilities | 68,781 | |
Less: current lease obligations | (12,157) | $ (14,556) |
Long-term lease obligations | $ 56,624 | $ 41,802 |
Deferred Revenue - Schedule of
Deferred Revenue - Schedule of Deferred Revenue (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Revenue from External Customer [Line Items] | ||||||
Total deferred revenue, current | $ 235,960 | $ 226,356 | ||||
Total deferred revenue, non-current | 61,366 | 57,897 | ||||
Total deferred revenue | 297,326 | $ 280,291 | 284,253 | $ 244,084 | $ 250,534 | $ 273,241 |
Platform, cloud subscription and managed services | ||||||
Revenue from External Customer [Line Items] | ||||||
Total deferred revenue, current | 128,149 | 126,086 | ||||
Total deferred revenue, non-current | 60,024 | 56,691 | ||||
Professional services | ||||||
Revenue from External Customer [Line Items] | ||||||
Total deferred revenue, current | 107,811 | 100,270 | ||||
Total deferred revenue, non-current | $ 1,342 | $ 1,206 |
Deferred Revenue - Changes in D
Deferred Revenue - Changes in Deferred Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Deferred Revenue | ||||
Beginning balance | $ 280,291 | $ 250,534 | $ 284,253 | $ 273,241 |
Billings for the period | 130,945 | 90,780 | 241,671 | 160,227 |
Revenue recognized | (113,910) | (97,230) | (228,598) | (189,384) |
Ending balance | $ 297,326 | $ 244,084 | $ 297,326 | $ 244,084 |
Deferred Revenue - Narrative (D
Deferred Revenue - Narrative (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Revenue from Contract with Customer [Abstract] | ||||||
Deferred revenue | $ 297,326 | $ 280,291 | $ 284,253 | $ 244,084 | $ 250,534 | $ 273,241 |
Backlog | $ 13,400 |
Deferred Revenue - Remaining Pe
Deferred Revenue - Remaining Performance Obligations (Details) | 6 Months Ended |
Jun. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Deferred revenue | 100.00% |
Backlog | 100.00% |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-07-01 | |
Revenue from Contract with Customer [Abstract] | |
Deferred revenue | 79.00% |
Backlog | 65.00% |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Deferred Revenue | 1 year |
Backlog | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-07-01 | |
Revenue from Contract with Customer [Abstract] | |
Deferred revenue | 14.00% |
Backlog | 24.00% |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Deferred Revenue | 1 year |
Backlog | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-07-01 | |
Revenue from Contract with Customer [Abstract] | |
Deferred revenue | 6.00% |
Backlog | 10.00% |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Deferred Revenue | 1 year |
Backlog | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-07-01 | |
Revenue from Contract with Customer [Abstract] | |
Deferred revenue | 1.00% |
Backlog | 1.00% |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Deferred Revenue | |
Backlog |
Convertible Senior Notes - Conv
Convertible Senior Notes - Convertible Senior Notes due 2024 (Details) | May 24, 2018USD ($)day$ / shares | May 31, 2018USD ($) | Jun. 30, 2015USD ($)day | Jun. 30, 2021USD ($)$ / shares | Jun. 30, 2020USD ($) | Jun. 05, 2018USD ($) | Sep. 30, 2015$ / shares |
Debt Instrument [Line Items] | |||||||
Repurchase of convertible senior notes | $ 0 | $ 96,392,000 | |||||
Purchase of capped calls | $ 65,200,000 | ||||||
Common Stock | |||||||
Debt Instrument [Line Items] | |||||||
Fair value of common stock (usd per share) | $ / shares | $ 20.22 | ||||||
Convertible Senior Notes | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, convertible, conversion ratio | 0.0164572 | ||||||
Conversion price (usd per share) | $ / shares | $ 60.76 | ||||||
Threshold note trading days | day | 5 | ||||||
Threshold percentage of note price trigger | 98.00% | ||||||
Redemption price, percentage | 100.00% | 100.00% | |||||
Redemption price triggered by fundamental change, percentage | 100.00% | ||||||
Convertible Senior Notes | Subsequent to September 30, 2015 | |||||||
Debt Instrument [Line Items] | |||||||
Threshold trading days | day | 20 | 20 | |||||
Threshold consecutive trading days | day | 30 | 30 | |||||
Threshold percentage of stock price trigger | 130.00% | 130.00% | |||||
Convertible Senior Notes | On or After June 1, 2020 Until June 1, 2022 | |||||||
Debt Instrument [Line Items] | |||||||
Threshold consecutive trading days | day | 30 | ||||||
Convertible Senior Notes Due 2024 | Convertible Senior Notes | |||||||
Debt Instrument [Line Items] | |||||||
Principal amount | $ 525,000,000 | $ 75,000,000 | |||||
Interest rate | 0.875% | ||||||
Initial purchaser's discount | $ 15,000,000 | ||||||
Debt issuance costs | 600,000 | ||||||
Proceeds from issuance of convertible senior notes, net of issuance costs | 584,400,000 | ||||||
Repurchase of convertible senior notes | 330,400,000 | ||||||
Purchase of capped calls | $ 65,200,000 | ||||||
Debt instrument, convertible, conversion ratio | 0.0431167 | ||||||
Conversion price (usd per share) | $ / shares | $ 23.17 | ||||||
Threshold note trading days | day | 5 | ||||||
Threshold consecutive note trading days | 5 days | ||||||
Threshold percentage of note price trigger | 98.00% | ||||||
Equity component of debt | $ 141,700,000 | ||||||
Remaining discount amortization period | 2 years 10 months 24 days | ||||||
Cap price (usd per share) | $ / shares | $ 34.32 | ||||||
Convertible Senior Notes Due 2024 | Convertible Senior Notes | Measurement Input, Discount Rate | |||||||
Debt Instrument [Line Items] | |||||||
Measurement input | 0.055 | ||||||
Convertible Senior Notes Due 2024 | Convertible Senior Notes | On or After June 1, 2020 Until June 1, 2022 | |||||||
Debt Instrument [Line Items] | |||||||
Threshold trading days | day | 20 | ||||||
Threshold percentage of stock price trigger | 130.00% | ||||||
Series A Notes | Convertible Senior Notes | |||||||
Debt Instrument [Line Items] | |||||||
Principal amount | $ 460,000,000 | ||||||
Interest rate | 1.00% | ||||||
Repurchase of convertible senior notes | $ 330,400,000 | ||||||
Repurchased principal amount of debt | $ 340,200,000 | $ 340,200,000 | $ 96,400,000 | ||||
Series A Notes | Convertible Senior Notes | Measurement Input, Discount Rate | |||||||
Debt Instrument [Line Items] | |||||||
Measurement input | 0.045 | ||||||
Debt, Liability Component | Convertible Senior Notes | |||||||
Debt Instrument [Line Items] | |||||||
Initial purchaser's discount | 11,500,000 | $ 17,600,000 | |||||
Debt issuance costs | 500,000 | 400,000 | |||||
Carrying amount of convertible debt | 458,300,000 | ||||||
Debt, Equity Component | Convertible Senior Notes | |||||||
Debt Instrument [Line Items] | |||||||
Initial purchaser's discount | 3,500,000 | 5,400,000 | |||||
Debt issuance costs | $ 100,000 | $ 100,000 |
Convertible Senior Notes - Sche
Convertible Senior Notes - Schedule of the Liability and Equity Components of the Convertible Senior Notes (Details) - Convertible Senior Notes - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Convertible Senior Notes Due 2024 | ||
Debt Instrument [Line Items] | ||
Principal | $ 600,000 | $ 600,000 |
Less: Notes discounts and issuance costs, net of amortization | (80,130) | (92,750) |
Net carrying amount | 519,870 | 507,250 |
Equity component, net of issuance costs | 138,064 | 138,064 |
Series A Notes | ||
Debt Instrument [Line Items] | ||
Principal | 23,436 | 23,436 |
Less: Notes discounts and issuance costs, net of amortization | 0 | 0 |
Net carrying amount | 23,436 | 23,436 |
Equity component, net of issuance costs | 15,559 | 15,559 |
Series B Notes | ||
Debt Instrument [Line Items] | ||
Principal | 460,000 | 460,000 |
Less: Notes discounts and issuance costs, net of amortization | (19,503) | (29,790) |
Net carrying amount | 440,497 | 430,210 |
Equity component, net of issuance costs | $ 117,834 | $ 117,834 |
Convertible Senior Notes - Sc_2
Convertible Senior Notes - Schedule of Interest Expense related to the Convertible Senior Notes (Details) - Convertible Senior Notes - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Convertible Senior Notes Due 2024 | ||||
Debt Instrument [Line Items] | ||||
Coupon interest | $ 1,313 | $ 1,313 | $ 2,625 | $ 2,625 |
Non-cash interest expense related to convertible senior notes | 6,349 | 6,044 | 12,620 | 12,015 |
Total interest expense recognized | $ 7,662 | $ 7,357 | $ 15,245 | $ 14,640 |
Effective interest rate on the liability component | 6.00% | 6.00% | 6.00% | 6.10% |
Series A Notes | ||||
Debt Instrument [Line Items] | ||||
Coupon interest | $ 59 | $ 219 | $ 117 | $ 519 |
Non-cash interest expense related to convertible senior notes | 0 | 1,023 | 0 | 2,540 |
Total interest expense recognized | $ 59 | $ 1,242 | $ 117 | $ 3,059 |
Effective interest rate on the liability component | 1.00% | 4.20% | 1.00% | 5.20% |
Series B Notes | ||||
Debt Instrument [Line Items] | ||||
Coupon interest | $ 1,869 | $ 1,869 | $ 3,738 | $ 3,738 |
Non-cash interest expense related to convertible senior notes | 5,174 | 4,935 | 10,287 | 9,812 |
Total interest expense recognized | $ 7,043 | $ 6,804 | $ 14,025 | $ 13,550 |
Effective interest rate on the liability component | 6.50% | 6.60% | 6.50% | 6.60% |
Convertible Senior Notes - Co_2
Convertible Senior Notes - Convertible Senior Notes due 2035 (Details) - Convertible Senior Notes | May 24, 2018USD ($)day | Jun. 30, 2015USD ($)day | Sep. 30, 2015$ / shares |
Debt Instrument [Line Items] | |||
Debt instrument, convertible, conversion ratio | 0.0164572 | ||
Conversion price (usd per share) | $ / shares | $ 60.76 | ||
Threshold note trading days | day | 5 | ||
Threshold percentage of note price trigger | 98.00% | ||
Redemption price, percentage | 100.00% | 100.00% | |
Purchase price trigger percentage | 100.00% | ||
Subsequent to September 30, 2015 | |||
Debt Instrument [Line Items] | |||
Threshold trading days | day | 20 | 20 | |
Threshold consecutive trading days | day | 30 | 30 | |
Threshold percentage of stock price trigger | 130.00% | 130.00% | |
On or After June 1, 2020 Until June 1, 2022 | |||
Debt Instrument [Line Items] | |||
Threshold consecutive trading days | day | 30 | ||
Series A Notes | |||
Debt Instrument [Line Items] | |||
Principal amount | $ 460,000,000 | ||
Interest rate | 1.00% | ||
Series B Notes | |||
Debt Instrument [Line Items] | |||
Principal amount | $ 460,000,000 | ||
Interest rate | 1.625% | ||
Initial purchaser's discount | $ 23,000,000 | ||
Debt issuance costs | 500,000 | ||
Proceeds from issuance of convertible senior notes, net of issuance costs | $ 896,500,000 | ||
Threshold consecutive note trading days | 5 days | ||
Series B Notes | On or After June 1, 2020 Until June 1, 2022 | |||
Debt Instrument [Line Items] | |||
Threshold trading days | day | 20 | ||
Threshold percentage of stock price trigger | 130.00% | ||
Required trading days since notice of redemption, not more than | 3 days | ||
Debt, Liability Component | |||
Debt Instrument [Line Items] | |||
Initial purchaser's discount | $ 11,500,000 | $ 17,600,000 | |
Debt issuance costs | 500,000 | 400,000 | |
Debt, Equity Component | |||
Debt Instrument [Line Items] | |||
Initial purchaser's discount | 3,500,000 | 5,400,000 | |
Debt issuance costs | $ 100,000 | $ 100,000 |
Convertible Senior Notes - Repu
Convertible Senior Notes - Repurchase of a Portion of the Series A Notes (Details) $ in Thousands | 1 Months Ended | 6 Months Ended | ||||
Jun. 30, 2020USD ($) | May 31, 2018USD ($) | Jun. 30, 2021USD ($) | Jun. 30, 2020USD ($) | Dec. 31, 2020USD ($) | May 24, 2018USD ($) | |
Debt Instrument [Line Items] | ||||||
Repurchase of convertible senior notes | $ 0 | $ 96,392 | ||||
Convertible Senior Notes | ||||||
Debt Instrument [Line Items] | ||||||
Remaining discount and issuance cost, weighted average amortization period | 10 months 24 days | |||||
Series A Notes | Convertible Senior Notes | ||||||
Debt Instrument [Line Items] | ||||||
Repurchase of convertible senior notes | $ 330,400 | |||||
Repurchased principal amount of debt | $ 96,400 | 340,200 | $ 96,400 | $ 340,200 | ||
Equity component of debt, subsequent adjustments | $ 13,000 | |||||
Remaining expected life | 2 years | |||||
Loss on repurchase of convertible senior notes | 0 | $ 10,800 | ||||
Extinguishment of debt, amount | $ 96,400 | |||||
Debt amount outstanding | $ 23,436 | $ 23,436 | ||||
Series A Notes | Convertible Senior Notes | Measurement Input, Discount Rate | ||||||
Debt Instrument [Line Items] | ||||||
Measurement input | 0.045 | |||||
Series A Notes | Convertible Senior Notes | Convertible senior notes | ||||||
Debt Instrument [Line Items] | ||||||
Repurchase of convertible senior notes | $ 317,400 |
Convertible Senior Notes - Prep
Convertible Senior Notes - Prepaid Forward Stock Purchase (Narrative) (Details) - USD ($) shares in Millions, $ in Millions | Jun. 03, 2020 | Jun. 30, 2015 |
Debt Disclosure [Abstract] | ||
Stock repurchased during period | $ 150 | |
Stock repurchased and retired during period shares (shares) | 1.6 | |
Antidilutive securities excluded from net loss per share (shares) | 1.8 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) | 6 Months Ended | |
Jun. 30, 2021USD ($)claim | Dec. 31, 2020USD ($) | |
Long-term Purchase Commitment [Line Items] | ||
Letters of credit available | $ 3,400,000 | $ 3,900,000 |
Amount drawn against letters of credit | $ 0 | |
Number of claims | claim | 0 | |
Software and Services | ||
Long-term Purchase Commitment [Line Items] | ||
Non-cancellable open orders | $ 23,100,000 |
Redeemable Convertible Prefer_2
Redeemable Convertible Preferred Stock (Details) $ / shares in Units, $ in Thousands | Dec. 11, 2020USD ($)day$ / sharesshares | Jun. 30, 2021USD ($)$ / shares | Dec. 31, 2020USD ($) |
Class of Stock [Line Items] | |||
Paid in-kind dividend period | 3 years | ||
Series A Securities Financing Agreements | |||
Class of Stock [Line Items] | |||
Number of shares issued and sold (shares) | shares | 400,000 | ||
Sale price (usd per share) | $ / shares | $ 1,000 | ||
Aggregate purchase price | $ 400,000 | ||
Series A convertible preferred stock: | |||
Class of Stock [Line Items] | |||
Conversion price (usd per share) | $ / shares | $ 17.25 | $ 17.25 | |
Trading days | day | 20 | ||
Consecutive trading days | day | 30 | ||
Conversion price, percent | 175.00% | ||
Excess of net debt | $ 350,000 | ||
Accretion recognized | $ 100 | $ 4,700 | |
Dividends accrued during the period | 9,100 | ||
Dividends payable | $ 10,100 | ||
Series A convertible preferred stock: | Series A Securities Financing Agreements | |||
Class of Stock [Line Items] | |||
Dividend rate | 0.045 | ||
Percent issued still outstanding | 25.00% |
Common Shares Reserved for Is_3
Common Shares Reserved for Issuance - Narrative (Details) | 6 Months Ended | |
Jun. 30, 2021vote$ / sharesshares | Dec. 31, 2020$ / sharesshares | |
Class of Stock [Line Items] | ||
Common stock, shares authorized (shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, par value (usd per share) | $ / shares | $ 0.0001 | $ 0.0001 |
Voting rights, number of votes | vote | 1 | |
Series A convertible preferred stock: | ||
Class of Stock [Line Items] | ||
Preferred stock authorized (shares) | 100,000,000 | 100,000,000 |
Preferred stock, par value (usd per share) | $ / shares | $ 0.0001 | $ 0.0001 |
Preferred stock, shares issued (shares) | 400,000 | 400,000 |
Preferred stock, outstanding (shares) | 400,000 | 400,000 |
Common Shares Reserved for Is_4
Common Shares Reserved for Issuance - Schedule of Reserved Shares of Common Stock for Issuance (Details) - shares shares in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Class of Stock [Line Items] | ||
Shares reserved for future issuance (shares) | 106,642 | 99,275 |
Series A Preferred Stock | ||
Class of Stock [Line Items] | ||
Shares reserved for future issuance (shares) | 23,775 | 23,249 |
Convertible senior notes | ||
Class of Stock [Line Items] | ||
Shares reserved for future issuance (shares) | 33,856 | 33,856 |
Reserved under stock award plans | ||
Class of Stock [Line Items] | ||
Shares reserved for future issuance (shares) | 44,327 | 38,745 |
Employee Stock Purchase Plan (ESPP) | ||
Class of Stock [Line Items] | ||
Shares reserved for future issuance (shares) | 4,684 | 3,425 |
Equity Award Plans - Narrative
Equity Award Plans - Narrative (Details) - USD ($) shares in Thousands, $ in Millions | 6 Months Ended | |
Jun. 30, 2021 | Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares reserved for future issuance (shares) | 106,642 | 99,275 |
Compensation cost not yet recognized | $ 458.6 | |
Compensation cost not yet recognized, period for recognition | 2 years 9 months 18 days | |
Employee Stock Purchase Plan (ESPP) | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares reserved for future issuance (shares) | 4,684 | 3,425 |
Acquisition price at lower of fair market value, percentage | 85.00% | |
2013 Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
General vesting period | 4 years | |
Award expiration period from grant date | 10 years | |
Employee stock ownership, combined voting power of all stock | 10.00% | |
Minimum exercise price as a percentage of the fair value per share | 110.00% | |
Award expiration period, for excess voting power grants | 5 years | |
Shares reserved for future issuance (shares) | 14,400 | 14,900 |
2013 Plan | Employee Stock Option | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Grant date fair value, percentage, no less than | 100.00% |
Equity Award Plans - Summary of
Equity Award Plans - Summary of the Activity for Stock Option Changes and Summary of Information Related to Options Outstanding and Options Exercisable (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | |
Mar. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2020 | |
Number of Shares | |||
Beginning balance, options outstanding (shares) | 3,485 | 3,485 | |
Exercised (shares) | (714) | ||
Cancelled (shares) | (66) | ||
Ending balance, options outstanding (shares) | 2,705 | ||
Options exercisable (shares) | 1,694 | ||
Weighted- Average Exercise Price (per share) | |||
Beginning balance (usd per share) | $ 8.33 | $ 8.33 | |
Exercised (usd per share) | 5.04 | ||
Cancelled (usd per share) | 20.30 | ||
Ending balance (usd per share) | 8.90 | ||
Options exercisable (usd per share) | $ 12.81 | ||
Weighted- Average Contractual Life (years) | |||
Balance | 5 years 3 months 18 days | 5 years 3 months 18 days | |
Options exercisable — June 30, 2021 | 3 years 8 months 15 days | ||
Aggregate Intrinsic Value | |||
Aggregate intrinsic value balance | $ 39,960 | $ 60,679 | |
Exercised | 11,034 | ||
Options exercisable — June 30, 2021 | $ 21,912 |
Equity Award Plans - Summary _2
Equity Award Plans - Summary of Activity for Restricted Common Stock, RSAs and RSUs and Summary of Information Related to Unvested Restricted Common Stock, RSAs and RSUs and those Expected to Vest (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | |
Mar. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2020 | |
Number of Shares | |||
Beginning balance (shares) | 20,400 | 20,400 | |
Granted (shares) | 14,427 | ||
Vested (shares) | (5,899) | ||
Cancelled (shares) | (1,669) | ||
Ending balance (shares) | 27,259 | ||
Unvested awards for which the requisite service period has not been rendered and vesting is subject to the achievement of a performance condition (shares) | 2,748 | ||
Weighted- Average Grant Date Fair Value (per share) | |||
Beginning balance (usd per share) | $ 15.35 | $ 15.35 | |
Granted (usd per share) | 20.72 | ||
Vested (usd per share) | 15.24 | ||
Cancelled (usd per share) | 16.91 | ||
Ending balance (usd per share) | 18.17 | ||
Unvested awards for which the requisite service period has not been rendered and vesting is subject to the achievement of a performance condition (usd per share) | $ 19.04 | ||
Weighted- Average Contractual Life (years) | |||
Balance | 1 year 4 months 24 days | 1 year 7 months 6 days | |
Unvested awards for which the requisite service period has not been rendered and vesting is subject to the achievement of a performance condition — June 30, 2021 | 1 year 10 months 24 days | ||
Aggregate Intrinsic Value | |||
Balance | $ 551,195 | $ 470,424 | |
Unvested awards for which the requisite service period has not been rendered and vesting is subject to the achievement of a performance condition — June 30, 2021 | $ 55,556 |
Equity Award Plans - Assumption
Equity Award Plans - Assumptions (Details) - Employee Stock Purchase Plan (ESPP) - $ / shares | 3 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Fair value of common stock (usd per share) | $ 22.33 | $ 13.06 |
Risk-free interest rate | 0.04% | |
Risk free interest rate, minimum | 0.17% | |
Risk free interest rate, maximum | 0.18% | |
Dividend yield | 0.00% | 0.00% |
Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected term (in years) | 6 months | 6 months |
Volatility | 55.00% | 52.00% |
Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected term (in years) | 1 year | 1 year |
Volatility | 62.00% | 68.00% |
Equity Award Plans - Schedule o
Equity Award Plans - Schedule of Stock-Based Compensation Expense Related to Stock Options, ESPP and Restricted Stock Units and Awards (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense | $ 38,742 | $ 26,650 | $ 72,143 | $ 52,508 |
Cost of platform, subscription and support revenue | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense | 3,487 | 2,486 | 6,301 | 4,865 |
Cost of professional services revenue | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense | 6,135 | 4,171 | 11,321 | 7,748 |
Research and development | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense | 9,320 | 4,850 | 17,743 | 10,366 |
Sales and marketing | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense | 11,539 | 8,162 | 21,429 | 17,043 |
General and administrative | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense | $ 8,261 | $ 6,981 | $ 15,349 | $ 12,486 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Income Tax Disclosure [Abstract] | ||||
Provision for income taxes | $ 763 | $ 656 | $ 1,943 | $ 1,006 |
Net Loss per Share - Schedule o
Net Loss per Share - Schedule of Computation of Net Loss per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Numerator: | ||||
Loss from continuing operations | $ (99,141) | $ (89,996) | $ (185,596) | $ (187,803) |
Net income from discontinued operations | 34,445 | 36,721 | 70,254 | 58,222 |
Net loss | (64,696) | (53,275) | (115,342) | (129,581) |
Dividend on series A convertible preferred stock | (4,563) | 0 | (9,075) | 0 |
Accretion of series A convertible preferred stock | 0 | 0 | (82) | 0 |
Net loss attributable to common stockholders | (69,259) | (53,275) | (124,499) | (129,581) |
Net loss attributable to common stockholders | $ (69,259) | $ (53,275) | $ (124,499) | $ (129,581) |
Denominator: | ||||
Weighted average number of shares outstanding—basic (shares) | 237,279 | 221,352 | 236,016 | 219,570 |
Weighted average number of shares outstanding— diluted (shares) | 237,279 | 221,352 | 236,016 | 219,570 |
Net loss from continuing operations per share attributable to common stockholders, Basic (usd per share) | $ (0.44) | $ (0.41) | $ (0.83) | $ (0.86) |
Net loss from continuing operations per share attributable to common stockholders, diluted (usd per share) | (0.44) | (0.41) | (0.83) | (0.86) |
Discontinued operations, basic (usd per share) | 0.15 | 0.17 | 0.30 | 0.27 |
Discontinued operations, diluted (usd per share) | 0.15 | 0.17 | 0.30 | 0.27 |
Net loss per share attributable to common stockholders, basic (usd per share) | (0.29) | (0.24) | (0.53) | (0.59) |
Net loss per share attributable to common stockholders, diluted (usd per share) | $ (0.29) | $ (0.24) | $ (0.53) | $ (0.59) |
Net Loss per Share - Schedule_2
Net Loss per Share - Schedule of Outstanding Options and Unvested Shares Excluded from Computation of Diluted Net Loss per Common Share (Details) - shares shares in Thousands | Jun. 03, 2020 | Jun. 30, 2021 | Jun. 30, 2020 |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from net loss per share (shares) | 1,800 | ||
Options to purchase common stock | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from net loss per share (shares) | 2,705 | 3,425 | |
Unvested restricted stock awards and units | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from net loss per share (shares) | 27,259 | 22,680 | |
Convertible preferred stock | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from net loss per share (shares) | 23,775 | 0 | |
Convertible senior notes | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from net loss per share (shares) | 33,856 | 33,856 | |
ESPP shares | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from net loss per share (shares) | 133 | 198 |
Employee Benefit Plan - Narrati
Employee Benefit Plan - Narrative (Details) | 6 Months Ended |
Jun. 30, 2021USD ($) | |
Retirement Benefits [Abstract] | |
Employer contributions vested percentage | 100.00% |
Employer matching contributions | $ 0 |
Segment and Major Customers I_3
Segment and Major Customers Information - Narrative (Details) - segment | 3 Months Ended | 6 Months Ended |
Jun. 30, 2021 | Jun. 30, 2021 | |
Revenue, Major Customer [Line Items] | ||
Number of reportable segments | 1 | |
Customer Concentration Risk | Sales Revenue, Net | One Reseller | ||
Revenue, Major Customer [Line Items] | ||
Concentration risk percentage | 10.00% | 10.00% |
Segment and Major Customers I_4
Segment and Major Customers Information - Schedule of Revenue by Geographic Region (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | $ 113,910 | $ 97,230 | $ 228,598 | $ 189,384 |
U.S. | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 77,473 | 68,979 | 155,270 | 134,069 |
EMEA | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 16,417 | 12,687 | 33,433 | 24,835 |
APAC | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 11,219 | 8,348 | 22,922 | 16,965 |
Other | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 8,801 | 7,216 | 16,973 | 13,515 |
Platform, cloud subscription and managed services | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 51,936 | 48,051 | 107,935 | 93,353 |
Platform, cloud subscription and managed services | U.S. | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 34,669 | 34,976 | 71,843 | 67,913 |
Platform, cloud subscription and managed services | EMEA | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 8,439 | 6,032 | 17,015 | 11,507 |
Platform, cloud subscription and managed services | APAC | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 6,266 | 4,736 | 13,798 | 9,875 |
Platform, cloud subscription and managed services | Other | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 2,562 | 2,307 | 5,278 | 4,058 |
Professional services | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 61,974 | 49,179 | 120,663 | 96,031 |
Professional services | U.S. | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 42,804 | 34,003 | 83,427 | 66,156 |
Professional services | EMEA | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 7,978 | 6,655 | 16,418 | 13,328 |
Professional services | APAC | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 4,953 | 3,612 | 9,124 | 7,090 |
Professional services | Other | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | $ 6,239 | $ 4,909 | $ 11,695 | $ 9,457 |
Segment and Major Customers I_5
Segment and Major Customers Information - Revenue by Product (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Segment Reporting Information [Line Items] | ||||
Revenue | $ 113,910 | $ 97,230 | $ 228,598 | $ 189,384 |
Platform, cloud subscription and managed services | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 51,936 | 48,051 | 107,935 | 93,353 |
Professional services | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | $ 61,974 | $ 49,179 | $ 120,663 | $ 96,031 |
Segment and Major Customers I_6
Segment and Major Customers Information - Summary of Long lived Assets by Geographic Region Based on Physical Location (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Entity Location [Line Items] | ||
Total property and equipment, net | $ 65,886 | $ 64,336 |
United States | ||
Entity Location [Line Items] | ||
Total property and equipment, net | 62,017 | 59,998 |
International | ||
Entity Location [Line Items] | ||
Total property and equipment, net | $ 3,869 | $ 4,338 |
Subsequent Events (Details)
Subsequent Events (Details) $ in Millions | Aug. 04, 2021USD ($) |
Subsequent Event | |
Subsequent Event [Line Items] | |
Purchase consideration, cash paid | $ 16.3 |