Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2019 | Nov. 12, 2019 | |
Document And Entity Information | ||
Entity Registrant Name | PowerFleet, Inc. | |
Entity Central Index Key | 0001774170 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2019 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | false | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 29,686,727 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2019 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 5,560,000 | $ 10,159,000 |
Restricted cash | 307,000 | 307,000 |
Investments - short term | 394,000 | |
Accounts receivable, net of allowance for doubtful accounts of $67,000 and $160,000 in 2018 and 2019, respectively | 13,821,000 | 9,247,000 |
Financing receivables - current, net of allowance for doubtful accounts of $-0- in 2018 and 2019 | 950,000 | 1,036,000 |
Inventory, net | 9,761,000 | 4,649,000 |
Deferred costs - current | 3,868,000 | 3,660,000 |
Prepaid expenses and other current assets | 2,822,000 | 3,208,000 |
Total current assets | 37,089,000 | 32,660,000 |
Investments - long term | 4,131,000 | |
Financing receivables - less current portion | 972,000 | 1,254,000 |
Deferred costs - less current portion | 5,467,000 | 5,409,000 |
Fixed assets, net | 2,070,000 | 2,149,000 |
Goodwill | 9,362,000 | 7,318,000 |
Intangible assets, net | 6,292,000 | 4,705,000 |
Right of use asset | 1,822,000 | |
Other assets | 204,000 | 177,000 |
Total assets | 63,278,000 | 57,803,000 |
Current liabilities: | ||
Accounts payable and accrued expenses | 16,583,000 | 8,027,000 |
Deferred revenue - current | 8,095,000 | 7,902,000 |
Acquisition related contingent consideration payable | 946,000 | |
Lease liability - current | 849,000 | |
Total current liabilities | 25,527,000 | 16,875,000 |
Deferred revenue - less current portion | 9,019,000 | 9,186,000 |
Lease liability - less current portion | 1,122,000 | |
Deferred rent | 208,000 | |
Total Liabilities | 35,668,000 | 26,269,000 |
Commitments and Contingencies (Note 21) | ||
STOCKHOLDERS' EQUITY | ||
Preferred stock; authorized 5,000,000 shares, $0.01 par value; none issued | ||
Common stock; authorized 50,000,000 shares, $0.01 par value; 19,178,000 and 19,653,000 shares issued at December 31, 2018 and September 30, 2019, respectively; shares outstanding, 18,166,000 and 18,597,000 at December 31, 2018 and September 30, 2019, respectively | 197,000 | 192,000 |
Additional paid-in capital | 141,753,000 | 138,693,000 |
Accumulated deficit | (108,058,000) | (101,180,000) |
Accumulated other comprehensive loss | (255,000) | (435,000) |
Treasury stock; 1,012,000 and 1,056,000 common shares at cost at December 31, 2018 and September 30, 2019, respectively | (6,027,000) | (5,736,000) |
Total stockholders' equity | 27,610,000 | 31,534,000 |
Total liabilities and stockholders' equity | $ 63,278,000 | $ 57,803,000 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts, accounts receivable current | $ 160,000 | $ 67,000 |
Allowance for doubtful accounts, financial receivables current | $ 0 | $ 0 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares issued | ||
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares issued | 19,653,000 | 19,178,000 |
Common stock, shares outstanding | 18,597,000 | 18,166,000 |
Treasury stock, shares | 1,056,000 | 1,012,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Revenue: | ||||
Total Revenue | $ 16,884,000 | $ 13,385,000 | $ 46,769,000 | $ 41,573,000 |
Cost of revenue: | ||||
Total Cost of revenue | 9,254,000 | 6,588,000 | 25,050,000 | 21,899,000 |
Gross profit | 7,630,000 | 6,797,000 | 21,719,000 | 19,674,000 |
Operating expenses: | ||||
Selling, general and administrative expenses | 6,321,000 | 5,870,000 | 18,424,000 | 17,231,000 |
Research and development expenses | 1,824,000 | 1,696,000 | 5,508,000 | 4,981,000 |
Acquisition-related expenses | 1,611,000 | 51,000 | 4,673,000 | 379,000 |
Total Operating expenses | 9,756,000 | 7,617,000 | 28,605,000 | 22,591,000 |
Loss from operations | (2,126,000) | (820,000) | (6,886,000) | (2,917,000) |
Interest income | 37,000 | 66,000 | 110,000 | 217,000 |
Interest expense | (10,000) | (34,000) | (56,000) | (150,000) |
Other expense, net | (109,000) | (46,000) | (153,000) | |
Net loss | $ (2,099,000) | $ (897,000) | $ (6,878,000) | $ (3,003,000) |
Net loss per share - basic and diluted | $ (0.12) | $ (0.05) | $ (0.39) | $ (0.18) |
Weighted average common shares outstanding - basic and diluted | 17,929,000 | 17,312,000 | 17,744,000 | 17,121,000 |
Products [Member] | ||||
Revenue: | ||||
Total Revenue | $ 11,062,000 | $ 9,044,000 | $ 28,954,000 | $ 29,726,000 |
Cost of revenue: | ||||
Total Cost of revenue | 7,227,000 | 5,287,000 | 18,528,000 | 18,537,000 |
Service [Member] | ||||
Revenue: | ||||
Total Revenue | 5,822,000 | 4,341,000 | 17,815,000 | 11,847,000 |
Cost of revenue: | ||||
Total Cost of revenue | $ 2,027,000 | $ 1,301,000 | $ 6,522,000 | $ 3,362,000 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (2,099,000) | $ (897,000) | $ (6,878,000) | $ (3,003,000) |
Other comprehensive (loss) income, net: | ||||
Unrealized gain (loss) gain on investments | (22,000) | 9,000 | (137,000) | |
Reclassification of net realized investment (gain) loss included in net loss | 110,000 | 38,000 | 153,000 | |
Foreign currency translation adjustment | 191,000 | 55,000 | 133,000 | 107,000 |
Total other comprehensive income | 191,000 | 143,000 | 180,000 | 123,000 |
Comprehensive loss | $ (1,908,000) | $ (754,000) | $ (6,698,000) | $ (2,880,000) |
Condensed Consolidated Statem_3
Condensed Consolidated Statement of Changes in Stockholders' Equity (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Accumulated Other Comprehensive Loss [Member] | Treasury Stock [Member] | Total |
Balance at Dec. 31, 2017 | $ 183,000 | $ 133,569,000 | $ (95,368,000) | $ (578,000) | $ (4,835,000) | $ 32,971,000 |
Balance, shares at Dec. 31, 2017 | 18,327,000 | |||||
Net loss | (990,000) | (990,000) | ||||
Foreign currency translation adjustment | (137,000) | (137,000) | ||||
Unrealized loss on investments, net of realized amounts | (60,000) | (60,000) | ||||
Shares issued pursuant to exercise of stock options | $ 1,000 | 424,000 | 425,000 | |||
Shares issued pursuant to exercise of stock options, shares | 65,000 | |||||
Issuance of restricted stock | $ 2,000 | $ (2,000) | ||||
Issuance of restricted stock, shares | 235,000 | |||||
Shares withheld pursuant to vesting of restricted stock | (408,000) | (408,000) | ||||
Shares withheld pursuant to exercise of stock options | $ (238,000) | $ (238,000) | ||||
Forfeiture of restricted shares | ||||||
Forfeiture of restricted shares, shares | (20,000) | |||||
Stock based compensation - restricted stock | 431,000 | 431,000 | ||||
Stock based compensation - options and performance shares | 63,000 | 63,000 | ||||
Balance at Mar. 31, 2018 | $ 186,000 | 134,485,000 | (96,358,000) | (775,000) | (5,481,000) | 32,057,000 |
Balance, shares at Mar. 31, 2018 | 18,607,000 | |||||
Balance at Dec. 31, 2017 | $ 183,000 | 133,569,000 | (95,368,000) | (578,000) | (4,835,000) | 32,971,000 |
Balance, shares at Dec. 31, 2017 | 18,327,000 | |||||
Net loss | (3,003,000) | |||||
Foreign currency translation adjustment | 107,000 | |||||
Unrealized loss on investments, net of realized amounts | 16,000 | |||||
Balance at Sep. 30, 2018 | $ 191,000 | 137,829,000 | (98,371,000) | (455,000) | (5,705,000) | 33,489,000 |
Balance, shares at Sep. 30, 2018 | 19,112,000 | |||||
Balance at Mar. 31, 2018 | $ 186,000 | 134,485,000 | (96,358,000) | (775,000) | (5,481,000) | 32,057,000 |
Balance, shares at Mar. 31, 2018 | 18,607,000 | |||||
Net loss | (1,116,000) | (1,116,000) | ||||
Foreign currency translation adjustment | 189,000 | 189,000 | ||||
Unrealized loss on investments, net of realized amounts | (12,000) | (12,000) | ||||
Shares issued pursuant to exercise of stock options | 3,000 | 3,000 | ||||
Shares issued pursuant to exercise of stock options, shares | 1,000 | |||||
Issuance of restricted stock | $ 2,000 | (2,000) | ||||
Issuance of restricted stock, shares | 121,000 | |||||
Shares withheld pursuant to exercise of stock options | ||||||
Forfeiture of restricted shares | ||||||
Forfeiture of restricted shares, shares | ||||||
Stock based compensation - restricted stock | 500,000 | 500,000 | ||||
Stock based compensation - options and performance shares | 95,000 | 95,000 | ||||
Shares repurchased pursuant to vesting of restricted stock | (48,000) | (48,000) | ||||
Balance at Jun. 30, 2018 | $ 188,000 | 135,081,000 | (97,474,000) | (598,000) | (5,529,000) | 31,668,000 |
Balance, shares at Jun. 30, 2018 | 18,729,000 | |||||
Net loss | (897,000) | (897,000) | ||||
Foreign currency translation adjustment | 55,000 | 55,000 | ||||
Unrealized loss on investments, net of realized amounts | 88,000 | 88,000 | ||||
Shares issued pursuant to exercise of stock options | 182,000 | 182,000 | ||||
Shares issued pursuant to exercise of stock options, shares | 37,000 | |||||
Issuance of restricted stock | ||||||
Issuance of restricted stock, shares | 78,000 | |||||
Shares withheld pursuant to exercise of stock options | (11,000) | (11,000) | ||||
Forfeiture of restricted shares | ||||||
Forfeiture of restricted shares, shares | (28,000) | |||||
Stock based compensation - restricted stock | 465,000 | 465,000 | ||||
Stock based compensation - options and performance shares | 104,000 | 104,000 | ||||
Shares issued relating to acquisition contingent consideration | $ 3,000 | 1,997,000 | 2,000,000 | |||
Shares issued relating to acquisition contingent consideration, shares | 296,000 | |||||
Shares repurchased pursuant to vesting of restricted stock | (165,000) | (165,000) | ||||
Balance at Sep. 30, 2018 | $ 191,000 | 137,829,000 | (98,371,000) | (455,000) | (5,705,000) | 33,489,000 |
Balance, shares at Sep. 30, 2018 | 19,112,000 | |||||
Balance at Dec. 31, 2018 | $ 192,000 | 138,693,000 | (101,180,000) | (435,000) | (5,736,000) | 31,534,000 |
Balance, shares at Dec. 31, 2018 | 19,178,000 | |||||
Net loss | (2,194,000) | (2,194,000) | ||||
Foreign currency translation adjustment | (12,000) | (12,000) | ||||
Shares issued pursuant to exercise of stock options | ||||||
Shares issued pursuant to exercise of stock options, shares | ||||||
Issuance of restricted stock | $ 1,000 | (1,000) | ||||
Issuance of restricted stock, shares | 81,000 | |||||
Stock based compensation - restricted stock | 447,000 | 447,000 | ||||
Stock based compensation - options and performance shares | 136,000 | 136,000 | ||||
Shares repurchased pursuant to vesting of restricted stock | (226,000) | (226,000) | ||||
Reclassification of realized losses on investments, net of unrealized amounts | 47,000 | 47,000 | ||||
Balance at Mar. 31, 2019 | $ 193,000 | 139,275,000 | (103,374,000) | (400,000) | (5,962,000) | 29,732,000 |
Balance, shares at Mar. 31, 2019 | 19,259,000 | |||||
Balance at Dec. 31, 2018 | $ 192,000 | 138,693,000 | (101,180,000) | (435,000) | (5,736,000) | 31,534,000 |
Balance, shares at Dec. 31, 2018 | 19,178,000 | |||||
Net loss | (6,878,000) | |||||
Foreign currency translation adjustment | 133,000 | |||||
Unrealized loss on investments, net of realized amounts | 47,000 | |||||
Balance at Sep. 30, 2019 | $ 197,000 | 141,753,000 | (108,058,000) | (255,000) | (6,027,000) | 27,610,000 |
Balance, shares at Sep. 30, 2019 | 19,653,000 | |||||
Balance at Mar. 31, 2019 | $ 193,000 | 139,275,000 | (103,374,000) | (400,000) | (5,962,000) | 29,732,000 |
Balance, shares at Mar. 31, 2019 | 19,259,000 | |||||
Net loss | (2,585,000) | (2,585,000) | ||||
Foreign currency translation adjustment | (46,000) | (46,000) | ||||
Shares issued pursuant to exercise of stock options | 177,000 | 177,000 | ||||
Shares issued pursuant to exercise of stock options, shares | 50,000 | |||||
Issuance of restricted stock | $ 2,000 | (2,000) | ||||
Issuance of restricted stock, shares | 164,000 | |||||
Stock based compensation - restricted stock | 440,000 | 449,000 | ||||
Stock based compensation - options and performance shares | 161,000 | 152,000 | ||||
Shares repurchased pursuant to vesting of restricted stock | (19,000) | (19,000) | ||||
Reclassification of realized losses on investments, net of unrealized amounts | ||||||
Balance at Jun. 30, 2019 | $ 195,000 | 140,051,000 | (105,959,000) | (446,000) | (5,981,000) | 27,860,000 |
Balance, shares at Jun. 30, 2019 | 19,473,000 | |||||
Net loss | (2,099,000) | (2,099,000) | ||||
Foreign currency translation adjustment | 191,000 | 191,000 | ||||
Issuance of restricted stock | $ 1,000 | (1,000) | ||||
Issuance of restricted stock, shares | 10,000 | |||||
Forfeiture of restricted shares | ||||||
Forfeiture of restricted shares, shares | (5,000) | |||||
Stock based compensation - restricted stock | 387,000 | 387,000 | ||||
Stock based compensation - options and performance shares | 161,000 | 161,000 | ||||
Shares issued pursuant to acquisition | 156,000 | 156,000 | ||||
Shares issued pursuant to acquisition, shares | 27,000 | |||||
Shares repurchased pursuant to vesting of restricted stock | (46,000) | (46,000) | ||||
Shares issued relating to Keytroller acquisition consideration | $ 1,000 | 999,000 | 1,000,000 | |||
Shares issued relating to Keytroller acquisition consideration, shares | 148,000 | |||||
Balance at Sep. 30, 2019 | $ 197,000 | $ 141,753,000 | $ (108,058,000) | $ (255,000) | $ (6,027,000) | $ 27,610,000 |
Balance, shares at Sep. 30, 2019 | 19,653,000 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Cash flows from operating activities: (net of assets acquired) | ||
Net loss | $ (6,878,000) | $ (3,003,000) |
Adjustments to reconcile net loss to cash used in operating activities: | ||
Bad debt expense | 155,000 | 15,000 |
Stock-based compensation expense | 1,732,000 | 1,658,000 |
Depreciation and amortization | 1,299,000 | 1,174,000 |
Inventory reserve | 156,000 | 260,000 |
Change in contingent consideration | 54,000 | 146,000 |
Other non-cash items | (37,000) | 93,000 |
Changes in: | ||
Accounts receivable | (4,537,000) | (835,000) |
Financing receivables | 368,000 | 511,000 |
Inventory | (5,069,000) | 372,000 |
Prepaid expenses and other assets | 386,000 | (1,152,000) |
Deferred costs | (266,000) | (17,000) |
Deferred revenue | 26,000 | (567,000) |
Accounts payable and accrued expenses | 8,306,000 | 1,168,000 |
Net cash used in operating activities | (4,305,000) | (177,000) |
Cash flows from investing activities: | ||
Acquisitions | (4,350,000) | |
Capital expenditures | (501,000) | (155,000) |
Purchase of investments | (99,000) | (2,415,000) |
Proceeds from the sale and maturities of investments | 4,638,000 | 9,308,000 |
Net cash provided by (used in) investing activities | (312,000) | 6,738,000 |
Cash flows from financing activities: | ||
Proceeds from exercise of stock options | 177,000 | 361,000 |
Shares repurchased pursuant to vesting of restricted stock | (291,000) | (621,000) |
Net cash used in financing activities | (114,000) | (260,000) |
Effect of foreign exchange rate changes on cash and cash equivalents | 132,000 | 130,000 |
Net increase (decrease) in cash, cash equivalents and restricted cash | (4,599,000) | 6,431,000 |
Cash, cash equivalents and restricted cash - beginning of period | 10,466,000 | 5,403,000 |
Cash, cash equivalents and restricted cash - end of period | 5,867,000 | 11,834,000 |
Reconciliation of cash, cash equivalents, and restricted cash, beginning of period | ||
Cash and cash equivalents | 10,159,000 | 5,097,000 |
Restricted cash | 307,000 | 306,000 |
Cash, cash equivalents, and restricted cash, beginning of period | 10,466,000 | 5,403,000 |
Cash and cash equivalents | 5,560,000 | 11,528,000 |
Restricted cash | 307,000 | 306,000 |
Cash, cash equivalents, and restricted cash, end of beginning of period | 5,867,000 | 11,834,000 |
Cash paid for: | ||
Taxes | ||
Interest | 56,000 | |
Noncash investing and financing activities: | ||
Unrealized (loss) gain on investments | 47,000 | 16,000 |
Value of shares withheld pursuant to stock issuance | 249,000 | |
Value of shares issued relating to acquisition contingent consideration | 2,000,000 | |
Value of shares issued relating to Keytroller acquisition consideration | 1,000,000 | |
Value of shares issued pursuant to CarrierWeb Ireland acquisition | 156,000 | |
CarrierWeb Ireland acquisition related holdback | $ 250,000 |
Description of the Company and
Description of the Company and Basis of Presentation | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Description of the Company and Basis of Presentation | NOTE 1 - DESCRIPTION OF THE COMPANY AND BASIS OF PRESENTATION Description of the Company On October 3, 2019, pursuant to the transactions (the “Transactions”) contemplated by (i) the Agreement and Plan of Merger, dated as of March 13, 2019 (the “Merger Agreement”), by and among I.D. Systems, Inc., a Delaware corporation (“I.D. Systems”), PowerFleet, Inc., a Delaware corporation and a wholly-owned subsidiary of I.D. Systems prior to the Transactions (“PowerFleet” or the “Company”), Pointer Telocation Ltd., a public company limited by shares formed under the laws of the State of Israel (“Pointer”), Powerfleet Israel Holding Company Ltd., a private company limited by shares formed under the laws of the State of Israel and a wholly-owned subsidiary of PowerFleet (“Pointer Holdco”), and Powerfleet Israel Acquisition Company Ltd., a private company limited by shares formed under the laws of the State of Israel and a wholly-owned subsidiary of Pointer Holdco prior to the Transactions (“Pointer Merger Sub”), and (ii) the Investment and Transaction Agreement, dated as of March 13, 2019, as amended by Amendment No. 1 thereto dated as of May 16, 2019, Amendment No. 2 thereto dated as of June 27, 2019 and Amendment No. 3 thereto dated as of October 3, 2019 (the “Investment Agreement,” and together with the Merger Agreement, the “Agreements”), by and among I.D. Systems, PowerFleet, PowerFleet US Acquisition Inc., a Delaware corporation and a wholly-owned subsidiary of PowerFleet prior to the Transactions (“I.D. Systems Merger Sub”), and ABRY Senior Equity V, L.P., ABRY Senior Equity Co-Investment Fund V, L.P. and ABRY Investment Partnership, L.P. (the “Investors”), I.D. Systems reorganized into a new holding company structure by merging I.D. Systems Merger Sub with and into I.D. Systems, with I.D. Systems surviving as a direct, wholly-owned subsidiary of PowerFleet, and Pointer Merger Sub merged with and into Pointer, with Pointer surviving as a direct, wholly owned subsidiary of Pointer Holdco and an indirect, wholly-owned subsidiary of PowerFleet. Prior to the Transactions, PowerFleet had no material assets, did not operate any business and did not conduct any activities, other than those incidental to its formation and matters contemplated by the Agreements. I.D. Systems was determined to be the accounting acquirer in the Transactions. As a result, the historical financial statements of I.D. Systems for the periods prior to the Transactions are considered to be the historical financial statements of PowerFleet and the Condensed Consolidated Financial Statements only include the financial results for I.D. Systems as of and for the three- and nine-month periods ended September 30, 2019. See Note 23 for additional information regarding the Transactions. I.D. Systems and its subsidiaries (collectively, “I.D. Systems,” “we,” “our” or “us”) develop, market and sell wireless machine-to-machine solutions for managing and securing high-value enterprise assets. These assets include industrial vehicles such as forklifts and airport ground support equipment, rental vehicles and transportation assets, such as trucks, semi-tractors, dry van trailers, refrigerated trailers, railcars and containers. I.D. Systems’ patented wireless asset management systems utilize radio frequency identification (RFID), Wi-Fi, Bluetooth, satellite or cellular communications, and sensor technology and software to address the needs of organizations to control, track, monitor and analyze their assets. Our cloud-based analytics software application for both industrial trucks and logistics assets is designed to provide a single, integrated view of asset activity across multiple locations, generating enterprise-wide benchmarks and peer-industry comparisons to provide an even deeper layer of insights into asset operations. Analytics determines key performance indicators relating to the performance of managed assets. I.D. Systems’ solutions enable customers to achieve tangible economic benefits by making timely, informed decisions that increase the safety, security, revenue, productivity and efficiency of their operations. I.D. Systems outsources its hardware manufacturing operations to contract manufacturers. I.D. Systems, Inc. was incorporated in Delaware in 1993 and commenced operations in January 1994. PowerFleet, Inc. was incorporated in Delaware in 2019 and commenced operations in October 2019. Basis of Presentation The unaudited interim condensed consolidated financial statements include the accounts of I.D. Systems, Inc. and its wholly-owned subsidiaries, Asset Intelligence, LLC (“AI”), I.D. Systems GmbH (“IDS GmbH”), I.D. Systems (UK) Ltd (formerly Didbox Ltd.) (“IDS Ltd”) and Keytroller, LLC (collectively referred to as “I.D. Systems”). All material intercompany balances and transactions have been eliminated in consolidation. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and the instructions to Form 10-Q. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, such statements include all adjustments (consisting only of normal recurring items) which are considered necessary for a fair presentation of the consolidated financial position of I.D. Systems as of September 30, 2019, the consolidated results of its operations for the three- and nine-month periods ended September 30, 2018 and 2019, the consolidated change in stockholders’ equity for the three-month periods ended March 31, June 30, and September 30, 2018 and 2019 and the consolidated cash flows for the nine-month periods ended September 30, 2018 and 2019. The results of operations for the three- and nine-month periods ended September 30, 2019 are not necessarily indicative of the operating results for the full year. These financial statements should be read in conjunction with the audited consolidated financial statements and related disclosures for the year ended December 31, 2018 included in I.D. Systems’ Annual Report on Form 10-K for the year then ended. Certain amounts included in selling, general and administrative expenses in the prior period’s consolidated financial statements have been reclassified to acquisition-related expenses to conform to the current period presentation for comparative purposes. Acquisition On January 30, 2019, I.D. Systems completed the acquisition (the “CarrierWeb US Acquisition”) of substantially all of the assets of CarrierWeb, L.L.C. (“CarrierWeb”), an Atlanta-based provider of real-time in-cab mobile communications technology, electronic logging devices, two-way refrigerated command and control, and trailer tracking. On July 30, 2019, I.D. Systems completed the acquisition (the “CarrierWeb Ireland Acquisition” and together with the CarrierWeb US Acquisition, the “CarrierWeb Acquisitions”) of substantially all of the assets of CarrierWeb Services Ltd. (“CarrierWeb Ireland”), an affiliate of CarrierWeb, from e*freightrac Holding B.V., the owner of the outstanding equity of CarrierWeb Ireland. The assets I.D. Systems acquired in the CarrierWeb Acquisitions will be integrated into the Company’s logistics visibility solutions and product line. The CarrierWeb Acquisitions allow the Company to offer a full complement of highly-integrated logistics technology solutions to its current customers and prospects and immediately add customers and subscriber units. Liquidity As of September 30, 2019, I.D. Systems had cash (including restricted cash) and cash equivalents of $5.9 million and working capital of $11.6 million. The Company’s primary sources of cash are cash flows from operating activities and the Company’s holdings of cash and cash equivalents from the sale of common stock. To date, the Company has not generated sufficient cash flows solely from operating activities to fund its operations. The Company believes that its available working capital, anticipated level of future revenues, expected cash flows from operations and available borrowings under its revolving credit facility with Bank Hapoalim B.M. (see Note 23) will provide sufficient funds to cover capital requirements through at least November 14, 2020. |
Cash and Cash Equivalents
Cash and Cash Equivalents | 9 Months Ended |
Sep. 30, 2019 | |
Cash and Cash Equivalents [Abstract] | |
Cash and Cash Equivalents | NOTE 2 - CASH AND CASH EQUIVALENTS I.D. Systems considers all highly liquid debt instruments purchased with an original maturity of three months or less to be cash equivalents unless they are legally or contractually restricted. I.D. Systems’ cash and cash equivalent balances exceed Federal Deposit Insurance Corporation (FDIC) limits. |
Use of Estimates
Use of Estimates | 9 Months Ended |
Sep. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Use of Estimates | NOTE 3 - USE OF ESTIMATES The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company continually evaluates estimates used in the preparation of the financial statements for reasonableness. The most significant estimates relate to stock-based compensation arrangements, measurements of fair value of assets acquired and liabilities assumed and acquisition-related contingent consideration, realization of deferred tax assets, the impairment of tangible and intangible assets, inventory reserves, allowance for doubtful accounts, warranty reserves and deferred revenue and costs. Actual results could differ from those estimates. |
Investments
Investments | 9 Months Ended |
Sep. 30, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | NOTE 4 - INVESTMENTS I.D. Systems’ investments as of December 31, 2018 include debt securities, U.S. Treasury Notes, government and state agency bonds and corporate bonds, which are classified as either available for sale, held to maturity or trading, depending on management’s investment intentions relating to these securities. As of December 31, 2018, all of I.D. Systems’ investments are classified as available for sale. Available for sale securities are measured at fair value based on quoted market values of the securities, with the unrealized gains and (losses) reported as comprehensive income or (loss). For the three- and nine-month periods ended September 30, 2018, I.D. Systems reported unrealized loss, net of realized amounts of $(22,000) and $(137,000), respectively, and for the three- and nine-month periods ended September 30, 2019, I.D. Systems reported unrealized gain, net of realized amounts of $-0- and $9,000, respectively, on available for sale securities in total comprehensive loss. Realized gains and losses from the sale of available for sale securities are determined on a specific-identification basis. I.D. Systems has classified as short-term those securities that mature within one year. All other securities are classified as long-term. The cost, gross unrealized gains (losses) and fair value of available for sale securities by major security types as of December 31, 2018 are as follows: Unrealized Unrealized Fair December 31, 2018 Cost Gain Loss Value Investments - short term U.S. Treasury Notes $ 302,000 $ 1,000 - $ 303,000 Corporate bonds and commercial paper 91,000 - - 91,000 Total investments - short term 393,000 1,000 394,000 Investments - long term U.S. Treasury Notes 1,569,000 - (2,000 ) 1,567,000 Government agency bonds 1,548,000 - (23,000 ) 1,525,000 Corporate bonds 1,062,000 - (23,000 ) 1,039,000 Total investments - long term 4,179,000 - (48,000 ) 4,131,000 Total investments - available for sale $ 4,572,000 $ 1,000 $ (48,000 ) $ 4,525,000 The Company utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those levels: ● Level 1: Unadjusted quoted prices in active markets for identical assets or liabilities. ● Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. ● Level 3: Unobservable inputs that reflect the reporting entity’s estimates of market participants’ assumptions. As of December 31, 2018, all of I.D. Systems’ investments are classified as Level 1 fair value measurements. |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Sep. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | NOTE 5 - REVENUE RECOGNITION Our revenue is derived from: (i) sales of our wireless asset management systems and spare parts; (ii) remotely hosted SaaS agreements and post-contract maintenance and support agreements; (iii) services, which includes training and technical support; and (iv) periodically, leasing arrangements. Amounts invoiced to customers which are not recognized as revenue are classified as deferred revenue and classified as short-term or long-term based upon the terms of future services to be delivered. Revenue is recognized when obligations under the terms of a contract with our customer are satisfied; generally this occurs with the transfer of control of our wireless asset management systems, spare parts, or services. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods or providing services. Sales, value add, and other taxes we collect concurrent with revenue-producing activities are excluded from revenue. Incidental items that are immaterial in the context of the contract are recognized as expense. The expected costs associated with our base warranties continue to be recognized as expense when the products are sold (see Note 15). We recognize revenue for remotely hosted SaaS agreements and post-contract maintenance and support agreements beyond our standard warranties over the life of the contract. The following table sets forth our revenues by product line for the three- and nine-month periods ended September 30, 2019 and 2018: Three Months Ended September 30, 2019 Product Service Total Industrial truck management $ 5,743,000 $ 2,007,000 $ 7,750,000 Connected vehicles 2,985,000 1,518,000 4,503,000 Logistics visibility 2,334,000 2,297,000 4,631,000 Total Revenue $ 11,062,000 $ 5,822,000 $ 16,884,000 Three Months Ended September 30, 2018 Product Service Total Industrial truck management $ 6,172,000 $ 2,027,000 $ 8,199,000 Connected vehicles 1,462,000 399,000 1,861,000 Logistics visibility 1,410,000 1,915,000 3,325,000 Total Revenue $ 9,044,000 $ 4,341,000 $ 13,385,000 Nine Months Ended September 30, 2019 Product Service Total Industrial truck management $ 16,751,000 $ 5,671,000 $ 22,422,000 Connected vehicles 6,106,000 5,415,000 11,521,000 Logistics visibility 6,097,000 6,729,000 12,826,000 Total Revenue $ 28,954,000 $ 17,815,000 $ 46,769,000 Nine Months Ended September 30, 2018 Product Service Total Industrial truck management $ 16,866,000 $ 5,333,000 $ 22,199,000 Connected vehicles 8,491,000 616,000 9,107,000 Logistics visibility 4,369,000 5,898,000 10,267,000 Total Revenue $ 29,726,000 $ 11,847,000 $ 41,573,000 Our wireless asset management systems consist of on-asset hardware, communication infrastructure, SaaS, and hosting infrastructure. I.D. Systems’ system is typically implemented by the customer or a third party and, as a result, revenue related to the on-asset hardware is recognized when control of the hardware is transferred to the customer, which usually is upon delivery of the system and contractual obligations have been satisfied. For systems which do not have stand-alone value to the customer separate from the SaaS services provided, I.D. Systems considers both hardware and SaaS services a bundled performance obligation. Under the applicable accounting guidance, all of I.D. Systems’ billings for equipment and the related cost for these systems are deferred, recorded, and classified as a current and long-term liability and a current and long-term asset, respectively. The deferred revenue and cost are recognized over the service contract life, ranging from one to five years, beginning at the time that a customer acknowledges acceptance of the equipment and service. Revenue related to the SaaS and hosting infrastructure performance obligation is recognized over time as access to the SaaS and hosting infrastructure is provided to the customer. In some instances, we are also responsible for providing installation services, training and technical support services which are short-term in nature and revenue for these services are recognized at the time of performance or right to invoice. I.D. Systems also enters into post-contract maintenance and support agreements for its wireless asset management systems. Revenue is recognized ratably over the service periods and the cost of providing these services is expensed as incurred. Deferred revenue includes prepayment of extended maintenance, SaaS, hosting and support contracts. I.D. Systems also derives revenue under leasing arrangements. Such arrangements provide for monthly payments covering the system sale, maintenance, support and interest. These arrangements meet the criteria to be accounted for as sales-type leases. Accordingly, an asset is established for the “sales-type lease receivable” at the present value of the expected lease payments and revenue is deferred and recognized over the service contract, as described above. Maintenance revenues and interest income are recognized monthly over the lease term. Sales taxes collected from customers and remitted to governmental authorities are accounted for on a net basis and therefore are excluded from revenues in the Condensed Consolidated Statements of Operations. The balances of contract assets, and contract liabilities from contracts with customers are as follows as of December 31, 2018 and September 30, 2019: December 31, 2018 September 30, 2019 (Unaudited) Current assets: Deferred sales commissions to employees $ 585,000 $ 748,000 Deferred costs $ 9,069,000 $ 9,335,000 Current liabilities: Deferred revenue -other (1) $ 305,000 $ 272,000 Deferred maintenance and SaaS revenue (1) 4,607,000 4,815,000 Deferred logistics visibility solutions product revenue (1) 12,176,000 12,027,000 17,088,000 17,114,000 Less: Current portion 7,902,000 8,095,000 Deferred revenue - less current portion $ 9,186,000 $ 9,019,000 (1) We record deferred revenues when cash payments are received or due in advance of our performance. For the three- and nine-month periods ended September 30, 2018 and 2019, we recognized revenue of $2,434,000 and $9,325,000, respectively, and $3,306,000 and $9,544,000, respectively, that was included in the deferred revenue balance at the beginning of each reporting period. We expect to recognize deferred revenue as revenue before year 2024, when we transfer those goods and services and, therefore, satisfies our performance obligation to the customers. We do not separately account for activation fees since no good or service is transferred to the customer. Therefore, the activation fee is included in the transaction price and allocated to the performance obligations in the contract and deferred/amortized over the life of the contract. Arrangements with multiple performance obligations Our contracts with customers may include multiple performance obligations. For such arrangements, we allocate revenue to each performance obligation based on its relative standalone selling price. We generally determine standalone selling prices based on observable prices charged to customers or adjusted market assessment or using expected cost-plus margin when one is available. Adjusted market assessment price is determined based on overall pricing objectives taking into consideration market conditions and entity specific factors. Practical expedients and exemptions We recognize an asset for the incremental costs of obtaining the contract arising from the sales commissions to employees because we expect to recover those costs through future fees from the customers. We amortize the asset over three to five years because the asset relates to the services transferred to the customer during the contract term of three to five years. We do not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed. Development projects with Avis Budget Car Rental, LLC On December 3, 2018 (the “SOW#5 Effective Date”), I.D. Systems entered into a statement of work (the “SOW#5”) with Avis Budget Car Rental, LLC (“ABCR”), a subsidiary of Avis Budget Group, Inc. (“Avis”), for 75,000 units of I.D. Systems’ cellular-enabled rental fleet car management system (the “System”) and maintenance and support of the System (“Maintenance Services”) for sixty months from installation of the equipment and the non-recurring engineering (“NRE”) services for development of additional features and functionality for the consideration of approximately $33,000,000. ABCR has an option to purchase additional units and has the option to renew the Maintenance Services period for an additional twelve months upon its expiry, and then after such 12-month period, ABCR can purchase additional Maintenance Services on a month-to-month basis (during which ABCR can terminate the Maintenance Services) for up to forty-eight additional months. I.D. Systems recognizes revenue on the non-recurring engineering services over time, on an input-cost method performance basis, as determined by the relationship of actual labor and material costs incurred to date compared to the estimated total project costs. Estimates of total project costs are reviewed and revised during the term of the project. Revisions to project costs estimates, where applicable, are recorded in the period in which the facts that give rise to such changes become known. For the three- and nine-month periods ended September 30, 2019, I.D. Systems recognized SOW#5 NRE revenue of $841,000 and $3,687,000, respectively. The SOW#5 may be terminated by ABCR for cause (which is generally I.D. Systems’ material breach of its obligations under the SOW#5), for convenience (subject to a termination fee), upon a material adverse change to I.D. Systems, or for intellectual property infringement. I.D. Systems does not have the right to unilaterally terminate the SOW#5. In the event that ABCR terminates the SOW#4, then ABCR would be liable to I.D. Systems for the net present value of all future remaining charges under the SOW#5 at a negotiated discount rate per annum, with the payment due on the effective date of termination. The SOW#5 provides for a period of exclusivity commencing on the SOW#5 Effective Date and ending twelve months after the SOW#5 Effective Date, which may be extended in six-month increments by Avis under certain conditions. Approximately $188,000 of the SOW#5 NRE transaction price that has not yet been recognized as revenue as of September 30, 2019 is expected to be recognized in 2019. Part of the performance credit earnbacks and incentive payments (“performance bonus”) have been excluded from the disclosure table above because it was not included in the transaction price. That part of the performance bonus was excluded from the transaction price in accordance with the accounting guidance in Topic 606 on constraining estimates of variable consideration, including the following factors: ● the susceptibility of the consideration amount to factors outside I.D. Systems’ influence, including weather conditions and the risk of obsolescence of the promised goods and services; ● whether the uncertainty about the consideration amount is not expected to be resolved for a long period of time; ● I.D. Systems’ experience with similar types of contracts; ● whether I.D. Systems expects to offer price concessions or change the payment terms; and ● the range of possible consideration amounts. |
Financing Receivables
Financing Receivables | 9 Months Ended |
Sep. 30, 2019 | |
Receivables [Abstract] | |
Financing Receivables | NOTE 6 - FINANCING RECEIVABLES Financing receivables consist of sales-type lease receivables from the sale of the Company’s products and services. The present value of net investment in sales-type lease receivable is principally for three- to five-year leases of I.D. Systems’ products and is reflected net of unearned interest income of $114,000 and $83,000 at December 31, 2018 and September 30, 2019, respectively, at a weighted-average discount rate of 3%. Scheduled maturities of sales-type lease minimum lease payments outstanding as of September 30, 2019 are as follows: Year ending December 31: October - December 2019 $ 253,000 2020 876,000 2021 471,000 2022 213,000 2023 91,000 Thereafter 18,000 1,922,000 Less: Current portion 950,000 Sales-type lease receivable - less current portion $ 972,000 The allowance for doubtful accounts represents I.D. Systems’ best estimate of the amount of credit losses in I.D. Systems’ existing sales-type lease receivables. The allowance for doubtful accounts is determined on an individual lease basis if it is probable that I.D. Systems will not collect all principal and interest contractually due. I.D. Systems considers its customers’ financial condition and historical payment patterns in determining the customers’ probability of default. The impairment is measured based on the present value of expected future cash flows discounted at the lease’s effective interest rate. There were no impairment losses recognized for the three- and nine-month periods ended September 30, 2018 and 2019. I.D. Systems does not accrue interest when a lease is considered impaired. When the ultimate collectability of the principal balance of the impaired lease is in doubt, all cash receipts on impaired leases are applied to reduce the principal amount of such leases until the principal has been recovered and are recognized as interest income thereafter. Impairment losses are charged against the allowance and increases in the allowance are charged to bad debt expense. Leases are written off against the allowance when all possible means of collection have been exhausted and the potential for recovery is considered remote. I.D. Systems resumes accrual of interest income when it is probable that I.D. Systems will collect the remaining principal and interest of an impaired lease. Leases become past due based on how recently payments have been received. |
Inventory
Inventory | 9 Months Ended |
Sep. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Inventory | NOTE 7 - INVENTORY Inventory, which primarily consists of finished goods and components used in I.D. Systems’ products, is stated at the lower of cost or net realizable value using the first-in first-out (FIFO) method. Inventory is shown net of a valuation reserve of $119,000 at December 31, 2018, and $159,000 at September 30, 2019. Inventories consist of the following: December 31, 2018 September 30, 2019 (Unaudited) Components $ 2,218,000 $ 1,518,000 Finished goods 2,431,000 8,243,000 $ 4,649,000 $ 9,761,000 |
Fixed Assets
Fixed Assets | 9 Months Ended |
Sep. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Fixed Assets | NOTE 8 - FIXED ASSETS Fixed assets are stated at cost, less accumulated depreciation and amortization, and are summarized as follows: December 31, 2018 September 30, 2019 (Unaudited) Equipment $ 1,114,000 $ 1,236,000 Computer software and web application development 5,633,000 5,636,000 Computer hardware 2,664,000 2,578,000 Furniture and fixtures 466,000 505,000 Automobiles 60,000 60,000 Leasehold improvements 181,000 238,000 10,118,000 10,253,000 Accumulated depreciation and amortization (7,969,000 ) (8,183,000 ) $ 2,149,000 $ 2,070,000 Depreciation and amortization expense of fixed assets for the three- and nine-month periods ended September 30, 2018 was $214,000 and $640,000, respectively, and for the three- and nine-month periods ended September 30, 2019 was $194,000 and $573,000, respectively. This includes amortization of costs associated with computer software and web application development for the three- and nine-month periods ended September 30, 2018 of $133,000 and $395,000, respectively, and for the three- and nine-month periods ended September 30, 2019 of $131,000 and $397,000, I.D. Systems capitalizes in fixed assets the costs of software development and web application development. Specifically, the assets comprise an implementation and enhancements of Enterprise Resource Planning (ERP) software, enhancements to the VeriWise TM |
Acquisition
Acquisition | 9 Months Ended |
Sep. 30, 2019 | |
Business Combinations [Abstract] | |
Acquisition | NOTE 9 - ACQUISITION On January 30, 2019, I.D. Systems completed the CarrierWeb US Acquisition. Aggregate consideration for the CarrierWeb US Acquisition was $3,500,000, consisting of (i) closing cash payment of $2,800,000, which consisted of cash of $2,150,000 and a credit bid by I.D. Systems in the amount of the aggregate principal amount plus accrued and unpaid interest outstanding under a $650,000 debtor-in-possession loan made by I.D. Systems to CarrierWeb on January 11, 2019, and (ii) $700,000 payment in April 2019, when CarrierWeb Ireland was restored to the Register of Companies in Ireland. The CarrierWeb US Acquisition was subject to the entry of a sale order by the United States Bankruptcy Court for the Northern District of Georgia approving such acquisition. The sale order was entered on January 28, 2019. In connection with the restoration of CarrierWeb Ireland to the Register of Companies in Ireland, I.D. Systems also made certain loans to CarrierWeb Ireland in the aggregate principal amount of $300,000. On July 30, 2019, I.D. Systems, completed the CarrierWeb Ireland Acquisition. Consideration for the CarrierWeb Ireland Acquisition included (i) $550,000 in cash paid at closing, and (ii) 126,748 shares of I.D. Systems’ common stock, less (1) 55,783 shares for the satisfaction of aggregate principal amount plus accrued and unpaid interest outstanding under $300,000 loans, less (2) 43,706 shares held back with an estimated fair value of $250,000 which is included in accounts payable and accrued expenses in the Condensed Consolidated Balance Sheets. The assets I.D. Systems acquired in the CarrierWeb Acquisitions will be integrated into the Company’s logistics visibility solutions and products. In connection with the CarrierWeb Acquisitions, I.D. Systems offered employment to all of the former employees of CarrierWeb and CarrierWeb Ireland. The CarrierWeb Acquisitions allow the Company to offer a full complement of highly-integrated logistics technology solutions to its current customers and prospects and immediately add customers and subscriber units. For the three- and nine-month periods ended September 30, 2019, I.D. Systems incurred acquisition-related expenses of approximately $(15,000) and $145,000, respectively, which are included in acquisition-related fees. The purchase method of accounting in accordance with ASC805, Business Combinations The following table summarizes the approximate preliminary purchase price allocation of CarrierWeb and CarrierWeb Ireland based on estimated fair values of the net assets acquired at the acquisition date: Accounts receivable $ 192,000 Inventory 200,000 Other assets 26,000 Customer relationships 1,080,000 Trademark and tradename 112,000 Patents 1,121,000 Goodwill (a) 2,044,000 Net assets acquired $ 4,775,000 (a) The goodwill is fully deductible for tax purposes. The Company will finalize the purchase price allocation as soon as all the required information is available. The results of operations of CarrierWeb and CarrierWeb Ireland have been included in the condensed consolidated statement of operations as of the effective date of acquisitions. For the three- and nine-month periods ended September 30, 2019, the CarrierWeb and CarrierWeb Ireland acquisitions contributed approximately $1,111,000 and $3,087,000, respectively, to I.D. Systems’ revenues. Operating income contributed by the CarrierWeb and CarrierWeb Ireland acquisitions was not separately identifiable due to Company’s integration activities and is impracticable to provide. On July 31, 2017, I.D. Systems, together with its wholly-owned subsidiary Keytroller, acquired substantially all of the assets of Keytroller, LLC, a Florida limited liability company (the “Keytroller Acquisition”), pursuant to an asset purchase agreement (as amended, the “Keytroller Purchase Agreement”) by and among I.D. Systems, Keytroller, Keytroller, LLC, a Florida limited liability company (n/k/a Sparkey, LLC) (“Sparkey”) and the principals of Sparkey party thereto. Consideration for the Keytroller Acquisition included (i) $7,098,000 in cash paid at closing, (ii) 295,902 shares of I.D. Systems’ common stock issued at closing with a fair value of $2,000,000 and (iii) up to $3,000,000 of shares of I.D. Systems’ common stock as potential earn-out payments to be made on the first and second anniversaries of the closing date of the Keytroller Acquisition, computed in accordance with the terms of the Keytroller Purchase Agreement. The potential earn-out payments were estimated at a fair value of $2,683,000. During the fourth quarter of 2017, I.D. Systems paid a post-closing working capital adjustment of $275,000. On September 14, 2018, I.D. Systems issued 296,000 shares of its common stock for the earn-out payment for the twelve-month period ending on the first anniversary of the closing date of the Keytroller Acquisition. On August 17, 2019, I.D. Systems issued 147,951 shares of its common stock for the earn-out payment for the twelve-month period ending on the second anniversary of the closing date of the Keytroller Acquisition. |
Intangible Assets and Goodwill
Intangible Assets and Goodwill | 9 Months Ended |
Sep. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets and Goodwill | NOTE 10 - INTANGIBLE ASSETS AND GOODWILL The following table summarizes identifiable intangible assets of I.D. Systems as of December 31, 2018 and September 30, 2019: September 30, 2019 (Unaudited) Useful Lives (In Years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Amortized: Customer relationships 9 - 10 $ 4,203,000 (749,000 ) 3.454,000 Trademark and tradename 3 - 15 1,479,000 (296,000 ) 1,183,000 Patents 7 - 13 2,610,000 (1,416,000 ) 1,194,000 Favorable contract interest 5 388,000 (210,000 ) 178,000 Covenant not to compete 4 208,000 (90,000 ) 118,000 8,888,000 (2,761,000 ) 6,127,000 Unamortized: Customer list 104,000 - 104,000 Trademark and Tradename 61,000 - 61,000 165,000 - 165,000 Total $ 9,053,000 $ (2,761,000 ) $ 6,292,000 December 31, 2018 Useful Lives (In Years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Amortized: Customer relationships 10 $ 3,123,000 (442,000 ) 2,681,000 Trademark and tradename 10 - 15 1,367,000 (178,000 ) 1,189,000 Patents 11 1,489,000 (1,218,000 ) 271,000 Favorable contract interest 5 388,000 (137,000 ) 251,000 Covenant not to compete 4 208,000 (60,000 ) 148,000 6,575,000 (2,035,000 ) 4,540,000 Unamortized: Customer list 104,000 - 104,000 Trademark and Tradename 61,000 - 61,000 165,000 - 165,000 Total $ 6,740,000 $ (2,035,000 ) $ 4,705,000 Amortization expense for the three- and nine-month periods ended September 30, 2018 was $178,000 and $534,000, respectively, and for the three- and nine-month periods ended September 30, 2019 was $253,000 and $726,000, respectively. Estimated future amortization expense for each of the five succeeding fiscal years for these intangible assets is as follows: Year ending December 31: October - December 2019 $ 257,000 2020 1,029,000 2021 853,000 2022 745,000 2023 718,000 Thereafter 2,525,000 6,127,000 The change in goodwill from January 1, 2019 to September 30, 2019 is as follows: Balance of as January 1, 2019 $ 7,318,000 CarrierWeb acquisition 2,044,000 Balance as of September 30, 2019 $ 9,362,000 |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | NOTE 11 - STOCK-BASED COMPENSATION Stock Option Plans In June 2018, I.D. Systems’ stockholders approved the I.D. Systems, Inc. 2018 Incentive Plan (as amended the “2018 Plan”) pursuant to which I.D. Systems may grant stock options, restricted stock and other equity-based awards with respect to up to an aggregate of 1,500,000 shares of I.D. Systems’ common stock with a vesting period of approximately four to five years. There were 58,000 shares available for future issuance under the 2018 Plan at September 30, 2019. Upon the adoption of the 2018 Plan, I.D. Systems’ 2009 Non-Employee Director Equity Compensation Plan and the 2015 Equity Compensation Plan were frozen, and no new awards can be issued pursuant to such plans. In connection with the completion of the Transactions, I.D. Systems assigned to PowerFleet and PowerFleet assumed all obligations of I.D. Systems pursuant to the 2018 Plan, which was amended to, among other things, increase the number of shares available for issuance thereunder by 3,000,000 shares and to rename the plan to the PowerFleet, Inc. 2018 Incentive Plan. The 2018 Plan is administered by the Compensation Committee of the Company’s Board of Directors, which has the authority to determine, among other things, the term during which an option may be exercised (not more than 10 years), the exercise price of an option and the vesting provisions. The Company recognizes all employee share-based payments in the statement of operations as an operating expense, based on their fair values on the applicable grant date. Performance Shares - Transaction-Related Awards In connection with the Transactions, on March 13, 2019, I.D. Systems’ Board of Directors approved the grant of options to purchase 350,000 shares of I.D. Systems’ common stock to Chris Wolfe, I.D. Systems’ Chief Executive Officer, and the grant of options to purchase 150,000 shares of I.D. Systems’ common stock to Ned Mavrommatis, I.D. Systems’ Chief Financial Officer. The options are subject to the terms of the 2018 Plan, have an exercise price of $6.28 per share, vest upon the attainment of adjusted EBITDA targets for the fiscal years ending December 31, 2020 and December 31, 2021 and become exercisable 180 days after vesting. Vesting of the options will accelerate in the event of certain change of control transactions, provided that the options will not accelerate upon the completion of the Transactions. The following table summarizes the activity relating to I.D. Systems’ stock options for the nine-month period ended September 30, 2019: Weighted- Weighted- Average Average Remaining Aggregate Exercise Contractual Intrinsic Options Price Term Value Outstanding at beginning of year 1,220,000 $ 5.37 Granted 894,000 6.20 Exercised (50,000 ) 3.54 Forfeited or expired (4,000 ) 5.34 Outstanding at end of period 2,060,000 $ 5.77 7 years $ 404,000 Exercisable at end of period 1,298,000 $ 5.68 7 years $ 8,000 The fair value of each option grant on the date of grant is estimated using the Black-Scholes option-pricing model reflecting the following weighted-average assumptions: September 30, 2018 2019 Expected volatility 42.8 % 24.2 % Expected life of options (in years) 4 3 Risk free interest rate 2.72 % 1.41 % Dividend yield 0 % 0 % Weighted average fair value of options granted during the period $ 2.46 $ 2.72 Expected volatility is based on historical volatility of I.D. Systems’ common stock and the expected life of options is based on historical data with respect to employee exercise periods. I.D. Systems recorded stock-based compensation expense of $104,000 and $299,000 for the three- and nine-month periods ended September 30, 2018, respectively and $161,000 and $458,000 for the three- and nine-month periods ended September 30, 2019, respectively, in connection with awards made under the stock option plans. The fair value of options vested during the nine-month periods ended September 30, 2018 and 2019 was $352,000 and $363,000, respectively. The total intrinsic value of options exercised during the nine-month periods ended September 30, 2018 and 2019 was $117,000 and $112,000, respectively. As of September 30, 2019, there was approximately $1,381,000 of unrecognized compensation cost related to non-vested options granted under I.D. Systems’ stock option plans. That cost is expected to be recognized over a weighted-average period of 2.68 years. I.D. Systems estimates forfeitures at the time of valuation and reduces expense ratably over the vesting period. This estimate is adjusted periodically based on the extent to which actual forfeitures differ, or are expected to differ, from the previous estimate. Restricted Stock I.D. Systems grants restricted stock to employees, whereby the employees are contractually restricted from transferring the shares until they are vested. The stock is unvested stock at the time of grant and, upon vesting, there are no contractual restrictions on the stock. The fair value of each share is based on I.D. Systems’ closing stock price on the date of the grant. A summary of all non-vested restricted stock for the nine-month period ended September 30, 2019 is as follows: Weighted- Number of Average Non-vested Grant Date Shares Fair Value Restricted stock, non-vested, beginning of year 568,000 $ 6.65 Granted 255,000 5.74 Vested (246,000 ) 6.52 Forfeited (5,000 ) 6.91 Restricted stock, non-vested, end of period 572,000 $ 6.30 I.D. Systems recorded stock-based compensation expense of $465,000 and $1,396,000, respectively, for the three- and nine-month periods ended September 30, 2018 and $387,000 and $1,274,000, respectively, for the three- and nine-month periods ended September 30, 2019, in connection with restricted stock grants. As of September 30, 2019, there was $2,947,000 of total unrecognized compensation cost related to non-vested shares. That cost is expected to be recognized over a weighted-average period of 2.17 years. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
Stockholders' Equity | NOTE 12 - STOCKHOLDERS’ EQUITY Preferred stock As of September 30, 2019, I.D. Systems was authorized to issue 5,000,000 shares of preferred stock, par value $0.01 per share. I.D. Systems’ Board of Directors had the authority to issue shares of preferred stock and to determine the price and terms of those shares. No shares of preferred stock of I.D. Systems are issued and outstanding (See Note 23). Stock repurchase program On November 3, 2010, I.D. Systems’ Board of Directors authorized the repurchase of issued and outstanding shares of I.D. Systems’ common stock having an aggregate value of up to $3,000,000 pursuant to a share repurchase program. The repurchases under the share repurchase program are made from time to time in the open market or in privately negotiated transactions and are funded from I.D. Systems’ working capital. The amount and timing of such repurchases is dependent upon the price and availability of shares, general market conditions and the availability of cash, as determined at the discretion of I.D. Systems’ management. All shares of common stock repurchased under I.D. Systems’ share repurchase program are held as treasury stock. I.D. Systems did not purchase any shares of its common stock under the share repurchase program during the nine-month period ended September 30, 2019. As of September 30, 2019, I.D. Systems has purchased a total of approximately 310,000 shares of its common stock in open market transactions under the share repurchase program for an aggregate purchase price of approximately $1,340,000, or an average cost of $4.33 per share. Shares Withheld or Repurchased During the nine-month periods ended September 30, 2018 and 2019, 120,000 and 44,000 shares, respectively, of I.D. Systems’ common stock were withheld to satisfy minimum tax withholding obligations in connection with the vesting of restricted shares and to pay the exercise price of stock options in the aggregate amount of $870,000 and $291,000, respectively. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 9 Months Ended |
Sep. 30, 2019 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive Loss | NOTE 13 - ACCUMULATED OTHER COMPREHENSIVE LOSS Comprehensive loss includes net loss and unrealized gains or losses on available-for-sale investments and foreign currency translation gains and losses. Cumulative unrealized gains and losses on available-for-sale investments are reflected as accumulated other comprehensive loss in stockholders’ equity on I.D. Systems’ Condensed Consolidated Balance Sheets. The accumulated balances for each classification of other comprehensive loss for the nine-month period ended September 30, 2019 are as follows: Unrealized Accumulated Foreign gain (losses) other currency on comprehensive items investments loss Balance at January 1, 2019 $ (388,000 ) $ (47,000 ) $ (435,000 ) Net current period change 133,000 47,000 180,000 Balance at September 30, 2019 $ (255,000 ) $ - $ (255,000 ) The accumulated balances for each classification of other comprehensive loss for the nine-month period ended September 30, 2018 are as follows: Unrealized Accumulated Foreign gain (losses) other currency on comprehensive items investments loss Balance at January 1, 2018 $ (465,000 ) $ (113,000 ) $ (578,000 ) Net current period change 107,000 16,000 123,000 Balance at September 30, 2018 $ (358,000 ) $ (97,000 ) $ (455,000 ) Income and expense accounts of foreign operations are translated at actual or weighted-average exchange rates during the period. Assets and liabilities of foreign operations that operate in a local currency environment are translated to U.S. dollars at the exchange rates in effect at the balance sheet date. Translation gains or losses are reported as components of accumulated other comprehensive income or loss in consolidated stockholders’ equity. Net translation gains or losses resulting from the translation of foreign currency financial statements and the effect of exchange rate changes on intercompany transactions of a long-term investment nature with IDS GmbH resulted in translation gains (losses) of $107,000 and $133,000 for the nine-month periods ended September 30, 2018 and 2019, respectively, which are included in comprehensive loss in the Consolidated Statement of Changes in Stockholders’ Equity. Effective December 1, 2015, the intercompany transactions with IDS GmbH are not considered of a long-term investment nature and the effect of the exchange rate changes subsequent to December 1, 2015 on the intercompany transactions are included selling, general and administrative expenses in the Condensed Consolidated Statement of Operations. Gains and losses resulting from foreign currency transactions are included in determining net income or loss. Foreign currency transactions (losses) for the three- and nine-month periods ended September 30, 2018 of $(50,000) and $(146,000), respectively, and for the three- and nine-month periods ended September 30, 2019 of $(258,000) and $(288,000), respectively, are included in selling, general and administrative expenses in the Condensed Consolidated Statement of Operations. |
Net Loss Per Share of Common St
Net Loss Per Share of Common Stock | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share of Common Stock | NOTE 14 - NET LOSS PER SHARE OF COMMON STOCK Net loss per share for the three- and nine-month periods ended September 30, 2018 and 2019 are as follows: Three Months Ended Nine Months Ended September 30, September 30, 2018 2019 2018 2019 Basic and diluted loss per share Net loss $ (897,000 ) $ (2,099,000 ) $ (3,003,000 ) $ (6,878,000 ) Weighted-average shares outstanding 17,312,000 17,929,000 17,121,000 17,744,000 Basic and diluted net loss per share $ (0.05 ) $ (0.12 ) $ (0.18 ) $ (0.39 ) Basic loss per share is calculated by dividing net loss by the weighted-average number of common shares outstanding during the period. Diluted loss per share reflects the potential dilution assuming common shares were issued upon the exercise of outstanding options and the proceeds thereof were used to purchase outstanding common shares. Dilutive potential common shares include outstanding stock options, warrants and unvested restricted stock and performance shares awards. For the three- and nine-month periods ended September 30, 2018, the basic and diluted weighted-average shares outstanding are the same, since the effect from the potential exercise of outstanding stock options, warrants and vesting of restricted stock and performance shares of 1,874,000 would have been anti-dilutive. For the three- and nine-month periods ended September 30, 2019, the basic and diluted weighted-average shares outstanding are the same, since the effect from the potential exercise of outstanding stock options, warrants and vesting of restricted stock and performance shares of 2,632,000 would have been anti-dilutive due to the net loss. |
Accounts Payable and Accrued Ex
Accounts Payable and Accrued Expenses | 9 Months Ended |
Sep. 30, 2019 | |
Payables and Accruals [Abstract] | |
Accounts Payable and Accrued Expenses | NOTE 15 - ACCOUNTS PAYABLE AND ACCRUED EXPENSES Accounts payable and accrued expenses consist of the following: December 31, 2018 September 30, 2019 (Unaudited) Accounts payable $ 6,644,000 $ 15,513,000 Accrued warranty 422,000 337,000 Accrued compensation 870,000 488,000 Other current liabilities 91,000 245,000 $ 8,027,000 $ 16,583,000 I.D. Systems’ products are warranted against defects in materials and workmanship for a period of one to three years from the date of acceptance of the product by the customer. The customers may purchase an extended warranty providing coverage up to a maximum of 60 months. A provision for estimated future warranty costs is recorded for expected or historical warranty matters related to equipment shipped and is included in accounts payable and accrued expenses in the Condensed Consolidated Balance Sheets as of December 31, 2018 and September 30, 2019. The following table summarizes warranty activity for the nine-month periods ended September 30, 2018 and 2019: Nine Months Ended September 30, 2018 2019 Accrued warranty reserve, beginning of period $ 535,000 $ 422,000 Accrual for product warranties issued 70,000 204,000 Product replacements and other warranty expenditures (124,000 ) (165,000 ) Expiration of warranties (90,000 ) (124,000 ) Accrued warranty reserve, end of period $ 391,000 $ 337,000 |
Leases
Leases | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Leases | NOTE 16 - LEASES I.D. Systems determines whether an arrangement is a lease at inception. I.D. Systems has operating leases for office space and office equipment. I.D. Systems’ leases have remaining lease terms of one year to seven years, some of which include options to extend the lease term for up to five years. I.D. Systems considered these options to extend in determining the lease term used to establish I.D. Systems’ right-of use assets and lease liabilities once reasonably certain of exercise. I.D. Systems’ lease agreements do not contain any material residual value guarantees or material restrictive covenants. Right-of-use (“ROU”) assets represent I.D. Systems’ right to use an underlying asset for the lease term and lease liabilities represent I.D. Systems’ obligation to make lease payments arising from the lease. Operating lease ROU assets and operating lease liabilities are recognized at the lease commencement date based on the present value of the future lease payments over the lease term. The operating lease ROU asset also includes any lease payments made in advance of lease commencement and excludes lease incentives. The lease terms used in the calculations of the operating ROU assets and operating lease liabilities include options to extend or terminate the lease when I.D. Systems is reasonably certain that it will exercise those options. Lease expense for lease payments is recognized on a straight-line basis over the lease term. As I.D. Systems’ leases do not provide an implicit rate, I.D. Systems uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. I.D. Systems has lease agreements with lease and non-lease components, which are generally not accounted for separately. Components of lease expense are as follows: Three Months Ended September 30, 2019 Nine Months Ended September 30, 2019 Operating lease cost $ 233,000 $ 622,000 Short term lease cost 87,000 231,000 $ 320,000 $ 853,000 I.D. Systems has lease arrangements which are classified as short-term in nature. I.D. Systems has elected the short-term lease recognition exemption for all leases that qualify. This means, for those leases that qualify, I.D. Systems will not recognize ROU assets or lease liabilities. Supplemental cash flow information and non-cash activity related to our operating leases are as follows: Nine Months Ended Operating cash flow information: Cash paid for amounts included in the measurement of lease liabilities $ 586,000 Non-cash activity: Right-of-use assets obtained in exchange for lease obligations $ 2,556,000 Weighted-average remaining lease term and discount rate for our operating leases are as follows: September 30, 2019 Weighted-average remaining lease term (in years) 3.7 Weighted-average discount rate 7.5 % Scheduled maturities of operating lease liabilities outstanding as of September 30, 2019 are as follows: Year ending December 31, October - December 2019 $ 240,000 2020 971,000 2021 302,000 2022 172,000 2023 177,000 Thereafter 416,000 Total lease payments 2,278,000 Less: Imputed interest (307,000 ) Present value of lease liabilities $ 1,971,000 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 17 - INCOME TAXES I.D. Systems accounts for income taxes under the asset and liability approach. Deferred tax assets and liabilities are recognized for the expected future tax consequences attributed to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using the enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse. As of September 30, 2019, I.D. Systems had provided a valuation allowance to fully reserve its net operating loss carryforwards and other items giving rise to deferred tax assets, primarily as a result of anticipated net losses for income tax purposes. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | NOTE 18 - FAIR VALUE OF FINANCIAL INSTRUMENTS Cash and cash equivalents and investments in securities are carried at fair value. Financing receivables and capital lease obligation are carried at cost, which is not materially different than fair value. Accounts receivable, accounts payable and other liabilities approximate their fair values due to the short period to maturity of these instruments. |
Concentration of Customers
Concentration of Customers | 9 Months Ended |
Sep. 30, 2019 | |
Risks and Uncertainties [Abstract] | |
Concentration of Customers | NOTE 19 - CONCENTRATION OF CUSTOMERS For the nine-month period ended September 30, 2019 and as of September 30, 2019, one customer accounted for 25% of I.D. Systems’ revenue and 20% of I.D. Systems’ accounts receivable. Two customers accounted for 23% and 21% of finance receivables as of September 30, 2019. For the nine-month period ended September 30, 2018 and as of September 30, 2018, three customers accounted for 22%, 10% and 10% of I.D. Systems’ revenue and two customers accounted for 15% and 12% of I.D. Systems’ accounts receivable. Two customers accounted for 19% and 11% of finance receivables as of September 30, 2018. |
Wholly Owned Foreign Subsidiari
Wholly Owned Foreign Subsidiaries | 9 Months Ended |
Sep. 30, 2019 | |
Wholly Owned Foreign Subsidiaries [Abstract] | |
Wholly Owned Foreign Subsidiaries | NOTE 20 - WHOLLY OWNED FOREIGN SUBSIDIARIES The financial statements of I.D. Systems’ wholly owned German subsidiary, IDS GmbH, and United Kingdom subsidiary, IDS Ltd, are consolidated with the financial statements of I.D. Systems, Inc. The net revenue and net loss for IDS GmbH included in the Condensed Consolidated Statement of Operations are as follows: For the Three Months Ended For the Nine Months Ended September 30, September 30, 2018 2019 2018 2019 Net revenue $ 423,000 $ 957,000 $ 945,000 $ 2,178,000 Net loss (17,000 ) (231,000 ) (247,000 ) (162,000 ) Total assets of IDS GmbH were $1,430,000 and $2,172,000 as of December 31, 2018 and September 30, 2019, respectively. IDS GmbH operates in a local currency environment using the Euro as its functional currency. The net revenue and net loss for IDS Ltd included in the Condensed Consolidated Statement of Operations are as follows: For the Three Months Ended For the Nine Months Ended September 30, September 30, 2018 2019 2018 2019 Net revenue $ 23,000 $ 47,000 $ 155,000 $ 276,000 Net loss (84,000 ) (83,000 ) (214,000 ) (54,000 ) Total assets of IDS Ltd were $1,054,000 and $1,076,000 as of December 31, 2018 and September 30, 2019, respectively. IDS Ltd operates in a local currency environment using the British Pound as its functional currency. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 21 - COMMITMENTS AND CONTINGENCIES Except for normal operating leases, I.D. Systems is not currently subject to any material commitments. Severance agreements I.D. Systems has entered into severance agreements with two executive officers. The severance agreement for Ned Mavrommatis, I.D. Systems’ Chief Financial Officer, provides Mr. Mavrommatis with certain severance and change in control benefits upon the occurrence of a “Trigger Event,” which will have occurred if I.D. Systems terminates the executive without cause or the executive resigns for good reason within six months following a change in control event. The severance agreement for Chris Wolfe, I.D. Systems’ Chief Executive Officer, provides Mr. Wolfe with certain severance and change in control benefits upon the occurrence of a “Trigger Event,” which will have occurred if I.D. Systems terminates Mr. Wolfe without cause, or upon the occurrence of a “Change in Control Trigger Event,” which will have occurred if I.D. Systems terminates Mr. Wolfe without cause or Mr. Wolfe resigns for good reason, each within six months following a change in control event. As a condition to I.D. Systems’ obligations under the severance agreements, each executive has executed and delivered to I.D. Systems a restrictive covenants agreement. Under the terms of the severance agreement with Mr. Mavrommatis, Mr. Mavrommatis is entitled to the following: (i) a cash payment at the rate of the executive’s annual base salary as in effect immediately prior to the Trigger Event for a period of 12 months, (ii) a waiver of any remaining portion of the executive’s healthcare continuation payments under COBRA for the twelve-month severance period, provided that the executive timely elects COBRA coverage and continues to make contributions for such coverage equal to his contribution amount in effect immediately preceding the date of his termination of employment, and (iii) partial accelerated vesting of the executive’s previously granted stock options and restricted stock awards. Under the terms of the severance agreement with Mr. Wolfe, Mr. Wolfe is entitled to the following: (i) a cash payment either (A) in the event of a Trigger Event, at the rate of his annual base salary, or (B) in the event of a Change in Control Trigger Event, at twice the rate of his annual base salary, in each case as in effect immediately prior to the Trigger Event or Change in Control Trigger Event, as the case may be, for a period of 12 months, (ii) a waiver of any remaining portion of Mr. Wolfe’s healthcare continuation payments under COBRA for the twelve-month severance period, provided that he timely elects COBRA coverage and continues to make contributions for such coverage equal to his contribution amount in effect immediately preceding the date of his termination of employment, (iii) partial accelerated vesting of Mr. Wolfe’s previous granted stock options and restricted stock awards, and (iv) in the event of a Change in Control Trigger Event, a pro-rata portion of any bonus that would have been payable to Mr. Wolfe with respect to the year of termination based on the achievement of predetermined Company objectives used to determine the Company’s performance. In connection with the completion of the Transactions, on October 3, 2019, I.D. Systems assigned to the Company all of its rights and obligations under the severance agreements with each of Mr. Wolfe and Mr. Mavrommatis. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Pronouncements | NOTE 22 - RECENT ACCOUNTING PRONOUNCEMENTS In August 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2018-15, “Intangibles-Goodwill and Other-Internal-Use Software (Topic 350): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract”, which 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 (and hosting arrangements that include an internal use software license). ASU 2018-15 is effective for fiscal years beginning after December 15, 2019, with early adoption permitted. The Company is currently evaluating the impact of this ASU on the consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments - Credit Losses (Topic 326) Measurement of Credit Losses on Financial Instruments,” which amends the guidance on measuring credit losses on financial assets held at amortized cost. The amendment is intended to address the issue that the previous “incurred loss” methodology was restrictive for an entity’s ability to record credit losses based on not yet meeting the “probable” threshold. The new language will require these assets to be valued at amortized cost presented at the net amount expected to be collected with a valuation provision. This update standard is effective for fiscal years beginning after December 15, 2019. The Company is currently evaluating the impact of this ASU on the consolidated financial statements. In August 2018, the Securities and Exchange Commission (the “SEC”) issued a final rule that amends certain of the SEC’s disclosure requirements, including requirements relating to disclosures about changes in stockholders’ equity. For Quarterly Reports on Form 10-Q, the final rule extends to interim periods the annual requirement in Rule 3-04 of Regulation S-X, to disclose (1) changes in stockholders’ equity and (2) the amount of dividends per share for each class of shares (as opposed to common stock only, as previously required). Pursuant to the final rule, registrants must now analyze changes in stockholders’ equity, in the form of a reconciliation, for “the current and comparative year-to-date [interim] periods, with subtotals for each interim period,” i.e., a reconciliation covering each period for which an income statement is presented. Rule 3-04 of Regulation S-X permits the disclosure of changes in stockholders’ equity (including dividend-per-share amounts) to be made either in a separate financial statement or in the notes to the financial statements. The final rule is effective for all filings made on or after November 5, 2018. SEC staff has indicated it would not object if a registrant’s first presentation of the changes in shareholders’ equity is included in its Form 10-Q for the quarter that begins after the effective date of the amendments. Therefore, I.D. Systems conformed to this rule in its Quarterly Report on Form 10-Q for the quarter ended March 31, 2019. In June 2018, the FASB issued ASU 2018-07, “Compensation - Stock Compensation (Topic 718): Improvements to Non-employee Share-Based Accounting”. This guidance aligns the accounting for share-based payment transactions with non-employees to accounting for share-based payment transactions with employees. Companies are required to record a cumulative-effect adjustment (net of tax) to retained earnings as of the beginning of the fiscal year of the adoption. Upon transition, non-employee awards are required to be measured at fair value as of the adoption date. This standard was effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The adoption of this guidance did not have a material impact on I.D. Systems’ financial results. In February 2018, the FASB issued ASU 2018-02, “Income Statement - Reporting Comprehensive Income (Topic 220)”. The objective of the ASU is to allow a reclassification from accumulated comprehensive income (loss) to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act and will improve the usefulness of information reported to financial statement users. This ASU was effective for interim and annual reporting periods beginning after December 15, 2018. The adoption of this guidance did not have a material impact on I.D. Systems’ financial results. In January 2017, the FASB issued ASU 2017-04, “Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment,” which simplifies how an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test. Step 2 measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. Under the amendments in ASU 2017-04, an entity should recognize an impairment charge for the amount by which the carrying amount of a reporting unit exceeds its fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The updated guidance requires a prospective adoption. The guidance is effective beginning fiscal year 2020. Early adoption is permitted. The adoption of this guidance did not have a material impact on I.D. Systems’ financial results. In February 2016, the FASB issued ASU No. 2016-02, “Leases” (Topic 842), which requires lessees to recognize the following for all leases (with the exception of short-term leases) at the commencement date: a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. For leases with a term of 12 months or less, the lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. Also, in July 2018, the FASB issued ASU 2018-11, Leases (Topic 842): “Targeted Improvements,” which provides an optional transition method to allow entities, on adoption of ASU 2016-02, to report prior periods under previous lease accounting guidance. The revised guidance must be applied on a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The revised guidance is effective for the Company beginning after December 15, 2018, including interim periods within those fiscal years. The Company adopted Topic 842; refer to “Note 16 - Leases” for more information. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 23 – SUBSEQUENT EVENTS On October 3, 2019 (the “Closing Date”), in connection with the completion of the Transactions and pursuant to the terms of the Investment Agreement, I.D. Systems reorganized into a new holding company structure by merging I.D. Systems Merger Sub with and into I.D. Systems (the “I.D. Systems Merger”), with I.D. Systems surviving as a direct, wholly-owned subsidiary of PowerFleet. Also on October 3, 2019, pursuant to the terms of the Merger Agreement, Pointer Merger Sub merged with and into Pointer (the “Pointer Merger”), with Pointer surviving as a direct, wholly-owned subsidiary of Pointer Holdco and an indirect, wholly-owned subsidiary of PowerFleet. As a result of the Transactions, I.D. Systems and Pointer Holdco each became direct, wholly-owned subsidiaries of PowerFleet and Pointer became an indirect, wholly-owned subsidiary of PowerFleet. In addition, as a result of the Transactions, PowerFleet became a publicly traded corporation and former I.D. Systems stockholders and former Pointer shareholders received common stock of PowerFleet. I.D. Systems common stock ceased trading on the Nasdaq Global Market and Pointer ordinary shares ceased trading on the Nasdaq Capital Market and the Tel Aviv Stock Exchange (“TASE”), following the close of trading on October 2, 2019 and at the effectiveness of the Pointer Merger on October 3, 2019, respectively, and PowerFleet common stock commenced trading on the Nasdaq Global Market on October 3, 2019 and on the TASE on October 6, 2019, in each case under the symbol “PWFL”. At the effective time of the I.D. Systems Merger (the “I.D. Systems Merger Effective Time”), each share of I.D. Systems common stock outstanding immediately prior to such time (other than any I.D. Systems common stock owned by I.D. Systems immediately prior to the I.D. Systems Merger Effective Time) was converted automatically into the right to receive one share of PowerFleet common stock. At the effective time of the Pointer Merger (the “Pointer Merger Effective Time”), each Pointer ordinary share outstanding immediately prior to such time (other than Pointer ordinary shares owned, directly or indirectly, by I.D. Systems, PowerFleet or any of their subsidiaries or Pointer or any of its wholly-owned subsidiaries immediately prior to the Pointer Merger Effective Time) was cancelled in exchange for $8.50 in cash, without interest (the “Cash Consideration”), and 1.272 shares of PowerFleet common stock (the “Stock Consideration,” and together with the Cash Consideration, the “Pointer Merger Consideration”). I.D. Systems stock options and restricted stock awards that were outstanding immediately prior to the I.D. Systems Merger Effective Time were converted automatically into equivalent PowerFleet awards on the same terms and conditions applicable to such I.D. Systems stock options and restricted stock awards prior to the I.D. Systems Merger Effective Time. At the Pointer Merger Effective Time, each award of options to purchase Pointer ordinary shares that was outstanding and unvested immediately prior to such time was cancelled and substituted with options to purchase shares of PowerFleet common stock under the 2018 Plan on the same material terms and conditions as were applicable to the corresponding option immediately prior to the Pointer Merger Effective Time, except that (i) the number of shares of PowerFleet common stock underlying such substituted option is equal to the product of (A) the number of Pointer ordinary shares underlying such option immediately prior to the Pointer Merger Effective Time multiplied by (B) 2.544, with any fractional shares rounded down to the nearest whole number of shares of PowerFleet common stock, and (ii) the per-share exercise price is equal to the quotient obtained by dividing (A) the exercise price per Pointer ordinary share subject to such option immediately prior to the Pointer Merger Effective Time by (B) 2.544 (rounded up to the nearest whole cent). At the Pointer Merger Effective Time, each award of options to purchase Pointer ordinary shares that was outstanding and vested immediately prior to such time was cancelled in exchange for the right to receive the product of (i) the excess, if any, of (A) the Pointer Merger Consideration (allocated between the Cash Consideration and the Stock Consideration in the same proportion as for holders of Pointer ordinary shares), over (B) the exercise price per Pointer ordinary share subject to such option, multiplied by (ii) the total number of Pointer ordinary shares underlying such option. If the exercise price of a vested option was equal to or greater than the consideration payable in respect of a vested option, such option was cancelled without payment. At the Pointer Merger Effective Time, each award of restricted stock units of Pointer (a “Pointer RSU”) that was outstanding and vested immediately prior to such time was cancelled in exchange for the right to receive the Pointer Merger Consideration (allocated between the Cash Consideration and the Stock Consideration in the same proportion as for holders of Pointer ordinary shares). Each Pointer RSU that was outstanding and unvested immediately prior to such time was cancelled and substituted with restricted stock units under the 2018 Plan representing the right to receive, on the same material terms and conditions as were applicable under such Pointer RSU immediately prior to the Pointer Merger Effective Time, that number of shares of PowerFleet common stock equal to the product of (i) the number of Pointer ordinary shares underlying such Pointer RSU immediately prior to the Pointer Merger Effective Time multiplied by (ii) 2.544, with any fractional shares rounded down to the nearest lower whole number of shares of PowerFleet common stock. The Cash Consideration was financed using (i) net proceeds of the issuance and sale by PowerFleet of 50,000 shares of PowerFleet’s Series A Convertible Preferred Stock, par value $0.01 per share (the “Series A Preferred Stock”), to the Investors for an aggregate purchase price of $50,000,000 pursuant to the terms of the Investment Agreement, and (ii) term loan borrowings by Pointer Holdco on the Closing Date of $30,000,000 under a credit agreement, dated August 19, 2019 (the “Credit Agreement”), with Bank Hapoalim B.M., pursuant to which Bank Hapoalim B.M. agreed to provide Pointer Holdco with two senior secured term loan facilities in an aggregate principal amount of $30,000,000 (comprised of two facilities in the aggregate principal amount of $20,000,000 and $10,000,000) and a five-year revolving credit facility to Pointer in an aggregate principal amount of $10,000,000. Pointer is a provider of telematics and mobile IoT solutions to the automotive, insurance and logistics (cargo, assets and containers) industries. Pointer’s cloud-based software-as-a-service (SaaS) platform extracts and captures data from an organization’s mobility points, including drivers, routes, points-of-interest, logistics network, vehicles, trailers, containers and cargo. The Transactions are expected to provide the Company with operational synergies and access to a broader base of customers. The Transactions will be accounted for as a business combination and I.D. Systems has been determined to be the accounting acquirer in the Transactions. In addition, on October 3, 2019, PowerFleet, I.D. Systems, I.D. Systems Merger Sub and the Investors entered into Amendment No. 3 to the Investment Agreement (the “Investment Agreement Third Amendment”), pursuant to which PowerFleet agreed to issue and sell to the Investors in a private placement convertible unsecured promissory notes in the aggregate principal amount of $5,000,000 (the “Notes”) at the closing of the Transactions. The principal amount of, and accrued interest through the maturity date on, the Notes will convert automatically into Series A Preferred Stock (at the original issuance price thereof) upon receipt of the approval by PowerFleet’s stockholders in accordance with Nasdaq rules. The Notes will bear interest at 10% per annum, will mature on the third business day before the first anniversary of their issuance date (unless earlier converted) and may be prepaid in full subject to a prepayment premium. |
Investments (Tables)
Investments (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Available for Sale Securities Reconciliation | The cost, gross unrealized gains (losses) and fair value of available for sale securities by major security types as of December 31, 2018 are as follows: Unrealized Unrealized Fair December 31, 2018 Cost Gain Loss Value Investments - short term U.S. Treasury Notes $ 302,000 $ 1,000 - $ 303,000 Corporate bonds and commercial paper 91,000 - - 91,000 Total investments - short term 393,000 1,000 394,000 Investments - long term U.S. Treasury Notes 1,569,000 - (2,000 ) 1,567,000 Government agency bonds 1,548,000 - (23,000 ) 1,525,000 Corporate bonds 1,062,000 - (23,000 ) 1,039,000 Total investments - long term 4,179,000 - (48,000 ) 4,131,000 Total investments - available for sale $ 4,572,000 $ 1,000 $ (48,000 ) $ 4,525,000 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Revenue Disaggregated by Revenue Sources | The following table sets forth our revenues by product line for the three- and nine-month periods ended September 30, 2019 and 2018: Three Months Ended September 30, 2019 Product Service Total Industrial truck management $ 5,743,000 $ 2,007,000 $ 7,750,000 Connected vehicles 2,985,000 1,518,000 4,503,000 Logistics visibility 2,334,000 2,297,000 4,631,000 Total Revenue $ 11,062,000 $ 5,822,000 $ 16,884,000 Three Months Ended September 30, 2018 Product Service Total Industrial truck management $ 6,172,000 $ 2,027,000 $ 8,199,000 Connected vehicles 1,462,000 399,000 1,861,000 Logistics visibility 1,410,000 1,915,000 3,325,000 Total Revenue $ 9,044,000 $ 4,341,000 $ 13,385,000 Nine Months Ended September 30, 2019 Product Service Total Industrial truck management $ 16,751,000 $ 5,671,000 $ 22,422,000 Connected vehicles 6,106,000 5,415,000 11,521,000 Logistics visibility 6,097,000 6,729,000 12,826,000 Total Revenue $ 28,954,000 $ 17,815,000 $ 46,769,000 Nine Months Ended September 30, 2018 Product Service Total Industrial truck management $ 16,866,000 $ 5,333,000 $ 22,199,000 Connected vehicles 8,491,000 616,000 9,107,000 Logistics visibility 4,369,000 5,898,000 10,267,000 Total Revenue $ 29,726,000 $ 11,847,000 $ 41,573,000 |
Schedule of Deferred Revenue | The balances of contract assets, and contract liabilities from contracts with customers are as follows as of December 31, 2018 and September 30, 2019: December 31, 2018 September 30, 2019 (Unaudited) Current assets: Deferred sales commissions to employees $ 585,000 $ 748,000 Deferred costs $ 9,069,000 $ 9,335,000 Current liabilities: Deferred revenue -other (1) $ 305,000 $ 272,000 Deferred maintenance and SaaS revenue (1) 4,607,000 4,815,000 Deferred logistics visibility solutions product revenue (1) 12,176,000 12,027,000 17,088,000 17,114,000 Less: Current portion 7,902,000 8,095,000 Deferred revenue - less current portion $ 9,186,000 $ 9,019,000 (1) We record deferred revenues when cash payments are received or due in advance of our performance. For the three- and nine-month periods ended September 30, 2018 and 2019, we recognized revenue of $2,434,000 and $9,325,000, respectively, and $3,306,000 and $9,544,000, respectively, that was included in the deferred revenue balance at the beginning of each reporting period. We expect to recognize deferred revenue as revenue before year 2024, when we transfer those goods and services and, therefore, satisfies our performance obligation to the customers. We do not separately account for activation fees since no good or service is transferred to the customer. Therefore, the activation fee is included in the transaction price and allocated to the performance obligations in the contract and deferred/amortized over the life of the contract. |
Financing Receivables (Tables)
Financing Receivables (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Receivables [Abstract] | |
Scheduled Maturities of Sales-type Lease Minimum Lease Payments | Scheduled maturities of sales-type lease minimum lease payments outstanding as of September 30, 2019 are as follows: Year ending December 31: October - December 2019 $ 253,000 2020 876,000 2021 471,000 2022 213,000 2023 91,000 Thereafter 18,000 1,922,000 Less: Current portion 950,000 Sales-type lease receivable - less current portion $ 972,000 |
Inventory (Tables)
Inventory (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories consist of the following: December 31, 2018 September 30, 2019 (Unaudited) Components $ 2,218,000 $ 1,518,000 Finished goods 2,431,000 8,243,000 $ 4,649,000 $ 9,761,000 |
Fixed Assets (Tables)
Fixed Assets (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Fixed Assets | Fixed assets are stated at cost, less accumulated depreciation and amortization, and are summarized as follows: December 31, 2018 September 30, 2019 (Unaudited) Equipment $ 1,114,000 $ 1,236,000 Computer software and web application development 5,633,000 5,636,000 Computer hardware 2,664,000 2,578,000 Furniture and fixtures 466,000 505,000 Automobiles 60,000 60,000 Leasehold improvements 181,000 238,000 10,118,000 10,253,000 Accumulated depreciation and amortization (7,969,000 ) (8,183,000 ) $ 2,149,000 $ 2,070,000 |
Acquisition (Tables)
Acquisition (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Business Combinations [Abstract] | |
Schedule of Purchase Price Allocation on Net Assets Acquired | The following table summarizes the approximate preliminary purchase price allocation of CarrierWeb and CarrierWeb Ireland based on estimated fair values of the net assets acquired at the acquisition date: Accounts receivable $ 192,000 Inventory 200,000 Other assets 26,000 Customer relationships 1,080,000 Trademark and tradename 112,000 Patents 1,121,000 Goodwill (a) 2,044,000 Net assets acquired $ 4,775,000 (a) The goodwill is fully deductible for tax purposes. |
Intangible Assets and Goodwill
Intangible Assets and Goodwill (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | The following table summarizes identifiable intangible assets of I.D. Systems as of December 31, 2018 and September 30, 2019: September 30, 2019 (Unaudited) Useful Lives (In Years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Amortized: Customer relationships 9 - 10 $ 4,203,000 (749,000 ) 3.454,000 Trademark and tradename 3 - 15 1,479,000 (296,000 ) 1,183,000 Patents 7 - 13 2,610,000 (1,416,000 ) 1,194,000 Favorable contract interest 5 388,000 (210,000 ) 178,000 Covenant not to compete 4 208,000 (90,000 ) 118,000 8,888,000 (2,761,000 ) 6,127,000 Unamortized: Customer list 104,000 - 104,000 Trademark and Tradename 61,000 - 61,000 165,000 - 165,000 Total $ 9,053,000 $ (2,761,000 ) $ 6,292,000 December 31, 2018 Useful Lives (In Years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Amortized: Customer relationships 10 $ 3,123,000 (442,000 ) 2,681,000 Trademark and tradename 10 - 15 1,367,000 (178,000 ) 1,189,000 Patents 11 1,489,000 (1,218,000 ) 271,000 Favorable contract interest 5 388,000 (137,000 ) 251,000 Covenant not to compete 4 208,000 (60,000 ) 148,000 6,575,000 (2,035,000 ) 4,540,000 Unamortized: Customer list 104,000 - 104,000 Trademark and Tradename 61,000 - 61,000 165,000 - 165,000 Total $ 6,740,000 $ (2,035,000 ) $ 4,705,000 |
Schedule of Finite-lived Intangible Assets, Future Amortization Expense | Estimated future amortization expense for each of the five succeeding fiscal years for these intangible assets is as follows: Year ending December 31: October - December 2019 $ 257,000 2020 1,029,000 2021 853,000 2022 745,000 2023 718,000 Thereafter 2,525,000 6,127,000 |
Schedule of Changes in Goodwill | The change in goodwill from January 1, 2019 to September 30, 2019 is as follows: Balance of as January 1, 2019 $ 7,318,000 CarrierWeb acquisition 2,044,000 Balance as of September 30, 2019 $ 9,362,000 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Stock Options Activity | The following table summarizes the activity relating to I.D. Systems’ stock options for the nine-month period ended September 30, 2019: Weighted- Weighted- Average Average Remaining Aggregate Exercise Contractual Intrinsic Options Price Term Value Outstanding at beginning of year 1,220,000 $ 5.37 Granted 894,000 6.20 Exercised (50,000 ) 3.54 Forfeited or expired (4,000 ) 5.34 Outstanding at end of period 2,060,000 $ 5.77 7 years $ 404,000 Exercisable at end of period 1,298,000 $ 5.68 7 years $ 8,000 |
Schedule of Fair Value Stock Option Assumptions | The fair value of each option grant on the date of grant is estimated using the Black-Scholes option-pricing model reflecting the following weighted-average assumptions: September 30, 2018 2019 Expected volatility 42.8 % 24.2 % Expected life of options (in years) 4 3 Risk free interest rate 2.72 % 1.41 % Dividend yield 0 % 0 % Weighted average fair value of options granted during the period $ 2.46 $ 2.72 |
Schedule of Non-vested Restricted Stock Activity | A summary of all non-vested restricted stock for the nine-month period ended September 30, 2019 is as follows: Weighted- Number of Average Non-vested Grant Date Shares Fair Value Restricted stock, non-vested, beginning of year 568,000 $ 6.65 Granted 255,000 5.74 Vested (246,000 ) 6.52 Forfeited (5,000 ) 6.91 Restricted stock, non-vested, end of period 572,000 $ 6.30 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of Accumulated Other Comprehensive Loss | The accumulated balances for each classification of other comprehensive loss for the nine-month period ended September 30, 2019 are as follows: Unrealized Accumulated Foreign gain (losses) other currency on comprehensive items investments loss Balance at January 1, 2019 $ (388,000 ) $ (47,000 ) $ (435,000 ) Net current period change 133,000 47,000 180,000 Balance at September 30, 2019 $ (255,000 ) $ - $ (255,000 ) The accumulated balances for each classification of other comprehensive loss for the nine-month period ended September 30, 2018 are as follows: Unrealized Accumulated Foreign gain (losses) other currency on comprehensive items investments loss Balance at January 1, 2018 $ (465,000 ) $ (113,000 ) $ (578,000 ) Net current period change 107,000 16,000 123,000 Balance at September 30, 2018 $ (358,000 ) $ (97,000 ) $ (455,000 ) |
Net Loss Per Share of Common _2
Net Loss Per Share of Common Stock (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of Net Loss Per Share Basic and Diluted | Net loss per share for the three- and nine-month periods ended September 30, 2018 and 2019 are as follows: Three Months Ended Nine Months Ended September 30, September 30, 2018 2019 2018 2019 Basic and diluted loss per share Net loss $ (897,000 ) $ (2,099,000 ) $ (3,003,000 ) $ (6,878,000 ) Weighted-average shares outstanding 17,312,000 17,929,000 17,121,000 17,744,000 Basic and diluted net loss per share $ (0.05 ) $ (0.12 ) $ (0.18 ) $ (0.39 ) |
Accounts Payable and Accrued _2
Accounts Payable and Accrued Expenses (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Payables and Accruals [Abstract] | |
Schedule of Accounts Payable and Accrued Liabilities | Accounts payable and accrued expenses consist of the following: December 31, 2018 September 30, 2019 (Unaudited) Accounts payable $ 6,644,000 $ 15,513,000 Accrued warranty 422,000 337,000 Accrued compensation 870,000 488,000 Other current liabilities 91,000 245,000 $ 8,027,000 $ 16,583,000 |
Schedule of Product Warranty Liability | The following table summarizes warranty activity for the nine-month periods ended September 30, 2018 and 2019: Nine Months Ended September 30, 2018 2019 Accrued warranty reserve, beginning of period $ 535,000 $ 422,000 Accrual for product warranties issued 70,000 204,000 Product replacements and other warranty expenditures (124,000 ) (165,000 ) Expiration of warranties (90,000 ) (124,000 ) Accrued warranty reserve, end of period $ 391,000 $ 337,000 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Schedule of Lease Expense | Components of lease expense are as follows: Three Months Ended September 30, 2019 Nine Months Ended September 30, 2019 Operating lease cost $ 233,000 $ 622,000 Short term lease cost 87,000 231,000 $ 320,000 $ 853,000 |
Schedule of Cash Flow Information and Non-cash Activity of Operating Leases | Supplemental cash flow information and non-cash activity related to our operating leases are as follows: Nine Months Ended Operating cash flow information: Cash paid for amounts included in the measurement of lease liabilities $ 586,000 Non-cash activity: Right-of-use assets obtained in exchange for lease obligations $ 2,556,000 |
Schedule of Weighted Average Remaining Lease Term and Discount Rate | Weighted-average remaining lease term and discount rate for our operating leases are as follows: September 30, 2019 Weighted-average remaining lease term (in years) 3.7 Weighted-average discount rate 7.5 % |
Scheduled Maturities of Operating Lease Liabilities | Scheduled maturities of operating lease liabilities outstanding as of September 30, 2019 are as follows: Year ending December 31, October - December 2019 $ 240,000 2020 971,000 2021 302,000 2022 172,000 2023 177,000 Thereafter 416,000 Total lease payments 2,278,000 Less: Imputed interest (307,000 ) Present value of lease liabilities $ 1,971,000 |
Wholly Owned Foreign Subsidia_2
Wholly Owned Foreign Subsidiaries (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
I.D. Systems GmbH [Member] | |
Schedule of Financial Statements of Foreign Subsidiary | The net revenue and net loss for IDS GmbH included in the Condensed Consolidated Statement of Operations are as follows: For the Three Months Ended For the Nine Months Ended September 30, September 30, 2018 2019 2018 2019 Net revenue $ 423,000 $ 957,000 $ 945,000 $ 2,178,000 Net loss (17,000 ) (231,000 ) (247,000 ) (162,000 ) |
I.D. Systems Ltd [Member] | |
Schedule of Financial Statements of Foreign Subsidiary | The net revenue and net loss for IDS Ltd included in the Condensed Consolidated Statement of Operations are as follows: For the Three Months Ended For the Nine Months Ended September 30, September 30, 2018 2019 2018 2019 Net revenue $ 23,000 $ 47,000 $ 155,000 $ 276,000 Net loss (84,000 ) (83,000 ) (214,000 ) (54,000 ) |
Description of the Company an_2
Description of the Company and Basis of Presentation (Details Narrative) | Sep. 30, 2019USD ($) |
Accounting Policies [Abstract] | |
Cash, cash equivalents and marketable securities | $ 5,900,000 |
Working capital | $ 11,600,000 |
Investments (Details Narrative)
Investments (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Investments, Debt and Equity Securities [Abstract] | ||||
Unrealized (loss) gain on investments | $ (22,000) | $ 9,000 | $ (137,000) |
Investments - Schedule of Avail
Investments - Schedule of Available for Sale Securities Reconciliation (Details) | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Debt Securities, Available-for-sale [Line Items] | |
Cost | $ 4,572,000 |
Unrealized Gain | 1,000 |
Unrealized Loss | (48,000) |
Fair Value | 4,525,000 |
Short-term Investments [Member] | |
Debt Securities, Available-for-sale [Line Items] | |
Cost | 393,000 |
Unrealized Gain | 1,000 |
Unrealized Loss | |
Fair Value | 394,000 |
Short-term Investments [Member] | U.S. Treasury Notes [Member] | |
Debt Securities, Available-for-sale [Line Items] | |
Cost | 302,000 |
Unrealized Gain | 1,000 |
Unrealized Loss | |
Fair Value | 303,000 |
Short-term Investments [Member] | Corporate Bonds and Commercial Paper [Member] | |
Debt Securities, Available-for-sale [Line Items] | |
Cost | 91,000 |
Unrealized Gain | |
Unrealized Loss | |
Fair Value | 91,000 |
Long-term Investments [Member] | |
Debt Securities, Available-for-sale [Line Items] | |
Cost | 4,179,000 |
Unrealized Gain | |
Unrealized Loss | (48,000) |
Fair Value | 4,131,000 |
Long-term Investments [Member] | U.S. Treasury Notes [Member] | |
Debt Securities, Available-for-sale [Line Items] | |
Cost | 1,569,000 |
Unrealized Gain | |
Unrealized Loss | (2,000) |
Fair Value | 1,567,000 |
Long-term Investments [Member] | Government Agency Bonds [Member] | |
Debt Securities, Available-for-sale [Line Items] | |
Cost | 1,548,000 |
Unrealized Gain | |
Unrealized Loss | (23,000) |
Fair Value | 1,525,000 |
Long-term Investments [Member] | Corporate Bonds [Member] | |
Debt Securities, Available-for-sale [Line Items] | |
Cost | 1,062,000 |
Unrealized Gain | |
Unrealized Loss | (23,000) |
Fair Value | $ 1,039,000 |
Revenue Recognition (Details Na
Revenue Recognition (Details Narrative) | Dec. 03, 2018USD ($)Unit | Sep. 30, 2019USD ($) | Sep. 30, 2019USD ($) |
Development project revenue | $ 841,000 | $ 3,687,000 | |
Avis Budget Car Rental LLC [Member] | Statement of Work #4 [Member] | |||
Number of cellular-enabled rental fleet car management system | Unit | 75,000 | ||
Period of installation of equipment | 60 months | ||
Equipment for consideration | $ 33,000,000 | ||
Avis Budget Car Rental LLC [Member] | Statement of Work #5 [Member] | |||
Equipment for consideration | $ 188,000 |
Revenue Recognition - Schedule
Revenue Recognition - Schedule of Revenue Disaggregated by Revenue Sources (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Total Revenue | $ 16,884,000 | $ 13,385,000 | $ 46,769,000 | $ 41,573,000 |
Products [Member] | ||||
Total Revenue | 11,062,000 | 9,044,000 | 28,954,000 | 29,726,000 |
Services [Member] | ||||
Total Revenue | 5,822,000 | 4,341,000 | 17,815,000 | 11,847,000 |
Industrial Truck Management [Member] | ||||
Total Revenue | 7,750,000 | 8,199,000 | 22,422,000 | 22,199,000 |
Industrial Truck Management [Member] | Products [Member] | ||||
Total Revenue | 5,743,000 | 6,172,000 | 16,751,000 | 16,866,000 |
Industrial Truck Management [Member] | Services [Member] | ||||
Total Revenue | 2,007,000 | 2,027,000 | 5,671,000 | 5,333,000 |
Connected Vehicles [Member] | ||||
Total Revenue | 4,503,000 | 1,861,000 | 11,521,000 | 9,107,000 |
Connected Vehicles [Member] | Products [Member] | ||||
Total Revenue | 2,985,000 | 1,462,000 | 6,106,000 | 8,491,000 |
Connected Vehicles [Member] | Services [Member] | ||||
Total Revenue | 1,518,000 | 399,000 | 5,415,000 | 616,000 |
Logistics Visibility Solutions [Member] | ||||
Total Revenue | 4,631,000 | 3,325,000 | 12,826,000 | 10,267,000 |
Logistics Visibility Solutions [Member] | Products [Member] | ||||
Total Revenue | 2,334,000 | 1,410,000 | 6,097,000 | 4,369,000 |
Logistics Visibility Solutions [Member] | Services [Member] | ||||
Total Revenue | $ 2,297,000 | $ 1,915,000 | $ 6,729,000 | $ 5,898,000 |
Revenue Recognition - Schedul_2
Revenue Recognition - Schedule of Deferred Revenue (Details) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 | |
Deferred costs | $ 3,868,000 | $ 3,660,000 | |
Deferred revenue | 17,114,000 | 17,088,000 | |
Less: Current portion | 8,095,000 | 7,902,000 | |
Deferred revenue - less current portion | 9,019,000 | 9,186,000 | |
Deferred Sales Commissions to Employees [Member] | |||
Deferred costs | 748,000 | 585,000 | |
Deferred Revenue - Other [Member] | |||
Deferred revenue | [1] | 272,000 | 305,000 |
Deferred Maintenance and SaaS Revenue [Member] | |||
Deferred revenue | [1] | 4,815,000 | 4,607,000 |
Deferred Logistics Visibility Solutions Product Revenue [Member] | |||
Deferred revenue | [1] | $ 12,027,000 | $ 12,176,000 |
[1] | We record deferred revenues when cash payments are received or due in advance of our performance. For the three- and nine-month periods ended September 30, 2018 and 2019, we recognized revenue of $2,434,000 and $9,325,000, respectively, and $3,306,000 and $9,544,000, respectively, that was included in the deferred revenue balance at the beginning of each reporting period. We expect to recognize deferred revenue as revenue before year 2024, when we transfer those goods and services and, therefore, satisfies our performance obligation to the customers. We do not separately account for activation fees since no good or service is transferred to the customer. Therefore, the activation fee is included in the transaction price and allocated to the performance obligations in the contract and deferred/amortized over the life of the contract. |
Revenue Recognition - Schedul_3
Revenue Recognition - Schedule of Deferred Revenue (Details) (Parenthetical) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | ||||
Revenue recognized | $ 9,325,000 | $ 2,434,000 | $ 9,544,000 | $ 3,306,000 |
Financing Receivables (Details
Financing Receivables (Details Narrative) - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Dec. 31, 2018 | |
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Unearned interest income on sales type leases | $ 83,000 | $ 114,000 |
Weighted-average discount rate | 3.00% | 3.00% |
Minimum [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Investment lease receivable term | 3 years | 3 years |
Maximum [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Investment lease receivable term | 5 years | 5 years |
Financing Receivables - Schedul
Financing Receivables - Scheduled Maturities of Sales-type Lease Minimum Lease Payments (Details) | Sep. 30, 2019USD ($) |
Receivables [Abstract] | |
October - December 2019 | $ 253,000 |
2020 | 876,000 |
2021 | 471,000 |
2022 | 213,000 |
2023 | 91,000 |
Thereafter | 18,000 |
Sales-type Lease Receivable, Future Minimum Payments | 1,922,000 |
Less: Current portion | 950,000 |
Sales-type Lease Receivable - Less current portion | $ 972,000 |
Inventory (Details Narrative)
Inventory (Details Narrative) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Inventory valuation reserves | $ 159,000 | $ 119,000 |
Inventory - Schedule of Invento
Inventory - Schedule of Inventories (Details) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Components | $ 1,518,000 | $ 2,218,000 |
Finished goods | 8,243,000 | 2,431,000 |
Inventory, Net | $ 9,761,000 | $ 4,649,000 |
Fixed Assets (Details Narrative
Fixed Assets (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation and amortization expense | $ 194,000 | $ 214,000 | $ 573,000 | $ 640,000 |
Amortization expense | $ 131,000 | $ 133,000 | 397,000 | 395,000 |
Software development and website development projects costs | $ 0 | $ 5,000 |
Fixed Assets - Schedule of Fixe
Fixed Assets - Schedule of Fixed Assets (Details) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 10,253,000 | $ 10,118,000 |
Accumulated depreciation and amortization | (8,183,000) | (7,969,000) |
Property, plant and equipment, net | 2,070,000 | 2,149,000 |
Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 1,236,000 | 1,114,000 |
Computer Software and Web Application Development [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 5,636,000 | 5,633,000 |
Computer Hardware [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 2,578,000 | 2,664,000 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 505,000 | 466,000 |
Automobiles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 60,000 | 60,000 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 238,000 | $ 181,000 |
Acquisition (Details Narrative)
Acquisition (Details Narrative) - USD ($) | Aug. 17, 2019 | Jul. 30, 2019 | Jan. 30, 2019 | Apr. 30, 2019 | Jul. 31, 2017 | Sep. 14, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2017 | Sep. 30, 2019 | Sep. 30, 2018 |
Acquisition-related expenses | $ 1,611,000 | $ 51,000 | $ 4,673,000 | $ 379,000 | |||||||
Number of common stock issued, value | 156,000 | ||||||||||
Post-closing working capital adjustment | $ 275,000 | ||||||||||
Asset Purchase Agreement [Member] | |||||||||||
Stock issued during period for common stock acquisition | 147,951 | 296,000 | |||||||||
Earn-out payment term | 24 months | ||||||||||
CarrierWeb US Acquisition [Member] | |||||||||||
Aggregate consideration for acquisition | $ 3,500,000 | ||||||||||
Closing cash payment | 2,800,000 | ||||||||||
Cash amount in acquisition | 2,150,000 | ||||||||||
Principal and interest outstanding | 650,000 | ||||||||||
Repayment of loan amount | $ 700,000 | ||||||||||
CarrierWeb Ireland Acquisitions [Member] | |||||||||||
Principal and interest outstanding | $ 300,000 | ||||||||||
CarrierWeb Ireland Acquisition [Member] | |||||||||||
Closing cash payment | $ 550,000 | ||||||||||
Stock issued during period for common stock acquisition | 126,748 | ||||||||||
Stock issued during the period for repayment of loans | 55,783 | ||||||||||
Stock issued during the period for repayment of loans, value | $ 300,000 | ||||||||||
Number of shares held back | 43,706 | ||||||||||
Estimated fair value of held back | $ 250,000 | ||||||||||
CarrierWeb Acquisitions [Member] | |||||||||||
Acquisition-related expenses | (15,000) | ||||||||||
Acquisition contributed to revenue | $ 1,111,000 | ||||||||||
CarrierWeb and CarrierWeb Ireland Acquisitions [Member] | |||||||||||
Acquisition-related expenses | 145,000 | ||||||||||
Acquisition contributed to revenue | $ 3,087,000 | ||||||||||
Keytroller Acquisition [Member] | Asset Purchase Agreement [Member] | |||||||||||
Closing cash payment | $ 7,098,000 | ||||||||||
Stock issued during period for common stock acquisition | 295,902 | ||||||||||
Number of common stock issued, value | $ 2,000,000 | ||||||||||
Potential earn-out payments | 3,000,000 | ||||||||||
Fair value of potential earn-out payments | $ 2,683,000 |
Acquisition - Schedule of Purch
Acquisition - Schedule of Purchase Price Allocation on Net Assets Acquired (Details) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 | |
Goodwill | $ 9,362,000 | $ 7,318,000 | |
CarrierWeb and CarrierWeb Ireland Acquisitions [Member] | |||
Accounts receivable | 192,000 | ||
Inventory | 200,000 | ||
Other assets | 26,000 | ||
Customer relationships | 1,080,000 | ||
Trademark and tradename | 112,000 | ||
Patents | 1,121,000 | ||
Goodwill | [1] | 2,044,000 | |
Net assets acquired | $ 4,775,000 | ||
[1] | The goodwill is fully deductible for tax purposes. |
Intangible Assets and Goodwil_2
Intangible Assets and Goodwill (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization expense | $ 253,000 | $ 178,000 | $ 726,000 | $ 534,000 |
Intangible Assets and Goodwil_3
Intangible Assets and Goodwill - Schedule of Intangible Assets (Details) - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Dec. 31, 2018 | |
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross Carrying Amount | $ 8,888,000 | $ 6,575,000 |
Finite-Lived Intangible Assets, Accumulated Amortization | (2,761,000) | (2,035,000) |
Finite-Lived Intangible Assets, Net Carrying Amount | 6,127,000 | 4,540,000 |
Indefinite-Lived Intangible Assets (Excluding Goodwill), Gross | 165,000 | 165,000 |
Indefinite-Lived Intangible Assets (Excluding Goodwill) | 165,000 | 165,000 |
Intangible Assets Gross | 9,053,000 | 6,740,000 |
Intangible Assets, Accumulated Amortization | (2,761,000) | (2,035,000) |
Total | 6,292,000 | 4,705,000 |
Trademark and Tradename [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross Carrying Amount | 1,479,000 | 1,367,000 |
Finite-Lived Intangible Assets, Accumulated Amortization | (296,000) | (178,000) |
Finite-Lived Intangible Assets, Net Carrying Amount | 1,183,000 | 1,189,000 |
Indefinite-Lived Intangible Assets (Excluding Goodwill), Gross | 61,000 | 61,000 |
Indefinite-Lived Intangible Assets (Excluding Goodwill) | $ 61,000 | $ 61,000 |
Trademark and Tradename [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Lives (In Years) | 3 years | 10 years |
Trademark and Tradename [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Lives (In Years) | 15 years | 15 years |
Customer List [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite-Lived Intangible Assets (Excluding Goodwill), Gross | $ 104,000 | $ 104,000 |
Indefinite-Lived Intangible Assets (Excluding Goodwill) | 104,000 | $ 104,000 |
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Lives (In Years) | 10 years | |
Finite-Lived Intangible Assets, Gross Carrying Amount | 4,203,000 | $ 3,123,000 |
Finite-Lived Intangible Assets, Accumulated Amortization | (749,000) | (442,000) |
Finite-Lived Intangible Assets, Net Carrying Amount | $ 3,454,000 | $ 2,681,000 |
Customer Relationships [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Lives (In Years) | 9 years | |
Customer Relationships [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Lives (In Years) | 10 years | |
Patents [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Lives (In Years) | 11 years | |
Finite-Lived Intangible Assets, Gross Carrying Amount | $ 2,610,000 | $ 1,489,000 |
Finite-Lived Intangible Assets, Accumulated Amortization | (1,416,000) | (1,218,000) |
Finite-Lived Intangible Assets, Net Carrying Amount | $ 1,194,000 | $ 271,000 |
Patents [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Lives (In Years) | 7 years | |
Patents [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Lives (In Years) | 13 years | |
Favorable Contract Interest [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Lives (In Years) | 5 years | 5 years |
Finite-Lived Intangible Assets, Gross Carrying Amount | $ 388,000 | $ 388,000 |
Finite-Lived Intangible Assets, Accumulated Amortization | (210,000) | (137,000) |
Finite-Lived Intangible Assets, Net Carrying Amount | $ 178,000 | $ 251,000 |
Covenant Not to Compete [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Lives (In Years) | 4 years | 4 years |
Finite-Lived Intangible Assets, Gross Carrying Amount | $ 208,000 | $ 208,000 |
Finite-Lived Intangible Assets, Accumulated Amortization | (90,000) | (60,000) |
Finite-Lived Intangible Assets, Net Carrying Amount | $ 118,000 | $ 148,000 |
Intangible Assets and Goodwil_4
Intangible Assets and Goodwill - Schedule of Finite-Lived Intangible Assets, Future Amortization Expense (Details) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
October - December 2019 | $ 257,000 | |
2020 | 1,029,000 | |
2021 | 853,000 | |
2022 | 745,000 | |
2023 | 718,000 | |
Thereafter | 2,525,000 | |
Finite-Lived Intangible Assets, Net, Total | $ 6,127,000 | $ 4,540,000 |
Intangible Assets and Goodwil_5
Intangible Assets and Goodwill - Schedule of Changes in Goodwill (Details) | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Balance, beginning | $ 7,318,000 |
CarrierWeb acquisition | 2,044,000 |
Balance, ending | $ 9,362,000 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details Narrative) - USD ($) | Mar. 13, 2019 | Jun. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Allocated share-based compensation expense | $ 161,000 | $ 104,000 | $ 458,000 | $ 299,000 | ||
Share-based compensation, fair value of options vested | 363,000 | 352,000 | ||||
Share-based compensation, intrinsic value of options exercised | 112,000 | 117,000 | ||||
Share-based compensation, nonvested awards, not yet recognized | 1,381,000 | $ 1,381,000 | ||||
Share-based compensation, nonvested awards, not yet recognized, period for recognition | 2 years 8 months 5 days | |||||
Restricted Stock [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Allocated share-based compensation expense | 387,000 | $ 465,000 | $ 1,274,000 | $ 1,396,000 | ||
Share-based compensation, nonvested awards, not yet recognized | $ 2,947,000 | $ 2,947,000 | ||||
Share-based compensation, nonvested awards, not yet recognized, period for recognition | 2 years 2 months 1 day | |||||
Chief Executive Officer [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of options granted to purchase shares of common stock | 350,000 | |||||
Chief Financial Officer [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of options granted to purchase shares of common stock | 150,000 | |||||
2018 Incentive Plan [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based compensation arrangement by share-based payment award, number of shares authorized | 1,500,000 | |||||
Option vested term | 10 years | |||||
Shares available for future issuance | 58,000 | 58,000 | ||||
Increase the number shares available for issuance | 3,000,000 | 3,000,000 | ||||
Options exercise price per share | $ 6.28 | |||||
2018 Incentive Plan [Member] | Minimum [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Option vested term | 4 years | |||||
2018 Incentive Plan [Member] | Maximum [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Option vested term | 5 years |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Stock Options Activity (Details) - Employee Stock Option [Member] | 9 Months Ended |
Sep. 30, 2019USD ($)$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options, Outstanding at Beginning of Year | shares | 1,220,000 |
Options, Granted | shares | 894,000 |
Options, Exercised | shares | (50,000) |
Options, Forfeited or Expired | shares | (4,000) |
Options, Outstanding at End of Year | shares | 2,060,000 |
Options, Exercisable at End of Year | shares | 1,298,000 |
Weighted-average Exercise Price, Outstanding at Beginning of Year | $ / shares | $ 5.37 |
Weighted-average Exercise Price, Granted | $ / shares | 6.20 |
Weighted-average Exercise Price, Exercised | $ / shares | 3.54 |
Weighted-average Exercise Price, Forfeited or Expired | $ / shares | 5.34 |
Weighted-average Exercise Price, Outstanding at End of Year | $ / shares | 5.77 |
Weighted-average Exercise Price, Exercisable at End of Year | $ / shares | $ 5.68 |
Weighted-Average Remaining Contractual Term | 7 years |
Weighted-Average Remaining Contractual Term, Exercisable | 7 years |
Aggregate Intrinsic Value, Ending | $ | $ 404,000 |
Aggregate Intrinsic Value, Exercisable | $ | $ 8,000 |
Stock-Based Compensation - Sc_2
Stock-Based Compensation - Schedule of Fair Value Stock Option Assumptions (Details) - $ / shares | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Share-based Payment Arrangement [Abstract] | ||
Expected volatility | 24.20% | 42.80% |
Expected life of options (in years) | 3 years | 4 years |
Risk free interest rate | 1.41% | 2.72% |
Dividend yield | 0.00% | 0.00% |
Weighted average fair value of options granted during the period | $ 2.72 | $ 2.46 |
Stock-Based Compensation - Sc_3
Stock-Based Compensation - Schedule of Non-vested Restricted Stock Activity (Details) - Restricted Stock [Member] | 9 Months Ended |
Sep. 30, 2019$ / sharesshares | |
Number of Non-vested Shares, Beginning of Year | shares | 568,000 |
Number of Non-vested Shares, Granted | shares | 255,000 |
Number of Non-vested Shares, Vested | shares | (246,000) |
Number of Non-vested Shares, Forfeited | shares | (5,000) |
Number of Non-vested Shares, End of Period | shares | 572,000 |
Weighted- Average Grant Date Fair Value, Non-vested, Beginning of Year | $ / shares | $ 6.65 |
Weighted- Average Grant Date Fair Value, Granted | $ / shares | 5.74 |
Weighted- Average Grant Date Fair Value, Vested | $ / shares | 6.52 |
Weighted- Average Grant Date Fair Value, Forfeited | $ / shares | 6.91 |
Weighted- Average Grant Date Fair Value, Non-vested, End of Period | $ / shares | $ 6.30 |
Stockholders' Equity (Details N
Stockholders' Equity (Details Narrative) - USD ($) | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Nov. 03, 2010 | |
Equity, Class of Treasury Stock [Line Items] | ||||
Preferred stock, shares authorized | 5,000,000 | 5,000,000 | ||
Preferred stock, par value | $ 0.01 | $ 0.01 | ||
Number of shares repurchased | 44,000 | 120,000 | ||
Value of shares withheld pursuant to stock issuance | $ 291,000 | $ 870,000 | ||
Share Repurchase Program [Member] | ||||
Equity, Class of Treasury Stock [Line Items] | ||||
Stock repurchase program, authorized amount | $ 3,000,000 | |||
Treasury stock, shares | 310,000 | |||
Treasury stock, value | $ 1,340,000 | |||
Treasury stock acquired, average cost per share | $ 4.33 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||||||||
Other comprehensive gain (loss) foreign currency translation adjustment | $ 191,000 | $ (46,000) | $ (12,000) | $ 55,000 | $ 189,000 | $ (137,000) | $ 133,000 | $ 107,000 |
Foreign currency transaction gains (losses) | $ (258,000) | $ (50,000) | $ (288,000) | $ (146,000) |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Loss - Schedule of Accumulated Other Comprehensive Loss (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||||||
Foreign currency items, Balance at Beginning | $ (465,000) | $ (388,000) | $ (465,000) | |||
Foreign currency items, Net current period change | 133,000 | 107,000 | ||||
Foreign currency items, Balance at End | $ (255,000) | $ (358,000) | (255,000) | (358,000) | ||
Unrealized gain (losses) on investments, Balance at Beginning | (113,000) | (47,000) | (113,000) | |||
Unrealized gain (losses) on investments, Net current period change | 88,000 | $ (12,000) | (60,000) | 47,000 | 16,000 | |
Unrealized gain (losses) on investments, Balance at End | (97,000) | (97,000) | ||||
Accumulated other comprehensive loss, Balance at Beginning | $ (578,000) | (435,000) | (578,000) | |||
Accumulated other comprehensive loss, Net current period change | 191,000 | 143,000 | 180,000 | 123,000 | ||
Accumulated other comprehensive loss, Balance at End | $ (255,000) | $ (455,000) | $ (255,000) | $ (455,000) |
Net Loss Per Share of Common _3
Net Loss Per Share of Common Stock (Details Narrative) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Earnings Per Share [Abstract] | ||||
Antidilutive securities excluded from computation of earnings per share, amount | 2,632,000 | 1,874,000 | 2,632,000 | 1,874,000 |
Net Loss Per Share of Common _4
Net Loss Per Share of Common Stock - Schedule of Net Loss Per Share Basic and Diluted (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Earnings Per Share [Abstract] | ||||||||
Net loss | $ (2,099,000) | $ (2,585,000) | $ (2,194,000) | $ (897,000) | $ (1,116,000) | $ (990,000) | $ (6,878,000) | $ (3,003,000) |
Weighted-average common shares outstanding | 17,929,000 | 17,312,000 | 17,744,000 | 17,121,000 | ||||
Basic and diluted net loss per share | $ (0.12) | $ (0.05) | $ (0.39) | $ (0.18) |
Accounts Payable and Accrued _3
Accounts Payable and Accrued Expenses (Details Narrative) | 9 Months Ended |
Sep. 30, 2019 | |
Payables and Accruals [Abstract] | |
Extended warranty coverage term | 60 months |
Accounts Payable and Accrued _4
Accounts Payable and Accrued Expenses - Schedule of Accounts Payable and Accrued Liabilities (Details) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Payables and Accruals [Abstract] | ||
Accounts payable | $ 15,513,000 | $ 6,644,000 |
Accrued warranty | 337,000 | 422,000 |
Accrued compensation | 488,000 | 870,000 |
Other current liabilities | 245,000 | 91,000 |
Accounts payable and accrued expenses | $ 16,583,000 | $ 8,027,000 |
Accounts Payable and Accrued _5
Accounts Payable and Accrued Expenses - Schedule of Product Warranty Liability (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Payables and Accruals [Abstract] | ||
Accrued warranty reserve, beginning of period | $ 422,000 | $ 535,000 |
Accrual for product warranties issued | 204,000 | 67,000 |
Product replacements and other warranty expenditures | (165,000) | (75,000) |
Expiration of warranties | (124,000) | (78,000) |
Accrued warranty reserve, end of period | $ 337,000 | $ 449,000 |
Leases (Details Narrative)
Leases (Details Narrative) | Sep. 30, 2019 |
Operating lease, remaining lease term | 3 years 8 months 12 days |
Options to extend lease term | 5 years |
Minimum [Member] | |
Operating lease, remaining lease term | 1 year |
Maximum [Member] | |
Operating lease, remaining lease term | 7 years |
Leases - Schedule of Lease Expe
Leases - Schedule of Lease Expense (Details) - USD ($) | 3 Months Ended | 9 Months Ended |
Sep. 30, 2019 | Sep. 30, 2019 | |
Leases [Abstract] | ||
Operating lease cost | $ 233,000 | $ 622,000 |
Short term lease cost | 87,000 | 231,000 |
Lease expense | $ 320,000 | $ 853,000 |
Leases - Schedule of Cash Flow
Leases - Schedule of Cash Flow Information and Non-cash Activity of Operating Leases (Details) | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Leases [Abstract] | |
Cash paid for amounts included in the measurement of lease liabilities | $ 586,000 |
Right-of-use assets obtained in exchange for lease obligations | $ 2,556,000 |
Leases - Schedule of Weighted A
Leases - Schedule of Weighted Average Remaining Lease Term and Discount Rate (Details) | Sep. 30, 2019 |
Leases [Abstract] | |
Weighted-average remaining lease term (in years) | 3 years 8 months 12 days |
Weighted-average discount rate | 7.50% |
Leases - Scheduled Maturities o
Leases - Scheduled Maturities of Operating Lease Liabilities (Details) | Sep. 30, 2019USD ($) |
Leases [Abstract] | |
October - December 2019 | $ 240,000 |
2020 | 971,000 |
2021 | 302,000 |
2022 | 172,000 |
2023 | 177,000 |
Thereafter | 416,000 |
Total lease payments | 2,278,000 |
Less: Imputed interest | (307,000) |
Present value of lease liabilities | $ 1,971,000 |
Concentration of Customers (Det
Concentration of Customers (Details Narrative) | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
One Customer [Member] | Revenue [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 25.00% | |
Customer One [Member] | Accounts Receivables [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 20.00% | 15.00% |
Customer One [Member] | Finance Receivables [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 23.00% | 19.00% |
Customer One [Member] | Sales Revenue, Net [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 22.00% | |
Customer Two [Member] | Accounts Receivables [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 12.00% | |
Customer Two [Member] | Finance Receivables [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 21.00% | 11.00% |
Customer Two [Member] | Sales Revenue, Net [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 10.00% | |
Customer Three [Member] | Sales Revenue, Net [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 10.00% |
Wholly Owned Foreign Subsidia_3
Wholly Owned Foreign Subsidiaries (Details Narrative) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Foreign Subsidiaries Financial Information Disclosure [Line Items] | ||
Total assets | $ 63,278,000 | $ 57,803,000 |
I.D. Systems GmbH [Member] | ||
Foreign Subsidiaries Financial Information Disclosure [Line Items] | ||
Total assets | 2,172,000 | 1,430,000 |
I.D. Systems Ltd [Member] | ||
Foreign Subsidiaries Financial Information Disclosure [Line Items] | ||
Total assets | $ 1,076,000 | $ 1,054,000 |
Wholly Owned Foreign Subsidia_4
Wholly Owned Foreign Subsidiaries - Schedule of Financial Statements of Foreign Subsidiary (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Foreign Subsidiaries Financial Information Disclosure [Line Items] | ||||||||
Net revenue | $ 16,884,000 | $ 13,385,000 | $ 46,769,000 | $ 41,573,000 | ||||
Net loss | (2,099,000) | $ (2,585,000) | $ (2,194,000) | (897,000) | $ (1,116,000) | $ (990,000) | (6,878,000) | (3,003,000) |
I.D. Systems GmbH [Member] | ||||||||
Foreign Subsidiaries Financial Information Disclosure [Line Items] | ||||||||
Net revenue | 957,000 | 423,000 | 2,178,000 | 945,000 | ||||
Net loss | (231,000) | (17,000) | (162,000) | (247,000) | ||||
I.D. Systems Ltd [Member] | ||||||||
Foreign Subsidiaries Financial Information Disclosure [Line Items] | ||||||||
Net revenue | 47,000 | 23,000 | 276,000 | 155,000 | ||||
Net loss | $ (83,000) | $ (84,000) | $ (54,000) | $ (214,000) |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) | Oct. 03, 2019 | Aug. 19, 2019 |
Credit Agreement [Member] | ||
Line of credit facility, borrowing capacity | $ 30,000,000 | |
Subsequent Event [Member] | ||
Cash consideration on merger, price | $ 8.50 | |
Stock consideration on merger | $ 1.272 | |
Subsequent Event [Member] | Investor [Member] | Private Placement [Member] | ||
Convertible unsecured promissory notes, principal amount | $ 5,000,000 | |
Debt instrument interest rate | 10.00% | |
Subsequent Event [Member] | Five Year Revolving Credit Facility [Member] | Pointer Holdco [Member] | ||
Aggregate principal amount in secured term loan facilities | $ 10,000,000 | |
Subsequent Event [Member] | Two Senior Secured Term Loan Facilities [Member] | ||
Aggregate principal amount in secured term loan facilities | 30,000,000 | |
Subsequent Event [Member] | Facilities One [Member] | ||
Aggregate principal amount in secured term loan facilities | 20,000,000 | |
Subsequent Event [Member] | Facilities Two [Member] | ||
Aggregate principal amount in secured term loan facilities | $ 10,000,000 | |
Subsequent Event [Member] | Series A Convertible Preferred Stock [Member] | ||
Sale of stock, shares | 50,000 | |
Sale of stock price per shares | $ 0.01 | |
Aggregate purchase price, amount | $ 50,000,000 | |
Subsequent Event [Member] | 2018 Plan [Member] | ||
Option to purchase transaction description | The Pointer Merger Effective Time, each award of options to purchase Pointer ordinary shares that was outstanding and unvested immediately prior to such time was cancelled and substituted with options to purchase shares of PowerFleet common stock under the 2018 Plan on the same material terms and conditions as were applicable to the corresponding option immediately prior to the Pointer Merger Effective Time, except that (i) the number of shares of PowerFleet common stock underlying such substituted option is equal to the product of (A) the number of Pointer ordinary shares underlying such option immediately prior to the Pointer Merger Effective Time multiplied by (B) 2.544, with any fractional shares rounded down to the nearest whole number of shares of PowerFleet common stock, and (ii) the per-share exercise price is equal to the quotient obtained by dividing (A) the exercise price per Pointer ordinary share subject to such option immediately prior to the Pointer Merger Effective Time by (B) 2.544 (rounded up to the nearest whole cent). | |
Fractional shares | 2,544 |