Cover Page
Cover Page - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Feb. 21, 2020 | Jun. 30, 2019 | |
Cover page. | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Transition Report | false | ||
Entity File Number | 001-37918 | ||
Entity Registrant Name | iRhythm Technologies, Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 20-8149544 | ||
Entity Address, Address Line One | 699 8th Street | ||
Entity Address, Address Line Two | Suite 600 | ||
Entity Address, City or Town | San Francisco | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 94103 | ||
City Area Code | 415 | ||
Local Phone Number | 632-5700 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 1,950,000 | ||
Entity Common Stock, Shares Outstanding | 26,801,044 | ||
Documents Incorporated by Reference | Portions of the information called for by Part III of this Form 10-K is hereby incorporated by reference from the definitive Proxy Statements for our annual meeting of stockholders, which will be filed with the Securities and Exchange Commission not later than 120 days after December 31, 2019. | ||
Title of 12(b) Security | Common Stock, Par Value $.001 Per Share | ||
Trading Symbol | IRTC | ||
Security Exchange Name | NASDAQ | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Entity Central Index Key | 0001388658 | ||
Current Fiscal Year End Date | --12-31 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 20,462 | $ 20,023 |
Short-term investments | 120,089 | 58,320 |
Accounts receivable, net | 23,867 | 19,790 |
Inventory | 4,037 | 2,062 |
Prepaid expenses and other current assets | 4,337 | 4,100 |
Total current assets | 172,792 | 104,295 |
Long-term investments | 8,030 | 0 |
Property and equipment, net | 26,464 | 9,158 |
Operating lease right-of-use assets | 90,124 | 0 |
Goodwill | 862 | 862 |
Other assets | 7,940 | 3,208 |
Total assets | 306,212 | 117,523 |
Current liabilities: | ||
Accounts payable | 8,243 | 2,284 |
Accrued liabilities | 32,586 | 26,688 |
Deferred revenue | 1,251 | 1,223 |
Debt, current portion | 1,944 | 0 |
Accrued interest | 128 | 139 |
Operating lease liabilities, current portion | 7,914 | 0 |
Total current liabilities | 52,066 | 30,334 |
Debt, noncurrent portion | 32,989 | 34,899 |
Deferred rent, noncurrent portion | 0 | 153 |
Operating lease liabilities, noncurrent portion | 85,748 | 0 |
Total liabilities | 170,803 | 65,386 |
Commitments and contingencies (Note 6) | ||
Stockholders’ equity: | ||
Preferred stock, $0.001 par value – 5,000,000 shares authorized at December 31, 2019 and 2018; and none issued and outstanding at December 31, 2019 and 2018, respectively | 0 | 0 |
Common stock, $0.001 par value – 100,000,000 shares authorized at December 31, 2019 and 2018; 26,682,720 and 24,368,073 shares issued and outstanding at December 31, 2019 and 2018, respectively | 25 | 23 |
Additional paid-in capital | 395,695 | 257,955 |
Accumulated other comprehensive income (loss) | 82 | (16) |
Accumulated deficit | (260,393) | (205,825) |
Total stockholders’ equity | 135,409 | 52,137 |
Total liabilities and stockholders’ equity | $ 306,212 | $ 117,523 |
Common stock, shares issued | 26,682,720 | 24,368,073 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in USD per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 26,682,720 | 24,368,073 |
Common stock, shares outstanding | 26,682,720 | 24,368,073 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Statement [Abstract] | |||
Revenue | $ 214,552 | $ 147,277 | $ 99,129 |
Cost of revenue | 52,485 | 38,795 | 28,203 |
Gross profit | 162,067 | 108,482 | 70,926 |
Operating expenses: | |||
Research and development | 37,299 | 20,860 | 13,265 |
Selling, general and administrative | 179,523 | 133,313 | 85,252 |
Total operating expenses | 216,822 | 154,173 | 98,517 |
Loss from operations | (54,755) | (45,691) | (27,591) |
Interest expense | (1,643) | (3,115) | (3,386) |
Other income, net | 1,895 | 1,501 | 1,237 |
Loss on extinguishment of debt | 0 | (3,029) | 0 |
Loss before income taxes | (54,503) | (50,334) | (29,740) |
Income tax provision | 65 | 44 | 0 |
Net loss | $ (54,568) | $ (50,378) | $ (29,740) |
Net loss per common share, basic and diluted | $ (2.16) | $ (2.11) | $ (1.31) |
Weighted-average shares, basic and diluted | 25,265,918 | 23,885,858 | 22,627,327 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement of Comprehensive Income [Abstract] | |||
Net loss | $ (54,568) | $ (50,378) | $ (29,740) |
Other comprehensive income (loss): | |||
Net change in unrealized gains (losses) on available-for-sale securities | 98 | 49 | (56) |
Comprehensive loss | (54,470) | (50,329) | (29,796) |
Other Comprehensive Income (Loss), Securities, Available-for-sale, Adjustment, after Tax | $ 98 | $ 49 | $ (56) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders’ Equity - USD ($) $ in Thousands | Total | Secondary Offering | Common Stock | Common StockSecondary Offering | Additional Paid-In Capital | Additional Paid-In CapitalSecondary Offering | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) |
Beginning balance (in shares) at Dec. 31, 2016 | 22,139,346 | |||||||
Beginning balance at Dec. 31, 2016 | $ 93,041 | $ 22 | $ 220,089 | $ (127,061) | $ (9) | |||
Increase (Decrease) in Stockholders' and Temporary Equity [Roll Forward] | ||||||||
Issuance of common stock in connection with employee equity incentive plans, net (in shares) | 827,556 | 1,027,595 | ||||||
Issuance of common stock in connection with employee equity incentive plans, net | $ 6,390 | $ 1 | 6,389 | |||||
Issuance of preferred stock upon exercise of warrants (in shares) | 210,374 | |||||||
Tax withholding upon vesting of restricted stock awards | (46) | (46) | ||||||
Stock-based compensation expense | 9,752 | 9,752 | ||||||
Net loss | (29,740) | (29,740) | ||||||
Net change in unrealized gains on available-for-sale securities | (56) | (56) | ||||||
Common stock ending balance (in shares) at Dec. 31, 2017 | 23,377,315 | |||||||
Ending balance at Dec. 31, 2017 | $ 79,341 | $ 23 | 236,184 | (156,801) | (65) | |||
Increase (Decrease) in Stockholders' and Temporary Equity [Roll Forward] | ||||||||
Issuance of common stock in connection with employee equity incentive plans, net (in shares) | 798,424 | 990,758 | ||||||
Issuance of common stock in connection with employee equity incentive plans, net | $ 9,319 | 9,319 | ||||||
Tax withholding upon vesting of restricted stock awards | (3,877) | (3,877) | ||||||
Stock-based compensation expense | 16,329 | 16,329 | ||||||
Net loss | (50,378) | (50,378) | ||||||
Net change in unrealized gains on available-for-sale securities | $ 49 | 49 | ||||||
Common stock ending balance (in shares) at Dec. 31, 2018 | 24,368,073 | 24,368,073 | ||||||
Ending balance at Dec. 31, 2018 | $ 52,137 | $ 23 | 257,955 | (205,825) | (16) | |||
Increase (Decrease) in Stockholders' and Temporary Equity [Roll Forward] | ||||||||
Issuance of common stock in connection with employee equity incentive plans, net (in shares) | 540,307 | 734,453 | ||||||
Issuance of common stock in connection with employee equity incentive plans, net | $ 9,495 | |||||||
Warrants exercised (in shares) | 4,852 | |||||||
Issuance of common stock in connection with follow-on public offering, net of discounts and issuance costs (in shares) | 1,575,342 | |||||||
Issuance of common stock in connection with follow-on public offering, net of issuance costs | $ 107,294 | $ 2 | $ 107,292 | |||||
Tax withholding upon vesting of restricted stock awards | (5,288) | (5,288) | ||||||
Stock-based compensation expense | 26,241 | 26,241 | ||||||
Net loss | (54,568) | (54,568) | ||||||
Net change in unrealized gains on available-for-sale securities | $ 98 | 98 | ||||||
Common stock ending balance (in shares) at Dec. 31, 2019 | 26,682,720 | 26,682,720 | ||||||
Ending balance at Dec. 31, 2019 | $ 135,409 | $ 25 | $ 395,695 | $ (260,393) | $ 82 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cash flows from operating activities | |||
Net loss | $ (54,568) | $ (50,378) | $ (29,740) |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Depreciation and amortization | 3,445 | 2,269 | 1,597 |
Stock-based compensation | 26,241 | 16,329 | 9,752 |
Amortization of debt discount and issuance costs | 37 | 210 | 260 |
Accretion of discounts on investments, net of premium amortization | (884) | (907) | (352) |
Loss on disposal of assets | 0 | 75 | 9 |
Provision for bad debt and contractual allowance | 24,647 | 16,448 | 9,222 |
Non-cash interest expense | 0 | 0 | 1,550 |
Loss on extinguishment of debt | 0 | 3,029 | 0 |
Repayment of interest paid in kind | 0 | (3,141) | 0 |
Cost of operating lease right-of-use assets | 8,953 | 0 | 0 |
Changes in operating assets and liabilities: | |||
Accounts receivable | (28,725) | (21,747) | (12,471) |
Inventory | (1,974) | (380) | (293) |
Prepaid expenses and other current assets | (696) | (1,568) | (795) |
Other assets | (4,732) | 269 | (467) |
Accounts payable | 5,604 | (192) | 634 |
Accrued liabilities | 6,002 | 10,501 | 5,757 |
Deferred rent | 0 | 105 | 135 |
Deferred revenue | 28 | (15) | 291 |
Operating lease liabilities | (5,241) | 0 | 0 |
Net cash used in operating activities | (21,863) | (29,093) | (14,911) |
Cash flows from investing activities | |||
Purchases of property and equipment | (20,457) | (5,180) | (3,562) |
Purchases of available-for-sale investments | (165,915) | (93,133) | (129,829) |
Sales of available-for-sale investments | 1,498 | 5,962 | 0 |
Maturities of available-for-sale investments | 95,600 | 126,493 | 98,707 |
Net cash provided by (used in) investing activities | (89,274) | 34,142 | (34,684) |
Cash flows from financing activities | |||
Issuance of common stock in connection with follow-on public offering, net | 107,369 | 0 | 0 |
Proceeds from issuance of common stock | 9,495 | 9,319 | 6,390 |
Tax withholding upon vesting of restricted stock awards | (5,288) | (3,877) | (46) |
Payments of deferred offering costs | 0 | 0 | 188 |
Proceeds from long-term debt, net of debt discount | 0 | 35,000 | 0 |
Repayments of long-term debt | 0 | (31,500) | 0 |
Payments of issuance costs for long term debt | 0 | (121) | 0 |
Premiums paid on extinguishment of debt | 0 | (2,518) | 0 |
Net cash provided by financing activities | 111,576 | 6,303 | 6,532 |
Net increase (decrease) in cash and cash equivalents | 439 | 11,352 | (43,063) |
Cash and cash equivalents, beginning of year | 20,023 | 8,671 | 51,734 |
Cash and cash equivalents, end of year | 20,462 | 20,023 | 8,671 |
Supplemental disclosures of cash flow information | |||
Interest paid | 1,644 | 6,065 | 1,550 |
Non-cash investing and financing activities | |||
Property and equipment included in accounts payable and accrued liabilities | 293 | 101 | 110 |
Deferred offering costs included in accounts payable and accrued liabilities | 77 | 0 | 0 |
Right-of-use assets obtained in exchange for new operating lease liabilities | $ 88,860 | $ 0 | $ 0 |
Selected Quarterly Financial Da
Selected Quarterly Financial Data (unaudited) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Selected Quarterly Financial Data (unaudited) | Selected Quarterly Financial Data (unaudited) The following table presents selected unaudited financial data for each of the eight quarters in the two-year period ended December 31, 2019, which have been updated to reflect the revisions discussed in Note 14. Revision of Prior Period Financial Statements and Note 1. Organization and Description of Business. The revision of the third quarter 2018 was previously effected in the Company’s Quarterly Report on Form 10-Q for the third quarter of fiscal 2019 and thus the impact of the revision on such periods financial data is not reflected below. The Company will effect the revision of its unaudited interim financial statements as of and for the three months ended March 31, 2019 and as of and for the three and six-months ended June 30, 2019 when it issues its Form 10-Q for the periods ended March 31 and June 30, 2020. The Company believes this information reflects all recurring adjustments necessary to fairly state this information when read in conjunction with the Company's financial statements and the related notes. Net loss per common share, basic and diluted, for the four quarters of each fiscal year may not sum to the total for the fiscal year because of the different number of shares outstanding during each period. The results of operations for any quarter are not necessarily indicative of the results to be expected for any future period (in thousands of dollars, except for share and per share data): Quarter Ended March 31 June 30 September 30 December 31 2019: Total revenues $ 48,334 $ 52,441 $ 54,673 $ 59,104 Gross profit 36,561 39,429 40,888 45,189 Net loss (8,250) (10,725) (18,293) (17,300) Net loss per common share, basic and diluted $ (0.34) $ (0.43) $ (0.72) $ (0.65) 2018: Total revenues $ 31,762 $ 35,292 $ 38,441 $ 41,782 Gross profit 23,212 25,806 28,488 30,976 Net loss (11,077) (13,304) (9,727) (16,270) Net loss per common share, basic and diluted $ (0.47) $ (0.56) $ (0.40) $ (0.67) The impact of the revision on the unaudited quarterly financial data is as follows: Quarter Ended June 30, 2019 As Reported Adjustment As Revised Total revenues $ 53,331 $ (890) $ 52,441 Gross profit 40,506 (1,077) 39,429 Net loss (11,467) 742 (10,725) Net loss per common share, basic and diluted $ (0.46) $ 0.03 $ (0.43) Quarter Ended March 31, 2019 As Reported Adjustment As Revised Total revenues $ 47,214 $ 1,120 $ 48,334 Gross profit 35,484 1,077 36,561 Net loss (8,019) (231) (8,250) Net loss per common share, basic and diluted $ (0.33) $ (0.01) $ (0.34) Quarter Ended December 31, 2018 As Reported Adjustment As Revised Total revenues $ 43,155 $ (1,373) $ 41,782 Gross profit 32,626 (1,650) 30,976 Net loss (14,713) (1,557) (16,270) Net loss per common share, basic and diluted $ (0.61) $ (0.06) $ (0.67) Quarter Ended June 30, 2018 As Reported Adjustment As Revised Total revenues $ 35,469 $ (177) $ 35,292 Gross profit 25,979 (173) 25,806 Net loss (12,206) (1,098) (13,304) Net loss per common share, basic and diluted $ (0.51) $ (0.05) $ (0.56) Quarter Ended March 31, 2018 As Reported Adjustment As Revised Total revenues $ 30,565 $ 1,197 $ 31,762 Gross profit 21,954 1,258 23,212 Net loss $ (11,117) $ 40 $ (11,077) |
Organization and Description of
Organization and Description of Business | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Organization and Description of Business | Organization and Description of Business iRhythm Technologies, Inc. (the “Company”) was incorporated in the state of Delaware in September 2006. The Company is a digital healthcare company redefining the way cardiac arrhythmias are clinically diagnosed by combining wearable biosensing technology with cloud-based data analytics and deep-learning capabilities. The Company began commercial operations in the United States in 2009 following clearance by the U.S. Food and Drug Administration. The Company is headquartered in San Francisco, California, which also serves as a clinical center. The Company has additional clinical centers in Lincolnshire, Illinois and Houston, Texas and a manufacturing facility in Cypress, California. In March 2016, the Company formed a wholly-owned subsidiary in the United Kingdom. The Company manages its operations as a single operating segment. Substantially all of the Company’s assets are maintained in the United States. The Company derives substantially all of its revenue from sales to customers in the United States. On September 10, 2019, the Company issued and sold an aggregate of 1,575,342 shares (the "Shares") of common stock, in a public offering at a price of $73.00 per share. The Shares included the full exercise of the underwriters’ option to purchase an additional 205,479 shares of common stock. Total proceeds received from the offering were $107.3 million, net of issuance costs. Revision of Prior Period Financial Statements |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles and include the accounts of iRhythm Technologies, Inc. and its wholly-owned subsidiary. All intercompany accounts and transactions have been eliminated. The financial statements of the Company’s subsidiary use the U.S. dollar as the functional currency. For all non-functional currency balances, the remeasurement of such balances to functional currency results in a foreign exchange transaction gain or loss, which is recorded in the consolidated statements of operations. Use of Estimates The preparation of the 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 as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, management evaluates its estimates, including those related to revenue recognition, contractual allowances for revenue, allowance for doubtful accounts, the useful lives of property and equipment, the recoverability of long-lived assets including the estimated usage of the printed circuit board assemblies (“PCBAs”), the incremental borrowing rate for operating leases, accounting for income taxes, the fair value of the Company’s common stock and stock-based compensation. The Company bases these estimates on historical and anticipated results, trends, and various other assumptions that the Company believes are reasonable under the circumstances, including assumptions as to future events. Actual results may differ from those estimates. Fair Value of Financial Instruments The carrying amounts of certain of the Company’s financial instruments, which include cash equivalents, short-term investments, long-term investments, accounts receivable, accounts payable and accrued liabilities, approximate fair value due to their short maturities. Cash Equivalents Cash equivalents consist of short-term, highly liquid investments with original maturities of three months or less from the date of purchase. Investments Short-term investments consist of debt securities classified as available-for-sale and have maturities greater than 90 days, but less than one year as of the balance sheet date. Long-term investments have maturities greater than one year as of the balance sheet date. All investments are carried at fair value based upon quoted market prices. Unrealized gains and losses on available-for-sale securities are excluded from earnings and are reported as a component of accumulated other comprehensive loss. The cost of available-for-sale securities sold is based on the specific-identification method. Realized gains and losses are included in earnings, and are derived for specific-identification method for determining the costs of investments sold. Amortization of premiums and accretion of discounts are reported as a component of other income, net. Accounts Receivable, Allowance for Doubtful Accounts and Contractual Allowance Accounts receivable includes amounts due to the Company from healthcare institutions, third-party payors, and government payors and their related patients, as a result of the Company's normal business activities. Accounts receivable is reported on the consolidated balance sheets net of an estimated allowance for doubtful accounts and a contractual allowance. The Company establishes an allowance for doubtful accounts for estimated uncollectible receivables based on its historical experience and recognizes the provision as a component of selling, general and administrative expenses. The Company records a provision for contractual allowances based on the estimated differences between contracted amounts and expected collection rates. Such provisions are based on the Company's historical experience and are reported as a reduction of revenue. The following table presents the changes in the allowance for doubtful accounts (in thousands): Year ended December 31, 2019 2018 2017 Balance, beginning of year $ 7,296 $ 4,486 $ 1,792 Add: provision for doubtful accounts 9,129 7,353 4,558 Less: write-offs, net of recoveries and other adjustments (7,376) (4,543) (1,864) Balance, end of year $ 9,049 $ 7,296 $ 4,486 The following table presents the changes in the contractual allowance (in thousands): Year ended December 31, 2019 2018 2017 Balance, beginning of year $ 9,205 $ 6,345 $ 2,340 Add: allowance for contractual adjustments 15,518 9,095 4,664 Less: contractual adjustments (9,290) (6,235) (659) Balance, end of year $ 15,433 $ 9,205 $ 6,345 Concentrations of Risk Credit Risk Financial instruments that potentially subject the Company to a concentration of credit risk consist primarily of cash and cash equivalents, investments and accounts receivable. Cash balances are deposited in financial institutions which, at times, may be in excess of federally insured limits. Cash equivalents are invested in highly rated money market funds. The Company invests in a variety of financial instruments, such as, but not limited to, United States Government securities, corporate notes, commercial paper and, by policy, limits the amount of credit exposure with any one financial institution or commercial issuer. The Company has not experienced any material losses on its deposits of cash and cash equivalents or investments. Concentrations of credit risk with respect to accounts receivable are limited due to the large number of customers comprising the Company’s customer base and their dispersion across many geographies. The Company does not require collateral. The Company records an allowance for doubtful accounts when it becomes probable that a receivable will not be collected. Centers for Medicare and Medicaid Services (“CMS”), accounted for approximately 27%, 27% and 28% of the Company’s revenue for the years ended December 31, 2019, 2018 and 2017, respectively. CMS accounted for 20% and 20% of accounts receivable as of December 31, 2019 and 2018, respectively. Supply Risk While the Company has not experienced manufacturing supply disruptions to date, the Company relies on single-source vendors for the supply of its disposable housings, instruments and other materials used to manufacture the Zio monitor and the adhesive that binds the Zio monitor to a patient’s body. These components and materials are critical, and there could be a considerable delay in finding alternative sources of supply. Inventory Inventory is stated at the lower of cost or net realizable value, cost being determined on a standard cost basis for material costs and on actual cost basis for labor and overhead, which approximates actual cost on a first in, first out (“FIFO”) basis, and market being determined as the lower of cost or net realizable value. The Company records write-downs of inventory that is obsolete or in excess of anticipated demand. The Company also records market value based write-downs on consideration of product lifecycle stage, technology trends, product development plans and assumptions about future demand and market conditions. Actual demand may differ from forecasted demand, and such differences may have a material effect on recorded inventory values. Inventory write-downs are charged to cost of revenue and establish a new cost basis for the inventory. Property and Equipment Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization is computed using the straight-line method over the estimated useful lives of the assets, ranging from three Internal-Use Software The Company capitalizes costs related to internal-use software during the application development stage. Costs related to planning and post implementation activities are expensed as incurred. Capitalized internal-use software is amortized, and recognized as cost of revenue, on a straight-line basis over the estimated useful life, which is up to five years. The Company evaluates the useful lives of these assets on an annual basis, and tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets. Capitalized internal-use software costs are classified as a component of property and equipment. Goodwill Goodwill represents the excess of the purchase price paid over the fair value of tangible and identifiable intangible net assets acquired in business combinations. Goodwill is tested for impairment on an annual basis and at any other time if events occur or circumstances indicate that the carrying amount of goodwill may not be recoverable. Such events or circumstances may include significant adverse changes in the general business climate, among other things. The impairment test is performed by determining the enterprise fair value of the Company, which is primarily based on the Company’s market capitalization. If the Company’s carrying value, as a one reporting unit entity, is less than its fair value, then the fair value is allocated to all of its assets and liabilities (including any unrecognized intangible assets) as if the fair value was the purchase price to acquire the Company. The excess of the fair value over the amounts assigned to the Company’s assets and liabilities is the implied fair value of the goodwill. If the carrying amount of goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess. The Company performs its annual evaluation of goodwill during the fourth quarter of each fiscal year. The Company did not record any charges related to goodwill impairment in any of the periods presented in these consolidated financial statements. Impairment of Long-Lived Assets The Company annually reviews long-lived assets for impairment or whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability is measured by comparison of the carrying amount to the future net cash flows which the assets are expected to generate. If such assets are considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the assets exceeds the projected discounted future net cash flows arising from the asset. To date, there have been no such impairments of long-lived assets. Other Assets The Company uses Printed Circuit Board Assemblies (“PCBAs”), in each wearable Zio XT and Zio AT monitor as well as the wireless gateway used in conjunction with the ZIO AT monitor. The PCBAs are used numerous times and have useful lives beyond one year. Each time a PCBA is used in a wearable Zio XT or Zio AT monitor, or a wireless gateway is used with a Zio AT monitor a portion of the cost of the PCBA and/or gateway is recorded as a cost of revenue. The PCBAs are recorded as other assets and were $7.4 million and $2.5 million as of December 31, 2019 and 2018, respectively. The Company has based its estimates of how many times a PCBA can be used on testing in research and development, loss rates, product obsolescence, and the amount of time it takes the device to go through the manufacturing, shipping, customer shelf and patient wear time and upload process. The Company periodically evaluates the use estimate. Comprehensive Loss Comprehensive loss represents all changes in stockholders’ equity during the period from non-owner sources. The Company’s unrealized gains and losses on available-for-sale securities represent the only component of other comprehensive loss that are excluded from the reported net loss and that are presented in the consolidated statements of comprehensive loss. Revenue Recognition Revenue policy under ASC 606 The Company adopted Accounting Standard Codification Topic 606, Revenue from Contracts with Customers (“ASC 606”), on January 1, 2018 and used the modified retrospective approach. Upon adoption, the Company recognized the cumulative effect of $1.4 million as an adjustment to decrease the opening balance of the Company’s accumulated deficit. This adjustment did not have a material impact on the Company’s consolidated financial statements. Prior periods were not retrospectively adjusted. The Company recognized revenue in prior years in accordance with Accounting Standard Codification Topic 954-605, Health Care Entities - Revenue Recognition and Accounting Standard Codification Topic 605, Revenue Recognition . The Company’s revenue is generated primarily from the provision of its cardiac rhythm monitoring service, the Zio XT service. The Zio XT is a cardiac rhythm monitoring service that has a patient wear period of up to 14 days and is billable when the monitoring reports are delivered to the healthcare provider, which is also when the service is complete and the Company recognizes revenue. The time from when the patient has the Zio XT device applied to the time the report is posted is generally around 20 days. The Company has concluded that the Zio XT service is one performance obligation on the basis that the customer cannot benefit from each component of the service on its own or together with other resources that are readily available to the customer. The Company recognizes as revenue the amount of consideration to which it expects to be entitled in exchange for performing the service. The consideration the Company is entitled to varies by portfolio, as further defined below, and includes estimates that require significant judgment by management. A unique aspect of healthcare is the involvement of multiple parties to the service transaction. In addition to the patient, often a third-party, for example a commercial or governmental payor or healthcare institution, will pay the Company for some or all of the service on the patient’s behalf. Separate contractual arrangements exist between the Company and third-party payors that establish amounts the third-party payor will pay on behalf of a patient for covered services rendered. A small part of the Company’s transactions are covered by third-party payors with whom there is no contractual agreement or not an established amount the third-party payor will pay. In determining the collectability and transaction price for its service, the Company considers factors such as insurance claims which are adjudicated as allowable under the applicable policy and payment history from both payors and patient out-of-pocket costs, payor coverage, whether there is a contract between the payor or healthcare institution and the Company, historical amount received for the service, and any current developments or changes that could impact reimbursement and healthcare institution payments. Certain of these factors are forms of variable consideration which are only included in the transaction price to the extent it is probable that a significant reversal of cumulative revenue will not occur when the uncertainty associated with the variable consideration is subsequently resolved. A summary of the payment arrangements with third-party payors and healthcare institutions is as follows: • Contracted third-party payors – The Company has contracts with negotiated prices for services provided for patients with commercial healthcare insurance carriers • CMS – The Company has received independent diagnostic testing facility approval from regional Medicare Administrative Contractors and will receive reimbursement per the relevant Current Procedural Terminology (“CPT”) code rates for the services rendered to the patient covered by CMS. • Non-contracted third-party payors – Non-contracted commercial and government payors often reimburse out-of-network rates provided under the relevant CPT codes on a case-by-case basis. The transaction price used for determining revenue recognition is based on factors including an average of the Company’s historical collection experience for its non-contracted services. This rate is reviewed at least quarterly. • Healthcare institutions – Healthcare institutions are typically hospitals or physician practices in which the Company has negotiated amounts for its monitoring services, including certain governmental agencies such as the Veterans Administration and Department of Defense. The Company is utilizing the portfolio approach practical expedient under ASC 606 for revenue recognition whereby services provided under each of the above payor types form a separate portfolio. The Company accounts for the contracts within each portfolio as a collective group, rather than individual contracts. Based on history with these portfolios and the similar nature and characteristics of the patients within each portfolio, the Company has concluded that the financial statement effects are not materially different than if accounting for revenue on a contract-by-contract basis. For contracted and CMS portfolios, the Company recognizes revenue, net of contractual allowances, and recognizes an allowance for doubtful accounts for uncollectible patient accounts receivable. The transaction price is determined based on negotiated rates, and the Company has historical experience collecting substantially all of these contracted rates. These contracts also impose a number of obligations regarding billing and other matters, and the Company’s noncompliance with a material term of such contracts may result in a denial of the claim. The Company accounts for denied claims as a form of variable consideration that is included as a reduction to the transaction price recognized as revenue. The Company estimates the denied claims which require judgment by management. The estimated denied claims are based on historical information and judgement includes the historical period utilized. The Company monitors the estimated denied claims against the latest available information, and subsequent changes to the estimated denied claims are recorded as an adjustment to revenue in the periods during which such changes occur. Historical cash collection indicates that it is probable that substantially all of the transaction price, less the estimate of denied claims, will be received. Contracted payors may require that we bill patient co-payments and deductibles and from time to time we may not be able to collect such amounts due to credit risk. The Company provides for estimates of uncollectible patient accounts receivable, based upon historical experience and judgment includes the historical period utilized, at the time revenue is recognized, with such provisions presented as bad debt expense within the selling, general and administrative line item of the consolidated statement of operations. Adjustments to these estimates for actual experience are also recorded as an adjustment to bad debt expense. For non-contracted portfolios, the Company is providing an implicit price concession due to the lack of a contracted rate with the underlying payor, the result of which requires the Company to estimate the transaction price based on historical cash collections utilizing the expected value method. All subsequent adjustments to the transaction price are recorded as an adjustment to revenue. For healthcare institutions, the transaction price is determined based on negotiated rates, and the Company has historical experience collecting substantially all of these contracted rates. Historical cash collection indicates that it is probable that substantially all of the transaction price will be received. As such, the Company is not providing an implicit price concession but, rather, has chosen to accept the risk of default, and any subsequent uncollected amounts are recorded as bad debt expense. Revenue policy under ASC 605 The Company’s devices, cardiac rhythm monitors, have a wear period for up to 14 days for the Zio XT service or 30 days for the Zio Event Card. The Company’s services, consisting of the delivery of reports containing analysis of data captured by the physical device to the prescribing physician, are generally billable at the start of the wear period or when reports are issued to physicians, depending on the service provided. For the Zio XT service, the Company recognizes the revenue at the time that a report is delivered to a physician. For the Zio Event Card, the Company recognizes revenue on a straight-line basis over the applicable wear period, as the event monitoring results are delivered to physicians. For all services performed, the Company considers whether or not the following revenue recognition criteria are met: persuasive evidence of an arrangement exists and delivery has occurred or services have been rendered. For services performed for customers which the Company invoices directly, additional revenue recognition criteria include that the price is fixed and determinable and collectability is reasonably assured; for customers in which the Company submits claims to third-party commercial and governmental payors for reimbursement, the Company recognizes revenue only when a reasonable estimate of reimbursement can be made.The assessment of whether a reasonable estimate of reimbursement can be made requires significant judgment by management. Where management’s judgment indicates a reasonable estimate of reimbursement can be made, revenue is recognized upon delivery of the patient report for the Zio XT service and straight-line for the Zio Event Card. Some patients have out-of-pocket costs for amounts not covered by their insurance carrier, and the Company bills the patient directly for these amounts in the form of co-payments and co-insurance in accordance with their insurance carrier and health plans. Some payors may not cover the Company’s service as ordered by the prescribing physician under their reimbursement policies. In the absence of an agreement with the patient or other clearly enforceable legal right to demand payment from the patient, the related revenue is recognized upon the earlier of notification of the payor benefits allowed or when payment is received, until the Company has the ability to make a reasonable estimate. Once a reasonable estimate can be made, revenue is recognized upon delivery of the service. During 2017, the Company recognized revenue on an accrual basis from certain non-contracted payors as a reasonable estimate was able to be made, primarily based on the consistency of historical payments. The Company recognizes revenue related to billings for CMS and commercial payors on an accrual basis, net of contractual allowances, when a reasonable estimate of reimbursement can be made. These contractual allowances represent the difference between the list price (the billing rate) and the reimbursement rate for each payor. Upon ultimate collection from CMS and commercial payors, the amount is compared to the previous estimates and the contractual allowance is adjusted accordingly. Until a contract has been negotiated with a commercial payor, the Company’s services may or may not be covered by these entities’ existing reimbursement policies. In addition, patients do not enter into direct agreements with the Company that commit them to pay any portion of the cost of the service in the event that their insurance declines to reimburse the Company. In the absence of an agreement with the patient or other clearly enforceable legal right to demand payment from the patient, the related revenue is recognized only upon the earlier of notification of the payor benefits allowed or when payment is received, until the Company has the ability to make a reasonable estimate. Disaggregation of Revenue The Company disaggregates revenue from contracts with customers by payor type. The Company believes these categories aggregate the payor types by nature, amount, timing and uncertainty of its revenue streams. Disaggregated revenue by payor type and major service line for the years ended December 31, 2019 and December 31, 2018 was as follows (in thousands): Year Ended December 31, Year Ended December 31, Contracted third-party payors $ 101,845 $ 56,949 Non-contracted third-party payors 10,770 12,447 Centers for Medicare & Medicaid 58,918 40,482 Healthcare Institutions 43,019 37,399 Total $ 214,552 $ 147,277 Contract Liabilities ASC 606 requires an entity to present a revenue contract as a contract liability when the Company has an obligation to transfer goods or services to a customer for which the Company has received consideration from the customer, or an amount of consideration from the customer is due and unconditional (whichever is earlier). Certain of the Company’s customers pay the Company directly for the Zio XT service upon shipment of devices. Such advance payments are contract liabilities and are recorded as deferred revenue on the Consolidated Balance Sheets and revenue is recognized when reports are delivered to the healthcare provider. During the year ended December 31, 2019, $1.2 million relating to the contract liability balance at the beginning of 2019 was recognized as revenue. Contract Costs Under ASC 340, the incremental costs of obtaining a contract with a customer are recognized as an asset. Incremental costs of obtaining a contract are those costs that an entity incurs to obtain a contract with a customer that it would not have incurred if the contract had not been obtained. The Company’s current commission programs are considered incremental. However, as a practical expedient, ASC 340 permits the Company to immediately expense contract acquisition costs, as the asset that would have resulted from capitalizing these costs will be amortized in one year or less. Cost of Revenue Cost of revenue includes direct labor, material costs, equipment and infrastructure expenses, amortization of internal-use software, allocated overhead, and shipping and handling. Direct labor includes payroll and personnel-related costs including stock-based compensation involved in manufacturing, data analysis, and customer service. Material costs include both the disposable costs of the device and amortization of the PCBAs. Each time the PCBA is used in a wearable Zio XT monitor, a portion of the cost of the PCBA is recorded as a cost of revenue. Research and Development The Company’s research and development costs are expensed as incurred. Research and development costs include, but are not limited to, payroll and personnel-related expenses, laboratory supplies, consulting costs and overhead charges. Income Taxes The Company uses the asset and liability method to account for income taxes in accordance with the authoritative guidance for income taxes. Under this method, deferred tax assets and liabilities are determined based on future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and tax loss and credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates applied to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is established when necessary to reduce deferred tax assets to the amount expected to be realized. The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that has a greater than greater than 50% likelihood of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company records interest and penalties related to unrecognized tax benefits in income tax expense. To date, there have been no interest or penalties charged in relation to the unrecognized tax benefits. The Company recognize taxes on Global Intangible Low-Taxed Income as a current period expense when incurred. Stock-based Compensation The Company measures its stock-based awards made to employees based on the estimated fair values of the awards as of the grant date. The fair value of stock options is determined using the Black-Scholes option pricing model. Stock-based compensation expense is recognized over the requisite service period using the straight-line method and is based on the value of the portion of stock-based payment awards that is ultimately expected to vest. As such, the Company’s stock-based compensation is reduced for the estimated forfeitures at the date of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. For restricted stock, the compensation cost for these awards is based on the closing price of the Company’s common stock on the date of grant, and recognized as compensation expense on a straight-line basis over the requisite service period. The Company recognizes compensation expense related to the Employee Stock Purchase Program (“ESPP”) based on the estimated fair value of the options on the date of grant, net of estimated forfeitures. The Company estimates the grant date fair value, and the resulting stock-based compensation expense, using the Black-Scholes option pricing model for each purchase period. The grant date fair value is expensed on a straight-line basis over the offering period. Net Loss per Common Share Basic net loss per common share is calculated by dividing the net loss by the weighted average number of shares of common stock outstanding during the period, without consideration of potentially dilutive securities. Diluted net loss per common share is the same as basic net loss per common share for all periods presented, since the effect of potentially dilutive securities are anti-dilutive. Leases Identifying a lease The Company determines whether a contract contains a lease at the inception of a contract. If the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration, the Company considers the contract to contain a lease. The Company determines whether a contract conveys the right to control the use of an identified asset for a period of time if the contract contains both of the following terms: • The right to obtain substantially all of the economic benefits from use of the identified asset; and • The right to direct the use of the identified asset. Discount rate for leases On January 1, 2019, the rate implicit in the Company’s leases was not readily determinable. As such, the Company used its incremental borrowing rate to calculate its right-of-use assets and lease liabilities upon the adoption of ASC 842. The Company determined the appropriate incremental borrowing rate by utilizing the interest rate obtained in connection with the Third Amended and Restated Loan and Security Agreement with Silicon Valley Bank (“Third Amended and Restated SVB Loan Agreement”) which was finalized on October 23, 2018. On October 4, 2018, the Company entered into an office lease (“San Francisco Lease”) to rent approximately 117,560 rentable square feet in San Francisco, California, which became the Company’s new headquarters in October 2019. The San Francisco Lease commenced on May 13, 2019 and the Company determined that the interest rate associated with the Third Amended and Restated SVB Loan Agreement could not be utilized as the incremental borrowing rate associated with the San Francisco Lease due to the term of the lease, as well as annual rental payments. The Company determined the appropriate incremental borrowing rate by using a synthetic credit rating which was estimated based on an analysis of outstanding debt of companies with similar credit and financial profiles. Lease term The lease term is generally the minimum noncancellable period of each lease. The Company does not include option periods in determining the right-of-use asset and operating lease liability at inception unless it is reasonably certain that the Company will exercise the option at inception or when a triggering event occurs. As of December 31, 2019, no renewal options were included in the determination of lease terms. Lease Modification The San Francisco Lease is in the same building with the same landlord as the lease for the Company’s prior headquarters in San Francisco (“existing lease”). Upon the commencement of the San Francisco Lease, the existing lease which had an original expiration date of February 2020, was modified to expire in September 2019 and accordingly the right-of-us |
Cash Equivalents and Investment
Cash Equivalents and Investments | 12 Months Ended |
Dec. 31, 2019 | |
Cash Equivalents And Investments [Abstract] | |
Cash Equivalents and Investments | Cash Equivalents and Investments The fair value of cash equivalents and available-for-sale investments at December 31, 2019 and 2018, were as follows (in thousands): December 31, 2019 Amortized Cost Gross Unrealized Estimated Fair Value Gains Losses Money market funds $ 13,897 $ — $ — $ 13,897 U.S. government securities 77,329 72 (1) 77,400 Corporate notes 14,955 11 — 14,966 Commercial paper 35,753 — — 35,753 Total available-for-sale marketable debt securities $ 141,934 $ 83 $ (1) $ 142,016 Classified as: Cash equivalents $ 13,897 Short-term investments 120,089 Long-term investments 8,030 Total cash equivalents and available-for-sale investments $ 142,016 December 31, 2018 Amortized Gross Unrealized Estimated Gains Losses Money market funds $ 10,606 $ — $ — $ 10,606 U.S. government securities 9,976 — (1) 9,975 Corporate notes 16,514 3 (18) 16,499 Commercial paper 36,331 — — 36,331 Total available-for-sale marketable debt securities $ 73,427 $ 3 $ (19) $ 73,411 Classified as: Cash equivalents $ 15,091 Short-term investments 58,320 Total cash equivalents and available-for-sale investments $ 73,411 The following table summarizes the fair value of the Company's cash equivalents, short-term and long-term marketable securities classified by maturity (in thousands): December 31, 2019 2018 Due within one year $ 133,986 $ 73,411 Due after one year through three years 8,030 — Total cash equivalents and available-for-sale investments $ 142,016 $ 73,411 The following tables present the Company's available-for-sale securities that were in an unrealized loss position as of December 31, 2018 (in thousands): December 31, 2018 Less than 12 months 12 Months or Greater Total Assets Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss U.S. government securities $ 5,977 $ (1) $ — $ — $ 5,977 $ (1) Corporate notes 11,521 (10) 2,993 (8) 14,514 (18) Total $ 17,498 $ (11) $ 2,993 $ (8) $ 20,491 $ (19) Unrealized losses as of December 31, 2019 were not material. Available-for-sale securities held as of December 31, 2019 had a weighted average maturity of 126 days. At December 31, 2019, one investment was in an unrealized loss position and no investments have been in an unrealized loss position for more than one year. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The Company discloses and recognizes the fair value of its assets and liabilities using a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). The guidance establishes three levels of the fair value hierarchy as follows: Level 1 —Inputs are unadjusted quoted prices in active markets for identical assets or liabilities at the measurement date. Level 2 —Inputs (other than quoted market prices included in Level 1) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life. Level 3 —Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires management to make judgments and consider factors specific to the asset or liability. The corporate notes, commercial paper and government securities are classified as Level 2 as they were valued based upon quoted market prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques for which all significant inputs are observable in the market or can be corroborated by observable market data for substantially the full term of the assets. The fair value of the Company’s outstanding interest-bearing obligations is estimated using the net present value of the future payments, discounted at an interest rate that is consistent with market interest rates, which is a Level 2 input. The carrying amount and the estimated fair value of the Company’s outstanding interest-bearing obligations at December 31, 2019 were $34.9 million and $35.2 million, respectively. The carrying amount and the estimated fair value of the Company’s outstanding interest-bearing obligations at December 31, 2018 were $34.9 million and $34.9 million, respectively. The Company had no transfers between levels of the fair value hierarchy of its assets measured at fair value. The following tables present the fair value of the Company’s financial assets determined using the inputs defined above (in thousands). December 31, 2019 Level 1 Level 2 Level 3 Total Assets Money market funds $ 13,897 $ — $ — $ 13,897 U.S. government securities — 77,400 — 77,400 Corporate notes — 14,966 — 14,966 Commercial paper — 35,753 — 35,753 Total $ 13,897 $ 128,119 $ — $ 142,016 December 31, 2018 Level 1 Level 2 Level 3 Total Assets Money market funds $ 10,606 $ — $ — $ 10,606 U.S. government securities — 9,975 — 9,975 Corporate notes — 16,499 — 16,499 Commercial paper — 36,331 — 36,331 Total $ 10,606 $ 62,805 $ — $ 73,411 |
Balance Sheet Components
Balance Sheet Components | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Balance Sheet Components | Balance Sheet Components Inventory and Other Assets Inventory consisted of the following (in thousands): December 31, 2019 2018 Raw materials $ 1,574 $ 676 Finished goods 2,463 1,386 Total $ 4,037 $ 2,062 The Company uses Printed Circuit Board Assemblies (“PCBAs”), in each wearable Zio XT and Zio AT monitor as well as the wireless gateway used in conjunction with the Zio AT monitor. The PCBAs are used numerous times and have useful lives beyond one year. Each time a PCBA is used in a wearable Zio XT or Zio AT monitor, or a wireless gateway is used with a Zio AT monitor a portion of the cost of the PCBA and/or gateway is recorded as a cost of revenue. The PCBAs are recorded as other assets and were $7.4 million and $2.5 million as of December 31, 2019, and December 31, 2018, respectively. The amortization was $3.6 million, $3.1 million and $2.1 million for the years ending December 31, 2019, 2018, and 2017, respectively. Property and Equipment, Net Property and equipment, net consisted of the following (in thousands): December 31, 2019 2018 Laboratory and manufacturing equipment $ 4,238 $ 2,750 Computer equipment and software 2,315 1,062 Furniture and fixtures 3,669 925 Leasehold improvements 7,597 726 Internal-use software 16,277 8,925 Total property and equipment, gross 34,096 14,388 Less: accumulated depreciation and amortization (7,632) (5,230) Total property and equipment, net $ 26,464 $ 9,158 Depreciation and amortization expense for the years ended December 31, 2019, 2018 and 2017 was $3.4 million, $2.3 million, and $1.6 million, respectively. Accrued Liabilities Accrued liabilities consisted of the following (in thousands): December 31, 2019 2018 Accrued vacation $ 3,809 $ 2,825 Accrued payroll and related expenses 19,156 18,188 Accrued ESPP Contributions 417 373 Accrued professional services fees 2,846 1,249 Claims payable 2,802 2,374 Other 3,556 1,679 Total accrued liabilities $ 32,586 $ 26,688 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Lease Arrangements The Company leases office, manufacturing, and clinical centers under non-cancelable operating leases which expire on various dates through 2031. These leases generally contain scheduled rent increases or escalation clauses and renewal options. Operating lease right-of-use assets and lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. The operating lease right-of-use assets also include any lease payments made to the lessor at or before the commencement date as well as variable lease payments which are based on a consumer price index. The Company is also subject to variable lease payments related to janitorial services and electricity which are not included in the operating lease right-of-use asset as they are based on actual usage. The Company recognizes operating lease expense on a straight-line basis over the lease period. The total operating lease cost recognized during the year ended December 31, 2019 was $11.3 million which primarily consisted of lease payments and common area maintenance costs. Cash paid for operating leases during the year ended December 31, 2019 was $7.9 million. On October 4, 2018, the Company entered into an office lease (“San Francisco Lease”) to rent approximately 117,560 rentable square feet in San Francisco, California, which became the Company’s new headquarters in October 2019. The term of the San Francisco lease began on May 13, 2019, and expires on August 31, 2031. The Company is entitled to one option to extend the San Francisco Lease for a five The Company has obtained a standby letter of credit in the amount of $6.9 million, which may be drawn down by the landlord to be applied upon the Company’s breach of any provisions under the San Francisco Lease. As of December 31, 2019, maturities of operating lease liabilities were as follows (in thousands): Year Ended December 31: 2020 $ 9,253 2021 11,550 2022 11,330 2023 11,667 2024 12,015 Thereafter 87,793 143,608 Less: imputed interest (49,946) Total lease liabilities $ 93,662 Minimum future lease payments as of December 31, 2018 and under the previous lease accounting standard, which includes annual rental payments for the San Francisco Lease which commenced May 13, 2019, for the year ended December 31, 2018 are as follows (in thousands): Year Ended December 31: 2019 $ 8,135 2020 10,669 2021 10,828 2022 11,150 2023 11,483 Thereafter 98,209 Total $ 150,474 The weighted average remaining lease term of the Company's operating leases as of December 31 2019 was 11.6 years. The weighted average discount rate of the Company's operating leases was 7.36% as of December 31, 2019. Legal Proceedings From time to time, the Company may become involved in legal proceedings arising from the ordinary course of its business. Management is currently not aware of any matters that could have a material adverse effect on the financial position, results of operations or cash flows of the Company. Collaboration Agreement On September 3, 2019, the Company entered into a Development Collaboration Agreement (the “Development Agreement”) with Verily Life Sciences LLC ("Verily"). The Development Agreement, which is over a 24 month term, involves joint development and production of intellectual property between the Company and Verily. Each participant has primary responsibility for certain aspects of development and approval, with all processes to be performed at each respective party’s own cost. Costs incurred by the Company in connection with the Development Agreement will be expensed as research and development expense in accordance with ASC 730, Research and Development. The Company and Verily will develop certain next-generation atrial fibrillation (“AF”) screening, detection, or monitoring products pursuant to the Development Collaboration Agreement, which products will involve combining Verily’s technology with the Company’s technology to create an end to end system. Under the terms of the Development Agreement, the Company paid Verily an upfront fee of $5.0 million. In addition, the Company has agreed to make additional payments to Verily up to an aggregate of $12.75 million in milestone payments upon achievement of various development and regulatory milestones over the 24 months of the Development Agreement, which payments will be made in cash to Verily. During the year ended December 31, 2019 the company achieved a milestone resulting in additional expense of $1.0 million which is included in accounts payable as of December 31, 2019. The Development Agreement provides each party with licenses to use certain intellectual property of the other party for development activities in the field of AF screening, detection, or monitoring. Ownership of developed intellectual property will be allocated to the Company or Verily depending on the subject matter of the underlying developed intellectual property, and, for certain subject matter, shall be jointly owned. During the year ended December 31, 2019, the Company recognized $6.0 million of research and development expense related to the Agreement. Indemnifications In the ordinary course of business, the Company enters into agreements pursuant to which it agrees to indemnify customers, vendors, lessors, business partners, and other parties with respect to certain matters, including losses arising out of the breach of such agreements, services to be provided by us, or from intellectual property infringement claims made by third parties. Pursuant to such agreements, the Company may indemnify, hold harmless and defend an indemnified party for losses suffered or incurred by the indemnified party. Some of the provisions will limit losses to those arising from third-party actions. In some cases, the indemnification will continue after the termination of the agreement. The maximum potential amount of future payments the Company could be required to make under these provisions is not determinable. The Company has also entered into indemnification agreements with its directors and officers that may require the Company to indemnify its directors and officers against liabilities that may arise by reason of their status or service as directors or officers to the fullest extent permitted by applicable law. The Company currently has directors’ and officers’ insurance. The Company has never incurred material costs to defend lawsuits or settle claims related to these indemnification provisions, and believes that the estimated fair value of these indemnification obligations is not material and it has not accrued any amounts for these obligations. |
Debt
Debt | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Debt | Debt Pharmakon Loan Agreement In December 2015, the Company entered into a Loan Agreement with Biopharma Secured Investments III Holdings Cayman LP (the “Pharmakon Loan Agreement”). The Pharmakon Loan Agreement provides for up to $55.0 million in term loans split into two tranches as follows: (i) the Tranche A Loans are $30.0 million in term loans, and (ii) the Tranche B Loans are up to $25.0 million in term loans. The Tranche A Loans were drawn on December 4, 2015. The Tranche B Loans were available to be drawn prior to December 4, 2016. No additional draw was taken. The Tranche A Loans bear interest at a fixed rate equal to 9.50% per annum that is due and payable quarterly in arrears. During the first eight calendar quarters, 50% of the interest due and payable was added to the then outstanding principal. In December 2015, the Company used the proceeds from the Pharmakon Loan Agreement to repay $4.9 million of bank debt to Silicon Valley Bank ("SVB"). The issuance costs and debt discount have been netted against the borrowed funds on the balance sheet. On October 23, 2018, the Company repaid the principal amount of the Tranche A Loan of $30.0 million and related accrued interest of $3.3 million, using proceeds from the Third Amended and Restated SVB Loan Agreement noted below. The Company incurred a $3.0 million loss in connection with the early extinguishment of the Pharmakon Loan Agreement which included a prepayment premium fee of $1.0 million and additional consideration related to the prepayment of $1.5 million. Bank Debt In December 2015, the Company entered into a Second Amended and Restated Loan and Security Agreement with SVB, (the “SVB Loan Agreement”). Under the SVB Loan Agreement, the Company may borrow, repay and reborrow under a revolving credit line, but not in excess of the maximum loan amount of $15.0 million, until December 4, 2018, when all outstanding principal and accrued interest becomes due and payable. Any principal amount outstanding under the SVB Loan Agreement shall bear interest at a floating rate per annum equal to the rate published by The Wall Street Journal as the “Prime Rate” plus 0.25%. The Company may borrow up to 80% of its eligible accounts receivable, up to the maximum of $15.0 million. In August 2016, the Company obtained a $3.1 million standby letter of credit pursuant to the SVB Loan Agreement in connection with a lease for its San Francisco office. In October 2018, the Company entered into the Third Amended and Restated Loan and Security Agreement with SVB (“Third Amended and Restated SVB Loan Agreement”). Pursuant to the Third Amended and Restated SVB Loan Agreement, the Company obtained a term loan (“SVB Term Loan”) for $35.0 million. Total proceeds from the SVB Term Loan were used to pay off the loan agreement with Biopharma Secured Investments III Holdings Cayman LP (“Pharmakon”), totaling $35.8 million. The Company will make interest-only payments through October 31, 2020, followed by 36 monthly payments of principal plus interest on the SVB Term Loan. Interest charged on the SVB Term Loan will be the greater of (a) a floating rate based on the “Prime Rate” published by The Wall Street Journal minus 0.75%, or (b) 4.25%. The weighted average interest rate was 4.58% and 4.50% for the years ended December 31, 2019 and 2018, respectively. Under the Third Amended and Restated SVB Loan Agreement, the Company may borrow, repay, and reborrow under a revolving credit line, but not in excess of the maximum loan amount of $25.0 million, which includes an $11.0 million standby letter of credit sublimit availability. In October 2018, a $6.9 million standby letter of credit was obtained in connection with a lease for the Company’s San Francisco headquarters. Any principal amount outstanding under the Third Amended and Restated SVB Loan Agreement revolving credit line shall bear interest at an amount that is the greater of (a) a floating rate per annum equal to the rate published by The Wall Street Journal as the “Prime Rate” or (b) 5.00%. The Company may borrow up to 75% of eligible accounts receivable, up to the maximum of $25.0 million. As of December 31, 2019, the Company was eligible to borrow up to $5.6 million and no amount was outstanding under the revolving credit line. The Third Amended and Restated Loan Agreement requires the Company to maintain a minimum consolidated liquidity ratio or minimum adjusted Earnings Before Interest, Tax, Depreciation, and Amortization during the term of the loan facility. In addition, the SVB Loan Agreement contains customary affirmative and negative covenants and events of default. The SVB Loan Agreement also includes financial covenants requiring the Company to maintain a minimum liquidity ratio and asset based threshold. The Company was in compliance with financial loan covenants as of December 31, 2019. The obligations under the Third Amended and Restated Loan Agreement are collateralized by substantially all assets of the Company. California HealthCare Foundation Note In November 2012, the Company entered into a Note Purchase Agreement and Promissory Note with the California HealthCare Foundation (the “CHCF Note”), through which the Company borrowed $1.5 million. The CHCF Note accrued simple interest of 2.0%. The accrued interest and the principal was to mature in November 2016. In partial consideration for the issuance of the CHCF Note, the Company issued warrants to purchase 22,807 shares of the Company’s Series D convertible preferred stock. In June 2015, the Company amended the CHCF Note to extend the maturity date to May 2018. The CHCF Note was subordinate to other debt. In May 2018, the Company repaid the principal amount of $1.5 million and related $0.2 million in accrued interest on the CHCF Note. Future minimum payments Future minimum payments under the Third Amended and Restated Loan and Security Agreement with Silicon Valley Bank at December 31, 2019 are as follows (in thousands): Year Ending December 31, 2020 $ 3,449 2021 12,860 2022 12,358 2023 9,914 Total 38,581 Less: Amount representing interest (3,581) Less: Debt Issuance Costs (67) Total Carrying Value $ 34,933 Reported as: Short-term debt $ 1,944 Long-term debt 32,989 Total $ 34,933 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (Tax Act). The Tax Act reduced the U.S. statutory corporate tax rate to 21%, effective January 1, 2018. Consequently, we recorded a decrease to our federal deferred tax assets of $22.0 million, which was fully offset by a reduction in our valuation allowance for the year ended December 31, 2017. The following table presents components of the Company’s provision for income taxes as for the period presented (in thousands): December 31, 2019 2018 2017 Current expense (benefit): Federal $ — $ — $ — State — — — Foreign 68 80 — Total current tax expense (benefit) 68 80 — Deferred expense (benefit): Federal — — — State — — — Foreign (3) (36) — Total deferred tax expense (benefit) (3) (36) — Total Tax Expense (benefit) $ 65 $ 44 $ — The following table presents a reconciliation of the tax expense computed at the statutory federal rate and the Company’s tax expense for the period presented (in thousands): December 31, 2019 2018 2017 Tax at statutory federal rate $ (11,446) $ (10,570) $ (10,143) Stock-based compensation (5,560) (8,557) (7,634) Meals and Entertainment 409 309 198 Other 614 148 (145) Tax credits (1,128) (1,015) (644) 2017 Tax Act — 44 21,969 Change in valuation allowance 17,176 19,685 (3,601) Provision for income taxes $ 65 $ 44 $ — Deferred income taxes reflect the net effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets and liabilities are as follows (in thousands): December 31, 2019 2018 Deferred tax assets: Net operating loss carryforwards $ 64,648 $ 50,601 Tax credit carryforwards 5,601 4,287 Share-based compensation 5,932 3,149 Allowances and other 11,443 8,827 Lease obligation 23,869 — Total deferred tax assets 111,493 66,864 Valuation allowance (88,433) (66,435) Net deferred tax assets 23,060 429 Deferred Tax Liabilities: Depreciation and Amortization (850) (388) Right of use asset (22,171) — Total deferred tax liability (23,021) (388) Total deferred tax assets $ 39 $ 41 Due to the uncertainties surrounding the realization of deferred tax assets through future taxable income, the Company has provided a full valuation allowance against its U.S. deferred tax assets, and, therefore, no benefit has been recognized for the net operating loss carryforwards and other deferred tax assets. The U.S. valuation allowance increased by $22.0 million and $22.1 million for the years ended December 31, 2019 and December 31, 2018, respectively. The current year change in the U.S. valuation allowance is primarily related to the increase in net operating loss carryforwards generated during the year. The Company recorded an immaterial deferred tax asset related to the Company’s foreign operations in the United Kingdom. The valuation allowance for deferred tax assets consisted of the following activity for the years ended December 31, 2019, 2018 and 2017 (in thousands): Balance at beginning of year Additions Deductions Balance at end of year Year Ended December 31, 2017 $ 44,861 $ — $ 540 $ 44,321 Year Ended December 31, 2018 44,321 22,114 — 66,435 Year Ended December 31, 2019 $ 66,435 $ 21,998 $ — $ 88,433 As of December 31, 2019, the Company had approximately $259.9 million of federal and $153.8 million of state net operating loss carryforwards available to offset future taxable income which expires in varying amounts beginning in 2027 and 2019 respectively. The Tax Act changed the federal rules governing net operating loss carryforwards. For net operating loss carryforwards arising in tax years beginning after December 31, 2017, the Tax Act limits a taxpayer’s ability to utilize such carryforwards to 80% of taxable income. In addition, net operating loss carryforwards arising in tax years ending after December 31, 2017 can be carried forward indefinitely, but carryback is generally prohibited. Net operating loss carryforwards generated before January 1, 2018 will not be subject to the Tax Act’s taxable income limitation and will continue to have a twenty-year carryforward period. As of December 31, 2019, the Company had tax credit carryforwards of approximately $5.1 million, and $2.7 million available to reduce future taxable income, if any, for both federal and state purposes, respectively. The federal tax credit carryforwards expire beginning in 2028 and the state tax credits can be carried forward indefinitely. Section 382 of the Internal Revenue Code, and similar state provisions, limits the use of net operating loss and tax credit carryforwards in certain situations where equity transactions result in a change of ownership as defined by Internal Revenue Code Section 382. In the event the Company should experience an ownership change, as defined, utilization of its net operating loss carryforwards and tax credits could be limited. A reconciliation of the Company’s unrecognized tax benefit amount is as follows (in thousands): Year Ended December 31, 2019 2018 2017 Balance at beginning of year $ 1,459 $ 943 $ 616 Additions for tax positions taken in current year 383 441 328 Increases in balance related to prior year tax positions — 75 — Decreases in balances related to prior year tax position — — (1) Balance at end of year $ 1,842 $ 1,459 $ 943 The total amount of gross unrecognized tax benefits was $1.8 million, $1.5 million, and $0.9 million as of December 31, 2019, 2018, and 2017 respectively. None of the Company’s unrecognized tax benefits that, if recognized, would affect its effective tax rate. The Company does not anticipate the total amounts of unrecognized tax benefits will significantly increase or decrease in the next 12 months. The Company’s policy is to include interest and penalties related to unrecognized tax benefits within the provision for taxes. Management determined that no accrual for interest or penalties was required as of December 31, 2019, 2018 and 2017. |
Stockholder's Equity
Stockholder's Equity | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Common stock The Company’s amended and restated certificate of incorporation dated October 25, 2016, authorizes the Company to issue 100,000,000 shares of common stock with a par value of $0.001 per share and 5,000,000 shares of preferred stock with a par value of $0.001 per share. The holders of common stock are entitled to receive dividends whenever funds and assets are legally available and when declared by the board of directors, subject to the prior rights of holders of all series of convertible preferred stock outstanding. No dividends were declared through December 31, 2019. The Company had reserved shares of common stock for issuance as follows: December 31, 2019 2018 Options issued and outstanding 1,503,247 2,094,137 Unvested restricted stock units 886,030 547,891 Common stock warrants issued and outstanding — 4,857 Shares available for grant under future stock plans 6,709,235 5,607,014 Shares available for future issuance 9,098,512 8,253,899 |
Stock Incentive Plans
Stock Incentive Plans | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Stock Incentive Plans | Stock Incentive Plans 2006 Plan In October 2006, the Company adopted the 2006 Equity Incentive Plan, as amended, (the “2006 Plan”). The Plan provided for the granting of stock options to employees and non-employees of the Company. Options granted under the Plan were either incentive stock options or nonqualified stock options. Incentive stock options (“ISO”) were granted only to employees (including officers and directors who are also employees). Nonqualified stock options (“NSO”) may be granted to employees and non-employees. The board of directors had the authority to determine to whom options will be granted, the number of options, the term and the exercise price. Options under the Plan were granted for periods of up to ten years and at the fair value of the shares on the date of grant as determined by the board of directors. In general, options become exercisable at a rate of 25% after the first anniversary of the grant and then monthly vesting for an additional three years from date of grant. The term for options is no longer than five years for ISOs for which the grantee owns greater than 10% of the voting power of all classes of stock and no longer than ten years for all other options. The Company issues new shares upon the exercise of options. 2016 Plan In October 2016, the Company adopted the 2016 Equity Incentive Plan, (the “2016 Plan”). The 2016 Plan was subsequently approved by the Company’s stockholders and became effective on October 19, 2016, immediately before the effective date of the IPO. Following the effectiveness of the 2016 Plan, no additional options will be granted under the 2006 Plan. In addition, to the extent that any awards outstanding or subject to vesting restrictions under the 2006 Plan are subsequently forfeited or terminated for any reason before being exercised or settled, the shares of common stock reserved for issuance pursuant to such awards as of the closing of the IPO will become available for issuance under the 2016 Plan. The remaining shares available for grant under the 2006 Plan became available for issuance under the 2016 Plan upon the closing of the IPO. On the first day of each year, the 2016 Plan authorizes an annual increase of the least of 3,865,000 shares, 5% of outstanding shares on the last day of the immediately preceding fiscal year or an amount as determined by the Company's Board of Directors. As of December 31, 2019, the Company has reserved 7,359,234 shares of common stock for issuance under the 2016 Plan. Pursuant to the 2016 Plan, stock options, restricted shares, stock units, including restricted stock units and stock appreciation rights may be granted to employees, consultants, and outside directors of the Company. Options granted may be either ISOs or NSOs. Stock options are governed by stock option agreements between the Company and recipients of stock options. ISOs and NSOs may be granted under the 2016 Plan at an exercise price of not less than 100% of the fair market value of the common stock on the date of grant, determined by the Compensation Committee of the Board of Directors. Options become exercisable and expire as determined by the Compensation Committee, provided that the term of ISOs may not exceed ten years from the date of grant. Employee Stock Purchase Program (“ESPP”) In October 2016, the Company’s Board of Directors and stockholders approved the Employee Stock Purchase Plan (the “ESPP”). Under the ESPP, the Company initially reserved 483,031 shares of common stock for issuance as of its effective date of October 19, 2019 On the first day of each calendar year, the number of shares reserved increases by the least of 966,062 shares, 1.5% of the shares of the Company’s common stock outstanding on the last day of the immediately preceding fiscal year, or an amount as determined by the Company’s Board of Directors. The ESPP allows eligible employees to purchase shares of the Company’s common stock at a discount through payroll deductions of up to 15% of their eligible compensation, subject to any plan limitations. The ESPP provides for 12 month offering periods that each contain two 6 month purchase periods. At the end of each purchase period, employees are able to purchase shares at 85% of the lower of the fair market value of the Company’s common stock on the first trading day of the offering period or on the last day of the purchase period. As of December 31, 2019, 350,198 shares of common stock have been issued to employees participating in the ESPP and 1,181,103 shares were available for issuance under the ESPP. The Company used the following assumptions to estimate the fair value of the ESPP offered for the year ended December 31, 2019: expected term of 0.5 – 1 year, volatility of 43.61% - 48.05%, risk-free interest rate of 1.60% - 2.35% and expected dividend yield of zero. The Company used the following assumptions to estimate the fair value of the ESPP offered for the year ended December 31, 2018: expected term of 0.5 – 1 year, volatility of 41.46% - 44.55%, risk-free interest rate of 2.19% - 2.64% and expected dividend yield of zero. The Company used the following assumptions to estimate the fair value of the ESPP offered for the year ended December 31, 2017: expected term of 0.5 – 1 year, volatility of 42.18% - 57.69%, risk-free interest rate of 0.52% - 1.62% and expected dividend yield of zero. Equity Incentive Plan Activity A summary of share-based awards available for grant under the 2016 Equity Incentive Plan is as follows: Shares Available Balance at December 31, 2016 3,743,037 Additional options authorized 1,106,966 Awards granted (837,436) Awards forfeited 21,585 Balance at December 31, 2017 4,034,152 Additional awards authorized 1,168,865 Awards granted (666,913) Awards forfeited 124,478 Awards withheld for tax purposes 56,710 Balance at December 31, 2018 4,717,292 Additional awards authorized 1,218,402 Awards granted (649,911) Awards forfeited 181,513 Awards withheld for tax purposes 60,836 Balance at December 31, 2019 5,528,132 During the year ended December 31, 2019, 629,901 restricted stock units ("RSUs") were granted, 180,842 RSUs vested, and 110,920 RSUs were forfeited. The following table summarizes stock option activity under the 2006 and 2016 Plans, including grants to nonemployees: Options Outstanding Options Outstanding Weighted- Average Exercise Price Per Share Weighted- Average Remaining Contractual Life (years) Aggregate Intrinsic Value (in thousands) Balance at December 31, 2016 2,977,218 $ 6.16 6.93 $ 70,979 Options granted 465,271 $ 36.76 Options exercised (827,556) $ 4.11 Options forfeited (13,752) $ 14.43 Balance at December 31, 2017 2,601,181 $ 12.24 7.17 $ 113,958 Options granted 366,928 $ 68.32 Options exercised (798,424) $ 7.19 Options forfeited (75,548) $ 34.30 Balance at December 31, 2018 2,094,137 $ 23.20 7.02 97,976 Options granted 20,010 $ 82.77 Options exercised (540,307) $ 9.59 Options forfeited (70,593) $ 54.54 Balance at December 31, 2019 1,503,247 $ 27.40 6.43 62,401 Options exercisable – December 31, 2019 1,147,525 $ 19.64 6.02 55,919 Options vested and expected to vest – December 31, 2019 1,487,867 $ 27.07 6.41 62,220 The aggregate intrinsic values of options outstanding, exercisable, vested and expected to vest were calculated as the difference between the exercise price of the options and the closing price of the Company’s common stock. During the years ended December 31, 2019, 2018 and 2017, the Company granted options with a weighted-average grant date fair value of $38.29, $32.38 and $18.69 per share, respectively. The aggregate intrinsic value of options exercised was $36.9 million, $52.4 million and $32.5 million for the years ended December 31, 2019, 2018 and 2017, respectively. The total estimated grant date fair value of options vested during the period was $7.8 million, $5.3 million and $2.4 million for the years ended December 31, 2019, 2018 and 2017, respectively. The fair value of non-vested restricted stock units (“RSUs”) is based on the Company’s closing stock price on the date of grant. A summary for the year ended December 31, 2019, is as follows: Shares Underlying RSUs Weighted Average Grant Date Fair Value Weighted Remaining Vesting Period (in years) Aggregate Intrinsic Value (in thousands) Non-vested as of December 31, 2018 547,891 $ 56.62 2.45 $ 38,067 Granted 629,901 $ 87.72 Vested (180,842) $ 52.52 Forfeited (110,920) $ 69.77 Non-vested as of December 31, 2019 886,030 $ 77.92 1.39 $ 60,330 |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Employee Stock-Based Compensation The Company estimates the fair value of stock options using the Black-Scholes option valuation model. The fair value of employee stock options is being amortized on a straight-line basis over the requisite service period of the awards. The fair value of employee stock options was estimated using the weighted average assumptions below. Each of these inputs is subjective and its determination generally requires significant judgment. Year Ended December 31 2019 2018 2017 Expected term (in years) 6.1 6.1 6.1 Expected volatility 45.0 % 45.7 % 51.9 % Risk-free interest rate 2.39 % 2.75 % 2.07 % Dividend yield 0.0 % 0.0 % 0.0 % Fair Value of Common Stock — Prior to the completion of the Company’s IPO, the fair value of the shares of the Company’s common stock underlying the stock options had historically been determined by the Company’s board of directors. Because there had been no public market for the Company’s common stock, its board of directors determined the fair value of the Company’s common stock at the time of grant of the option by considering a number of objective and subjective factors, including valuations of comparable companies, sales of the Company’s convertible preferred stock, the Company’s operating and financial performance, the lack of liquidity of the Company’s capital stock, and the general and industry-specific economic outlooks. For stock options granted after the completion of the IPO, the Company’s Board of Directors determined the fair value of each share of underlying common stock based on the closing price of the Company’s common stock as reported on the date of grant. Expected Term —The expected term represents the period that the share-based awards are expected to be outstanding. As the Company has very limited historical information to develop reasonable expectations about future exercise patterns and post-vesting employment termination behavior for its stock-option grants the Company has elected to use the “simplified method” as prescribed by authoritative guidance to compute expected term. Expected Volatility —Since the Company does not have sufficient trading history for its common stock, the expected volatility was estimated based on the average volatility for comparable publicly traded companies over a period equal to the expected term of the stock option grants. When selecting comparable publicly traded companies in a similar industry on which it has based its expected stock price volatility, the Company selected companies with comparable characteristics to it, including enterprise value, risk profiles, position within the industry, and with historical share price information sufficient to meet the expected life of the stock-based awards. The Company will continue to apply this process until a sufficient amount of historical information regarding the volatility of its own stock price becomes available. Risk-Free Interest Rate —The risk-free interest rate is based on the U.S. Treasury yield curve in effect on the date of grant for zero coupon U.S. Treasury notes with maturities approximately equal to expected term of the option award. Expected Dividend Yield —The Company has never paid dividends on its common stock and has no plans to pay dividends on its common stock. Therefore, the Company used an expected dividend yield of zero. In addition to the assumptions used in the Black-Scholes option-pricing model, the Company also estimates a forfeiture rate to calculate the stock-based compensation for the Company’s equity awards. The Company will continue to use judgment in evaluating the expected volatility, expected terms and forfeiture rates utilized for the Company’s stock-based compensation calculations on a prospective basis. The following table summarizes the total stock-based compensation expense included in the statements of operations for all periods presented (in thousands): Year Ended December 31 2019 2018 2017 Cost of revenue $ 658 $ 193 $ 589 Research and development 4,462 3,057 1,619 Selling, general and administrative 21,121 13,079 7,544 Total stock-based compensation expense $ 26,241 $ 16,329 $ 9,752 As of December 31, 2019, there was total unamortized compensation costs of $8.9 million, net of estimated forfeitures, related to unvested stock options, which the Company expects to recognize over a period of approximately 1.7 years $44.5 million, net of estimated forfeitures, related to unrecognized RSU expense, which the Company expects to recognize over a period of 2.3 years, and $1.1 million unrecognized ESPP expense, which the Company will recognize over 0.9 years. Performance based RSUs "PRSU" In February 2019, the Company granted PRSUs to key executives of the Company. The performance equity program has a 2-year performance period measuring target revenue compound annual growth rate (“CAGR”) achievement for fiscal year 2020 compared to fiscal year 2018. There is a minimum performance threshold of 75% to earn 50% of target, and a maximum threshold of 125% achieved to earn 200% of target. The exact number of earned shares will be determined based on linear interpolation using the actual revenue CAGR as it falls between the minimum and maximum thresholds outlined above. The fair value of the PRSUs will be up to $18.5 million, depending on the actual achievement relative to the performance target. Based on management’s assessment at December 31, 2019 of the Company’s achievement of its performance targets, the Company has determined that it is probable that the performance targets will be achieved. As of December 31, 2019, management believes that it will achieve its performance targets at the 134% level, and has recognized cumulative stock-based compensation expense of $4.8 million, for the year ended December 31, 2019. |
Net Loss Per Common Share
Net Loss Per Common Share | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Net Loss Per Common Share | Net Loss Per Common Share As the Company had net losses for the years ended December 31, 2019, 2018 and 2017, all potential common shares were determined to be anti-dilutive. The following table sets forth the computation of the basic and diluted net loss per share during the years ended December 31, 2019, 2018 and 2017 (in thousands, except share and per share data): Year Ended December 31, 2019 2018 2017 Numerator: Net loss $ (54,568) $ (50,378) $ (29,740) Denominator: Weighted-average shares used to compute net loss per common share, basic and diluted 25,265,918 23,885,858 22,627,327 Net loss per common share, basic and diluted $ (2.16) $ (2.11) $ (1.31) The following outstanding shares of potentially dilutive securities have been excluded from diluted net loss per common share for the years ended December 31, 2019, 2018 and 2017 because their inclusion would be anti-dilutive: Year Ended December 31, 2019 2018 2017 Options to purchase common stock 1,503,247 2,094,137 2,601,181 RSUs issued and unvested 886,030 547,891 468,426 Warrants to purchase common stock — 4,857 4,857 Total 2,389,277 2,646,885 3,074,464 |
Revision of Prior Period Financ
Revision of Prior Period Financial Statements | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Changes and Error Corrections [Abstract] | |
Revision of Prior Period Financial Statements | Revision of Prior Period Financial Statements As discussed in Note 1, the Company has revised its prior period financial statements to correct for immaterial errors in its accounting for revenues, contractual allowances, allowance for doubtful accounts and certain other items, the impact of which is presented below (in thousands, except share data): Revised Consolidated Balance Sheets As of December 31, 2018 As Reported Adjustment As Revised Assets Accounts receivable, net $ 21,977 $ (2,187) $ 19,790 Total current assets 106,482 (2,187) 104,295 Total assets 119,710 (2,187) 117,523 Liabilities and Stockholders’ Equity Accrued liabilities 26,570 118 26,688 Deferred revenue 1,243 (20) 1,223 Total current liabilities 30,236 98 30,334 Total liabilities 65,288 98 65,386 Accumulated other comprehensive loss (41) 25 (16) Accumulated deficit (203,515) (2,310) (205,825) Total stockholders’ equity 54,422 (2,285) 52,137 Total liabilities and stockholders’ equity 119,710 (2,187) 117,523 Revised Consolidated Statements of Operations Year ended December 31, 2018 As Reported Adjustment As Revised Revenue $ 147,293 $ (16) $ 147,277 Cost of revenue 38,579 216 38,795 Gross profit 108,714 (232) 108,482 Research and development 20,750 110 20,860 Selling, general and administrative 131,582 1,731 133,313 Total operating expenses 152,332 1,841 154,173 Loss from operations (43,618) (2,073) (45,691) Other income, net 1,526 (25) 1,501 Loss before income taxes (48,236) (2,098) (50,334) Net loss (48,280) (2,098) (50,378) Net loss per common share, basic and diluted (2.02) (0.09) (2.11) Year ended December 31, 2017 As Reported Adjustment As Revised Revenue $ 98,509 $ 620 $ 99,129 Cost of revenue 27,708 495 28,203 Gross profit 70,801 125 70,926 Research and development 13,335 (70) 13,265 Selling, general and administrative 84,737 515 85,252 Total operating expenses 98,072 445 98,517 Loss from operations (27,271) (320) (27,591) Net loss (29,420) (320) (29,740) Net loss per common share, basic and diluted (1.30) (0.01) (1.31) Revised Consolidated Statements of Comprehensive Loss Year ended December 31, 2018 As Reported Adjustment As Revised Net loss $ (48,280) $ (2,098) $ (50,378) Net change in unrealized gains on available-for-sale securities 24 25 49 Comprehensive loss (48,256) (2,073) (50,329) Year ended December 31, 2017 As Reported Adjustment As Revised Net loss $ (29,420) $ (320) $ (29,740) Comprehensive loss (29,476) (320) (29,796) Revised Consolidated Statements of Cash Flows Year ended December 31, 2018 As Reported Adjustment As Revised Cash flows from operating activities Net loss $ (48,280) $ (2,098) $ (50,378) Adjustments to reconcile net loss to net cash used in operating activities: Provision for bad debt and contractual allowances 15,218 1,230 16,448 Changes in operating assets and liabilities: Accounts receivable (22,885) 1,138 (21,747) Accrued liabilities 10,776 (275) 10,501 Deferred revenue 5 (20) (15) Net cash used in operating activities (29,068) (25) (29,093) Cash flows from investing activities Purchases of available-for-sale investments (93,158) 25 (93,133) Net cash provided by investing activities 34,117 25 34,142 Year ended December 31, 2017 As Reported Adjustment As Revised Cash flows from operating activities Net loss $ (29,420) $ (320) $ (29,740) Adjustments to reconcile net loss to net cash used in operating activities: Stock-based compensation 10,123 (371) 9,752 Provision for bad debt and contractual allowances 9,403 (181) 9,222 Changes in operating assets and liabilities: Accounts receivable (12,950) 479 (12,471) Accrued liabilities 5,364 393 5,757 Supplemental disclosures of cash flow information Property, plant and equipment costs included in liabilities 35 75 110 Revised Consolidated Statements of Shareholder's Equity Year Ended December 31, 2018 As Reported Adjustment As Revised Unrealized loss on investments $ 24 $ 25 $ 49 Accumulated other comprehensive loss ending balance (41) 25 (16) Accumulated deficit beginning balance (156,589) (212) (156,801) Net loss (48,280) (2,098) (50,378) Accumulated deficit ending balance (203,515) (2,310) (205,825) Total stockholders' equity 54,422 (2,285) 52,137 Year Ended December 31, 2017 As Reported Adjustment As Revised Accumulated deficit beginning balance $ (127,169) $ 108 $ (127,061) Net loss (29,420) (320) (29,740) Accumulated deficit ending balance (156,589) (212) (156,801) Total stockholders' equity 79,553 (212) 79,341 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles and include the accounts of iRhythm Technologies, Inc. and its wholly-owned subsidiary. All intercompany accounts and transactions have been eliminated. The financial statements of the Company’s subsidiary use the U.S. dollar as the functional currency. For all non-functional currency balances, the remeasurement of such balances to functional currency results in a foreign exchange transaction gain or loss, which is recorded in the consolidated statements of operations. |
Use of Estimates | Use of Estimates The preparation of the 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 as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, management evaluates its estimates, including those related to revenue recognition, contractual allowances for revenue, allowance for doubtful accounts, the useful lives of property and equipment, the recoverability of long-lived assets including the estimated usage of the printed circuit board assemblies (“PCBAs”), the incremental borrowing rate for operating leases, accounting for income taxes, the fair value of the Company’s common stock and stock-based compensation. The Company bases these estimates on historical and anticipated results, trends, and various other assumptions that the Company believes are reasonable under the circumstances, including assumptions as to future events. Actual results may differ from those estimates. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying amounts of certain of the Company’s financial instruments, which include cash equivalents, short-term investments, long-term investments, accounts receivable, accounts payable and accrued liabilities, approximate fair value due to their short maturities. |
Cash Equivalents | Cash Equivalents Cash equivalents consist of short-term, highly liquid investments with original maturities of three months or less from the date of purchase. |
Investments | InvestmentsShort-term investments consist of debt securities classified as available-for-sale and have maturities greater than 90 days, but less than one year as of the balance sheet date. Long-term investments have maturities greater than one year as of the balance sheet date. All investments are carried at fair value based upon quoted market prices. Unrealized gains and losses on available-for-sale securities are excluded from earnings and are reported as a component of accumulated other comprehensive loss. The cost of available-for-sale securities sold is based on the specific-identification method. Realized gains and losses are included in earnings, and are derived for specific-identification method for determining the costs of investments sold. Amortization of premiums and accretion of discounts are reported as a component of other income, net. |
Accounts Receivable, Allowance for Doubtful Accounts and Contractual Allowance | Accounts Receivable, Allowance for Doubtful Accounts and Contractual Allowance Accounts receivable includes amounts due to the Company from healthcare institutions, third-party payors, and government payors and their related patients, as a result of the Company's normal business activities. Accounts receivable is reported on the consolidated balance sheets net of an estimated allowance for doubtful accounts and a contractual allowance. The Company establishes an allowance for doubtful accounts for estimated uncollectible receivables based on its historical experience and recognizes the provision as a component of selling, general and administrative expenses. The Company records a provision for contractual allowances based on the estimated differences between contracted amounts and expected collection rates. Such provisions are based on the Company's historical experience and are reported as a reduction of revenue. |
Concentration of Credit Risk | Concentrations of Risk Credit Risk Financial instruments that potentially subject the Company to a concentration of credit risk consist primarily of cash and cash equivalents, investments and accounts receivable. Cash balances are deposited in financial institutions which, at times, may be in excess of federally insured limits. Cash equivalents are invested in highly rated money market funds. The Company invests in a variety of financial instruments, such as, but not limited to, United States Government securities, corporate notes, commercial paper and, by policy, limits the amount of credit exposure with any one financial institution or commercial issuer. The Company has not experienced any material losses on its deposits of cash and cash equivalents or investments. Concentrations of credit risk with respect to accounts receivable are limited due to the large number of customers comprising the Company’s customer base and their dispersion across many geographies. The Company does not require collateral. The Company records an allowance for doubtful accounts when it becomes probable that a receivable will not be collected. Centers for Medicare and Medicaid Services (“CMS”), accounted for approximately 27%, 27% and 28% of the Company’s revenue for the years ended December 31, 2019, 2018 and 2017, respectively. CMS accounted for 20% and 20% of accounts receivable as of December 31, 2019 and 2018, respectively. |
Supply Risk | Supply Risk While the Company has not experienced manufacturing supply disruptions to date, the Company relies on single-source vendors for the supply of its disposable housings, instruments and other materials used to manufacture the Zio monitor and the adhesive that binds the Zio monitor to a patient’s body. These components and materials are critical, and there could be a considerable delay in finding alternative sources of supply. |
Inventory | Inventory Inventory is stated at the lower of cost or net realizable value, cost being determined on a standard cost basis for material costs and on actual cost basis for labor and overhead, which approximates actual cost on a first in, first out (“FIFO”) basis, and market being determined as the lower of cost or net realizable value. The Company records write-downs of inventory that is obsolete or in excess of anticipated demand. The Company also records market value based write-downs on consideration of product lifecycle stage, technology trends, product development plans and assumptions about future demand and market conditions. Actual demand may differ from forecasted demand, and such differences may have a material effect on recorded inventory values. Inventory write-downs are charged to cost of revenue and establish a new cost basis for the inventory. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization is computed using the straight-line method over the estimated useful lives of the assets, ranging from three |
Internal-Use Software | Internal-Use Software The Company capitalizes costs related to internal-use software during the application development stage. Costs related to planning and post implementation activities are expensed as incurred. Capitalized internal-use software is amortized, and recognized as cost of revenue, on a straight-line basis over the estimated useful life, which is up to five years. The Company evaluates the useful lives of these assets on an annual basis, and tests for impairment whenever events or changes in |
Goodwill | Goodwill Goodwill represents the excess of the purchase price paid over the fair value of tangible and identifiable intangible net assets acquired in business combinations. Goodwill is tested for impairment on an annual basis and at any other time if events occur or circumstances indicate that the carrying amount of goodwill may not be recoverable. Such events or circumstances may include significant adverse changes in the general business climate, among other things. The impairment test is performed by determining the enterprise fair value of the Company, which is primarily based on the Company’s market capitalization. If the Company’s carrying value, as a one reporting unit entity, is less than its fair value, then the fair value is allocated to all of its assets and liabilities (including any unrecognized intangible assets) as if the fair value was the purchase price to acquire the Company. The excess of the fair value over the amounts assigned to the Company’s assets and liabilities is the implied fair value of the goodwill. If the carrying amount of goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess. The Company performs its annual evaluation of goodwill during the fourth quarter of each fiscal year. The Company did not record any charges related to goodwill impairment in any of the periods presented in these consolidated financial statements. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company annually reviews long-lived assets for impairment or whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability is measured by comparison of the carrying amount to the future net cash flows which the assets are expected to generate. If such assets are considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the assets exceeds the projected discounted future net cash flows arising from the asset. To date, there have been no such impairments of long-lived assets. |
Other Assets | Other Assets The Company uses Printed Circuit Board Assemblies (“PCBAs”), in each wearable Zio XT and Zio AT monitor as well as the wireless gateway used in conjunction with the ZIO AT monitor. The PCBAs are used numerous times and have useful lives beyond one year. Each time a PCBA is used in a wearable Zio XT or Zio AT monitor, or a wireless gateway is used with a Zio AT monitor a portion of the cost of the PCBA and/or gateway is recorded as a cost of revenue. The PCBAs are recorded as other assets and were $7.4 million and $2.5 million as of December 31, 2019 and 2018, respectively. The Company has based its estimates of how many times a PCBA can be used on testing in research and development, loss rates, product obsolescence, and the amount of time it takes the device to go through the manufacturing, shipping, customer shelf and patient wear time and upload process. The Company periodically evaluates the use estimate. |
Comprehensive Loss | Comprehensive LossComprehensive loss represents all changes in stockholders’ equity during the period from non-owner sources. The Company’s unrealized gains and losses on available-for-sale securities represent the only component of other comprehensive loss that are excluded from the reported net loss and that are presented in the consolidated statements of comprehensive loss. |
Revenue Recognition | Revenue Recognition Revenue policy under ASC 606 The Company adopted Accounting Standard Codification Topic 606, Revenue from Contracts with Customers (“ASC 606”), on January 1, 2018 and used the modified retrospective approach. Upon adoption, the Company recognized the cumulative effect of $1.4 million as an adjustment to decrease the opening balance of the Company’s accumulated deficit. This adjustment did not have a material impact on the Company’s consolidated financial statements. Prior periods were not retrospectively adjusted. The Company recognized revenue in prior years in accordance with Accounting Standard Codification Topic 954-605, Health Care Entities - Revenue Recognition and Accounting Standard Codification Topic 605, Revenue Recognition . The Company’s revenue is generated primarily from the provision of its cardiac rhythm monitoring service, the Zio XT service. The Zio XT is a cardiac rhythm monitoring service that has a patient wear period of up to 14 days and is billable when the monitoring reports are delivered to the healthcare provider, which is also when the service is complete and the Company recognizes revenue. The time from when the patient has the Zio XT device applied to the time the report is posted is generally around 20 days. The Company has concluded that the Zio XT service is one performance obligation on the basis that the customer cannot benefit from each component of the service on its own or together with other resources that are readily available to the customer. The Company recognizes as revenue the amount of consideration to which it expects to be entitled in exchange for performing the service. The consideration the Company is entitled to varies by portfolio, as further defined below, and includes estimates that require significant judgment by management. A unique aspect of healthcare is the involvement of multiple parties to the service transaction. In addition to the patient, often a third-party, for example a commercial or governmental payor or healthcare institution, will pay the Company for some or all of the service on the patient’s behalf. Separate contractual arrangements exist between the Company and third-party payors that establish amounts the third-party payor will pay on behalf of a patient for covered services rendered. A small part of the Company’s transactions are covered by third-party payors with whom there is no contractual agreement or not an established amount the third-party payor will pay. In determining the collectability and transaction price for its service, the Company considers factors such as insurance claims which are adjudicated as allowable under the applicable policy and payment history from both payors and patient out-of-pocket costs, payor coverage, whether there is a contract between the payor or healthcare institution and the Company, historical amount received for the service, and any current developments or changes that could impact reimbursement and healthcare institution payments. Certain of these factors are forms of variable consideration which are only included in the transaction price to the extent it is probable that a significant reversal of cumulative revenue will not occur when the uncertainty associated with the variable consideration is subsequently resolved. A summary of the payment arrangements with third-party payors and healthcare institutions is as follows: • Contracted third-party payors – The Company has contracts with negotiated prices for services provided for patients with commercial healthcare insurance carriers • CMS – The Company has received independent diagnostic testing facility approval from regional Medicare Administrative Contractors and will receive reimbursement per the relevant Current Procedural Terminology (“CPT”) code rates for the services rendered to the patient covered by CMS. • Non-contracted third-party payors – Non-contracted commercial and government payors often reimburse out-of-network rates provided under the relevant CPT codes on a case-by-case basis. The transaction price used for determining revenue recognition is based on factors including an average of the Company’s historical collection experience for its non-contracted services. This rate is reviewed at least quarterly. • Healthcare institutions – Healthcare institutions are typically hospitals or physician practices in which the Company has negotiated amounts for its monitoring services, including certain governmental agencies such as the Veterans Administration and Department of Defense. The Company is utilizing the portfolio approach practical expedient under ASC 606 for revenue recognition whereby services provided under each of the above payor types form a separate portfolio. The Company accounts for the contracts within each portfolio as a collective group, rather than individual contracts. Based on history with these portfolios and the similar nature and characteristics of the patients within each portfolio, the Company has concluded that the financial statement effects are not materially different than if accounting for revenue on a contract-by-contract basis. For contracted and CMS portfolios, the Company recognizes revenue, net of contractual allowances, and recognizes an allowance for doubtful accounts for uncollectible patient accounts receivable. The transaction price is determined based on negotiated rates, and the Company has historical experience collecting substantially all of these contracted rates. These contracts also impose a number of obligations regarding billing and other matters, and the Company’s noncompliance with a material term of such contracts may result in a denial of the claim. The Company accounts for denied claims as a form of variable consideration that is included as a reduction to the transaction price recognized as revenue. The Company estimates the denied claims which require judgment by management. The estimated denied claims are based on historical information and judgement includes the historical period utilized. The Company monitors the estimated denied claims against the latest available information, and subsequent changes to the estimated denied claims are recorded as an adjustment to revenue in the periods during which such changes occur. Historical cash collection indicates that it is probable that substantially all of the transaction price, less the estimate of denied claims, will be received. Contracted payors may require that we bill patient co-payments and deductibles and from time to time we may not be able to collect such amounts due to credit risk. The Company provides for estimates of uncollectible patient accounts receivable, based upon historical experience and judgment includes the historical period utilized, at the time revenue is recognized, with such provisions presented as bad debt expense within the selling, general and administrative line item of the consolidated statement of operations. Adjustments to these estimates for actual experience are also recorded as an adjustment to bad debt expense. For non-contracted portfolios, the Company is providing an implicit price concession due to the lack of a contracted rate with the underlying payor, the result of which requires the Company to estimate the transaction price based on historical cash collections utilizing the expected value method. All subsequent adjustments to the transaction price are recorded as an adjustment to revenue. For healthcare institutions, the transaction price is determined based on negotiated rates, and the Company has historical experience collecting substantially all of these contracted rates. Historical cash collection indicates that it is probable that substantially all of the transaction price will be received. As such, the Company is not providing an implicit price concession but, rather, has chosen to accept the risk of default, and any subsequent uncollected amounts are recorded as bad debt expense. Revenue policy under ASC 605 The Company’s devices, cardiac rhythm monitors, have a wear period for up to 14 days for the Zio XT service or 30 days for the Zio Event Card. The Company’s services, consisting of the delivery of reports containing analysis of data captured by the physical device to the prescribing physician, are generally billable at the start of the wear period or when reports are issued to physicians, depending on the service provided. For the Zio XT service, the Company recognizes the revenue at the time that a report is delivered to a physician. For the Zio Event Card, the Company recognizes revenue on a straight-line basis over the applicable wear period, as the event monitoring results are delivered to physicians. For all services performed, the Company considers whether or not the following revenue recognition criteria are met: persuasive evidence of an arrangement exists and delivery has occurred or services have been rendered. For services performed for customers which the Company invoices directly, additional revenue recognition criteria include that the price is fixed and determinable and collectability is reasonably assured; for customers in which the Company submits claims to third-party commercial and governmental payors for reimbursement, the Company recognizes revenue only when a reasonable estimate of reimbursement can be made.The assessment of whether a reasonable estimate of reimbursement can be made requires significant judgment by management. Where management’s judgment indicates a reasonable estimate of reimbursement can be made, revenue is recognized upon delivery of the patient report for the Zio XT service and straight-line for the Zio Event Card. Some patients have out-of-pocket costs for amounts not covered by their insurance carrier, and the Company bills the patient directly for these amounts in the form of co-payments and co-insurance in accordance with their insurance carrier and health plans. Some payors may not cover the Company’s service as ordered by the prescribing physician under their reimbursement policies. In the absence of an agreement with the patient or other clearly enforceable legal right to demand payment from the patient, the related revenue is recognized upon the earlier of notification of the payor benefits allowed or when payment is received, until the Company has the ability to make a reasonable estimate. Once a reasonable estimate can be made, revenue is recognized upon delivery of the service. During 2017, the Company recognized revenue on an accrual basis from certain non-contracted payors as a reasonable estimate was able to be made, primarily based on the consistency of historical payments. The Company recognizes revenue related to billings for CMS and commercial payors on an accrual basis, net of contractual allowances, when a reasonable estimate of reimbursement can be made. These contractual allowances represent the difference between the list price (the billing rate) and the reimbursement rate for each payor. Upon ultimate collection from CMS and commercial payors, the amount is compared to the previous estimates and the contractual allowance is adjusted accordingly. Until a contract has been negotiated with a commercial payor, the Company’s services may or may not be covered by these entities’ existing reimbursement policies. In addition, patients do not enter into direct agreements with the Company that commit them to pay any portion of the cost of the service in the event that their insurance declines to reimburse the Company. In the absence of an agreement with the patient or other clearly enforceable legal right to demand payment from the |
Contract Liabilities | Contract Liabilities ASC 606 requires an entity to present a revenue contract as a contract liability when the Company has an obligation to transfer goods or services to a customer for which the Company has received consideration from the customer, or an amount of consideration from the customer is due and unconditional (whichever is earlier). Certain of the Company’s customers pay the Company directly for the Zio XT service upon shipment of devices. Such advance payments are contract liabilities and are recorded as deferred revenue on the Consolidated Balance Sheets and revenue is recognized when reports are delivered to the healthcare provider. During the year ended December 31, 2019, $1.2 million relating to the contract liability balance at the beginning of 2019 was recognized as revenue. |
Contract Costs | Contract Costs Under ASC 340, the incremental costs of obtaining a contract with a customer are recognized as an asset. Incremental costs of obtaining a contract are those costs that an entity incurs to obtain a contract with a customer that it would not have incurred if the contract had not been obtained. The Company’s current commission programs are considered incremental. However, as a practical expedient, ASC 340 permits the Company to immediately expense contract acquisition costs, as the asset that would have resulted from capitalizing these costs will be amortized in one year or less. |
Cost of Revenue | Cost of Revenue Cost of revenue includes direct labor, material costs, equipment and infrastructure expenses, amortization of internal-use software, allocated overhead, and shipping and handling. Direct labor includes payroll and personnel-related costs including stock-based compensation involved in manufacturing, data analysis, and customer service. Material costs include both the disposable costs of the device and amortization of the PCBAs. Each time the PCBA is used in a wearable Zio XT monitor, a portion of the cost of the PCBA is recorded as a cost of revenue. |
Research and Development | Research and Development The Company’s research and development costs are expensed as incurred. Research and development costs include, but are not limited to, payroll and personnel-related expenses, laboratory supplies, consulting costs and overhead charges. |
Income Taxes | Income Taxes The Company uses the asset and liability method to account for income taxes in accordance with the authoritative guidance for income taxes. Under this method, deferred tax assets and liabilities are determined based on future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and tax loss and credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates applied to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is established when necessary to reduce deferred tax assets to the amount expected to be realized. The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that has a greater than greater than 50% likelihood of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company records interest and penalties related to unrecognized tax benefits in income tax expense. To date, there have been no interest or penalties charged in relation to the unrecognized tax benefits. The Company recognize taxes on Global Intangible Low-Taxed Income as a current period expense when incurred. |
Stock-based Compensation | Stock-based Compensation The Company measures its stock-based awards made to employees based on the estimated fair values of the awards as of the grant date. The fair value of stock options is determined using the Black-Scholes option pricing model. Stock-based compensation expense is recognized over the requisite service period using the straight-line method and is based on the value of the portion of stock-based payment awards that is ultimately expected to vest. As such, the Company’s stock-based compensation is reduced for the estimated forfeitures at the date of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. For restricted stock, the compensation cost for these awards is based on the closing price of the Company’s common stock on the date of grant, and recognized as compensation expense on a straight-line basis over the requisite service period. The Company recognizes compensation expense related to the Employee Stock Purchase Program (“ESPP”) based on the estimated fair value of the options on the date of grant, net of estimated forfeitures. The Company estimates the grant date fair value, and the resulting stock-based compensation expense, using the Black-Scholes option pricing model for each purchase period. The grant date fair value is expensed on a straight-line basis over the offering period. |
Net Loss per Common Share | Net Loss per Common Share Basic net loss per common share is calculated by dividing the net loss by the weighted average number of shares of common stock outstanding during the period, without consideration of potentially dilutive securities. Diluted net loss per common share is the same as basic net loss per common share for all periods presented, since the effect of potentially dilutive securities are anti-dilutive. Leases Identifying a lease The Company determines whether a contract contains a lease at the inception of a contract. If the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration, the Company considers the contract to contain a lease. The Company determines whether a contract conveys the right to control the use of an identified asset for a period of time if the contract contains both of the following terms: • The right to obtain substantially all of the economic benefits from use of the identified asset; and • The right to direct the use of the identified asset. Discount rate for leases On January 1, 2019, the rate implicit in the Company’s leases was not readily determinable. As such, the Company used its incremental borrowing rate to calculate its right-of-use assets and lease liabilities upon the adoption of ASC 842. The Company determined the appropriate incremental borrowing rate by utilizing the interest rate obtained in connection with the Third Amended and Restated Loan and Security Agreement with Silicon Valley Bank (“Third Amended and Restated SVB Loan Agreement”) which was finalized on October 23, 2018. On October 4, 2018, the Company entered into an office lease (“San Francisco Lease”) to rent approximately 117,560 rentable square feet in San Francisco, California, which became the Company’s new headquarters in October 2019. The San Francisco Lease commenced on May 13, 2019 and the Company determined that the interest rate associated with the Third Amended and Restated SVB Loan Agreement could not be utilized as the incremental borrowing rate associated with the San Francisco Lease due to the term of the lease, as well as annual rental payments. The Company determined the appropriate incremental borrowing rate by using a synthetic credit rating which was estimated based on an analysis of outstanding debt of companies with similar credit and financial profiles. Lease term The lease term is generally the minimum noncancellable period of each lease. The Company does not include option periods in determining the right-of-use asset and operating lease liability at inception unless it is reasonably certain that the Company will exercise the option at inception or when a triggering event occurs. As of December 31, 2019, no renewal options were included in the determination of lease terms. Lease Modification The San Francisco Lease is in the same building with the same landlord as the lease for the Company’s prior headquarters in San Francisco (“existing lease”). Upon the commencement of the San Francisco Lease, the existing lease which had an original expiration date of February 2020, was modified to expire in September 2019 and accordingly the right-of-use asset and lease liability was remeasured as of the modification date. |
Recent Accounting Guidance / Pronouncements | Recently Adopted Accounting Guidance In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-2, Leases (“Topic 842”), which requires lessees to recognize lease liabilities and corresponding right-of-use assets on the consolidated balance sheet for all leases. For finance leases, the lessee would recognize interest expense and amortization of the right-of-use asset and, for operating leases, the lessee would recognize a straight-line lease expense. As of December 31, 2019, the Company does not have any finance leases. Topic 842 also changes the definition of a lease and expands the disclosure requirements of lease arrangements. The Company has no embedded leases with suppliers. Upon adoption of Topic 842 on January 1, 2019 using the modified retrospective method, the Company recognized right-of-use assets of $10.2 million and lease liabilities of $10.0 million. There was no cumulative-effect adjustment recorded on January 1, 2019. The Company adopted the following practical expedients allowed under Topic 842: • The package of three practical expedients, which allows entities to make an election that allows them not to reassess (1) whether existing or expired contracts contain embedded leases under Topic 842, (2) lease classification of existing or expiring leases, and (3) indirect costs for existing or expired leases; • Combining lease and non-lease components practical expedient, which allows lessees, as an accounting policy election by class of underlying asset, to choose not to separate non-lease components from lease components and instead to account for each separate lease component and the non-lease components associated with that lease component as a single lease component; and • Comparative reporting practical expedient, which allows entities to initially apply Topic 842 at the adoption date and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. For further details, refer to Note 6. Commitments and Contingencies. Recent Accounting Standards or Updates Not Yet Effective In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost, including trade receivables. ASU No. 2016-13 replaces the existing incurred loss impairment model with an expected loss model that requires the use of forward-looking information to calculate credit loss estimates. It also eliminates the concept of other-than-temporary impairment and requires credit losses related to available-for-sale debt securities to be recorded through an allowance for credit losses rather than as a reduction in the amortized cost basis of the securities. The Company will adopt this standard in the first quarter of fiscal 2020 and is evaluating the impact of adopting this amendment to its consolidated financial statements. In August 2018, the FASB issued ASU No. 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, which amended its guidance for costs of implementing a cloud computing service arrangement to align the requirements for capitalizing 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. This new standard also requires customers to expense the capitalized implementation costs of a hosting arrangement that is a service contract over the term of the hosting arrangement. This new standard becomes effective for the Company in the first quarter of fiscal year 2020, with early adoption permitted. This new standard can be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. The Company is evaluating the impact of adopting this amendment to its consolidated financial statements. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, which simplifies the accounting for income taxes by removing certain exceptions to the general principles for income taxes. ASU 2019-12 will be effective for us beginning January 1, 2021, and early adoption is permitted. The Company is currently evaluating the impact of adoption on our consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Schedule of Changes in Allowance for Doubtful Accounts | The following table presents the changes in the allowance for doubtful accounts (in thousands): Year ended December 31, 2019 2018 2017 Balance, beginning of year $ 7,296 $ 4,486 $ 1,792 Add: provision for doubtful accounts 9,129 7,353 4,558 Less: write-offs, net of recoveries and other adjustments (7,376) (4,543) (1,864) Balance, end of year $ 9,049 $ 7,296 $ 4,486 |
Schedule of Changes in Contractual Allowance | The following table presents the changes in the contractual allowance (in thousands): Year ended December 31, 2019 2018 2017 Balance, beginning of year $ 9,205 $ 6,345 $ 2,340 Add: allowance for contractual adjustments 15,518 9,095 4,664 Less: contractual adjustments (9,290) (6,235) (659) Balance, end of year $ 15,433 $ 9,205 $ 6,345 |
Disaggregated Revenue by Payor Type and Major Service | The Company disaggregates revenue from contracts with customers by payor type. The Company believes these categories aggregate the payor types by nature, amount, timing and uncertainty of its revenue streams. Disaggregated revenue by payor type and major service line for the years ended December 31, 2019 and December 31, 2018 was as follows (in thousands): Year Ended December 31, Year Ended December 31, Contracted third-party payors $ 101,845 $ 56,949 Non-contracted third-party payors 10,770 12,447 Centers for Medicare & Medicaid 58,918 40,482 Healthcare Institutions 43,019 37,399 Total $ 214,552 $ 147,277 |
Cash Equivalents and Investme_2
Cash Equivalents and Investments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Cash Equivalents And Investments [Abstract] | |
Schedule of Fair Value of Securities, not Including Cash | The fair value of cash equivalents and available-for-sale investments at December 31, 2019 and 2018, were as follows (in thousands): December 31, 2019 Amortized Cost Gross Unrealized Estimated Fair Value Gains Losses Money market funds $ 13,897 $ — $ — $ 13,897 U.S. government securities 77,329 72 (1) 77,400 Corporate notes 14,955 11 — 14,966 Commercial paper 35,753 — — 35,753 Total available-for-sale marketable debt securities $ 141,934 $ 83 $ (1) $ 142,016 Classified as: Cash equivalents $ 13,897 Short-term investments 120,089 Long-term investments 8,030 Total cash equivalents and available-for-sale investments $ 142,016 |
Schedule of Fair Value of Short-term and Long-term Marketable Securities Classified by Maturity | The following table summarizes the fair value of the Company's cash equivalents, short-term and long-term marketable securities classified by maturity (in thousands): December 31, 2019 2018 Due within one year $ 133,986 $ 73,411 Due after one year through three years 8,030 — Total cash equivalents and available-for-sale investments $ 142,016 $ 73,411 |
Schedule of Available-for-Sale Securities Unrealized Loss Position | The following tables present the Company's available-for-sale securities that were in an unrealized loss position as of December 31, 2018 (in thousands): December 31, 2018 Less than 12 months 12 Months or Greater Total Assets Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss U.S. government securities $ 5,977 $ (1) $ — $ — $ 5,977 $ (1) Corporate notes 11,521 (10) 2,993 (8) 14,514 (18) Total $ 17,498 $ (11) $ 2,993 $ (8) $ 20,491 $ (19) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value of Company's Financial Assets and Liabilities | The following tables present the fair value of the Company’s financial assets determined using the inputs defined above (in thousands). December 31, 2019 Level 1 Level 2 Level 3 Total Assets Money market funds $ 13,897 $ — $ — $ 13,897 U.S. government securities — 77,400 — 77,400 Corporate notes — 14,966 — 14,966 Commercial paper — 35,753 — 35,753 Total $ 13,897 $ 128,119 $ — $ 142,016 December 31, 2018 Level 1 Level 2 Level 3 Total Assets Money market funds $ 10,606 $ — $ — $ 10,606 U.S. government securities — 9,975 — 9,975 Corporate notes — 16,499 — 16,499 Commercial paper — 36,331 — 36,331 Total $ 10,606 $ 62,805 $ — $ 73,411 |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Components of Inventory and Printed Circuit Board Assemblies ("PCBAs") | Inventory consisted of the following (in thousands): December 31, 2019 2018 Raw materials $ 1,574 $ 676 Finished goods 2,463 1,386 Total $ 4,037 $ 2,062 |
Components of Property and Equipment, Net | Property and equipment, net consisted of the following (in thousands): December 31, 2019 2018 Laboratory and manufacturing equipment $ 4,238 $ 2,750 Computer equipment and software 2,315 1,062 Furniture and fixtures 3,669 925 Leasehold improvements 7,597 726 Internal-use software 16,277 8,925 Total property and equipment, gross 34,096 14,388 Less: accumulated depreciation and amortization (7,632) (5,230) Total property and equipment, net $ 26,464 $ 9,158 |
Components of Accrued Liabilities | Accrued liabilities consisted of the following (in thousands): December 31, 2019 2018 Accrued vacation $ 3,809 $ 2,825 Accrued payroll and related expenses 19,156 18,188 Accrued ESPP Contributions 417 373 Accrued professional services fees 2,846 1,249 Claims payable 2,802 2,374 Other 3,556 1,679 Total accrued liabilities $ 32,586 $ 26,688 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Maturities of Operating Lease Liabilities | As of December 31, 2019, maturities of operating lease liabilities were as follows (in thousands): Year Ended December 31: 2020 $ 9,253 2021 11,550 2022 11,330 2023 11,667 2024 12,015 Thereafter 87,793 143,608 Less: imputed interest (49,946) Total lease liabilities $ 93,662 |
Schedule of Minimum Future Lease Payments under Previous Lease Accounting Standard | Minimum future lease payments as of December 31, 2018 and under the previous lease accounting standard, which includes annual rental payments for the San Francisco Lease which commenced May 13, 2019, for the year ended December 31, 2018 are as follows (in thousands): Year Ended December 31: 2019 $ 8,135 2020 10,669 2021 10,828 2022 11,150 2023 11,483 Thereafter 98,209 Total $ 150,474 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Future Minimum Payments | Future minimum payments under the Third Amended and Restated Loan and Security Agreement with Silicon Valley Bank at December 31, 2019 are as follows (in thousands): Year Ending December 31, 2020 $ 3,449 2021 12,860 2022 12,358 2023 9,914 Total 38,581 Less: Amount representing interest (3,581) Less: Debt Issuance Costs (67) Total Carrying Value $ 34,933 Reported as: Short-term debt $ 1,944 Long-term debt 32,989 Total $ 34,933 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Components of Provision for Income Taxes | The following table presents components of the Company’s provision for income taxes as for the period presented (in thousands): December 31, 2019 2018 2017 Current expense (benefit): Federal $ — $ — $ — State — — — Foreign 68 80 — Total current tax expense (benefit) 68 80 — Deferred expense (benefit): Federal — — — State — — — Foreign (3) (36) — Total deferred tax expense (benefit) (3) (36) — Total Tax Expense (benefit) $ 65 $ 44 $ — |
Reconciliation of Tax Expense Computed at Statutory Federal Rate and Company's Tax Expense | The following table presents a reconciliation of the tax expense computed at the statutory federal rate and the Company’s tax expense for the period presented (in thousands): December 31, 2019 2018 2017 Tax at statutory federal rate $ (11,446) $ (10,570) $ (10,143) Stock-based compensation (5,560) (8,557) (7,634) Meals and Entertainment 409 309 198 Other 614 148 (145) Tax credits (1,128) (1,015) (644) 2017 Tax Act — 44 21,969 Change in valuation allowance 17,176 19,685 (3,601) Provision for income taxes $ 65 $ 44 $ — |
Significant Components of Deferred Tax Assets and Liabilities | Significant components of the Company’s deferred tax assets and liabilities are as follows (in thousands): December 31, 2019 2018 Deferred tax assets: Net operating loss carryforwards $ 64,648 $ 50,601 Tax credit carryforwards 5,601 4,287 Share-based compensation 5,932 3,149 Allowances and other 11,443 8,827 Lease obligation 23,869 — Total deferred tax assets 111,493 66,864 Valuation allowance (88,433) (66,435) Net deferred tax assets 23,060 429 Deferred Tax Liabilities: Depreciation and Amortization (850) (388) Right of use asset (22,171) — Total deferred tax liability (23,021) (388) Total deferred tax assets $ 39 $ 41 |
Summary of Valuation Allowance for Deferred Tax Assets | The valuation allowance for deferred tax assets consisted of the following activity for the years ended December 31, 2019, 2018 and 2017 (in thousands): Balance at beginning of year Additions Deductions Balance at end of year Year Ended December 31, 2017 $ 44,861 $ — $ 540 $ 44,321 Year Ended December 31, 2018 44,321 22,114 — 66,435 Year Ended December 31, 2019 $ 66,435 $ 21,998 $ — $ 88,433 |
Reconciliation of Unrecognized Tax Benefit | A reconciliation of the Company’s unrecognized tax benefit amount is as follows (in thousands): Year Ended December 31, 2019 2018 2017 Balance at beginning of year $ 1,459 $ 943 $ 616 Additions for tax positions taken in current year 383 441 328 Increases in balance related to prior year tax positions — 75 — Decreases in balances related to prior year tax position — — (1) Balance at end of year $ 1,842 $ 1,459 $ 943 |
Stockholder's Equity (Tables)
Stockholder's Equity (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Schedule of Common Stock Shares Reserved for Future Issuance | The Company had reserved shares of common stock for issuance as follows: December 31, 2019 2018 Options issued and outstanding 1,503,247 2,094,137 Unvested restricted stock units 886,030 547,891 Common stock warrants issued and outstanding — 4,857 Shares available for grant under future stock plans 6,709,235 5,607,014 Shares available for future issuance 9,098,512 8,253,899 |
Stock Incentive Plans (Tables)
Stock Incentive Plans (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Summary of Share-based Awards Available for Grant under 2016 Plan | A summary of share-based awards available for grant under the 2016 Equity Incentive Plan is as follows: Shares Available Balance at December 31, 2016 3,743,037 Additional options authorized 1,106,966 Awards granted (837,436) Awards forfeited 21,585 Balance at December 31, 2017 4,034,152 Additional awards authorized 1,168,865 Awards granted (666,913) Awards forfeited 124,478 Awards withheld for tax purposes 56,710 Balance at December 31, 2018 4,717,292 Additional awards authorized 1,218,402 Awards granted (649,911) Awards forfeited 181,513 Awards withheld for tax purposes 60,836 Balance at December 31, 2019 5,528,132 |
Summary of Stock Option Activity Under 2006 and 2016 Plans, Including Grants To Nonemployees | The following table summarizes stock option activity under the 2006 and 2016 Plans, including grants to nonemployees: Options Outstanding Options Outstanding Weighted- Average Exercise Price Per Share Weighted- Average Remaining Contractual Life (years) Aggregate Intrinsic Value (in thousands) Balance at December 31, 2016 2,977,218 $ 6.16 6.93 $ 70,979 Options granted 465,271 $ 36.76 Options exercised (827,556) $ 4.11 Options forfeited (13,752) $ 14.43 Balance at December 31, 2017 2,601,181 $ 12.24 7.17 $ 113,958 Options granted 366,928 $ 68.32 Options exercised (798,424) $ 7.19 Options forfeited (75,548) $ 34.30 Balance at December 31, 2018 2,094,137 $ 23.20 7.02 97,976 Options granted 20,010 $ 82.77 Options exercised (540,307) $ 9.59 Options forfeited (70,593) $ 54.54 Balance at December 31, 2019 1,503,247 $ 27.40 6.43 62,401 Options exercisable – December 31, 2019 1,147,525 $ 19.64 6.02 55,919 Options vested and expected to vest – December 31, 2019 1,487,867 $ 27.07 6.41 62,220 |
Summary of Non-vested Restricted Stock Units ("RSUs") | The fair value of non-vested restricted stock units (“RSUs”) is based on the Company’s closing stock price on the date of grant. A summary for the year ended December 31, 2019, is as follows: Shares Underlying RSUs Weighted Average Grant Date Fair Value Weighted Remaining Vesting Period (in years) Aggregate Intrinsic Value (in thousands) Non-vested as of December 31, 2018 547,891 $ 56.62 2.45 $ 38,067 Granted 629,901 $ 87.72 Vested (180,842) $ 52.52 Forfeited (110,920) $ 69.77 Non-vested as of December 31, 2019 886,030 $ 77.92 1.39 $ 60,330 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Fair Value of Employee Stock Options Estimated Using Weighted Average Assumptions | The fair value of employee stock options was estimated using the weighted average assumptions below. Each of these inputs is subjective and its determination generally requires significant judgment. Year Ended December 31 2019 2018 2017 Expected term (in years) 6.1 6.1 6.1 Expected volatility 45.0 % 45.7 % 51.9 % Risk-free interest rate 2.39 % 2.75 % 2.07 % Dividend yield 0.0 % 0.0 % 0.0 % |
Summary of Total Stock-Based Compensation Expense for Options, RSUs and ESPP Included in Consolidated Statements of Operations and Comprehensive Loss | The following table summarizes the total stock-based compensation expense included in the statements of operations for all periods presented (in thousands): Year Ended December 31 2019 2018 2017 Cost of revenue $ 658 $ 193 $ 589 Research and development 4,462 3,057 1,619 Selling, general and administrative 21,121 13,079 7,544 Total stock-based compensation expense $ 26,241 $ 16,329 $ 9,752 |
Net Loss Per Common Share (Tabl
Net Loss Per Common Share (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Net Loss per Share | The following table sets forth the computation of the basic and diluted net loss per share during the years ended December 31, 2019, 2018 and 2017 (in thousands, except share and per share data): Year Ended December 31, 2019 2018 2017 Numerator: Net loss $ (54,568) $ (50,378) $ (29,740) Denominator: Weighted-average shares used to compute net loss per common share, basic and diluted 25,265,918 23,885,858 22,627,327 Net loss per common share, basic and diluted $ (2.16) $ (2.11) $ (1.31) |
Schedule of Anti-dilutive Securities Excluded from Diluted Net Loss per Common Share | The following outstanding shares of potentially dilutive securities have been excluded from diluted net loss per common share for the years ended December 31, 2019, 2018 and 2017 because their inclusion would be anti-dilutive: Year Ended December 31, 2019 2018 2017 Options to purchase common stock 1,503,247 2,094,137 2,601,181 RSUs issued and unvested 886,030 547,891 468,426 Warrants to purchase common stock — 4,857 4,857 Total 2,389,277 2,646,885 3,074,464 |
Selected Quarterly Financial _2
Selected Quarterly Financial Data (unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Information | Quarter Ended March 31 June 30 September 30 December 31 2019: Total revenues $ 48,334 $ 52,441 $ 54,673 $ 59,104 Gross profit 36,561 39,429 40,888 45,189 Net loss (8,250) (10,725) (18,293) (17,300) Net loss per common share, basic and diluted $ (0.34) $ (0.43) $ (0.72) $ (0.65) 2018: Total revenues $ 31,762 $ 35,292 $ 38,441 $ 41,782 Gross profit 23,212 25,806 28,488 30,976 Net loss (11,077) (13,304) (9,727) (16,270) Net loss per common share, basic and diluted $ (0.47) $ (0.56) $ (0.40) $ (0.67) |
Impact Of Revisions On Quarterly Finanical Data | The impact of the revision on the unaudited quarterly financial data is as follows: Quarter Ended June 30, 2019 As Reported Adjustment As Revised Total revenues $ 53,331 $ (890) $ 52,441 Gross profit 40,506 (1,077) 39,429 Net loss (11,467) 742 (10,725) Net loss per common share, basic and diluted $ (0.46) $ 0.03 $ (0.43) Quarter Ended March 31, 2019 As Reported Adjustment As Revised Total revenues $ 47,214 $ 1,120 $ 48,334 Gross profit 35,484 1,077 36,561 Net loss (8,019) (231) (8,250) Net loss per common share, basic and diluted $ (0.33) $ (0.01) $ (0.34) Quarter Ended December 31, 2018 As Reported Adjustment As Revised Total revenues $ 43,155 $ (1,373) $ 41,782 Gross profit 32,626 (1,650) 30,976 Net loss (14,713) (1,557) (16,270) Net loss per common share, basic and diluted $ (0.61) $ (0.06) $ (0.67) Quarter Ended June 30, 2018 As Reported Adjustment As Revised Total revenues $ 35,469 $ (177) $ 35,292 Gross profit 25,979 (173) 25,806 Net loss (12,206) (1,098) (13,304) Net loss per common share, basic and diluted $ (0.51) $ (0.05) $ (0.56) Quarter Ended March 31, 2018 As Reported Adjustment As Revised Total revenues $ 30,565 $ 1,197 $ 31,762 Gross profit 21,954 1,258 23,212 Net loss $ (11,117) $ 40 $ (11,077) |
Revision of Prior Period Fina_2
Revision of Prior Period Financial Statements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Changes and Error Corrections [Abstract] | |
Schedule of Revised Consolidated Statements | As discussed in Note 1, the Company has revised its prior period financial statements to correct for immaterial errors in its accounting for revenues, contractual allowances, allowance for doubtful accounts and certain other items, the impact of which is presented below (in thousands, except share data): Revised Consolidated Balance Sheets As of December 31, 2018 As Reported Adjustment As Revised Assets Accounts receivable, net $ 21,977 $ (2,187) $ 19,790 Total current assets 106,482 (2,187) 104,295 Total assets 119,710 (2,187) 117,523 Liabilities and Stockholders’ Equity Accrued liabilities 26,570 118 26,688 Deferred revenue 1,243 (20) 1,223 Total current liabilities 30,236 98 30,334 Total liabilities 65,288 98 65,386 Accumulated other comprehensive loss (41) 25 (16) Accumulated deficit (203,515) (2,310) (205,825) Total stockholders’ equity 54,422 (2,285) 52,137 Total liabilities and stockholders’ equity 119,710 (2,187) 117,523 Revised Consolidated Statements of Operations Year ended December 31, 2018 As Reported Adjustment As Revised Revenue $ 147,293 $ (16) $ 147,277 Cost of revenue 38,579 216 38,795 Gross profit 108,714 (232) 108,482 Research and development 20,750 110 20,860 Selling, general and administrative 131,582 1,731 133,313 Total operating expenses 152,332 1,841 154,173 Loss from operations (43,618) (2,073) (45,691) Other income, net 1,526 (25) 1,501 Loss before income taxes (48,236) (2,098) (50,334) Net loss (48,280) (2,098) (50,378) Net loss per common share, basic and diluted (2.02) (0.09) (2.11) Year ended December 31, 2017 As Reported Adjustment As Revised Revenue $ 98,509 $ 620 $ 99,129 Cost of revenue 27,708 495 28,203 Gross profit 70,801 125 70,926 Research and development 13,335 (70) 13,265 Selling, general and administrative 84,737 515 85,252 Total operating expenses 98,072 445 98,517 Loss from operations (27,271) (320) (27,591) Net loss (29,420) (320) (29,740) Net loss per common share, basic and diluted (1.30) (0.01) (1.31) Revised Consolidated Statements of Comprehensive Loss Year ended December 31, 2018 As Reported Adjustment As Revised Net loss $ (48,280) $ (2,098) $ (50,378) Net change in unrealized gains on available-for-sale securities 24 25 49 Comprehensive loss (48,256) (2,073) (50,329) Year ended December 31, 2017 As Reported Adjustment As Revised Net loss $ (29,420) $ (320) $ (29,740) Comprehensive loss (29,476) (320) (29,796) Revised Consolidated Statements of Cash Flows Year ended December 31, 2018 As Reported Adjustment As Revised Cash flows from operating activities Net loss $ (48,280) $ (2,098) $ (50,378) Adjustments to reconcile net loss to net cash used in operating activities: Provision for bad debt and contractual allowances 15,218 1,230 16,448 Changes in operating assets and liabilities: Accounts receivable (22,885) 1,138 (21,747) Accrued liabilities 10,776 (275) 10,501 Deferred revenue 5 (20) (15) Net cash used in operating activities (29,068) (25) (29,093) Cash flows from investing activities Purchases of available-for-sale investments (93,158) 25 (93,133) Net cash provided by investing activities 34,117 25 34,142 Year ended December 31, 2017 As Reported Adjustment As Revised Cash flows from operating activities Net loss $ (29,420) $ (320) $ (29,740) Adjustments to reconcile net loss to net cash used in operating activities: Stock-based compensation 10,123 (371) 9,752 Provision for bad debt and contractual allowances 9,403 (181) 9,222 Changes in operating assets and liabilities: Accounts receivable (12,950) 479 (12,471) Accrued liabilities 5,364 393 5,757 Supplemental disclosures of cash flow information Property, plant and equipment costs included in liabilities 35 75 110 Revised Consolidated Statements of Shareholder's Equity Year Ended December 31, 2018 As Reported Adjustment As Revised Unrealized loss on investments $ 24 $ 25 $ 49 Accumulated other comprehensive loss ending balance (41) 25 (16) Accumulated deficit beginning balance (156,589) (212) (156,801) Net loss (48,280) (2,098) (50,378) Accumulated deficit ending balance (203,515) (2,310) (205,825) Total stockholders' equity 54,422 (2,285) 52,137 Year Ended December 31, 2017 As Reported Adjustment As Revised Accumulated deficit beginning balance $ (127,169) $ 108 $ (127,061) Net loss (29,420) (320) (29,740) Accumulated deficit ending balance (156,589) (212) (156,801) Total stockholders' equity 79,553 (212) 79,341 |
Organization and Description _2
Organization and Description of Business - Additional Information (Details) $ / shares in Units, $ in Millions | Sep. 10, 2019USD ($)$ / sharesshares |
Accounting Policies [Abstract] | |
Sale of stock, number of shares issued in transaction (in shares) | 1,575,342 |
Sale of stock, price per share (in USD per share) | $ / shares | $ 73 |
Underwriters' option to purchase additional shares of common stock (in shares) | 205,479 |
Proceeds from Issuance of Common Stock | $ | $ 107.3 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Schedule of Changes in Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | |||
Balance, beginning of year | $ 7,296 | $ 4,486 | $ 1,792 |
Add: provision for doubtful accounts | 9,129 | 7,353 | 4,558 |
Less: write-offs, net of recoveries and other adjustments | (7,376) | (4,543) | (1,864) |
Balance, end of year | $ 9,049 | $ 7,296 | $ 4,486 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Changes in Contractual Allowance (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Contract with Customer, Asset, Allowance for Credit Loss [Roll Forward] | ||||
Balance, beginning of year | $ 9,205 | $ 6,345 | $ 2,340 | |
Add: allowance for contractual adjustments | 15,518 | 9,095 | 4,664 | |
Less: contractual adjustments | (9,290) | (6,235) | (659) | |
Balance, end of year | 15,433 | 9,205 | 6,345 | |
Allowance for Doubtful Accounts Receivable | $ 9,049 | $ 7,296 | $ 4,486 | $ 1,792 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 01, 2018 | |
Summary Of Significant Accounting Policies [Line Items] | |||||||||||||
Impairment long-lived assets | $ 0 | ||||||||||||
Contract liability balance, revenue recognized | 1,200,000 | ||||||||||||
Increase (decrease) in valuation allowance | 22,000,000 | $ 22,100,000 | |||||||||||
Revenue | $ 59,104,000 | $ 54,673,000 | $ 52,441,000 | $ 48,334,000 | $ 41,782,000 | $ 38,441,000 | $ 35,292,000 | $ 31,762,000 | 214,552,000 | 147,277,000 | $ 99,129,000 | ||
Unrecognized tax benefits, income tax interest or penalties charge | 0 | ||||||||||||
Accumulated deficit | $ (260,393,000) | (205,825,000) | (260,393,000) | (205,825,000) | |||||||||
Difference between Revenue Guidance in Effect before and after Topic 606 | |||||||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||||||
Accumulated deficit | $ 1,400,000 | ||||||||||||
As Reported | |||||||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||||||
Revenue | $ 53,331,000 | $ 47,214,000 | 43,155,000 | $ 35,469,000 | $ 30,565,000 | 147,293,000 | $ 98,509,000 | ||||||
Accumulated deficit | (203,515,000) | (203,515,000) | |||||||||||
Contracted third-party payors | |||||||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||||||
Revenue | $ 73,005,000 | 101,845,000 | 56,949,000 | ||||||||||
Contracted third-party payors | As Reported | |||||||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||||||
Revenue | 72,040,000 | ||||||||||||
Non-contracted third-party payors | |||||||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||||||
Revenue | 8,051,000 | $ 10,770,000 | 12,447,000 | ||||||||||
Non-contracted third-party payors | As Reported | |||||||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||||||
Revenue | $ 9,016,000 | ||||||||||||
Internal-use software | |||||||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||||||
Estimated useful life | 5 years | ||||||||||||
Printed Circuit Board Assemblies | |||||||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||||||
Total other assets | $ 2,500,000 | $ 2,500,000 | |||||||||||
Minimum | |||||||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||||||
Property and equipment, estimated useful life | 3 years | ||||||||||||
Maximum | |||||||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||||||
Property and equipment, estimated useful life | 5 years | ||||||||||||
Maximum | Zio XT service | |||||||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||||||
Equipment wear period | 14 days | ||||||||||||
Maximum | Zio Event Card | |||||||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||||||
Equipment wear period | 30 days | ||||||||||||
Accounts Receivable | Accounts Receivable Concentration Risk | Federal Government Agencies | |||||||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||||||
Concentration of credit risk | 20.00% | 20.00% |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Disaggregated Revenue by Payor Type and Major Service (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | $ 59,104 | $ 54,673 | $ 52,441 | $ 48,334 | $ 41,782 | $ 38,441 | $ 35,292 | $ 31,762 | $ 214,552 | $ 147,277 | $ 99,129 | |
Contracted third-party payors | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | $ 73,005 | 101,845 | 56,949 | |||||||||
Non-contracted third-party payors | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | $ 8,051 | 10,770 | 12,447 | |||||||||
Centers for Medicare & Medicaid | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | 58,918 | 40,482 | ||||||||||
Healthcare Institutions | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Revenue | $ 43,019 | $ 37,399 |
Cash Equivalents and Investme_3
Cash Equivalents and Investments - Schedule of Fair Value of Securities, not Including Cash (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | $ 141,934 | $ 73,427 |
Gross Unrealized Gains | 83 | 3 |
Gross Unrealized Losses | (1) | (19) |
Estimated Fair Value | 142,016 | 73,411 |
Classified as: | ||
Cash equivalents | 13,897 | 15,091 |
Short-term investments | 120,089 | 58,320 |
Long-term investments | 8,030 | 0 |
Total cash equivalents and available-for-sale investments | 142,016 | 73,411 |
U.S. government securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 77,329 | 9,976 |
Gross Unrealized Gains | 72 | 0 |
Gross Unrealized Losses | (1) | (1) |
Estimated Fair Value | 77,400 | 9,975 |
Corporate notes | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 14,955 | 16,514 |
Gross Unrealized Gains | 11 | 3 |
Gross Unrealized Losses | 0 | (18) |
Estimated Fair Value | 14,966 | 16,499 |
Commercial paper | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 35,753 | 36,331 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 35,753 | 36,331 |
Money market funds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 13,897 | 10,606 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | $ 13,897 | $ 10,606 |
Cash Equivalents and Investme_4
Cash Equivalents and Investments - Schedule of Fair Value of Short-term and Long-term Marketable Securities Classified by Maturity (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Marketable Securities [Abstract] | ||
Due within one year | $ 133,986 | $ 73,411 |
Due after one year through three years | 8,030 | 0 |
Total cash equivalents and available-for-sale investments | $ 142,016 | $ 73,411 |
Cash Equivalents and Investme_5
Cash Equivalents and Investments - Schedule of Available-for-Sale Securities Unrealized Loss Position (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Debt Securities, Available-for-sale [Line Items] | |
Available-for-sale securities, unrealized loss position, Less than 12 months, Fair Value | $ 17,498 |
Available-for-sale securities, unrealized loss position, Less than 12 months, Unrealized Loss | (11) |
Available-for-sale securities, unrealized loss position, Greater than 12 months, Fair Value | 2,993 |
Available-for-sale securities, unrealized loss position, Greater than 12 months, Unrealized Loss | (8) |
Available-for-sale securities, unrealized loss position, fair value | 20,491 |
Available-for-sale securities, unrealized loss position, unrealized loss | 19 |
U.S. government securities | |
Debt Securities, Available-for-sale [Line Items] | |
Available-for-sale securities, unrealized loss position, Less than 12 months, Fair Value | 5,977 |
Available-for-sale securities, unrealized loss position, Less than 12 months, Unrealized Loss | (1) |
Available-for-sale securities, unrealized loss position, Greater than 12 months, Fair Value | 0 |
Available-for-sale securities, unrealized loss position, Greater than 12 months, Unrealized Loss | 0 |
Available-for-sale securities, unrealized loss position, fair value | 5,977 |
Available-for-sale securities, unrealized loss position, unrealized loss | 1 |
Corporate notes | |
Debt Securities, Available-for-sale [Line Items] | |
Available-for-sale securities, unrealized loss position, Less than 12 months, Fair Value | 11,521 |
Available-for-sale securities, unrealized loss position, Less than 12 months, Unrealized Loss | (10) |
Available-for-sale securities, unrealized loss position, Greater than 12 months, Fair Value | 2,993 |
Available-for-sale securities, unrealized loss position, Greater than 12 months, Unrealized Loss | (8) |
Available-for-sale securities, unrealized loss position, fair value | 14,514 |
Available-for-sale securities, unrealized loss position, unrealized loss | $ 18 |
Cash Equivalents and Investme_6
Cash Equivalents and Investments - Additional Information (Details) | 12 Months Ended |
Dec. 31, 2019Right | |
Cash Equivalents And Investments [Abstract] | |
Available-for-sale securities, weighted average days to maturity | 126 days |
Number of unrealized loss position in investments | 0 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Carrying amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Outstanding interest-bearing obligations | $ 34.9 | $ 34.9 |
Level 2 | Estimated fair value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Outstanding interest-bearing obligations | $ 35.2 | $ 34.9 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Fair Value of Company's Financial Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Assets | ||
Total financial assets | $ 142,016 | $ 73,411 |
Money market funds | ||
Assets | ||
Total financial assets | 13,897 | 10,606 |
U.S. government securities | ||
Assets | ||
Total financial assets | 77,400 | 9,975 |
Corporate notes | ||
Assets | ||
Total financial assets | 14,966 | 16,499 |
Commercial paper | ||
Assets | ||
Total financial assets | 35,753 | 36,331 |
Level 1 | ||
Assets | ||
Total financial assets | 13,897 | 10,606 |
Level 1 | Money market funds | ||
Assets | ||
Total financial assets | 13,897 | 10,606 |
Level 1 | U.S. government securities | ||
Assets | ||
Total financial assets | 0 | 0 |
Level 1 | Corporate notes | ||
Assets | ||
Total financial assets | 0 | 0 |
Level 1 | Commercial paper | ||
Assets | ||
Total financial assets | 0 | 0 |
Level 2 | ||
Assets | ||
Total financial assets | 128,119 | 62,805 |
Level 2 | Money market funds | ||
Assets | ||
Total financial assets | 0 | 0 |
Level 2 | U.S. government securities | ||
Assets | ||
Total financial assets | 77,400 | 9,975 |
Level 2 | Corporate notes | ||
Assets | ||
Total financial assets | 14,966 | 16,499 |
Level 2 | Commercial paper | ||
Assets | ||
Total financial assets | 35,753 | 36,331 |
Level 3 | ||
Assets | ||
Total financial assets | 0 | 0 |
Level 3 | Money market funds | ||
Assets | ||
Total financial assets | 0 | 0 |
Level 3 | U.S. government securities | ||
Assets | ||
Total financial assets | 0 | 0 |
Level 3 | Corporate notes | ||
Assets | ||
Total financial assets | 0 | 0 |
Level 3 | Commercial paper | ||
Assets | ||
Total financial assets | $ 0 | $ 0 |
Balance Sheet Components - Comp
Balance Sheet Components - Components of Inventory and Printed Circuit Board Assemblies ("PCBAs") (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Inventory [Line Items] | |||
Total inventory and printed circuit board assemblies | $ 4,037 | $ 2,062 | |
Other assets | 7,940 | 3,208 | |
Raw materials | |||
Inventory [Line Items] | |||
Total inventory and printed circuit board assemblies | 1,574 | 676 | |
Finished goods | |||
Inventory [Line Items] | |||
Total inventory and printed circuit board assemblies | 2,463 | 1,386 | |
Printed Circuit Board Assemblies | |||
Inventory [Line Items] | |||
Amortization | 3,600 | 3,100 | $ 2,100 |
Other assets | $ 7,400 | $ 2,500 |
Balance Sheet Components - Co_2
Balance Sheet Components - Components of Property and Equipment, Net (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, gross | $ 34,096 | $ 14,388 |
Less: accumulated depreciation and amortization | (7,632) | (5,230) |
Total property and equipment, net | 26,464 | 9,158 |
Laboratory and manufacturing equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, gross | 4,238 | 2,750 |
Computer equipment and software | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, gross | 2,315 | 1,062 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, gross | 3,669 | 925 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, gross | 7,597 | 726 |
Internal-use software | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, gross | $ 16,277 | $ 8,925 |
Balance Sheet Components - Addi
Balance Sheet Components - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation and amortization expense | $ 3,445 | $ 2,269 | $ 1,597 |
Balance Sheet Components - Co_3
Balance Sheet Components - Components of Accrued Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Payables and Accruals [Abstract] | ||
Accrued vacation | $ 3,809 | $ 2,825 |
Accrued payroll and related expenses | 19,156 | 18,188 |
Accrued ESPP Contributions | 417 | 373 |
Accrued professional services fees | 2,846 | 1,249 |
Claims payable | 2,802 | 2,374 |
Other | 3,556 | 1,679 |
Total accrued liabilities | $ 32,586 | $ 26,688 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) $ in Thousands | Sep. 03, 2019USD ($) | Oct. 04, 2018USD ($)ft²Right | Dec. 31, 2019USD ($) |
Operating Leased Assets [Line Items] | |||
Operating lease, cost | $ 11,300 | ||
Operating lease, payments | $ 7,900 | ||
Option to extend, amount | Right | 1 | ||
Operating lease, weighted average remaining lease term | 11 years 7 months 6 days | ||
Operating Lease, weighted average discount rate (in percentage) | 736.00% | ||
Verily Life Sciences LLC | |||
Operating Leased Assets [Line Items] | |||
Collaboration agreement, remaining term of agreement | 24 months | ||
Collaboration agreement, upfront fee payable | $ 5,000 | ||
Collaboration agreement, additional milestone payments, due in next 24 months | $ 12,750 | ||
Collaboration agreement, milestone payments paid | 1,000 | ||
Collaboration agreement, research and development expense | $ 6,000 | ||
Office Lease | San Francisco | |||
Operating Leased Assets [Line Items] | |||
Lease rentable area | ft² | 117,560 | ||
Renewal term of lease | 5 years | ||
Office Lease | San Francisco | Standby Letters of Credit | |||
Operating Leased Assets [Line Items] | |||
Credit facility borrowing capacity | $ 6,900 | ||
Office Lease | San Francisco | Maximum | |||
Operating Leased Assets [Line Items] | |||
Tenant improvement allowance | $ 2,400 |
Commitments and Contingencies_2
Commitments and Contingencies - Schedule of Future Minimum Lease Payments Under Non-cancelable Operating Leases (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
2020 | $ 9,253 |
2021 | 11,550 |
2022 | 11,330 |
2023 | 11,667 |
2024 | 12,015 |
Thereafter | 87,793 |
Payments due | 143,608 |
Less: imputed interest | (49,946) |
Total lease liabilities | $ 93,662 |
Commitments and Contingencies_3
Commitments and Contingencies - Schedule of Future Minimum Operating Lease Liabilities (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2019 | $ 8,135 |
2020 | 10,669 |
2021 | 10,828 |
2022 | 11,150 |
2023 | 11,483 |
Thereafter | 98,209 |
Total | $ 150,474 |
Debt - Additional Information (
Debt - Additional Information (Details) | Oct. 23, 2018USD ($) | Oct. 31, 2018USD ($) | May 31, 2018USD ($) | Dec. 31, 2015USD ($)Tranche | Nov. 30, 2012USD ($)shares | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016 | Aug. 31, 2016USD ($) |
Debt Instrument [Line Items] | ||||||||||
Repayment of debt | $ 0 | $ 31,500,000 | $ 0 | |||||||
Loss in connection with early extinguishment of debt | 0 | 3,029,000 | 0 | |||||||
Proceeds from long-term debt, net of issuance costs | $ 0 | $ 35,000,000 | $ 0 | |||||||
Debt, Weighted Average Interest Rate | 4.58% | 4.50% | ||||||||
Pharmakon Loan Agreement | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Maximum borrowing capacity | $ 55,000,000 | |||||||||
Number of Tranches | Tranche | 2 | |||||||||
Loss in connection with early extinguishment of debt | $ 3,000,000 | |||||||||
Prepayment premium fee | 1,000,000 | |||||||||
Additional consideration for prepayment of debt | 1,500,000 | |||||||||
Repayment of debt | $ 35,800,000 | |||||||||
Pharmakon Loan Agreement | Silicon Valley Bank | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Repayment of debt | $ 4,900,000 | |||||||||
Pharmakon Loan Agreement | Tranche A Loans | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Maximum borrowing capacity | $ 30,000,000 | |||||||||
Debt instrument, fixed interest rate (in percentage) | 9.50% | |||||||||
Debt instrument, periodic payment | quarterly | |||||||||
Debt instrument, interest due and payable (in percentage) | 50.00% | |||||||||
Repayment of debt | 30,000,000 | |||||||||
Payment of accrued interest on debt | $ 3,300,000 | |||||||||
Pharmakon Loan Agreement | Tranche B Loans | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Maximum borrowing capacity | $ 25,000,000 | |||||||||
SVB Loan Agreement | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Maximum borrowing capacity | $ 15,000,000 | |||||||||
SVB Loan Agreement | Maximum | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Percentage of eligible accounts receivable for borrowings (in percentage) | 80.00% | |||||||||
SVB Loan Agreement | Prime Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument interest rate spread (in percentage) | 0.25% | |||||||||
SVB Loan Agreement | Standby Letters of Credit | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Line of credit | $ 3,100,000 | |||||||||
Third Amended and Restated SVB Loan Agreement | Standby Letters of Credit | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Maximum borrowing capacity | 11,000,000 | |||||||||
Proceeds from line of credit | 6,900,000 | |||||||||
Third Amended and Restated SVB Loan Agreement | SVB Term Loan | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Maximum borrowing capacity | $ 35,000,000 | |||||||||
Number of monthly payments of principal and interest | 36 months | |||||||||
Third Amended and Restated SVB Loan Agreement | SVB Term Loan | Minimum | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument, interest rate (in percentage) | 4.25% | |||||||||
Third Amended and Restated SVB Loan Agreement | SVB Term Loan | Prime Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread deduction on variable rate (in percentage) | 0.75% | |||||||||
Third Amended and Restated SVB Loan Agreement | Revolving Credit Facility | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Maximum borrowing capacity | $ 25,000,000 | |||||||||
Line of credit | $ 0 | |||||||||
Third Amended and Restated SVB Loan Agreement | Revolving Credit Facility | Maximum | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Percentage of eligible accounts receivable for borrowings (in percentage) | 75.00% | |||||||||
Credit facility borrowing capacity | $ 5,600,000 | |||||||||
Third Amended and Restated SVB Loan Agreement | Revolving Credit Facility | Minimum | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument, interest rate (in percentage) | 5.00% | |||||||||
CHCF Note | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Repayment of debt | $ 1,500,000 | |||||||||
Payment of accrued interest on debt | $ 200,000 | |||||||||
Proceeds from long-term debt, net of issuance costs | $ 1,500,000 | |||||||||
Debt instrument accrues simple interest rate | 2.00% | |||||||||
CHCF Note | Series D Convertible Preferred Stock | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Warrants issued to purchase shares (in shares) | shares | 22,807 |
Debt - Schedule of Future Minim
Debt - Schedule of Future Minimum Payments (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Debt Instrument [Line Items] | ||
2024 | $ 12,015 | |
Total | 32,989 | $ 34,899 |
Debt, current portion | 1,944 | $ 0 |
Total | 34,933 | |
Third Amended and Restated SVB Loan Agreement | ||
Debt Instrument [Line Items] | ||
2020 | 3,449 | |
2021 | 12,860 | |
2022 | 12,358 | |
2023 | 9,914 | |
Total | 38,581 | |
Less: Amount representing interest | (3,581) | |
Less: Debt Issuance Costs | (67) | |
Total Carrying Value | $ 34,933 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Operating Loss Carryforwards [Line Items] | |||
Increase (decrease) in valuation allowance | $ 22,000,000 | ||
Federal deferred tax asset, increase (decrease), amount | 22,000,000 | ||
Benefit recognized for net operating loss carryforwards | $ 0 | ||
Benefit recognized for other deferred tax assets | 0 | ||
Increase (decrease) in valuation allowance | 22,000,000 | $ 22,100,000 | |
Net operating loss carryforwards, federal | 259,900,000 | ||
Net operating loss carryforwards, state | $ 153,800,000 | ||
Tax credit carryforwards expiration beginning year | 2028 | ||
Unrecognized tax benefit | $ 1,800,000 | $ 1,500,000 | $ 900,000 |
Foreign Tax Authority [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Tax credit carryforwards available to reduce future taxable income | 5,100,000 | ||
State | |||
Operating Loss Carryforwards [Line Items] | |||
Tax credit carryforwards available to reduce future taxable income | $ 2,700,000 |
Income Taxes - Components of Pr
Income Taxes - Components of Provision for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Current expense (benefit): | |||
Federal | $ 0 | $ 0 | $ 0 |
State | 0 | 0 | 0 |
Foreign | 68 | 80 | 0 |
Total current tax expense (benefit) | 68 | 80 | 0 |
Deferred expense (benefit): | |||
Federal | 0 | 0 | 0 |
State | 0 | 0 | 0 |
Foreign | (3) | (36) | 0 |
Total deferred tax expense (benefit) | (3) | (36) | 0 |
Total Tax Expense (benefit) | $ 65 | $ 44 | $ 0 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Tax Expense Computed at Statutory Federal Rate and Company's Tax Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Effective Income Tax Rate Reconciliation, Amount [Abstract] | |||
Tax at statutory federal rate | $ (11,446) | $ (10,570) | $ (10,143) |
Stock-based compensation | (5,560) | (8,557) | (7,634) |
Meals and Entertainment | 409 | 309 | 198 |
Other | 614 | 148 | (145) |
Tax credits | (1,128) | (1,015) | (644) |
2017 Tax Act | 0 | 44 | 21,969 |
Change in valuation allowance | 17,176 | 19,685 | (3,601) |
Total Tax Expense (benefit) | $ 65 | $ 44 | $ 0 |
Income Taxes - Significant Comp
Income Taxes - Significant Components of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Deferred tax assets: | ||||
Net operating loss carryforwards | $ 64,648 | $ 50,601 | ||
Tax credit carryforwards | 5,601 | 4,287 | ||
Share-based compensation | 5,932 | 3,149 | ||
Allowances and other | 11,443 | 8,827 | ||
Lease obligation | 23,869 | 0 | ||
Total deferred tax assets | 111,493 | 66,864 | ||
Valuation allowance | (88,433) | (66,435) | $ (44,321) | $ (44,861) |
Net deferred tax assets | 23,060 | 429 | ||
Deferred Tax Liabilities: | ||||
Depreciation and Amortization | 850 | 388 | ||
Right of use asset | 22,171 | 0 | ||
Total deferred tax liability | 23,021 | 388 | ||
Total deferred tax assets | $ 39 | $ 41 |
Income Taxes - Summary of Valua
Income Taxes - Summary of Valuation Allowance for Deferred Tax Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Deferred Tax Assets, Valuation Allowance [Roll Forward] | |||
Balance at beginning of year | $ 66,435 | $ 44,321 | $ 44,861 |
Additions | 21,998 | 22,114 | 0 |
Deductions | 0 | 0 | 540 |
Balance at end of year | $ 88,433 | $ 66,435 | $ 44,321 |
Income Taxes - Reconciliation_2
Income Taxes - Reconciliation of Unrecognized Tax Benefit (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Balance at beginning of year | $ 1,459 | $ 943 | $ 616 |
Additions for tax positions taken in current year | 383 | 441 | 328 |
Increases in balance related to prior year tax positions | 0 | 75 | 0 |
Decreases in balances related to prior year tax position | 0 | 0 | (1) |
Balance at end of year | $ 1,842 | $ 1,459 | $ 943 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Equity [Abstract] | ||
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, par value (in USD per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Dividends declared | $ 0 |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule Of Common Stock Shares Reserved For Future Issuance (Details) - shares | Dec. 31, 2019 | Dec. 31, 2018 |
Class of Stock [Line Items] | ||
Total number of shares reserved for future issuance (in shares) | 9,098,512 | 8,253,899 |
Common stock warrants issued and outstanding | ||
Class of Stock [Line Items] | ||
Total number of shares reserved for future issuance (in shares) | 0 | 4,857 |
Options issued and outstanding | ||
Class of Stock [Line Items] | ||
Total number of shares reserved for future issuance (in shares) | 1,503,247 | 2,094,137 |
Unvested restricted stock units | ||
Class of Stock [Line Items] | ||
Total number of shares reserved for future issuance (in shares) | 886,030 | 547,891 |
Shares available for grant under future stock plans | ||
Class of Stock [Line Items] | ||
Total number of shares reserved for future issuance (in shares) | 6,709,235 | 5,607,014 |
Stock Incentive Plans - Additio
Stock Incentive Plans - Additional Information (Details) $ / shares in Units, $ in Millions | Oct. 31, 2016Rightshares | Oct. 31, 2016shares | Dec. 31, 2019USD ($)$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Options granted during the period (in shares) | 20,010 | 366,928 | 465,271 | ||
Shares available for future issuance (in shares) | 9,098,512 | 8,253,899 | |||
Expected term (in years) | 6 years 1 month 6 days | 6 years 1 month 6 days | 6 years 1 month 6 days | ||
Expected dividend yield (in percentage) | 0.00% | 0.00% | 0.00% | ||
Weighted-average grant date fair value of options (in USD per share) | $ / shares | $ 38.29 | $ 32.38 | $ 18.69 | ||
Stock option, intrinsic value | $ | $ 36.9 | $ 52.4 | $ 32.5 | ||
Estimated grant date fair value of stock option vested | $ | $ 7.8 | $ 5.3 | $ 2.4 | ||
Restricted stock unit, granted | 629,901 | ||||
Restricted stock units vested | 180,842 | ||||
Restricted stock units forfeited | 110,920 | ||||
Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Expected term (in years) | 1 year | ||||
Minimum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Expected term (in years) | 6 months | ||||
2006 Equity Incentive Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock option vesting term | 3 years | ||||
2006 Equity Incentive Plan | First Anniversary of Grant | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock option exercisable rate, percentage(in percentage) | 25.00% | ||||
2006 Equity Incentive Plan | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock option, period for grant | 10 years | ||||
2006 Equity Incentive Plan | Minimum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Percentage of voting power of all classes of stock (in percentage) | 10.00% | ||||
2006 Equity Incentive Plan | ISO | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock option vesting term | 5 years | ||||
2006 Equity Incentive Plan | Other Options | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock option vesting term | 10 years | ||||
2016 Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Options granted during the period (in shares) | 0 | ||||
Shares available for future issuance (in shares) | 3,865,000 | 3,865,000 | 7,359,234 | ||
Percentage of outstanding shares increased annually under the plan(in percentage) | 500.00% | ||||
2016 Plan | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock option, period for grant | 10 years | ||||
2016 Plan | Minimum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Percentage of stock option exercise price of fair market value of common stock (in percentage) | 10000.00% | 10000.00% | |||
Employee Stock Purchase Program ("ESPP") | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares available for future issuance (in shares) | 483,031 | 483,031 | 1,181,103 | ||
Percentage of outstanding shares increased annually under the plan(in percentage) | 150.00% | ||||
Increase in shares available for future issuance (in shares) | 966,062 | ||||
Percentage of payroll deductions of eligible compensation (in percentage) | 1500.00% | 1500.00% | |||
Offering period | 12 months | ||||
Number of purchase period | Right | 2 | ||||
Purchase period | 6 months | ||||
Percentage of employee purchase shares of fair market value | 8500.00% | ||||
Common stock issued to employees (in shares) | 350,198 | ||||
Expected volatility, minimum (in percentage) | 43.61% | 41.46% | 42.18% | ||
Expected volatility, maximum (in percentage) | 48.05% | 44.55% | 57.69% | ||
Risk-free interest rate, minimum (in percentage) | 1.60% | 2.19% | 0.52% | ||
Risk-free interest rate, maximum (in percentage) | 2.35% | 2.64% | 1.62% | ||
Expected dividend yield (in percentage) | 0.00% | 0.00% | 0.00% |
Stock Incentive Plans - Summary
Stock Incentive Plans - Summary of Share-based Awards Available for Grant under 2016 Plan (Details) - 2016 Plan - shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-Based Awards Available for Grant | |||
Beginning balance (in shares) | 4,717,292 | 4,034,152 | 3,743,037 |
Additional options authorized (in shares) | 1,218,402 | 1,168,865 | 1,106,966 |
Awards granted (in shares) | (649,911) | (666,913) | (837,436) |
Awards forfeited (in shares) | 181,513 | 124,478 | 21,585 |
Awards withheld for tax purposes (in shares) | 60,836 | 56,710 | |
Ending balance (in shares) | 5,528,132 | 4,717,292 | 4,034,152 |
Stock Incentive Plans - Summa_2
Stock Incentive Plans - Summary of Stock Option Activity Under 2006 and 2016 Plans, Including Grants To Nonemployees (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2019 | |
Options Outstanding | |||||
Beginning balance (in shares) | 2,094,137 | 2,601,181 | 2,977,218 | ||
Options granted (in shares) | 20,010 | 366,928 | 465,271 | ||
Options exercised (in shares) | (540,307) | (798,424) | (827,556) | ||
Options forfeited (in shares) | (70,593) | (75,548) | (13,752) | ||
Ending balance (in shares) | 1,503,247 | 2,094,137 | 2,601,181 | 2,977,218 | |
Options exercisable (in shares) | 1,147,525 | ||||
Options vested and expected to vest (in shares) | 1,487,867 | ||||
Weighted Average Exercise Price Per Share [Abstract] | |||||
Beginning balance (in USD per share) | $ 23.20 | $ 12.24 | $ 6.16 | ||
Options granted (in USD per share) | 82.77 | 68.32 | 36.76 | ||
Options exercised (in USD per share) | 9.59 | 7.19 | 4.11 | ||
Options forfeited (in USD per share) | 54.54 | 34.30 | 14.43 | ||
Ending balance (in USD per share) | $ 27.40 | $ 23.20 | $ 12.24 | $ 6.16 | |
Options exercisable (in USD per share) | $ 19.64 | ||||
Options vested and expected to vest (in USD per share) | $ 27.07 | ||||
Weighted Average Remaining Contractual Life (Years) [Abstract] | |||||
SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsOutstandingWeightedAverageRemainingContractualTerm2 | 6 years 5 months 4 days | 7 years 7 days | 7 years 2 months 1 day | 6 years 11 months 4 days | |
SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsOutstandingWeightedAverageRemainingContractualTerm2 | 6 years 5 months 4 days | 7 years 7 days | 7 years 2 months 1 day | 6 years 11 months 4 days | |
Options exercisable | 6 years 7 days | ||||
Options vested and expected to vest | 6 years 4 months 28 days | ||||
Aggregate Intrinsic Value (in thousands) | |||||
Beginning balance | $ 97,976 | $ 113,958 | $ 70,979 | ||
Ending balance | $ 97,976 | $ 113,958 | $ 70,979 | $ 70,979 | $ 62,401 |
Options exercisable | 55,919 | ||||
Options vested and expected to vest | $ 62,220 |
Stock Incentive Plans - Summa_3
Stock Incentive Plans - Summary of Non-vested Restricted Stock Units ("RSUs") (Details) - RSUs issued and unvested - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Shares Underlying RSUs | ||
Beginning balance (in shares) | 547,891 | |
Granted (in shares) | 629,901 | |
Vested (in shares) | (180,842) | |
Forfeited (in shares) | (110,920) | |
Ending balance (in shares) | 886,030 | 547,891 |
Weighted Average Grant Date Fair Value | ||
Beginning balance (in USD per share) | $ 56.62 | |
Granted (in USD per share) | 87.72 | |
Vested and released (in USD per share) | 52.52 | |
Forfeited (in USD per share) | 69.77 | |
Ending balance (in USD per share) | $ 77.92 | $ 56.62 |
Weighted Remaining Vesting Period (in years) | ||
ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsOutstandingWeightedAverageRemainingContractualTerms | 1 year 4 months 20 days | 2 years 5 months 12 days |
ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsOutstandingWeightedAverageRemainingContractualTerms | 1 year 4 months 20 days | 2 years 5 months 12 days |
Aggregate Intrinsic Value (in thousands) | ||
Beginning balance | $ 38,067 | |
Ending balance | $ 60,330 | $ 38,067 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Fair Value of Employee Stock Options Estimated Using Weighted Average Assumptions (Details) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Payment Arrangement [Abstract] | |||
Expected term (in years) | 6 years 1 month 6 days | 6 years 1 month 6 days | 6 years 1 month 6 days |
Expected volatility (in percentage) | 45.00% | 45.70% | 51.90% |
Risk-free interest rate (in percentage) | 2.39% | 2.75% | 2.07% |
Dividend yield (in percentage) | 0.00% | 0.00% | 0.00% |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | ||
Feb. 28, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected dividend yield (in percentage) | 0.00% | 0.00% | 0.00% | |
Total unamortized compensation costs, net of estimated forfeitures related to unvested stock options | $ 8.9 | |||
Unamortized compensation costs related to unvested stock options, expected period of recognition (in years) | 1 year 8 months 12 days | |||
RSUs issued and unvested | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Unamortized compensation costs related to unvested stock options, expected period of recognition (in years) | 2 years 3 months 18 days | |||
Total unamortized compensation costs, net of estimated forfeitures related to restricted stock unit | $ 44.5 | |||
Performance shares | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share Based Compensation Arrangement By Share Based Payment Award Performance Period | 2 years | |||
Cumulative share based payment award equity instruments other than option expenses | $ 4.8 | |||
Performance shares | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Performance threshold percentage (in percentage) | 75.00% | |||
Percentage of performance target to be earned at performance threshold (in percentage) | 50.00% | |||
Share based compensation arrangement by share based payment award equity instruments other than options grants in period fair value | $ 18.5 | |||
Performance shares | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Performance threshold percentage (in percentage) | 125.00% | 134.00% | ||
Percentage of performance target to be earned at performance threshold (in percentage) | 200.00% | |||
ESPP | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total unamortized compensation costs, net of estimated forfeitures related to unvested stock options | $ 1.1 | |||
Unamortized compensation costs related to unvested stock options, expected period of recognition (in years) | 10 months 24 days |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Total Stock-Based Compensation Expense for Options, RSUs and ESPP Included in Consolidated Statements of Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total stock-based compensation expense | $ 26,241,000 | $ 16,329 | $ 9,752 |
Cost of revenue | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total stock-based compensation expense | 658,000 | 193 | 589 |
Research and development | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total stock-based compensation expense | 4,462,000 | 3,057 | 1,619 |
Selling, general and administrative | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total stock-based compensation expense | $ 21,121,000 | $ 13,079 | $ 7,544 |
Net Loss Per Common Share - Com
Net Loss Per Common Share - Computation of Basic and Diluted Net Loss per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Numerator: | |||||||||||
Net loss | $ (17,300) | $ (18,293) | $ (10,725) | $ (8,250) | $ (16,270) | $ (9,727) | $ (13,304) | $ (11,077) | $ (54,568) | $ (50,378) | $ (29,740) |
Denominator: | |||||||||||
Weighted-average shares used to compute net loss per common share, basic and diluted (in shares) | 25,265,918 | 23,885,858 | 22,627,327 | ||||||||
Net loss per common share, basic and diluted | $ (0.65) | $ (0.72) | $ (0.43) | $ (0.34) | $ (0.67) | $ (0.40) | $ (0.56) | $ (0.47) | $ (2.16) | $ (2.11) | $ (1.31) |
Net Loss Per Common Share - Sch
Net Loss Per Common Share - Schedule of Anti-dilutive Securities Excluded from Diluted Net Loss per Common Share (Details) - shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive securities excluded from diluted net loss per common share (in shares) | 2,389,277 | 2,646,885 | 3,074,464 |
Options to purchase common stock | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive securities excluded from diluted net loss per common share (in shares) | 1,503,247 | 2,094,137 | 2,601,181 |
RSUs issued and unvested | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive securities excluded from diluted net loss per common share (in shares) | 886,030 | 547,891 | 468,426 |
Warrants to purchase common stock | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive securities excluded from diluted net loss per common share (in shares) | 0 | 4,857 | 4,857 |
Selected Quarterly Financial _3
Selected Quarterly Financial Data (Unaudited) - Schedule of Quarterly Financial Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenue | $ 59,104 | $ 54,673 | $ 52,441 | $ 48,334 | $ 41,782 | $ 38,441 | $ 35,292 | $ 31,762 | $ 214,552 | $ 147,277 | $ 99,129 |
Gross profit | 45,189 | 40,888 | 39,429 | 36,561 | 30,976 | 28,488 | 25,806 | 23,212 | 162,067 | 108,482 | 70,926 |
Net loss | $ (17,300) | $ (18,293) | $ (10,725) | $ (8,250) | $ (16,270) | $ (9,727) | $ (13,304) | $ (11,077) | $ (54,568) | $ (50,378) | $ (29,740) |
Net loss per common share, basic and diluted | $ (0.65) | $ (0.72) | $ (0.43) | $ (0.34) | $ (0.67) | $ (0.40) | $ (0.56) | $ (0.47) | $ (2.16) | $ (2.11) | $ (1.31) |
Selected Quarterly Financial _4
Selected Quarterly Financial Data (unaudited) - Schedule of the Impact of the Revision on the Unaudited Quarterly Financial Data (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Revenue | $ 59,104 | $ 54,673 | $ 52,441 | $ 48,334 | $ 41,782 | $ 38,441 | $ 35,292 | $ 31,762 | $ 214,552 | $ 147,277 | $ 99,129 |
Gross profit | 45,189 | 40,888 | 39,429 | 36,561 | 30,976 | 28,488 | 25,806 | 23,212 | 162,067 | 108,482 | 70,926 |
Net loss | $ (17,300) | $ (18,293) | $ (10,725) | $ (8,250) | $ (16,270) | $ (9,727) | $ (13,304) | $ (11,077) | $ (54,568) | $ (50,378) | $ (29,740) |
Net loss per common share, basic and diluted | $ (0.65) | $ (0.72) | $ (0.43) | $ (0.34) | $ (0.67) | $ (0.40) | $ (0.56) | $ (0.47) | $ (2.16) | $ (2.11) | $ (1.31) |
As Reported | |||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Revenue | $ 53,331 | $ 47,214 | $ 43,155 | $ 35,469 | $ 30,565 | $ 147,293 | $ 98,509 | ||||
Gross profit | 40,506 | 35,484 | 32,626 | 25,979 | 21,954 | 108,714 | 70,801 | ||||
Net loss | $ (11,467) | $ (8,019) | $ (14,713) | $ (12,206) | (11,117) | $ (48,280) | $ (29,420) | ||||
Net loss per common share, basic and diluted | $ (0.46) | $ (0.33) | $ (0.61) | $ (0.51) | $ (2.02) | $ (1.30) | |||||
Adjustment | |||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Revenue | $ (890) | $ 1,120 | $ (1,373) | $ (177) | 1,197 | $ (16) | $ 620 | ||||
Gross profit | (1,077) | 1,077 | (1,650) | (173) | 1,258 | (232) | 125 | ||||
Net loss | $ 742 | $ (231) | $ (1,557) | $ (1,098) | $ 40 | $ (2,098) | $ (320) | ||||
Net loss per common share, basic and diluted | $ 0.03 | $ (0.01) | $ (0.06) | $ (0.05) | $ (0.09) | $ (0.01) |
Selected Quarterly Financial _5
Selected Quarterly Financial Data (unaudited) - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Revenue | $ 59,104 | $ 54,673 | $ 52,441 | $ 48,334 | $ 41,782 | $ 38,441 | $ 35,292 | $ 31,762 | $ 214,552 | $ 147,277 | $ 99,129 | |
As Reported | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Revenue | $ 53,331 | $ 47,214 | $ 43,155 | $ 35,469 | $ 30,565 | 147,293 | $ 98,509 | |||||
Contracted third-party payors | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Revenue | $ 73,005 | 101,845 | 56,949 | |||||||||
Contracted third-party payors | Classification error of payors in the disaggregation of revenue | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Revenue | 965 | |||||||||||
Contracted third-party payors | As Reported | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Revenue | 72,040 | |||||||||||
Non-contracted third-party payors | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Revenue | 8,051 | $ 10,770 | $ 12,447 | |||||||||
Non-contracted third-party payors | As Reported | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Revenue | $ 9,016 |
Revision of Prior Period Fina_3
Revision of Prior Period Financial Statements - Schedule of Revised Consolidated Balance Sheet (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Assets | ||||
Accounts receivable, net | $ 23,867 | $ 19,790 | ||
Total current assets | 172,792 | 104,295 | ||
Total assets | 306,212 | 117,523 | ||
Liabilities and Stockholders’ Equity | ||||
Accrued liabilities | 32,586 | 26,688 | ||
Deferred revenue | 1,251 | 1,223 | ||
Total current liabilities | 52,066 | 30,334 | ||
Total liabilities | 170,803 | 65,386 | ||
Accumulated other comprehensive income (loss) | 82 | (16) | ||
Accumulated deficit | (260,393) | (205,825) | ||
Total stockholders’ equity | 135,409 | 52,137 | $ 79,341 | $ 93,041 |
Total liabilities and stockholders’ equity | $ 306,212 | 117,523 | ||
As Reported | ||||
Assets | ||||
Accounts receivable, net | 21,977 | |||
Total current assets | 106,482 | |||
Total assets | 119,710 | |||
Liabilities and Stockholders’ Equity | ||||
Accrued liabilities | 26,570 | |||
Deferred revenue | 1,243 | |||
Total current liabilities | 30,236 | |||
Total liabilities | 65,288 | |||
Accumulated other comprehensive income (loss) | (41) | |||
Accumulated deficit | (203,515) | |||
Total stockholders’ equity | 54,422 | 79,553 | ||
Total liabilities and stockholders’ equity | 119,710 | |||
Adjustment | ||||
Assets | ||||
Accounts receivable, net | (2,187) | |||
Total current assets | (2,187) | |||
Total assets | (2,187) | |||
Liabilities and Stockholders’ Equity | ||||
Accrued liabilities | 118 | |||
Deferred revenue | (20) | |||
Total current liabilities | 98 | |||
Total liabilities | 98 | |||
Accumulated other comprehensive income (loss) | 25 | |||
Accumulated deficit | (2,310) | |||
Total stockholders’ equity | (2,285) | $ (212) | ||
Total liabilities and stockholders’ equity | $ (2,187) |
Revision of Prior Period Fina_4
Revision of Prior Period Financial Statements - Schedule of Revised Consolidated Statements of Operations (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Revenue | $ 59,104 | $ 54,673 | $ 52,441 | $ 48,334 | $ 41,782 | $ 38,441 | $ 35,292 | $ 31,762 | $ 214,552 | $ 147,277 | $ 99,129 |
Cost of revenue | 52,485 | 38,795 | 28,203 | ||||||||
Gross profit | 45,189 | 40,888 | 39,429 | 36,561 | 30,976 | 28,488 | 25,806 | 23,212 | 162,067 | 108,482 | 70,926 |
Research and development | 37,299 | 20,860 | 13,265 | ||||||||
Selling, general and administrative | 179,523 | 133,313 | 85,252 | ||||||||
Total operating expenses | 216,822 | 154,173 | 98,517 | ||||||||
Loss from operations | (54,755) | (45,691) | (27,591) | ||||||||
Other income, net | 1,895 | 1,501 | 1,237 | ||||||||
Loss before income taxes | (54,503) | (50,334) | (29,740) | ||||||||
Net loss | $ (17,300) | $ (18,293) | $ (10,725) | $ (8,250) | $ (16,270) | $ (9,727) | $ (13,304) | $ (11,077) | $ (54,568) | $ (50,378) | $ (29,740) |
Net loss per common share, basic and diluted | $ (0.65) | $ (0.72) | $ (0.43) | $ (0.34) | $ (0.67) | $ (0.40) | $ (0.56) | $ (0.47) | $ (2.16) | $ (2.11) | $ (1.31) |
As Reported | |||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Revenue | $ 53,331 | $ 47,214 | $ 43,155 | $ 35,469 | $ 30,565 | $ 147,293 | $ 98,509 | ||||
Cost of revenue | 38,579 | 27,708 | |||||||||
Gross profit | 40,506 | 35,484 | 32,626 | 25,979 | 21,954 | 108,714 | 70,801 | ||||
Research and development | 20,750 | 13,335 | |||||||||
Selling, general and administrative | 131,582 | 84,737 | |||||||||
Total operating expenses | 152,332 | 98,072 | |||||||||
Loss from operations | (43,618) | (27,271) | |||||||||
Other income, net | 1,526 | ||||||||||
Loss before income taxes | (48,236) | ||||||||||
Net loss | $ (11,467) | $ (8,019) | $ (14,713) | $ (12,206) | (11,117) | $ (48,280) | $ (29,420) | ||||
Net loss per common share, basic and diluted | $ (0.46) | $ (0.33) | $ (0.61) | $ (0.51) | $ (2.02) | $ (1.30) | |||||
Adjustment | |||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Revenue | $ (890) | $ 1,120 | $ (1,373) | $ (177) | 1,197 | $ (16) | $ 620 | ||||
Cost of revenue | 216 | 495 | |||||||||
Gross profit | (1,077) | 1,077 | (1,650) | (173) | 1,258 | (232) | 125 | ||||
Research and development | 110 | (70) | |||||||||
Selling, general and administrative | 1,731 | 515 | |||||||||
Total operating expenses | 1,841 | 445 | |||||||||
Loss from operations | (2,073) | (320) | |||||||||
Other income, net | (25) | ||||||||||
Loss before income taxes | (2,098) | ||||||||||
Net loss | $ 742 | $ (231) | $ (1,557) | $ (1,098) | $ 40 | $ (2,098) | $ (320) | ||||
Net loss per common share, basic and diluted | $ 0.03 | $ (0.01) | $ (0.06) | $ (0.05) | $ (0.09) | $ (0.01) |
Revision of Prior Period Fina_5
Revision of Prior Period Financial Statements - Schedule of Revised Consolidated Statements of Comprehensive Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Net loss | $ (17,300) | $ (18,293) | $ (10,725) | $ (8,250) | $ (16,270) | $ (9,727) | $ (13,304) | $ (11,077) | $ (54,568) | $ (50,378) | $ (29,740) |
Net change in unrealized gains on available-for-sale securities | 98 | 49 | (56) | ||||||||
Comprehensive loss | $ (54,470) | (50,329) | (29,796) | ||||||||
As Reported | |||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Net loss | (11,467) | (8,019) | (14,713) | (12,206) | (11,117) | (48,280) | (29,420) | ||||
Net change in unrealized gains on available-for-sale securities | 24 | ||||||||||
Comprehensive loss | (48,256) | (29,476) | |||||||||
Adjustment | |||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Net loss | $ 742 | $ (231) | $ (1,557) | $ (1,098) | $ 40 | (2,098) | (320) | ||||
Net change in unrealized gains on available-for-sale securities | 25 | ||||||||||
Comprehensive loss | $ (2,073) | $ (320) |
Revision of Prior Period Fina_6
Revision of Prior Period Financial Statements - Schedule of Revised Consolidated Statements of Cash Flows (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cash flows from operating activities | |||
Net loss | $ (54,568) | $ (50,378) | $ (29,740) |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Provision for bad debt and contractual allowances | 16,448 | 9,222 | |
Stock-based compensation | 26,241 | 16,329 | 9,752 |
Accounts receivable | 28,725 | 21,747 | 12,471 |
Accrued liabilities | 6,002 | 10,501 | 5,757 |
Deferred revenue | 28 | (15) | 291 |
Net cash used in operating activities | (21,863) | (29,093) | (14,911) |
Cash flows from investing activities | |||
Payments to Acquire Property, Plant, and Equipment | 20,457 | 5,180 | 3,562 |
Net cash provided by investing activities | $ (89,274) | 34,142 | (34,684) |
Supplemental disclosures of cash flow information | |||
Purchases of available-for-sale investments | 93,133 | ||
Property, plant and equipment costs included in liabilities | 110 | ||
As Reported | |||
Cash flows from operating activities | |||
Net loss | (48,280) | (29,420) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Provision for bad debt and contractual allowances | 15,218 | 9,403 | |
Stock-based compensation | 10,123 | ||
Accounts receivable | 22,885 | 12,950 | |
Accrued liabilities | 10,776 | 5,364 | |
Deferred revenue | 5 | ||
Net cash used in operating activities | (29,068) | ||
Cash flows from investing activities | |||
Net cash provided by investing activities | 34,117 | ||
Supplemental disclosures of cash flow information | |||
Purchases of available-for-sale investments | 93,158 | ||
Property, plant and equipment costs included in liabilities | 35 | ||
Adjustment | |||
Cash flows from operating activities | |||
Net loss | (2,098) | (320) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Provision for bad debt and contractual allowances | 1,230 | (181) | |
Stock-based compensation | (371) | ||
Accounts receivable | (1,138) | (479) | |
Accrued liabilities | (275) | 393 | |
Deferred revenue | (20) | ||
Net cash used in operating activities | (25) | ||
Cash flows from investing activities | |||
Net cash provided by investing activities | 25 | ||
Supplemental disclosures of cash flow information | |||
Purchases of available-for-sale investments | $ (25) | ||
Property, plant and equipment costs included in liabilities | $ 75 |
Revision of Prior Period Fina_7
Revision of Prior Period Financial Statements - Schedule of Revised Consolidated Statements of Shareholder's Equity (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Net change in unrealized gains on available-for-sale securities | $ 98 | $ 49 | $ (56) | |||||||||
Total stockholders’ equity | $ 135,409 | $ 52,137 | 135,409 | 52,137 | 79,341 | $ 93,041 | ||||||
Net loss | (17,300) | $ (18,293) | $ (10,725) | $ (8,250) | (16,270) | $ (9,727) | $ (13,304) | $ (11,077) | (54,568) | (50,378) | (29,740) | |
As Reported | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Net change in unrealized gains on available-for-sale securities | 24 | |||||||||||
Total stockholders’ equity | 54,422 | 54,422 | 79,553 | |||||||||
Net loss | (11,467) | (8,019) | (14,713) | (12,206) | (11,117) | (48,280) | (29,420) | |||||
Adjustment | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Net change in unrealized gains on available-for-sale securities | 25 | |||||||||||
Total stockholders’ equity | (2,285) | (2,285) | (212) | |||||||||
Net loss | $ 742 | $ (231) | (1,557) | $ (1,098) | $ 40 | (2,098) | (320) | |||||
Accumulated Other Comprehensive Income (Loss) | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Net change in unrealized gains on available-for-sale securities | 98 | 49 | (56) | |||||||||
Total stockholders’ equity | 82 | (16) | 82 | (16) | (65) | (9) | ||||||
Accumulated Other Comprehensive Income (Loss) | As Reported | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Net change in unrealized gains on available-for-sale securities | 24 | |||||||||||
Total stockholders’ equity | (41) | (41) | ||||||||||
Accumulated Other Comprehensive Income (Loss) | Adjustment | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Net change in unrealized gains on available-for-sale securities | 25 | |||||||||||
Total stockholders’ equity | 25 | 25 | ||||||||||
Accumulated Deficit | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Total stockholders’ equity | $ (260,393) | (205,825) | (260,393) | (205,825) | (156,801) | (127,061) | ||||||
Net loss | $ (54,568) | (50,378) | (29,740) | |||||||||
Accumulated Deficit | As Reported | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Total stockholders’ equity | (203,515) | (203,515) | (156,589) | (127,169) | ||||||||
Net loss | (48,280) | (29,420) | ||||||||||
Accumulated Deficit | Adjustment | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Total stockholders’ equity | $ (2,310) | (2,310) | (212) | $ 108 | ||||||||
Net loss | $ (2,098) | $ (320) |
Uncategorized Items - irtc-2019
Label | Element | Value |
Accounting Standards Update 2014-09 [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 1,354,000 |
Accounting Standards Update 2014-09 [Member] | Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 1,354,000 |